Of course, landlords have the ability to insist upon adequate performance by the tenants under their leases. A landlord can evict a tenant who fails to pay rent, neglects to perform maintenance or other contractual obligations, or refuses to move out after the expiration of the lease. And when landlords’ demands go unheeded, they keep the deposit and have the sheriff evict the tenant.
Tenants seem to be finding their voices. It appears that the tenants today are more sophisticated than those of a decade ago. They are also
finding better employment in the recovering economy and thus able to push back a bit when they feel abused. Local attorneys have gained several new clients in the past few months with stories of heavy-handed tactics, such as threats of eviction and demands for work
that was not part of the original agreement, or keeping deposits without explanation. In fact, in the majority of cases where residential tenants have complained, improperly retained deposits have been a substantial complaint.
So when is a landlord justified in keeping a security deposit? NRS 118A.242 provides that the landlord must return the tenant’s entire deposit, or provide an itemized accounting of how it was used, within 30 days of the end of the tenant’s lease. This return or accounting must be delivered personally to the tenant wherever the rent payments were normally made, or by mailing it to the tenant at their new address. If the tenant did not leave a forwarding address, the landlord is to mail it to the tenant’s last known address. If the landlord has retained all or part of a deposit and sent the proper notice, the tenant has 30 days in which to dispute the retainage to avoid any negative credit reports.
The landlord’s ability to keep the security is limited. Landlords may keep a portion of the security deposit to remedy any “default” of the
tenant, but only so much as is “reasonably necessary” to reimburse the actual costs. For example, if the tenants had a pet that chewed holes in the carpet or damaged the walls, the landlord is able to use the deposit to pay for the repairs. Similarly, if the tenant left the home
without paying rent, or without doing a reasonably good job of cleaning, the landlord can use the deposit to cover the unpaid rent or
to pay to have the space cleaned. In fact, the two most common landlord complaints are for these two issues. These two defaults are
doubly costly as it means that along with the costs to clean and repair, the landlord loses rent for the period for which it was not paid, or for the period needed to restore the home, rather than having a paying tenant in place.
However, although the landlord is free to retain a portion of the deposit to cover these costs, they cannot charge the tenant for what
is called “ordinary wear and tear.” This is most often seen in the instances of carpet that is well-worn in traffic areas, or small nail
holes from hanging art or family photographs. In other words, a landlord can only charge tenants for unusual cleaning or repairs, for
non-payment of rent, or for other express contractual defaults.
Unfortunately, too many landlords have forgotten that the security deposit is actually money belonging to the tenant that is simply held
in trust to protect the landlord. Instead, they are viewing deposits as secondary profit centers. And as tenants are starting to push back,
landlords are having to account for the money they’ve kept. Landlords bear the burden to prove that the home was not cleaned properly, or that the tenants let the landscaping die, or whatever it is they claim justified keeping the deposit. Sometimes, it turns out that the landlord has improperly claimed expenses against the deposit, when in reality they spent it and simply cannot return it on time. This is
often a very expensive mistake for the landlord as penalties will apply. (See NRS 118A.242(6)).
So how do tenants and landlords protect themselves? By doing two very important things: A joint walk-through before the tenant moves in, and another joint walk-through after the tenant has removed their items but before they finally leave. Photos or videos are incredibly
helpful, and increasingly easy to obtain since most people have at least one cell phone that can take pictures or videos. The landlord and tenant should walk through the home together, taking specific notes of issues that appear to be out of the ordinary. At the initial walk through, the tenant can point out carpet stains or damage to the walls or landscaping for which they are not going to be held responsible. At the final walk-through, the landlord, photos in hand, will be able to point out damage that is out of the ordinary and not present at the time of the initial walk-through. While it is understandable if the parties are uncomfortable as it is human nature to want to avoid conflict, if both sides have met their obligations, they should expect the inspection to go smoothly. Indeed, these inspections are incredibly helpful in avoiding arguments and costly litigation.
If, however, the landlord or tenant has not acted appropriately and will not voluntarily remedy the problem, then affirmative legal action
must be taken. These cases are often taken by attorneys because their fees can be recovered in Justice Court where these issues are resolved. So if you find yourself in a spot where you need to seek the help of the court, contact an experienced real estate attorney.
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Keith F. Pickard is a real estate attorney and partner at his firm, Pickard Parry. He can be reached at 702-910-4300, through his firm’s website at www. pickardparry.com, or his direct email, email@example.com.