Security Deposit Dispositions During a Pandemic

Posted by  wasserman 

After the tenant vacated, I found the bathroom full of mold and will need to have it professionally cleaned.  I was not aware of this problem during the tenancy, and it appears as though the mold growth was caused by a lack of cleaning and ventilation during the tenancy.  May I deduct the cleaning costs from the deposit?

First, let’s review the security deposit law found in Civil Code Section 1950.5.  The security deposit may be used at the end of a tenancy to compensate the owner for unpaid rent accrued before move out, to repair damages caused by the residents beyond normal wear and tear, and to clean the apartment to the same level of cleanliness that existed when the tenancy began.

Once the residents give notice of their intention to vacate, owners should issue a written notification informing them of their right to request a pre-move out inspection.  Please use the CAA/SFAA form.  If the residents opt for this inspection, you should conduct it no earlier than two weeks before the move out at a mutually acceptable date and time.  The purpose of the inspection is for property owners to identify in a written itemized statement cleaning or repairs that may cause a security deposit deduction if not completed before the residents leave.   

The pandemic has created some major challenges with regard to this step, as owners and residents alike want to avoid exposure to COVID-19.  With unprecedented departures occurring beginning in Spring of 2020 and lasting through Winter of 2021, many renters have either opted out of having the inspection while countless landlords did not even circulate the inspection notification.  Unfortunately, the security deposit law was not and has not been amended to address pandemic safety issues.  Some housing providers have conducted virtual inspections, while others ask for the residents to be absent from the apartment during entries.

It is unclear if a pre-move out inspection was sought or even offered in this instance.  If you failed to offer it, then no deductions should be made.  If the inspection occurred, the question becomes whether or not this problem was identified on the itemized statement.  If it was highlighted, or if the resident declined to have an inspection, then the removal and treatment of excessive mold growth would probably warrant a deposit deduction under both the “damage beyond normal wear and tear” and the “cost of cleaning” allowances of Section 1950.5.  Remember, proper mold remediation usually also requires partial wall and ceiling replacement in addition to a thorough cleaning.

You must send out a deposit disposition statement within 21 days after the residents left. You and your former tenants may agree to handle this communication via email.  If the total amount deducted exceeds $125, make sure to include copies of the material receipts and vendor billing statements, and if you personally performed some or all of the work, you must submit your bills reflecting commercially reasonable charges for your labor.  If the receipts/billing statements are not available within the 21-day period, provide an estimate and the contractor’s information.  Once you obtain this documentation from your vendor, forward it to the departed residents within 14 days upon your receipt.      

Lastly, photograph this contamination and try to have the remediation professional attest in writing that the mold outbreak was likely caused by the resident’s poor housekeeping.  Mold lawsuits are increasingly common, and insurance oftentimes will not cover these claims.  Therefore, you will want to document that the mold presence was not created by some building defect or the ownership’s failure to properly maintain this rental unit.

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