The reason that you and your husband are going to recover the deposit is that in WA, in order to take a deposit, the rental agreement has to be in writing and the terms of the deposit return have to be memorialized. See RCW 59 18 260.
The landlord (or the head tenant if you will) should never have taken a deposit in the first place, that was unlawful. The furnace fuel you paid is an entirely different problem. You are going to have to figure out what is a reasonable rebate on your husband's contribution to the fuel. That may be a lost cause.
Anyway, don't take legal advice from the landlord or the head tenant as neither apparently has ever read the relevant statutes. Hope this helps - Elizabeth Powell
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