Damages after deposit returned??

Question

Hi friends! 👋 would love some direction…Other than the ORC (Ohio Revised Code) where could I go to really learn landlord tenant laws and requirements for Ohio inside and out?

*also wondering ohio landlord recourse b/c of the following scenario:

2 Tenants (friends...but now no longer friends) on a year lease. They move out and surrender keys 6 months earlier than end of lease term.

A government document was accepted from one of the tenants as valid reason for terminating the lease early and security deposit was returned.

$4000+ in repairs ended up being needed and done to get it rent ready again (not found before deposit was returned).

Then it was discovered (2 months later) the government document was falsified and did not actually come from their employer regarding re-location. Tenants were contacted, one wont respond or do a thing and the other tenant who fudged the form is responding and they are discussing payment plan for the amount of rent for remainder of the lease term totaling $11,000.00

NOTE: This is NOT my tenant, thank goodness. But the whole scenario with this acquaintance of mine has intrigued me since I am a very 'green' landlord with only one tenant experience so far. Even after reading and re-reading the lease and scouring the ORC I can't figure out what their next step should be or if they even have a leg to stand on since they accepted the keys and returned the security deposit.

-Can they send the tenant to collections? Would they have to sue for damages? And where do I find the laws and regulations that would better answer specific questions like this and what steps to take when a tenant breaches contract?

Thank you so much! 😀

Jill F. · Answer

A landlord can go to small claims court to obtain a judgement for the damages or may turn the debt over to a collection agency. It seems to me like the fact that the landlord returned the security deposit could hurt their chances in court (which is always kind of a crap shoot)-- BUT the courts will probably view very, very dimly a tenant that falsified military orders which is the only codified reason an Ohio landlord is required to let a tenant off the hook for the breach of a lease term for a habitable unit (assuming no harassment or privacy violations by the landlord). (Also, Some municipalities do have special rules that apply to victims of domestic violence)

As far as breaking the lease early here's my (probably limited) understanding of the law: absent a clause in the lease that relieves the landlord of a duty to mitigate tenant's losses, under Ohio case law, the landlord has a duty to mitigate losses by re-renting asap and only charging tenant for time the property is not rented.  Since the requirement to mitigate arises from case law and not the Ohio Revised Code law, it must be enforced by a court: Stern v. Taft, 361 N.E.2d 279 (Ct. App. 1976)

If your landlord friend can get the tenant to pony up some of the losses they'll be lucky Either a judgement or collections account would negatively impact the tenant's credit and It sounds like the tenant must have some credit to protect so he maybe your friend will be lucky.

Adam Martin · Answer

My lease states that I have 30 days to return the deposit.  I like to return it sooner but honestly am in no hurry to do so and I make sure that there is no hidden damage before returning it but in my opinion once it is returned it is gone and it will be very hard to justify getting it back if you find additional damage.  As far as going after them for the falsified documents if they pay anything that is great however this isn't really something I would find a good use of my time.  Call it a learning opportunity and move on.

Scott Mac · Answer

You might want to think about (Trying) to get the local Police to take a report about "Fraud" regarding the letter, and see if the District Attorney will prosecute the person.

Someone going around defrauding a business like that out of thousands of dollars in income, might get the attention of the District Attorney.

Good Luck!

https://www.youtube.com/watch?v=PPxa4MYs-qM

Ned J. · Answer

Was the unit vacant for the entire rest of the lease term period?  In many states you can have penalties for early lease termination but you aren't entitled to the rest of the lease term rent unless you made reasonable/acceptable efforts to re-rent the unit and it remained vacant the entire time. And you had better prove that you made serious and reasonable efforts to fill the unit again.

In other words, they terminated with 6 month left....and you rented it a month later... the previous tenant is only on the hook for that 1 month of vacancy... you don't get to "double dip" on rent. You also can't just let it sit vacant collecting dust and expecting the previous tenant to pay the rent. Not how it works....

Damage after security deposit returned.... that's on the person that returned the deposit...unless you can prove it was directly caused by the tenant, and was purposely hidden by that tenant and not reasonably located/identified by a reasonably conducted inspection of the property, then its not likely you will win in court. By releasing the deposit, you essentially release their liability and terminate the contract with the tenant. Hard thing to reverse...

Jimmy Lieu · Answer

I would definitely talk to an attorney as referenced above and discuss best possible recourse for that situation.

Remington Lyman · Answer

1 - you could hire an attorney to teach you the laws or take a law class at a college

Jeremy H. · Answer

I think there's some good lessons to be learned here:

1) Always do an inspection before returning the security deposit. This is on the landlord/PM. Similar to paying a contractor before the work is done - what happens if he does a sh*t job? Exactly. You're likely on the hook for this one. You may be able to take them to court, it's just a lot harder to have control once the money has left your hand.

2) Falsified documents. Seems you have 2 options here - go to court and fight it. Move on with life, minimize your vacancy and get the place rented again. You got ample notice it seems here - so the lost rent isn't a huge issue (assuming your place rents easily) so I'd probably go with option 2. I have tenants just straight up leave from time to time in one of my lower income units - we bill them and it goes to collections, but 99.99% chance you will never get paid.

As far as all the legal questions your friend has - this is exactly why I am a proponent of hiring a property manager. Why? They are experts at this, have seen it all, done it all etc. They can handle this for you easily and it will be of minimal stress to you. Do you want to be a PM or a RE Investor? Pick one and be really good at that one.

Theresa Harris · Answer

I would never have returned the deposit until after I did the inspection. If after that, I found damage, that would be my fault that I didn't catch it.

As for falsifying documents, you could talk to a lawyer, but if they are trying to figure out how to repay the rent (during the time it was vacant along with any fees as per the lease) it may not be worth it.

Damages after deposit returned??

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