First, I have written a blog post about how landlords should handle security deposits after a tenant moves out. All landlords (and tenants, for that matter) should read this blog post:
https://balandlaw.com/blog/how-should-a-landlord-handle-a-tenants-security-deposit-after-the-tenant-moves-out
Here is why: under that statute, the landlord has 21 days from the date that the tenant moves out (and provides their forwarding address in writing) to either return the security deposit to the tenant with interest or provide an explanation as to why all or part of the security deposit was withheld. However, the Minnesota Court of Appeals has held that the tenant does not need to provide a forwarding address to trigger the 21 day deadline. Please see this guest blog post for more information:
https://balandlaw.com/blog/guest-blog-post-by-attorney-paul-birnberg-on-security-deposits-was-mungall-v-garry-correctly-decided
If the landlord does not meet the deadline, even by a day, or the tenant sues to question the reasons for withholding, the landlord is liable to the amount of the security deposit wrongfully withheld, double that amount as a penalty, and an additional $500 if the judge finds that the landlord withheld the security deposit in bad faith.
Because of the potential dangers and liabilities involved in charging a security deposit, I generally recommend that landlords do not charge the security deposit, and just take steps to vet their tenants thoroughly. Charting the security deposit is not worth the hassle that it might create. Tenants have the right to sue a property owner to recover a security deposit. I would take that right away from them by not charging a security deposit in the first place.
Every landlord – tenant situation is unique, and I recommend that landlords talk to an attorney experienced in evictions and landlord tenant law before taking action based on this blog post. To that end, I invite landlords to give me a call at 763-290-0445 to discuss their unique situation. I typically do not represent tenants.
WARNING: The information contained in this blog post does not constitute legal advice and may not be applicable to your situation. Tim is licensed to practice law only in Minnesota, and the information contained in this blog post may not apply to jurisdictions outside of Minnesota. Further, reading this blog post does not create an attorney-client relationship between you and Baland Law Office, P.L.L.C. You should always discuss your situation with an attorney before taking any action based on what you may read in this blog. To that end, please call (763) 290-0445 to set up an appointment to discuss your situation.