What can we do ifthe lease that our tenants signedstates deposits returned after 60 days but state law requires 21 days?

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What can we do ifthe lease that our tenants signedstates deposits returned after 60 days but state law requires 21 days?

Our lease states the return of a security deposit with interest in 60 days. Our lawyer reviewed the lease and didn’t tell us the state statute is 21 days. The tenants signed it and have a copy. We were living up to that when just after 21 days the tenants sent us a certified letter stating they were going to sue if we didn’t return the deposit ASAP. I hand delivered the check upon receiving that letter. The deposit was not in full as there were damages in the amount of $350. Interest was paid. They are threatening to sue us for double the amount of the entire deposit and $500 for bad faith.

Asked on October 12, 2010 under Real Estate Law, Minnesota

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Ok, so I would go back to your attorney and demand that he or she do something to help you here.  Here is the law:

"A landlord must return a tenant’s security deposit plus simple, non-compounded interest, (141) or give the tenant a written explanation as to why the deposit (or any part of the deposit) will not be returned. The landlord must do this within 21 days after the day the tenancy ends, provided that the tenant has given the landlord a forwarding address. 

If the landlord does not return the deposit or return an explanation in the time allowed, the landlord must pay the tenant a penalty equal to the amount withheld and interest and also pay the tenant the amount of the deposit and interest wrongfully withheld. 

Minnesota law allows a landlord to withhold from a security deposit only the amount necessary for unpaid rent , damages to the rental unit beyond ordinary wear and tear, or other money the tenant owes to the landlord under an agreement (e.g. water bills)."

Did they give you a forwarding address when they left?  That seems to be a loophole.  Did you give them a list of the damages when you returned the money?  That may be fatal to your case if you did not.  You need to ask your attorney if the 21 days can be extended in any way via contractual agreement (certain statutory time limits may indeed be extended or shortened by contract) and the lease was a contract.  you need to find out if being a few days late is fatal to your case.  You have a lot of follow up to do and get a second opinion as well.  Good luck.


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