Security Deposits
It is crucial for landlords to be fully informed about the Missouri law on residential lease security deposits because the courts enforce the statute rather strictly. More than a few landlords have gotten in trouble for not scrupulously following the statute. Topics covered on this page are:
Security Deposit Forms
Statutory Requirements
Forfeiture Clause Not
Enforceable
Statements Made During Security Deposit Inspections
Meaning of "Ordinary
Wear and Tear"
Lease Termination Date
Landlords need two forms to comply with the requirements of Missouri's security deposit statute:
- Form 8, Notice of Security Deposit Inspection, available on our Forms page and also available here your choice of three formats:
- Form 9, Security Deposit Statement, available on our Forms page and also available here your choice of three formats:
See also Form 7, Security Deposit Guidelines, available on our Forms page and also available here: PDF. Form 7 provides a convenient printable reference source containing much of the information on this page.
Residential security deposits are governed by Sec. 535.300 RSMo. The key points of the statute are as follows:
- You cannot collect a security deposit exceeding two months rent.
- The statute requires you to give the tenant reasonable notice in person or in writing at the tenant's last-known address (which can be the address of the leased premises if no forwarding address was left), of the date and time when you will inspect the premises after termination of the lease to determine the amount of security deposit to be withheld, if any. If you mail the notice, send it by certified mail, return receipt requested, so you can at least prove mailing. [See Form 8 above for an appropriate inspection notice.]
- The inspection must take place at a reasonable time, and the tenant has the right to be present. [See the topic below, "Statements Made During Security Deposit Inspections," regarding a desirable lease clause relating to security deposit inspections.]
- Within 30 days after termination of a lease [see the topic "Lease
Termination Date" below], you are
required to either:
- return the full security deposit to the tenant, or
- give the tenant a written itemized list of damages for which the security deposit, or any part thereof, is withheld, along with balance of security deposit, if any.
- You are deemed to have complied with the 30-day requirement by mailing the security deposit, or the list of damages and any balance of the security deposit, to the last-known address of the tenant. It is not an excuse for failing to timely mail the accounting that the tenant did not leave a new address with you. If no new address is known, you should mail the materials to the address of the formerly leased premises, preferably by certified mail, return receipt requested, so you can prove the date of mailing if necessary.
- The only amounts you are entitled to withhold from the
security deposit are:
- Unpaid rent pursuant to the lease.
- Repairs necessary to restore property to its condition at beginning of lease, except for ordinary wear and tear. [See the Premises Damage page for a discussion of how to document damages. See also the topic below, "Meaning of 'Ordinary Wear and Tear.' "]
- Compensation for actual damages resulting from the tenant's failure to give adequate notice to terminate the tenancy, provided that you must make reasonable efforts to re-lease the property and thereby reduce the amount owed.
- Penalty provision: If you fail to follow the above-listed requirements in any respect, or if you wrongfully withhold all or part of the security deposit, the tenant can obtain judgment against you for up to twice the amount wrongfully withheld. [Missouri cases say that the actual penalty, if any, is discretionary with the judge. This means the judge could award no penalty at all, or a reduced penalty, if the landlord can give a reasonable explanation why there was a violation of the technical requirements of the statute.]
Notes:
- Damages Exceeding Security Deposit: If your legitimate damages exceed the security deposit, nothing prohibits you from attempting to recover those damages by filing suit against the former tenant, but you will have to give credit for the security deposit against such damages.
- Pet Deposits: The foregoing statutory security deposit rules do not apply to deposits specifically designated as pet deposits. Pet deposits are not required to be refundable. The terms of the lease will govern the use and refundability of pet deposits.
- Commercial Lease Security Deposits: The foregoing statutory rules also do not apply to commercial lease security deposits. Such deposits are governed by the terms of the lease.
Forfeiture Clause Not Enforceable
Some leases, particularly those obtained from non-Missouri sources, contain a clause purporting to "forfeit" the security deposit if the tenant breaches the lease. In our experience, because the security deposit statute is deemed to override such a lease clause, the courts will not enforce such a forfeiture, and if an issue relating to a security deposit is litigated, the court will always give the tenant credit for the security deposit against all monetary losses (rent, property damage, etc.) claimed by the landlord or property manager.
Thus, security deposit accountings should always give full credit for security deposits paid by the tenant.
We recommend that a security deposit forfeiture clause not be included in leases because of the danger that a landlord or property manager or an employee may not be aware of the clause's unenforceability and rely on the clause in withholding the deposit, which often leads to litigation by the tenant to recover the deposit.
Statements Made During Security Deposit Inspections
When landlords sue tenants for property damage, tenants sometimes attempt to use statements the landlord made during the inspection to defend against the landlord's claim. Typically, the tenant will say something to the effect, "The landlord didn't mention that problem during the inspection, so it must not have existed and I shouldn't have to pay for it."
However, as most landlords know from experience, it is common that a particular problem may not be noted during the inspection but will be noticed later when there is more time to look at the unit or when actual repairs are being made.
In view of this problem, Scott Law Firm recommends that the following clause be included in the security deposit section of all residential leases: "Any statements or estimates made by lessor or lessor's representative during inspection are subject to correction or modification before final security deposit accounting."
Meaning of "Ordinary Wear and Tear"
Landlords and property managers often ask for a definition of "ordinary wear and tear." Unfortunately, there is no clearcut definition in the statutes or in Missouri court cases.
The courts describe the determination of ordinary wear and tear as being an "issue of fact." In a case involving property damage, this means that the court will consider all the facts introduced into evidence in the case and make a reasonable, common-sense evaluation of whether particular items of claimed damage are within or beyond ordinary wear and tear.
The word "ordinary" in the phrase ordinary wear and tear invokes well known principles in the law relating to "negligence." The courts define negligence as the failure to exercise that degree of care that the average ordinary person would exercise in the same or similar circumstances. To give an example, the ordinarily careful person would take care when burning candles not to allow wax to drip onto carpets, so wax on carpets is likely to be found to be damage beyond ordinary wear and tear.
In any event, it is clear that intentional damage done by a tenant will be found to be in excess of ordinary wear and tear. A good example of this a hole in a wall caused by the angry tenant punching or kicking the wall.
Some other examples and observations from our long experience in dealing with the issue of ordinary wear and tear in court may help:
- Repainting: It is to be expected in the
ordinary course of living in a rental unit that some soil will
accumulate on painted surfaces. Unless there is an unusual
amount of soil, the court likely would hold that repainting
costs cannot be charged to the tenant. However, major stains and
scuff marks may prompt the court to award painting costs.
- Tenant repainting: Another situation in which repainting costs generally are awarded is when the tenant has repainted without permission and done a sloppy job, or has used colors not approved by the landlord.
- Holes in walls: Another painting issue involves holes in walls, often resulting from the tenant having hung pictures and photographs. If the tenant has filled the holes with spackling which matches the paint, and there is no other particular reason to paint, the court likely would not award repainting costs. However, if the holes have not been filled, or the holes were filled with spackling that does not match the wall color, the cost of filling the holes and/or the cost of painting may be awarded.
- Routine repainting: Some landlords have a routine practice of totally repainting every time a rental unit turns over – in this situation, the court seldom awards repainting costs.
- Flooring: Issues often arise as to whether
landlords can recover for damage to carpets, vinyl flooring,
linoleum and wood floors.
- Carpets: If the tenant has been careful
with the carpets and routinely vacuumed during the tenancy,
any normal traffic wear on the carpets likely will be found
to be within ordinary wear and tear. However, if the carpets
have stains that cannot be removed by normal cleaning
processes, or tears, or burn holes, then the court likely
will give the landlord an award for replacing the carpets.
The court may require, however, that the amount awarded be
pro-rated based on the expected life of the carpet
– for instance, if a carpet is
expected to last 10 years and must be replaced after only
five years, then the court would award 50% of the
replacement cost.
- Special note: Many leases contain a clause requiring carpets to be professionally cleaned when the tenant moves out. Some of these clauses also specify that the tenant must use a carpet-cleaning company approved by the landlord. Also, most such clauses specify that the carpet-cleaning cost will be deducted from the tenant's security deposit if the tenant does not directly pay the cost to the carpet-cleaning company. In our experience in Boone County, such clauses have been held valid.
- Vinyl flooring and lineoleum: Normal traffic wear on vinyl flooring or linoleum will not be deemed compensable by the court. However, if the material is stained such that it cannot be cleaned, or has burn holes, or is ripped, then the replacement cost may be allowed. Again, the court may require the replacement cost to be pro-rated based on the expected lifespan of the material.
- Wood floors: Again, normal traffic wear on wood floors will not be seen by the court as compensable. However, if the wood flooring is scratched, gouged, stained, etc., then the cost of refinishing the floor likely will be awarded. In extreme cases, the court might allow an award for replacement of a wood floor, again requiring pro-ration based on the expected lifespan of the wood flooring material.
- Carpets: If the tenant has been careful
with the carpets and routinely vacuumed during the tenancy,
any normal traffic wear on the carpets likely will be found
to be within ordinary wear and tear. However, if the carpets
have stains that cannot be removed by normal cleaning
processes, or tears, or burn holes, then the court likely
will give the landlord an award for replacing the carpets.
The court may require, however, that the amount awarded be
pro-rated based on the expected life of the carpet
– for instance, if a carpet is
expected to last 10 years and must be replaced after only
five years, then the court would award 50% of the
replacement cost.
- Hardware: In the normal course of usage, certain items of household hardware will wear out and need to be replaced, and in such cases, the court will not give an award for the replacement. However, if the hardware item was clearly abused or intentionally damaged, then the court likely will grant an award for replacement. For instance, if a doorknob becomes worn and unusable as a result of normal use, no replacement cost will be granted; however, if the doorknob was ripped off in a fit of anger, then the replacement cost will be awarded.
- Plumbing Fixtures: As with hardware, plumbing fixtures will wear out with age and parts will need to be replaced. Toilets and faucets are a particular problem. Unless it is clear that the plumbing fixture has been abused or intentionally damaged, the court is not likely to award replacement costs. However, we have seen awards for cracked toilets and tubs, cracked toilet seats (unless the seat was of low quality to start with), heavily soiled tubs and sinks, and drain stoppages caused by, for instance, items such as sanitary napkins having been improperly flushed in the toilet.
- General Cleaning: Assuming the unit was clean when the tenant moved in, the landlord's cost to clean the unit after the tenant moves out if the tenant failed to do so is recoverable -- because the tenant's obligation is to return the unit in the same condition as when originally occupied, ordinary wear and tear excepted.
In summary, when a landlord or property manager is faced with the question whether a particular item consitutes damage beyond ordinary wear and tear that is not discussed above, the best advice we can give is that the landlord should ask himself or herself, "Is this damage something that could happen if the tenant exercised the same degree of care that the average ordinary person would exercise in the same circumstances?" If the answer is "yes," then the item of damage should not be charged to the tenant. If the answer is "no," then the item may be charged to the tenant.
Even when the landlord or property manager is cautious about what items are charged against a tenant's security deposit, we have found that tenants often disagree, and some will file a Small Claims Court lawsuit against the landlord to recover their deposits. When this happens, we have generally observed that landlords who can articulate a reasonable basis for items of damage being beyond ordinary wear and tear based on the discussion above will win such lawsuits.
Landlords and property managers who are uncertain whether to claim a particular item as damage beyond fair wear and tear after reviewing the discussion above are welcome to consult with us. We will endeavor to give our best advice based on our experience dealing with such issues in court over a period of many years.
When does a lease terminate? Depending on the circumstances, sometimes it can be difficult to determine when a lease "terminates," thereby starting the 30-day period to account for the security deposit. Following are some guidelines for making this determination:
- If the lease contains a definite termination date and the tenant moves out on or shortly before that date, then the termination date specified in the lease should be used.
- If the lease contains a definite termination date but
the tenant "skips" long before that, the lease will terminate on
the earlier of the termination date specified in the lease or at
midnight on the day before a new lease to a subsequent tenant
takes effect. You are required by law to make good faith efforts
to re-rent the premises and thereby "mitigate" your damages.
Examples:
- Assume the lease specifies a termination date of May 31. Tenant skips in January. You make good faith efforts to re-rent and a new tenant signs a lease effective April 1. In this case, March 31 would be the termination date for the old lease, and the security deposit accounting would be due within 30 days of March 31.
- Assume the lease specifies a termination date of May 31. Tenant skips in January. Despite your best efforts, you are unable to re-rent the premises before May 31. In this case, May 31 would be the termination date, and the security deposit accounting would be due within 30 days of May 31.
- Oral month-to-month leases present unusual problems in determining a termination date for security deposit accounting purposes. In these situations, it is recommended you consult with Scott Law Firm.