According to https://leginfo.legislature.ca.gov/faces/codes_dis... :
"No later than 21 calendar days after the tenant has vacated the premises, but not earlier than the time that either the landlord or the tenant provides a notice to terminate the tenancy under Section 1946 or 1946.1, Section 1161 of the Code of Civil Procedure, or not earlier than 60 calendar days prior to the expiration of a fixed-term lease, the landlord shall furnish the tenant, ...a copy of an itemized statement... and shall return any remaining portion of the security to the tenant."
Assuming a 12 month lease starts Jan 1st and ends Dec 31st, tenant terminates early and moves out as of 06/30, then the security deposit has to be accounted for and returned by 11/01 (Dec 31 minus 60 days)? Am I interpreting the "expiration of a fixed-term lease" correctly? I am asking because I always come across discussions mentioning the 21 days rule, but never heard about the 60 day rule.
This could have major implications, as by the 21 day rule, landlord would have to return the deposit by 07/21, and would potentially lose rental income for August, depending on the market, as rents are typically hard to collect after the deposit is returned.
@Michael Mueller , no you're not interpreting the statute correctly. In your scenario above, the lease has been broken and hence cancelled/terminated, not expired. At the time that the lease is broken/cancelled/terminated, there is no lease term remaining to expire. So, you would be obligated under that statute to timely return the appropriate security deposit amount and statement within 21 calendar days after the tenant has vacated the premises. Interesting idea nonetheless.
@Bryan Zuetel , thanks for your response. I too was first deliberating whether an early termination would alter the original "expiration" of the lease, as per your interpretation of "expiration".
HOWEVER, if this was the case, I cannot think of a scenario where the condition expressed in the halfsentence "... but not ... earlier than 60 calendar days prior to the expiration of a fixed-term lease" would come into effect. Clearly, the legislature would not half added this halfsentence, if it didn't have in mind a scenario where 21 days have passed since the tenant vacated, but the lease "expiration" has not yet happened. I therefore concluded that for purposes of this paragraph, the "expiration" must refer to the original expiration date per lease agreement. Please correct me if I'm missing something in my reasoning.
The halfsentence "or not earlier than 60 calendar days prior to the expiration of a fixed-term lease", which deals with the scenario of a fixed term lease, is juxtaposed to the preceding halfsentence "but not earlier than the time that either the landlord or the tenant provides a notice to terminate the tenancy under Section 1946 or 1946.1, Section 1161 of the Code of Civil Procedure", which exclusively deals with periodic leases (1946 or 1946.1) and overstays. The conditional semantics in the fixed term scenario, for which notices are not mentioned in this paragraph, therefore seems to be the later of the two dates: [21 days after tenant vacated] and [expiration of lease minus 60 days]. If the first date [21 days after tenant vacated] always resulted in accelerated "expiration", then the language in the paragraph would not make sense.
I acknowledge your answer, but I would appreciate if you could corroborate your interpretation with an example (with or without early termination) where the 60 day rule would come into effect using an alternate definition of "expiration", or with case law. (Irregardless of the actual law, it would arguably make total sense if the landlord could keep the deposit until the end of a fixed term lease, as security for the outstanding rent payments that the tenant is obligated to pay; but what makes rationally sense is a whole different topic as laws not always make sense.)
1. Don't purchase investment property in a heavily regulated, tenant-friendly leftist state like the People's Republik of Kalifornia.
2. I'm not an attorney but I don't think the lease is "terminated" just because the tenant left. They are usually obligated for the remaining term of the lease or until a replacement tenant is found, whichever comes first. If the tenant left without authorization to terminate early, then the lease is still in effect, the Landlord should make every attempt to rerent, and the original lease would only terminate when a replacement lease is signed. If the Landlord gave the tenant permission to leave or break the lease early, then I would argue it's terminated and the 21-day clock begins ticking.
@Nathan G. You are spot on with your perception of California. However, I live in CA and I'm "stuck" here. CA benefits from a glorious past with tech industry and entertainment industry to name a few, that were built before CA became effectively a one party system; and this "People's Republic" unfortunately also "occupies" more than half of our beautiful West Coast with prime real estate. It appears that these assets allow the "People's Government" to perpetuate their agenda.
More to the point, there is no question that the tenant is liable for the remainder of the lease, or 1-2 months that are typically granted by judges. The original post however is concerned with the rules for returning the deposit, which should be followed diligently by landlords.