Retaining deposit after terminating with cause

8 Replies

Rented to a man with one dog. After it turned into man, woman, 5 dogs, 3 cats, and rent paid apx 30 days late every month, I served a 10 day notice under the basis of terminating with cause. They did leave within 10 days. 

I'm looking to confirm if I can still keep the security deposit under the pretense that I lost rent as a result of their actions. Even if I had wanted to show the place after having given notice, I couldn't reasonably do so. Their dogs were aggressive and the apartment was filthy and smelled strongly of cat urine. 

As much as it makes sense to me, I'm well aware I'm not the law. Any thoughts from other landlords who prefer to stay out of court?

You have to review your state's l/t laws.  Normally, a security deposit is for damages done to the property (actually, it is for the cost of repairing the damages).  Unless you went to court and got a judgment against the tenant, I don't think it would be wise to keep entire deposit for "the pretense I lost rent because of their actions".

"Pretense" doesn't go over too well in a l/t court situation, if it should come to that.  If the damages cost over the amount of the security deposit, you may, (with proof of payment that the work has been done, or at least written estimates for said work) send the tenant an itemized list of charges, along with a bill for anything over the security amount, and keep the entire deposit.  

At least, that's how it works in my state. Further questions should be asked of a competent real estate attorney.

I have reviewed my state's laws. There is clear indication I could retain the entire deposit if by their choice they had vacated before lease end, I am finding no clear indication of what the stipulations are if I am the one to terminate before lease end. 

It would not have been reasonable for me to try to re-rent the unit before month end (also the end of the 10 day period). The condition they had the property in prevented me from showing the unit to qualified renters. 

I am not intending to get into an argument on here, I just want to be sure where I am coming from is understood. 

Why they left doesn't really matter. The security deposit can typically be applied towards cleaning and repairs. I suspect you could easily spend the deposit on cleaning, deodorizing, or even replacing the flooring.

Per our lease, the deposit can be used for items other than damages and our lease was created by a local RE attorney who we assume is familiar with the local L/T regulations.

What you can use the deposit for will be determined by your lease and local L/T regulations with the L/T regulations being what applies if there is a conflict with the lease.

Therefore to get a thorough and accurate response requires knowing the location of the rental.  Then possibly someone with local knowledge of the L/T regulations could let you know what the regulations allow the deposit to be used for.  Then you would need to look at your lease and see what it states the deposit can be used for.

If a tenant breaks a lease then it is reasonable in my locale (which is a tenant friendly locale) to use the deposit to cover lost rent.  The landlord is required to attempt to rent the RE as quickly as possible.  However, with tenants required to give notice at their current residence, it is easy to justify at least 1 month to place a qualified tenant (you likely do not desire a tenant that does not give 1 month notice).  Assuming the deposit is not more than a month's rent, I would keep the entire deposit per the lease and locale L/T laws (it would take at least a month to place a qualified tenant into the unit providing the new tenant time to give proper notice).

Again, your locale may have different regulations or your lease may not specify that the deposit can be used to cover lost rent in the case of a breakage of lease.  So verify what you can use the deposit for prior to sending any correspondence indicating you are keeping the deposit to cover lost rent that resulted from the breaking of the lease by the tenant.

Good luck.

Originally posted by @Dan Heuschele :

Per our lease, the deposit can be used for items other than damages and our lease was created by a local RE attorney who we assume is familiar with the local L/T regulations.

What you can use the deposit for will be determined by your lease and local L/T regulations with the L/T regulations being what applies if there is a conflict with the lease.

Therefore to get a thorough and accurate response requires knowing the location of the rental.  Then possibly someone with local knowledge of the L/T regulations could let you know what the regulations allow the deposit to be used for.  Then you would need to look at your lease and see what it states the deposit can be used for.

If a tenant breaks a lease then it is reasonable in my locale (which is a tenant friendly locale) to use the deposit to cover lost rent.  The landlord is required to attempt to rent the RE as quickly as possible.  However, with tenants required to give notice at their current residence, it is easy to justify at least 1 month to place a qualified tenant (you likely do not desire a tenant that does not give 1 month notice).  Assuming the deposit is not more than a month's rent, I would keep the entire deposit per the lease and locale L/T laws (it would take at least a month to place a qualified tenant into the unit providing the new tenant time to give proper notice).

Again, your locale may have different regulations or your lease may not specify that the deposit can be used to cover lost rent in the case of a breakage of lease.  So verify what you can use the deposit for prior to sending any correspondence indicating you are keeping the deposit to cover lost rent that resulted from the breaking of the lease by the tenant.

Good luck.

Dan, Thank you for the thorough, educated response. My lease was written by a team of local RE attorney's, it does make it clear the deposit can be withheld for reletting, and my point is exactly the one you are making. 

I posted the discussion to gain clarity regarding the notion of "who" broke the lease. They violated the lease, yet I terminated with cause. So who actually broke the lease? Me by terminating or them by violating? 

Also to add.. in addition to the security deposit, I hold refundable pet deposits. I want to charge all the cleaning expenses to the pet deposits (as that is truly the case) and hold the security for loss of rent. 

Originally posted by @Account Closed :
Originally posted by @Dan Heuschele:

Per our lease, the deposit can be used for items other than damages and our lease was created by a local RE attorney who we assume is familiar with the local L/T regulations.

What you can use the deposit for will be determined by your lease and local L/T regulations with the L/T regulations being what applies if there is a conflict with the lease.

Therefore to get a thorough and accurate response requires knowing the location of the rental.  Then possibly someone with local knowledge of the L/T regulations could let you know what the regulations allow the deposit to be used for.  Then you would need to look at your lease and see what it states the deposit can be used for.

If a tenant breaks a lease then it is reasonable in my locale (which is a tenant friendly locale) to use the deposit to cover lost rent.  The landlord is required to attempt to rent the RE as quickly as possible.  However, with tenants required to give notice at their current residence, it is easy to justify at least 1 month to place a qualified tenant (you likely do not desire a tenant that does not give 1 month notice).  Assuming the deposit is not more than a month's rent, I would keep the entire deposit per the lease and locale L/T laws (it would take at least a month to place a qualified tenant into the unit providing the new tenant time to give proper notice).

Again, your locale may have different regulations or your lease may not specify that the deposit can be used to cover lost rent in the case of a breakage of lease.  So verify what you can use the deposit for prior to sending any correspondence indicating you are keeping the deposit to cover lost rent that resulted from the breaking of the lease by the tenant.

Good luck.

Dan, Thank you for the thorough, educated response. My lease was written by a team of local RE attorney's, it does make it clear the deposit can be withheld for reletting, and my point is exactly the one you are making. 

I posted the discussion to gain clarity regarding the notion of "who" broke the lease. They violated the lease, yet I terminated with cause. So who actually broke the lease? Me by terminating or them by violating? 

Also to add.. in addition to the security deposit, I hold refundable pet deposits. I want to charge all the cleaning expenses to the pet deposits (as that is truly the case) and hold the security for loss of rent. 

I'm not a lawyer but if the tenant breaks the lease resulting in an eviction then they broke the lease and are responsible for any associated costs resulting from them breaking the lease.  if this is true in my tenant friendly area (California), it likely is true in most areas.

To put in in a different perspective, if all it took to get out of a lease early without consequences is not abiding by the terms of the lease, every tenant would have a means to get out of their lease early.

If your local L/T and your lease allows you  keeping the deposit for time it takes to acquire a tenant in the event of a broken lease then I would keep the deposit.  If your deposit is a single month's rent, it likely would result in the tenant forfeiting their full deposit.  Then I would use the pet deposit for all expenses that can be attributed to the pets.  I would return any pet deposit that the expense could not legitimately be thought to be a result of pet damage.  Likely there would be zero deposit to return to the tenant.

BTW I semi regularly get a threat of suit but so far no one has actually filed suit.  I feel I can justify my actions, have access to good lawyers, and have an umbrella coverage.  If someone actually filed suit I would most resent the loss of my time resulting from the suit.  Time is precious so I am not eager to be sued but I do not fear the financial result (I expect to win any suit and have the umbrella coverage in the event that I am hugely mistaken resulting from a huge judgment).

Good luck.

Whatever you do, DO NOT use the word pretense in association with the security deposit as the definition of the word is "to make something that is not the case appear to be true".

If you are keeping the security deposit for something legit than it isn't a pretense.

However if you are making up reasons to keep it that is a pretense and will get you in trouble if found out.

Account Closed, I think that the problem with your scenario is that you haven't provided us the location of the property.  Such information is necessary to answer your question.