Commentary on Sections Part 9 - Termination Etc. of Occupation Contracts Schedule 9 – Standard contracts to which limits in sections 175, 185(2) and 196 (landlord’s notice during first six months of occupation) do not apply Section 177 - Restrictions on section 173: breach of security and deposit requirements
408.A landlord may not give a possession notice under the term of the contract incorporating section 173 where security has been taken in a form that does not comply with section 43 (that is, a form other than money or a guarantee), and has not been returned.
409.A landlord is also prevented from giving a notice under the term of the contract incorporating section 173 (subject to the exception below) where: a deposit has not been protected under an authorised deposit scheme; a deposit has been paid but the landlord has not met the initial requirements of the deposit scheme; or a deposit has been paid but the information required by the term of the contract incorporating section 45(2)(b) (that is, information prescribed by regulations under section 45(3)) has not been provided to the contract-holder.
410.The restrictions in the paragraph above on giving notice do not apply where a deposit has been returned or matters relating to an application to the court under paragraph 2 of Schedule 5 have come to an end. Section 20 provides that this section must be incorporated without modification in all periodic standard contracts, unless the contract does not incorporate section 173 as a term.