No Security For Unlawful Landlords

A few weeks ago, I observed Alameda County Court Commissioner Bentrish Satarzadeh presiding over Small Claims Court where she gave a very valuable piece of advice to a landlord who unlawfully withheld their tenant's security deposit: "The rental laws are complicated, if you want to be a landlord, you should have an attorney on retainer."

That landlord, and many others who stood before Commissioner Satarzadeh, were ordered to pay their former tenants the entirety of their security deposits and statutory damages of twice the amount of the security. For a $3,000 security deposit, that was $9,000 because the landlord failed to follow the technical requirements of California Civil Code § 1950.5(g) and failed to return the deposit, or account for it, within 21 days.

While the rules of residential security deposits are laid out in § 1950.5 in black and white, many landlords don't understand them. Just like Commissioner Satarzadeh said, they are complicated, and failing to meet even one technical requirement can be a costly mistake.

Some landlords get lucky and their tenants hire an attorney first. While most landlords get defensive when a tenant hires an attorney, they really should see it as a gift.

If an attorney sends a landlord a letter explaining how the landlord unlawfully withheld a tenant's security deposit, and the consequences that landlord could face if their actions aren't remedied, that landlord may have just saved themself thousands of dollars.

If the landlord can process what the attorney is telling them, and understand the error of their ways, they can make the situation right without going to court and facing the dreaded double statutory damages, and in some cases, attorney fees.

As in most situations, it is better to work out a dispute outside of the courtroom. Talking out a problem can usually result in a compromise on both sides and end the conflict. To do that, you have to lower your defenses and try to resolve the conflict.

If you're an unrepresented landlord who has just received a letter from your tenant's attorney explaining that you owe them money, pick up the phone and call your tenant's attorney.

I understand your first instinct might be to fire back an email denying you did anything wrong, but resist that feeling. Understand that lawyers cannot make up laws, so whatever the lawyer is alleging you did wrong should be backed by law.

This is your opportunity to learn about that law and, if you can see that you violated that law, offer to correct the situation. You might also learn valuable information to help you avoid the same situation with future tenants.

Now that's security.

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