Can the property owners increase our deposit amount after we’ve already signed a lease with the property managers?

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Can the property owners increase our deposit amount after we’ve already signed a lease with the property managers?

We just put down a deposit and signed a lease with the property manager over the weekend. Now the property manager called and told me that the owner want to increase our deposit and have us sign a lease directly with them. Our original deposit was $500, and we signed a 12 month lease beginning 04/13 at the rate of $1899 a month, with April’s rent prorated. Now they want to lower the rent to $1850 but have us pay $1850+$800 for a deposit and sign a lease with them. We already gave out current landlords our 30 day notice, which expire 05/02, so we have to move. What should we do?

Asked on April 6, 2011 under Real Estate Law, California

Answers:

S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

The lease is a contract between landlord and tenant.  The property manager is the agent of the landlord.  Since you already paid a $500 deposit according to the terms of the lease, the landlord cannot demand an increase in the deposit as this would constitute a breach of the lease.

You can refuse to sign the new lease due to the increased deposit.  You can claim that the landlord breached the lease and demand a refund of your $500 deposit.  If the $500 is not refunded, you can file a lawsuit in Small Claims Court to recover the deposit.  Your damages (the amount you are seeking to recover in your lawsuit) should also include court costs such as the court filing fee and process server fee.

If the landlord tries to enforce the one year lease against you, you can claim that there is no lease because the landlord breached the lease by demanding you sign a new lease with the increase in your deposit.

Despite the inconvenience, it may be preferable to try to find another rental because if this is how this place acts at the outset of a tenancy, there will probably be future problems with this particular landlord if you move in after paying the increased deposit and signing the new lease.


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