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Under CA Civil Code 1950.5(l), are legitimate security deposits deducted before or after damages are calculated?

Rosemead, CA |

I have a question about CA Civil Code `1950.5(l) - treble damages/penalty for bad faith retention of security; applies to all residential rentals in CA.

Pursuant to CA CC 1950.5(l) if landlord is found to have unlawfully withheld tenant's security deposit (SD), but a judge also finds that something should be deducted from SD (i.e. for cleaning not covered under normal wear and tear), then would that amount would be deducted from the treble/triple damages?

(For argument's sake, let's say judge allows $100 for cleaning) For example, if your SD was $1,000, and the landlord didn't follow the requirements of CC 1950.5 and/or did not return any of your security, and a judge found in the tenant's favor that the security deposit was unlawfully withheld, would the judge start making deductions from $3,000, since the penalty for unlawfully held security deposit is treble damages ($1,000 x 3 - $100 = $2,900 net judgement to tenant), or would then $100 be deducted from the $1,000, and then the remainder used to calculate the triple damages (($1,000 - $100) x 3 = $2,700)?

CA Supreme Crt -Granburry v. Islay - if landlord hasn't complied w/ requirements of CA CC 1950.5 in 21 days, and fails to return tenant's security deposit, it's sufficient to show bad faith on landlord's part, so as to entitle tenant to the treble/triple damages stated in Civil Code 1950.5(l), although, "proving" bad faith by landlord is not an element of CC 1950.5. Also, CC 1950.5 states that landlord's failure to comply with CC 1950.5 can "subject landlord..to statutory damages of up to twice the amount of the security, in addition to actual damages". The accurate calculation for punitive damages pursuant to CC 1950.5, is double the amount of deposit plus damages suffered by tenant {so if deposit was $1000 and landlord wrongfully kept $500, judge should award tenant $2,500).

Attorney Answers 3

Posted

I agree with my colleague's excellent answers. I respond to note that even assuming bad faith retention, you should only treble the portion withheld in bad faith, not the entire security deposit. In other words, you deduct the amount properly withheld before trebling. $1,000 - $100 = $900 * 3 = $2700.

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Raffi Krikor Kevorkian

Raffi Krikor Kevorkian

Posted

Sadly my colleagues have failed to note 1950.5 (l) was amended prior to this consumers post and it only permits "twice" the security deposit and no longer "treble" damages. Though I agree with Mr. Kane's evaluation with the following change, $900 * 2= $1800.

Brad S Kane

Brad S Kane

Posted

Mr. Kevorkian misunderstands my response and the responses of my colleagues, who regularly practice real estate and landlord/tenant law. Civil Code 1950.5(l) states: (l) The bad faith claim or retention by a landlord or the landlord's successors in interest of the security or any portion thereof in violation of this section, or the bad faith demand of replacement security in violation of subdivision (j), may subject the landlord or the landlord's successors in interest to statutory damages of up to twice the amount of the security, in addition to actual damages. The court may award damages for bad faith whenever the facts warrant that award, regardless of whether the injured party has specifically requested relief. In an action under this section, the landlord or the landlord's successors in interest shall have the burden of proof as to the reasonableness of the amounts claimed or the authority pursuant to this section to demand additional security deposits. This means the tenant is entitled to: (i) the original balance of their security deposit (net of authorized deduction); and (ii) if bad faith is shown an additional award of 2 times the amount the landlord should have refund. Thus, a tenant who proves bad faith is entitled to a total of 3 times or treble the amount the landlord should have refunded. As result, I stand by my original analysis and computation.

Posted

Are you asking if you properly applied the law in your example? (I don't see a question in your post.)

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Asker

Posted

yes...I guess so..thx..

Posted

It is pretty rare for a court to award the bad faith treble damages in the first place, especially if the landlord had any basis to withhold any portion of the security deposit.

Just because the landlord failed to comply with Civil Code section 1950.5 by returning the deposit within 21 days is definitely not sufficient to show bad faith. Think about it. Otherwise, every landlord who doesn't refund or provide an itemized statement within 21 days would be liable for treble damages. The tenant would have to demonstrate specific facts showing the landlord acted in bad faith.

Frank W. Chen has been licensed to practice law in California since 1988. The information presented here is general in nature and is not intended, nor should be construed, as legal advice for a particular case. This Avvo.com posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, please consult with your own attorney.

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Posted

But the intent of CA Civil Code 1950.5(l) is to penalize landlords, b/c more often than not LL's take advantage of their positions of power/tenant's lack of knowledge, & attempt to unlawfully keep tenants' security deposits. The whole point of the statute is to discourage LL's from wrongfully withholding tenant's security deposits.

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