What to do when landlords give conflicting instructions

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09/24/2015 | Author: Editorial Staff

I manage a property for a couple who recently split. Prior to their separation, they signed a Residential Leasing and Property Management Agreement (TAR 2201). When their tenant vacated the property, one of my clients asked me to forward the tenant’s security deposit to her. The other client asked that I return the security deposit to the tenant. What should I do?

Any accounting for the security deposit happens between the tenant and you, the property manager, per Paragraph 4 of the Residential Leasing and Property Management Agreement.

Make deductions from the security deposit in accordance with the lease, if any, and return the remaining balance of the security deposit to the tenant. If you make deductions, you’ll need to provide to the tenant a written description and itemized list of those deductions. 

Categories: Legal
Tags: landlords, property management, security deposit


Teresa Warren on 09/29/2015

Re: Lenny…. If the Owners Terminate the Management Agreement and ask for the tenants deposit then YES…. you will turn over the tenants deposit to the Owners… you will also be required to notify the tenants in writing of the change in management and who is now responsible for holding their deposit….and who and where they are now required to pay rent to…..  (TAR-2210) Form.

Re: Bonson… Yes that is correct… the refund check is made payable to all parties listed as tenants.  Unless Both tenants agree and instructs Landlord (in writing) to refund deposit payable to one particular tenant.  Be careful ... make sure ALL parties are in agreement and it has been agreed to IN WRITTEN FROM (not just an email or text)

bonson on 09/29/2015

I thought the rule was to make one sec deposit refund check payable to all adults on the lease (i.e. pay to the order of John Doe and Mary Doe) ???

lenny schwartz on 09/24/2015

what if the landlords/prop owners terminate the management agreement and then direct me to send THEM the sec dep??

Roger Martin on 09/24/2015

Also, apologies for the spelling and grammar goofs. Spell check is not my friend at the moment.

Roger Martin on 09/24/2015

Assuming you are not doing this at the last moment, I would think it would best to a little bit of all of the above.  Determine how much is to be deducted. Inform the owners that your intent is return that amount to the tenant. Then your plan is to send them each 50% of the balance or you will send it “as directed by the courts.” Make them both sign off on your plan.

Frankly, I think if you refund some to the tenant and the remainder is sent to what are fairly sure to be unhappy people, no matter how you split it they are liable to take their unhappiness with their exe"out on you. You may find your self on the wrong side of at least one, maybe two clients and their attorneys..

Teresa Warren on 09/24/2015

Haha… My answer was in reference to Stephen Fosters question .. Not the original .. Sorry

Teresa Warren on 09/24/2015

You split it equally to both parties unless directed differently in writing on the management agreement with both parties signing.

Mike Cusimano on 09/24/2015

So how do you handle giving back any difference withheld from the security deposit to your clients (landlords)? In other words, who should get any left over money?  The first person on the management agreement, the second person or 50/50? What if they cannot come to an agreement? How long can I withhold their money?

Stephen D Foster on 09/24/2015

The lease gives you direction in this case.  But what if the lease is ongoing and the tenant pays their rent and both clients demand the monthly rental proceeds?

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The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on texasrealestate.com. Any legal or other information found here, on texasrealestate.com, or at other sites to which we link, should be verified before it is relied upon.

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