: A recent Supreme Judicial Court ruling favored tenants in a dispute over a lease requirement to hire professional cleaners when moving out. iStock photo
The Massachusetts Supreme Judicial this month ruled on whether a residential landlord properly used a tenant security deposit to offset the landlord’s cost of cleaning a vacated dwelling.
The Massachusetts security deposit statute imposes strict requirements on residential landlords. Security deposits cannot exceed one month’s rent. Landlords must give residential tenants written receipts for security deposits, with sworn statements of condition.
Security deposits must be held in special bank accounts and tenants are entitled to yearly notices identifying banks holding deposits, with account numbers and annual interest payments on their security deposits.
Residential landlords often inadvertently violate the statute and egregious violations can result in judgments requiring landlords to pay triple the security deposit to tenants plus attorney’s fees.
Landlords can only deduct from security deposits for unpaid rent and water charges, unpaid real estate taxes and reasonable amounts necessary to repair damage caused to the dwelling unit but specially excluding “reasonable wear and tear.” Landlords who deduct from security deposits for damage must provide tenants with sworn statements with supporting documentation.
A major Los Angeles-based residential landlord recently learned in Peebles v. JRK Property Holdings Inc., that even sophisticated landlords can get tripped up by the statute.
Tenant Challenges Lease Requirements
JRK Property Holdings uses its own standard form of residential lease. Its lease required tenants to paint and professionally clean their apartments, including carpet cleaning, at the end of their leases.
JRK’s lease authorized it to apply specific charges for the cost of painting, carpet cleaning and cleaning specific items such as bathroom and kitchen fixtures, doors, windows and cabinets. It reserved the right to deduct painting and cleaning charges from tenant security deposits if tenants failed to satisfy these obligations.
When one of its tenants, Branda Peebles, vacated her apartment without using professional cleaning services, JRK deducted $115 from her security deposit.
Peebles filed a putative class action lawsuit against JRK in Suffolk Superior Court for an alleged violation of the security deposit statute, seeking triple her security deposit. She claimed that JRK’s cleaning costs arose from “reasonable wear and tear” on the apartment and therefore JRK’s deduction from her security deposit violated the statute.
Federal Judge Returns Case to SJC
Because JRK is incorporated and headquartered in California, it was able to remove the case to federal court, but the case returned to Massachusetts when the federal judge certified questions regarding the Massachusetts security deposit statute to the Supreme Judicial Court.
The federal court asked the SJC to answer, first, whether a landlord deducting the cost of painting, carpet repair and similar refurbishments from a tenant security deposit, violates the security deposit statute; and second, whether a clause in a lease allowing the landlord to deduct the cost of professionally cleaning violates the statute.
The SJC first considered whether charging a tenant for painting and carpet cleaning violated the statute. Peebles argued that painting and carpet cleaning address reasonable wear and tear instead of damage to the premises, so the charges were not deductible.
The SJC noted that the statute does not define the term “reasonable wear and tear.” Accordingly, whether or not damage constitutes reasonable wear and tear is fact-specific to each case, depending on the condition of the premises at the outset of the lease, the use of the premises, the expected deterioration of the premise because of such use and the length of the tenant’s occupancy.
Christopher R. Vaccaro
The SJC declined to set a firm rule that all damage requiring painting or cleaning is reasonable wear and tear, but noted that normal use of leased premises will result in gradual deterioration and security deposit deductions for such reasonable wear and tear violate the statute.
The SJC next determined that JRK’s lease provision requiring tenants to professionally clean their premises at the end of the lease, under threat of security deposit deductions, is in effect a requirement that tenants forfeit security deposits to pay for reasonable wear and tear.
The SJC ruled that the lease provision violates the statute and is void and unenforceable. Based on the SJC’s decision, the federal court is likely to rule in favor of Peebles and it might require JRK to pay triple her security deposit plus her attorney’s fees.
Peebles filed her Superior Court suit in 2019. Her case spent several years working its way through Superior Court, federal court and the SJC.
The possibility remains that Peebles’ case will be certified as a class action, which will further JRK’s legal entanglements and risk. This is a lot of exposure for JRK over a $115 cleaning charge.
Christopher R. Vaccaro Esq. is a partner at Dalton & Finegold L.L.P. in Andover. His email address is cvaccaro@dfllp.com.
