Potential LL Threatening to Sue (apartments, lease, tenant, deposit)

[Becca8377]

My coworker was asking me for advice on this yesterday. Here's the situation -

She and her boyfriend have been looking for apartments. They checked out this one where it is a private landlord for a split level - LLs would be downstairs and they would be upstairs. No PM company involved and they are first time LLs. They signed paperwork only authorizing the credit check and application fees, but gave them the full "deposit." They never signed anything regarding the "deposit" and it was not specified if this was refundable or non-refundable. They assumed refundable, but it wasn't clear and there wasn't anything in writing. AFTER they signed the paperwork and paid the money, the LLs sent them an email detailing what the money was for and saying it was NON-refundable. Again, this was not told to them beforehand. My coworker is a little on the naive side so didn't think to make sure or get anything in writing.

Anyway, they ended up going with another place and since they wrote a personal check for the deposit, they canceled the check and told the LLs. This entire incident only transpired over 24 hours. The LLs screamed at them on the phone and sent them several threatening emails. They are demanding the full payment back because they said it's non-refundable. But my coworker never signed anything stating that and it wasn't in writing until after they signed anything.

Now the potential LLs are threatening to sue them for the full deposit plus damages. I personally don't think the LLs have a leg to stand on since they never signed anything saying the deposit was non-refundable and it wasn't made clear until after they signed. In addition to that, they pulled a bait-and-switch on my coworker by telling them all these upgrades they would do (adding dishwasher, washer, dryer, etc) but after they gave the money they told them that they weren't going to do any of these upgrades.

I told my coworker not to respond to the emails and let them sue if they want to. Anyone can sue for anything, so that doesn't mean they would win.

Thoughts?

[MrRational]

Originally Posted by Becca8377

...they ended up going with another place
and since they wrote a personal check for the deposit, they canceled the check and told the LLs.

Good for them.

Now the potential LLs are threatening to sue them for the full deposit plus damages.
I told my coworker not to respond to the emails and let them sue if they want to.
Thoughts?

I agree with you.
No phone conversation.
In writing only.

[STT Resident]

Everything transpired within 24 hours and it's highly unlikely that any judge in any court would allow the landlord to retain any of this "deposit" even were it not for all the obvious sloppiness of this whole deal.

I agree. Tell them to simply ignore it but, in case these people are really daft enough to file a claim, tell them to hold onto everything (emails, texts, etc.) in case they're needed down the line.

[JONOV]

Hold on to all communication. I would give it 100-1 that the landlords are just blustering and they won't hear about it again, but if you do, its good to have any documentation.

[Becca8377]

Thanks everyone! I figured it was total BS I'll be surprised if they actually file suit. They gave my coworker until Monday to pay them

[NoMoreSnowForMe]

I don't think this is a slam-dunk.

I think she created a contract one way or another. Depending on what the application paperwork said, it could be a written contract. And if not, the fact that she handed over a full deposit (not a holding deposit), will show an intent to contract. In that case she has a verbal contract of a month-to-month agreement, IMO.

Then, she canceled the check for the deposit and backed out of the contract. She breached the contract.

Her reason for breaching the contract is because the LL said their deposit was non-refundable, after the fact. Also, because after signing the papers the landlord said he wasn't going to do upgrades he had earlier said he would do. In other words, she considered herself in a contract, but didn't like the new, changing terms.

PA law doesn't require LLs to mitigate damages. If a judge determines that she had a valid contract, she'll have to pay the full contract, and the LL doesn't have to find another tenant to take her place. If it's a month-to-month verbal agreement, that's a month's rent. If it's a year lease, that's a year's rent.

PA law also has no laws regarding non-refundable fees.

So, her best bet, IMO, if she ends up in court, is to tell the judge that she believed the LL was dealing in bad faith and was basically pulling a bait and switch on her, so she wanted out.

The fact that she signed a lease on another place 24 hours later, though, IMO, is going to look like she just changed her mind. If it's all verbal, it will be he-said she-said. And the fact is, she signed papers to have her credit checked, paid application fees, gave a full deposit, immediately put a stop-payment on that check and signed a lease somewhere else the very next day.

I'm afraid that's going to look fishy. And I can't help thinking there is more to the story than your naive girl (who knew to put a stop payment on a check immediately) is telling you.

[old_cold]

Originally Posted by Becca8377

They signed paperwork only authorizing the credit check and application fees, but gave them the full "deposit." They never signed anything regarding the "deposit" and it was not specified if this was refundable or non-refundable. They assumed refundable, but it wasn't clear and there wasn't anything in writing.

Thoughts?

Depending on what the paperwork actually says, it would appear they should at least pay the amount that would cover the application fee and credit check, since they authorized it.
The rest does depend on what is written in what they signed.