After renting a property for eight years, a reader has queried whether the deductions made by the landlord on the deposit she paid are legitimate.
Recently she was given notice of termination of the lease and she vacated the dwelling, requesting a copy of the bank statement showing her deposit with accrued interest over the period.
The landlord responded by providing her with a statement drawn up by his accountant and paid over the balance.
See the reader’s question here.
However, he made several deductions, including the fees of the accountant who prepared the statement.
The accountant calculated a loss of interest to the landlord over the eight-year period where the reader perhaps paid her rental a day or two late.
Deductions were also made in respect of repairs to certain light fittings and light bulb replacements.
It appears that the landlord has not followed a legitimate procedure.
To begin with, the Rental Housing Act requires the landlord to ensure that the deposit is invested in an interest-bearing account with a financial institution.
The act adds that on request from the tenant during the period of the lease, the landlord must provide written proof in respect of interest accrued on the deposit.
It’s possible that the landlord failed to comply with his statutory obligation to invest the deposit correctly and that the use of his accountant in preparing the calculation is a knee-jerk reaction.
A lease agreement might make provision for certain deductions beyond the norm, but this is unlikely, particularly in a domestic environment.
Monies deducted from the deposit must be catered for in the lease.
The landlord must, where no amounts are due in terms of the lease, refund the deposit, together with the accrued interest, to the tenant without any deduction or set-off.
The accountant’s fees would almost certainly not be permitted.
It is also unlikely that the landlord would be entitled to recover lost interest over the period.
Even if a lease had made provision for such a deduction, making them so many years later might well constitute an unlawful deduction.
Considering the provisions of the Prescription Act which, for such a debt, prescribes a period of three years for recovery, that deduction may no longer be permitted.
The reader disputes that any light fittings required repairing or replacement while acknowledging that certain of the light bulbs did.
The cost implication, though, would be minor and no electrician would typically be required.
It must be considered that renting a dwelling is generally subject to fair wear and tear.
The landlord can’t replace light fittings merely because they may now be a little outdated or look a little worn.
They were used for a long period of time and will be more worn than at the inception of the lease.
If the reader wishes to pursue the various seemingly incorrect deductions from her deposit, she should consider approaching the Rental Housing Tribunal for relief.
She should refer the matter using the correct forms and by following the correct procedure, substantiating her claims with documentary evidence where necessary.
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