He would have to talk to the 3 remaining tenants about getting his deposit from them, and when they move out they talk to you about getting their deposit back.If he did pay a deposit directly to you, what you do with the deposit 1st depends on how the state statutes say you can handle security deposits, then it depends on how the lease says to handle security deposits, then it depends on how you want to treat the security deposit.I recommend you take advantage of this learning experience to list any and all items you did not take into account before renting to room-mates - then make sure all of your documents and procedures (and the state laws) allow you to operate how you want to operate....Generally speaking, a tenant who breaks a lease early by moving out (let's assume proper notice was given and assume there are no damages to the unit) is liable to the landlord for the income the landlord loses by virtue of the tenant moving out early.

Just be sure to build the electrical billing procedure into the lease.

This now begs the question of whether or not this same procedure can be applied to multiple businesses within real estate and what would be considered gaming the system if you split out the lines of business.  

If she did, we would simply release the storage locker into her name as per the procedure allowed by the storage facility.  

Very nice policy and procedure Account Closed  ..

I would also tell them the money was safely deposited in a bank as per normal procedure and that you don't keep that type of cash on hand.

It is as much of a legal proceeding as getting the judgment; with service and notice requirements and special procedures to obtain the money.  

What is the procedure and is it a good idea?

The CA summary probate procedure is intended for simple estates of modest gross value, inclusive of debt, whether there is equity or not.

Title insurance companies typically require this procedure to insure resale or commercially-offered mortgages.