Security Deposits

Steve Scott

Attorney at Law

Serving Landlords, Individuals
and Small Businesses

Vanessa Reynolds

Legal Assistant

Security Deposits

It is crucial for landlords to be fully informed about the Missouri law on security deposits because the courts enforce them rather strictly. More than a few landlords have gotten in trouble for not scrupulously following the statute. The information on this page is also available in PDF format which can be downloaded by clicking HERE. Needed forms include:

	Form 08SD ("Notice of Security Deposit Inspection"), which is available on our Forms page and can also be downloaded here your choice of three formats: PDF Word WordPerfect.
	Form 08aSD ("Security Deposit Statement"), which is available on our Forms page and can also be downloaded here your choice of three formats: PDF Word WordPerfect.

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. (This rule clearly applies to residential leases, but it is not clear whether it applies to commercial leases.)

The statute requires you to give the tenant reasonable written notice at the tenant's last-known address (which can be the address of the leased premises if no forwarding address was left), or in person, of 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 08SD for a sample notice of inspection.

The inspection must take place at a reasonable time, and the tenant has the right to be present. (See the note at the bottom of this page regarding a desirable lease clause relating to security deposit inspections.)

Within 30 days after termination of a lease, you are required to either:

	(1) return the full security deposit to the tenant, or
	(2) 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 do so 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 at least prove mailing if necessary.

The only amounts you are entitled to withhold from the security deposit are:

	Unpaid rent pursuant to lease.
	Repairs necessary to restore property to its condition at beginning of lease, except for 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.

It should be noted that if your legitimate damages exceed the security deposit, nothing prohibits you from attempting to recover those damages by filing suit against the former tenant.

The foregoing 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.

Note about 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 like, "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 found later when there is more time for looking 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 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."

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