If a landlord applies a security deposit to cover a month’s rent, do theyforfeit the right to sue the tenantfor the remainder of their broken lease?

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If a landlord applies a security deposit to cover a month’s rent, do theyforfeit the right to sue the tenantfor the remainder of their broken lease?

Tenant broke lease with 30 days notice, moved out, wants to apply her security deposit to December rent. If I agree, does it terminate her lease, absolving her of responsibility for remainder? If I agree, do I forfeit right to sue her for 5 months rent remaining on her lease? I am trying hard to mitigate damages by getting another tenant.

Asked on December 3, 2010 under Real Estate Law, Delaware

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

The landlord does not need to "agree" to let the tenant use the security deposit to cover a month's rent--and should not. If the tenat breaks a lease--e.g. moves out before  the term is done, when the lease does not allow the tenant to terminate early--then the landlord, by law, has the right to apply the security deposit to any unpaid rent, just as the landlord by law can apply to any amounts owed for damages to the premises. Any amounts owed--for either damages or unpaid rent--not covered by the security deposit is something the landlord can sue for. So rather than create an agreement with the tenant that, if there's any ambiguity, might be construed as allowing the tenant out of the lease early (unless that's what the landlord wants to do), the landlord should simply tell the tenant she is responsible for all remaining rent, even if she moves out--and after she has moved out and broken the lease, should apply the security deposit to unpaid rent and damages, then, if it's economically worth it, sue for  the balance.


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