Residential Tenancies Branch

Section 10 

Security Deposit

Sub-Section 10.7

Refunding A Security Deposit

Legislation

s. 32, The Residential Tenancies Act

Definitions

Security deposit: is money a tenant pays to a landlord before the start of a tenancy. A security deposit can’t be more than half of the first month’s rent. The landlord holds the money until the tenant moves out. When a tenancy ends, a landlord may claim the security deposit for unpaid rent, damage, extraordinary cleaning costs or other obligation of the tenant. Many people refer to this money as a damage deposit.

Policy

If a landlord doesn’t have a claim against a security deposit, they must return the money to the tenant within 14 days of the end of the tenancy.

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If there is more than one tenant, the landlord should make the security deposit cheque payable to all the tenants, unless the tenants have said otherwise, in writing.

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If a landlord is not sure who to give a security deposit to, either the landlord or the tenant(s) may ask the Branch for assistance. In some case, the Branch may accept the security deposit from the landlord. The Branch will then decide who is entitled to the money.

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The Branch may also get involved if a tenant can’t cash a security deposit cheque payable to two or more tenants.

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Deciding who gets a security deposit depends on circumstances during, and at the end, of a tenancy. Here are some common situations:

■  Example 1

Chris and Gerry have a one-year tenancy agreement with their landlord. At the end of the tenancy, both names and signatures are on the agreement, even though Chris moved out in the middle of the last month.

The landlord should make the security deposit cheque out to both Chris and Gerry.

■  Example 2

Chris and Gerry have a one-year tenancy agreement with their landlord. Three months into the tenancy, Gerry moves out and everyone agrees to take his name off the tenancy agreement. Chris leaves at the end of the one-year agreement.

Since Gerry, officially, is no longer responsible, the security deposit cheque should be made payable only to Chris.

■  Example 3

Chris and Gerry have a one-year tenancy agreement with their landlord. Gerry moves out at the end of the first term and only Chris’ name and signature are on the renewal. Chris leaves at the end of the second agreement.

The security deposit goes to Chris.

■  Example 4

Chris and Gerry have a month-to-month tenancy agreement with their landlord. During the tenancy, Chris moves out and Shawn moves in. Shawn pays his part of the rent directly to the landlord.

When the tenancy ends, the security deposit cheque should be made payable to both Gerry and Shawn.

■  Example 5

Chris and Gerry have a month-to-month tenancy agreement with their landlord. They both pay their share of the last month’s rent. But, Chris moves out five days before Gerry.

When the tenancy ends, the security deposit cheque should be made payable to both Chris and Gerry.

Procedure

Overview   

If a landlord is not sure who should receive a security deposit, the landlord may send the security deposit to the Branch.  An officer tries to help the landlord and tenant(s) reach an agreement on the deposit.  If they can’t agree, the officer may decide which tenant or tenants should get the security deposit.

Steps ▼   

1.   The officer asks the tenant(s) or the landlord the following questions

• Is there proof of a written or oral agreement?
• Who paid the security deposit?
• When was the security deposit paid?
• How was the security deposit paid?
• How much was the security deposit?
• Is there a receipt or cancelled cheque for the security deposit paid and do they have it?
• Why a cheque payable to all tenants can’t be cashed?
• What portion of the security deposit did each tenant pay?

2.   The officer may try to mediate between the tenants to help them reach       their own agreement.  An officer may ask each tenant to agree that the       Branch decide who should get the security deposit.

Forms & Form Letters

X-Referencing

For information on interest on security deposits, see Section 12.

Policy Developed

February, 1995

Last Revision

Other Resources

None

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