Is a property management company required to give a renter a set of disclaimers or terms of service pertaining to their policy regarding security deposits?
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Is a property management company required to give a renter a set of disclaimers or terms of service pertaining to their policy regarding security deposits?
Whether they do or don’t, do they have the right to arbitrarily determine the cost of replacement for a broken lamp without supplying a receipt to the renter? We broke lamp in vacation condo. I told the property management company when we returned keys. I expected to be charged a small fee to replace lamp, $25 or less, but they withheld $100. The broken lamp was the quality of a dollar store item. No terms of service or policy rules were provided before or after the vacation. The agent from the management company justifies the $100 because of the time involved to search for, purchase and replace the lamp. She balked when I asked to have a copy of the receipt for new lamps. Granted, this is for a small amount of money but it made me wonder what would happen if something major were to be damaged. How can a business arbitrarily choose an amount to withhold all or part of a security deposit? Why don’t they have to provide legal information explaining the procedures followed if some/all of a security deposit is retained? How can they determine the repair/replacement without a receipt or an estimate for larger problems?
Asked on October 11, 2018 under Real Estate Law, Pennsylvania
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 5 years ago | Contributor
A landlord may only withhold a "reasonable" amount from a security deposit. "Reasonable" in this context means a "reasonable" (not least expensive; call it "average," including shipping, if applicable) cost of the replacement item or material, and any out of pocket, or paid to contractors, etc., labor costs. It does NOT include compensation for the time spent by the landlord or the landlord's internal staff, whom the landlord has to pay anyway. The landlord does not need, unfortunately, to provide back up (e.g. receipts) for it costs--it can simply assert what they are.
If a landlord withholds more than the tenant believes is reasonable, the tenant can sue (e.g. in small claims court) for the return of any "unreasonable" amounts withheld. In the lawsuit (i.e. in court), the landord will have to justify and support the expenditure. Of course, it is not always cost-effective to sue for $50 or $75 dollars, so there are times when, as a practical matter, the tenant has to accept that he/she may have been overcharged, because its not worth the time or effort to pursue the overcharge.
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