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In a Nutshell
A security deposit is money that the landlord holds to protect himself in case
you break the rental agreement by not paying rent, causing damage or leave the
place dirties than you got it. If all goes well, you leave the place clean and
undamaged with no unpaid rent and you get the whole deposit back within 3 weeks
of leaving. If that has happened, you probably wouldn't be reading this section.
What was once a one-paragraph law has grown to pages, as landlords have tried
various tactics to steal the money, and the law has then expanded to stop those
tactics. In its current state, almost everything you pay up front except first
month's rent is part of the "security deposit," and it cannot be non-refundable.
When you leave other than by a 3-day eviction notice, you are entitled to a
"initial inspection" 2 weeks before you leave [i.e., this is
not the "initial inspection" which you may have had before you moved in], where the landlord hands you
a written list of his proposed deductions. You then have the remaining time to
clean and repair, or take pictures and make notes if you dispute the charge,
before you leave. After you leave, the landlord does a "final inspection," and
sees what is left to be done from the preliminary inspection list. Nothing more
can be added unless it was hidden during the preliminary inspection. Within 21
days after you leave, the landlord must give you the balance of your deposit
back minus deductions listed in detail in a written accounting, accompanied by
receipts for any money charged and an accounting for hours and pay rates spent.
Deductions for cleaning can only be made if the
cleaning is necessary to return it to the condition in which you got the place.
If you leave it as clean as you got it, no deduction for cleaning is allowed,
and the landlord has the burden to prove the difference. Even if the landlord
spent money "deep cleaning" the place [whatever that means], if you left it
clean, no deduction is permitted. The expenses of cleaning must also be
reasonable. Generally, a professional cleaning company can clean an empty unit
for $200, including shampooing the carpet.
Deductions for damage are only permitted if you
caused them and they are beyond normal wear and tear. Commonly, landlords
wanting to refurbish the place make wild accusations that you "trashed the
place," and charge you exorbitant amounts for things that were already there,
that you didn't cause, that broke from normal use, or never existed. Typically,
the landlord would send you a bill for outrageous charges beyond the deposit in
order to encourage you to hide from that debt, abandoning the legitimate refund
to which you were entitled.
You can get your deposit back by suing in
small claims court. If the landlord misses the 21 day deadline, he forfeits the
right to deduct anything. If he keeps the money in bad faith, you can sue for up
to 3 times the amount of the deposit. The process is quick, easy, and
inexpensive. While you're at it, you can sue your landlord for other
things, like breach of contract, nuisance, trespass, retaliation, fraud, unfair
business practices, and more. The maximum in small claims court is now $10,000,
and each person can sue separately for that amount.
The Law
Your landlord/manager will often try to con you into
thinking that you have no rights, because if they can convince you of that, they
can steal thousands of dollars per year from their tenants as a reward. Just so
you have the information at your fingertips, here is the statute that concerns
the Security Deposit, Civil Code 1950.5 (as of 2013). There are
also cases, such as Granberry v. Islay Investments [(1995) 9 Cal. 4th 738]
where the law is further clarified, but we can't have all of those cases here.
CIV §1950.5. (a) This section applies to security for a
rental agreement for residential property that is used as the dwelling of the
tenant.
(b) As used in this section, “security” means any payment, fee, deposit, or
charge, including, but not limited to, any payment, fee, deposit, or charge,
except as provided in Section 1950.6, that is imposed at the beginning of the
tenancy to be used to reimburse the landlord for costs associated with
processing a new tenant or that is imposed as an advance payment of rent, used
or to be used for any purpose, including, but not limited to, any of the
following:
(1) The compensation of a landlord for a tenant’s default in the payment of
rent.
(2) The repair of damages to the premises, exclusive of ordinary wear and tear,
caused by the tenant or by a guest or licensee of the tenant.
(3) The cleaning of the premises upon termination of the tenancy necessary to
return the unit to the same level of cleanliness it was in at the inception of
the tenancy. The amendments to this paragraph enacted by the act adding this
sentence shall apply only to tenancies for which the tenant’s right to occupy
begins after January 1, 2003.
(4) To remedy future defaults by the tenant in any obligation under the rental
agreement to restore, replace, or return personal property or appurtenances,
exclusive of ordinary wear and tear, if the security deposit is authorized to be
applied thereto by the rental agreement.
(c) A landlord may not demand or receive security, however denominated, in an
amount or value in excess of an amount equal to two months’ rent, in the case of
unfurnished residential property, and an amount equal to three months’ rent, in
the case of furnished residential property, in addition to any rent for the
first month paid on or before initial occupancy.
This subdivision does not prohibit an advance payment of not less than six
months’ rent if the term of the lease is six months or longer.
This subdivision does not preclude a landlord and a tenant from entering into a
mutual agreement for the landlord, at the request of the tenant and for a
specified fee or charge, to make structural, decorative, furnishing, or other
similar alterations, if the alterations are other than cleaning or repairing for
which the landlord may charge the previous tenant as provided by subdivision
(e).
(d) Any security shall be held by the landlord for the tenant who is party to
the lease or agreement. The claim of a tenant to the security shall be prior to
the claim of any creditor of the landlord.
(e) The landlord may claim of the security only those amounts as are reasonably
necessary for the purposes specified in subdivision (b). The landlord may not
assert a claim against the tenant or the security for damages to the premises or
any defective conditions that preexisted the tenancy, for ordinary wear and tear
or the effects thereof, whether the wear and tear preexisted the tenancy or
occurred during the tenancy, or for the cumulative effects of ordinary wear and
tear occurring during any one or more tenancies.
(f) (1) Within a reasonable time after notification of either party’s intention
to terminate the tenancy, or before the end of the lease term, the landlord
shall notify the tenant in writing of his or her option to request an initial
inspection and of his or her right to be present at the inspection. The
requirements of this subdivision do not apply when the tenancy is terminated
pursuant to subdivision (2), (3), or (4) of Section 1161 of the Code of Civil
Procedure. At a reasonable time, but no earlier than two weeks before the
termination or the end of lease date, the landlord, or an agent of the landlord,
shall, upon the request of the tenant, make an initial inspection of the
premises prior to any final inspection the landlord makes after the tenant has
vacated the premises. The purpose of the initial inspection shall be to allow
the tenant an opportunity to remedy identified deficiencies, in a manner
consistent with the rights and obligations of the parties under the rental
agreement, in order to avoid deductions from the security. If a tenant chooses
not to request an initial inspection, the duties of the landlord under this
subdivision are discharged. If an inspection is requested, the parties shall
attempt to schedule the inspection at a mutually acceptable date and time. The
landlord shall give at least 48 hours’ prior written notice of the date and time
of the inspection if either a mutual time is agreed upon, or if a mutually
agreed time cannot be scheduled but the tenant still wishes an inspection. The
tenant and landlord may agree to forgo the 48-hour prior written notice by both
signing a written waiver. The landlord shall proceed with the inspection whether
the tenant is present or not, unless the tenant previously withdrew his or her
request for the inspection. Written notice by the landlord shall contain, in
substantially the same form, the following:
“State law permits former tenants to reclaim abandoned personal property left at
the former address of the tenant, subject to certain conditions. You may or may
not be able to reclaim property without incurring additional costs, depending on
the cost of storing the property and the length of time before it is reclaimed.
In general, these costs will be lower the sooner you contact your former
landlord after being notified that property belonging to you was left behind
after you moved out.”
(2) Based on the inspection, the landlord shall give the tenant an itemized
statement specifying repairs or cleanings that are proposed to be the basis of
any deductions from the security the landlord intends to make pursuant to
paragraphs (1) to (4), inclusive, of subdivision (b). This statement shall also
include the texts of paragraphs (1) to (4), inclusive, of subdivision (b). The
statement shall be given to the tenant, if the tenant is present for the
inspection, or shall be left inside the premises.
(3) The tenant shall have the opportunity during the period following the
initial inspection until termination of the tenancy to remedy identified
deficiencies, in a manner consistent with the rights and obligations of the
parties under the rental agreement, in order to avoid deductions from the
security.
(4) Nothing in this subdivision shall prevent a landlord from using the security
for deductions itemized in the statement provided for in paragraph (2) that were
not cured by the tenant so long as the deductions are for damages authorized by
this section.
(5) Nothing in this subdivision shall prevent a landlord from using the security
for any purpose specified in paragraphs (1) to (4), inclusive, of subdivision
(b) that occurs between completion of the initial inspection and termination of
the tenancy or was not identified during the initial inspection due to the
presence of a tenant’s possessions.
(g) (1) 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,
by personal delivery or by first-class mail, postage prepaid, a copy of an
itemized statement indicating the basis for, and the amount of, any security
received and the disposition of the security, and shall return any remaining
portion of the security to the tenant. After either the landlord or the tenant
provides notice to terminate the tenancy, the landlord and tenant may mutually
agree to have the landlord deposit any remaining portion of the security deposit
electronically to a bank account or other financial institution designated by
the tenant. After either the landlord or the tenant provides notice to terminate
the tenancy, the landlord and the tenant may also agree to have the landlord
provide a copy of the itemized statement along with the copies required by
paragraph (2) to an email account provided by the tenant.
(2) Along with the itemized statement, the landlord shall also include copies of
documents showing charges incurred and deducted by the landlord to repair or
clean the premises, as follows:
(A) If the landlord or landlord’s employee did the work, the itemized statement
shall reasonably describe the work performed. The itemized statement shall
include the time spent and the reasonable hourly rate charged.
(B) If the landlord or landlord’s employee did not do the work, the landlord
shall provide the tenant a copy of the bill, invoice, or receipt supplied by the
person or entity performing the work. The itemized statement shall provide the
tenant with the name, address, and telephone number of the person or entity, if
the bill, invoice, or receipt does not include that information.
(C) If a deduction is made for materials or supplies, the landlord shall provide
a copy of the bill, invoice, or receipt. If a particular material or supply item
is purchased by the landlord on an ongoing basis, the landlord may document the
cost of the item by providing a copy of a bill, invoice, receipt, vendor price
list, or other vendor document that reasonably documents the cost of the item
used in the repair or cleaning of the unit.
(3) If a repair to be done by the landlord or the landlord’s employee cannot
reasonably be completed within 21 calendar days after the tenant has vacated the
premises, or if the documents from a person or entity providing services,
materials, or supplies are not in the landlord’s possession within 21 calendar
days after the tenant has vacated the premises, the landlord may deduct the
amount of a good faith estimate of the charges that will be incurred and provide
that estimate with the itemized statement. If the reason for the estimate is
because the documents from a person or entity providing services, materials, or
supplies are not in the landlord’s possession, the itemized statement shall
include the name, address, and telephone number of the person or entity. Within
14 calendar days of completing the repair or receiving the documentation, the
landlord shall complete the requirements in paragraphs (1) and (2) in the manner
specified.
(4) The landlord need not comply with paragraph (2) or (3) if either of the
following applies:
(A) The deductions for repairs and cleaning together do not exceed one hundred
twenty-five dollars ($125).
(B) The tenant waived the rights specified in paragraphs (2) and (3). The waiver
shall only be effective if it is signed by the tenant at the same time or after
a notice to terminate a tenancy under Section 1946 or 1946.1 has been given, a
notice under Section 1161 of the Code of Civil Procedure has been given, or no
earlier than 60 calendar days prior to the expiration of a fixed-term lease. The
waiver shall substantially include the text of paragraph (2).
(5) Notwithstanding paragraph (4), the landlord shall comply with paragraphs (2)
and (3) when a tenant makes a request for documentation within 14 calendar days
after receiving the itemized statement specified in paragraph (1). The landlord
shall comply within 14 calendar days after receiving the request from the
tenant.
(6) Any mailings to the tenant pursuant to this subdivision shall be sent to the
address provided by the tenant. If the tenant does not provide an address,
mailings pursuant to this subdivision shall be sent to the unit that has been
vacated.
(h) Upon termination of the landlord’s interest in the premises, whether by
sale, assignment, death, appointment of receiver, or otherwise, the landlord or
the landlord’s agent shall, within a reasonable time, do one of the following
acts, either of which shall relieve the landlord of further liability with
respect to the security held:
(1) Transfer the portion of the security remaining after any lawful deductions
made under subdivision (e) to the landlord’s successor in interest. The landlord
shall thereafter notify the tenant by personal delivery or by first-class mail,
postage prepaid, of the transfer, of any claims made against the security, of
the amount of the security deposited, and of the names of the successors in
interest, their addresses, and their telephone numbers. If the notice to the
tenant is made by personal delivery, the tenant shall acknowledge receipt of the
notice and sign his or her name on the landlord’s copy of the notice.
(2) Return the portion of the security remaining after any lawful deductions
made under subdivision (e) to the tenant, together with an accounting as
provided in subdivision (g).
(i) Prior to the voluntary transfer of a landlord’s interest in the premises,
the landlord shall deliver to the landlord’s successor in interest a written
statement indicating the following:
(1) The security remaining after any lawful deductions are made.
(2) An itemization of any lawful deductions from any security received.
(3) His or her election under paragraph (1) or (2) of subdivision (h).
This subdivision does not affect the validity of title to the real property
transferred in violation of this subdivision.
(j) (1) In the event of noncompliance with subdivision (h), the landlord’s
successors in interest shall be jointly and severally liable with the landlord
for repayment of the security, or that portion thereof to which the tenant is
entitled, when and as provided in subdivisions (e) and (g). A successor in
interest of a landlord may not require the tenant to post any security to
replace that amount not transferred to the tenant or successors in interest as
provided in subdivision (h), unless and until the successor in interest first
makes restitution of the initial security as provided in paragraph (2) of
subdivision (h) or provides the tenant with an accounting as provided in
subdivision (g).
(2) This subdivision does not preclude a successor in interest from recovering
from the tenant compensatory damages that are in excess of the security received
from the landlord previously paid by the tenant to the landlord.
(3) Notwithstanding this subdivision, if, upon inquiry and reasonable
investigation, a landlord’s successor in interest has a good faith belief that
the lawfully remaining security deposit is transferred to him or her or returned
to the tenant pursuant to subdivision (h), he or she is not liable for damages
as provided in subdivision (l), or any security not transferred pursuant to
subdivision (h).
(k) Upon receipt of any portion of the security under paragraph (1) of
subdivision (h), the landlord’s successors in interest shall have all of the
rights and obligations of a landlord holding the security with respect to the
security.
(l) The bad faith claim or retention by a landlord or the landlord’s successors
in interest of the security or any portion thereof in violation of this section,
or the bad faith demand of replacement security in violation of subdivision (j),
may subject the landlord or the landlord’s successors in interest to statutory
damages of up to twice the amount of the security, in addition to actual
damages. The court may award damages for bad faith whenever the facts warrant
that award, regardless of whether the injured party has specifically requested
relief. In an action under this section, the landlord or the landlord’s
successors in interest shall have the burden of proof as to the reasonableness
of the amounts claimed or the authority pursuant to this section to demand
additional security deposits.
(m) No lease or rental agreement may contain a provision characterizing any
security as “nonrefundable.”
(n) An action under this section may be maintained in small claims court if the
damages claimed, whether actual, statutory, or both, are within the
jurisdictional amount allowed by Section 116.220 or 116.221 of the Code of Civil
Procedure.
(o) Proof of the existence of and the amount of a security deposit may be
established by any credible evidence, including, but not limited to, a canceled
check, a receipt, a lease indicating the requirement of a deposit as well as the
amount, prior consistent statements or actions of the landlord or tenant, or a
statement under penalty of perjury that satisfies the credibility requirements
set forth in Section 780 of the Evidence Code.
(p) The amendments to this section made during the 1985 portion of the 1985–86
Regular Session of the Legislature that are set forth in subdivision (e) are
declaratory of existing law.
(q) The amendments to this section made during the 2003 portion of the 2003–04
Regular Session of the Legislature that are set forth in paragraph (1) of
subdivision (f) are declaratory of existing law. [Amended by Stats. 2013, Ch.
76, Sec. 12. Effective January 1, 2014]
Taking Action
Now that you understand how things are supposed to be, what can you do about it?
This site offers the Security Deposit Recovery Kit, a 65-page e-book that you
can download right now to get started. It has detailed discussions about the
law, the various tactics used by landlords, how to fill out the small claims
Plaintiff's Claim, how to present your case at trial, how to collect the money
and more. Included in the Kit are the small claims forms, collection forms,
handy organizing forms, and even a proof of service form. It contains $1,000 in
legal advice, but costs only $50.
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Security
Deposit
