Really needing some advice here. I was set to move into a residential lease at the end of the month. Completely my fault, but I got cold feet because I know I won’t be happy living there. I gave a security deposit of $1,500, but the landlord is refusing to give it back because he’s saying I wasted his time. The kicker here is that I am the only who has the original and ONLY signed lease contract. He said I can make a copy of the original, but I haven’t given it back since what has transpired. In the lease contract, it is documented when I gave the initial deposit. I am wondering if I am entitled to this deposit and if so, should I take this to court? Thanks.

  • If you have the only copy of the contract, you are literally the only person who can answer this question. You should read the contract carefully, and possibly take it to a lawyer. – Tim Lymington Aug 24 '19 at 11:49

You broke the lease, which is a contract, and under general principles of law the landlord is entitled to compensation for his losses (the rent owed). You would probably not owe the entire year's worth of rent: the landlord has an obligation to mitigate his losses (for example RCW 59.18.310 in Washington), by re-renting the unit ASAP, but at least a month's rent would be highly likely. If this is a year lease and the monthly rent is $1,500 then you owe $18,000 in rent, which would get reduced to 1 or 2 month's rent depending on circumstances. However, in the US, state laws also regulate security deposits, so there is no universal answer to the details of landlords keeping the deposit to cover unpaid rent. But unpaid rent can be deducted in Washington, California, Texas, Ohio and possibly all other states.

You don't say whether you also paid "first and last" along with a separate security deposit. Whatever amount of money you gave him, the basic principle is that you owe a lot of money as rent, you cannot void the contract because you got cold feet, but the landlord has a duty to mitigate his losses – you owe him for those losses, but not for more than those losses.

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  • Without knowing the terms of the contract and the circumstances of its formation, I am not so sure that the OP broke a lease which hasn't started or that his change of mind forfeits reimbursement. Landlord's bare pretext of "wasting his time" is inconclusive as to losses. RCW 59.18.310 refers to not resuming (rather than not starting) tenancy. Since the lease hadn't started yet, there might be grounds for rescission of contract. It is unclear here, but the OP should assess whether Restatement (Second) of Contracts at § 214(e) favors him. – Iñaki Viggers Aug 27 '19 at 13:03
  • The Restatement (Second) of Contracts is available here, now that the law firm of the link in my previous comment removed that resource and posted some useless "overview of contract law" instead. – Iñaki Viggers Jan 3 at 15:13

I am wondering if I am entitled to this deposit and if so, should I take this to court?

It is unclear why the landlord lost his copy of the contract. If anything, tenants are usually the ones who lose their copy, not landlords.

Without knowing the terms of your contract, it is impossible to ascertain the clauses regarding your security deposit. However, it is very unlikely for that type of contracts to entitle the landlord to keep the deposit only because you "wasted his time". With that sort of excuses, he will never give your contract back to you if you borrow it to him.

You did not specify your jurisdiction, but the decision whether or not to take this to court is entirely yours. If your jurisdiction is somewhere in the U.S., you would have to commence proceedings in the Small Claims Court in your state because the amount is $1,500.

Absent any specifics in the contract regarding forfeiture of the deposit, you could premise your position on the basis that security deposits mainly serve the purposes of (1) guaranteeing solvency in case of non-payment down the road (for instance, so the landlord does not lose rent money while evicting the landlord), and (2) sets up a fund from which to deduct any deterioration caused by the tenant beyond normal tear and wear. Since you no longer intend to move there, both normal tear & wear and the risk of default are preempted.

Security deposits are hardly ever intended to compensate for the landlord's mere waste of time. The contract would have to establish reasonably clear terms to overcome that presumption.

Make sure that your subsequent interactions with the landlord are in writing, so that you can produce evidence in the event that you decide to take him to court.

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  • So I am the only one with the original contract because after I signed, I asked for a copy. He didn’t have one so he said I can go make a copy of the original myself. Since I haven’t given it back, I am the only one with physical evidence that there was a signed contract. This is all happening in New Jersey, USA. There is no wording in the contract that states that I forfeit the deposit if I back out. It only states that I paid an initial deposit of $1500, which counts as a security deposit. I’m just worried about the signed contract as evidence because wouldn’t that mean I’m legally binded? – user3688713 Aug 24 '19 at 22:00
  • @user3688713 the fact that landlord doesn't have a copy of the lease is probably not relevant. A paper copy and a signature are not required for a contract to be established. The fact that you paid the damage deposit would be strong evidence that you had agreed to a contract with the landlord. You could perhaps dispute what the terms of the contract were, but in many jurisdictions you'd be entitled to your damage deposit back, but also obligated to pay rent until the landlord was able to re-lease the unit. The landlord would be required to make a good faith effort to re-lease the unit. – Charles E. Grant Aug 25 '19 at 16:18
  • @user3688713 "wouldn’t that mean I’m legally binded?" That depends on the terms of the contract and what it says regarding early termination. The fact that a contract was entered is very likely come to surface sooner or later in the court proceedings anyway. For instance, at some point the landlord will allude to the contract when he presents his defense. – Iñaki Viggers Aug 25 '19 at 16:25

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