Property Manager Question

[Alex K.]

Hi,

I have property with a PM....as part of the agreement any late fees go 100% to the property manager.......my tenant moved out without paying last month's rent and the property also had a bit of damage and repair expense (3-4x monthly rent.)  The security deposit was about 1.5x monthly rent..... the PM attempted to collect the final rent payment but was unsuccessful.....Now according to the property management company they need to technically apply the security deposit to the rent (according to them is part of some sort of fair housing law or something etc.) vs applying it to the damage caused by the tenant.  It's the same thing from a dollar perspective as it's just the accounting classification of funds, but since they applied the security deposit to the rent they also took part of the security deposit as late fees for themselves which just feels wrong since they didn't actually get the rent, but just applied the security deposit.  The late fees are only 100-$200, but just feels wrong.

What do you guys think, does this seem reasonable?