NJ Landlord did not return $800 security deposit - Filed Small Claims Complaint

This is my first post so please take it easy.

Facts:
7/1/08 Began a month-to-month lease with landlord in NJ for $800/month.
8/8/09 Landlord gives me a letter saying she is going to increase rent to $900 as of today. This is a basement apartment and I had been looking to move for a while.
8/10/09 I give letter to landlord stating I will be moving out by August 31st, 2009. Please send security deposit to this address...
8/29/09 I move out and leave the place super-clean. I ask landlord to inspect the place and she refuses to sign letter.
10/01/09 It has been 30 days and no sign of security deposit.
10/05/09 I call landlord and ask if she sent security deposit. She says she did not because I did not give her 45 days notice.
10/06/09 I file Small Claims Complaint at Bergen County Justice Center for $1600.
10/14/09 I just received summons (court date is 10/21/09 at 8:45AM).
10/21/09 I went to court this morning. Landlord did not show up. I have a conditional default judgment. I have to fill out a ton of paperwork. For example, I have to prove that she is not active duty in the Military ... Ughh...It will be a while before I can even start filling out paperwork to start the collection process.

Does anyone have any experience with Small Claims Court? I know NJ statute says 30 days notice should be given before I vacate, so I was willing to only take the pro-rated 21 days. However, she did not return anything or write a letter stating damages. What will happen at Small Claims? Any knowledgable FWers, please chime in.

Thanks in advance.

8/10/09 I give letter to landlord stating I will be moving out by August 31st, 2009. Please send security deposit to this address...
8/29/09 I move out and leave the place super-clean. I ask landlord to inspect the place and she refuses to sign letter.

You didn't meet the statute's requirement if that's what it is. What did your lease say? How much notice? Sounds like you didnt meet the terms of the lease nor the terms of the statute. I'm not sure what your basis is for suing.

Lease didn't say anything about giving notice. I found out after I left that the statute says 30 days.
So, then that's technically 30 days notice to September 10th. Doesn't that mean she should return 21 days?

I don't understand the pro-rated return of the security deposit. I was always under the impression that if you didn't meet some term (in this case the notice), you lost all of the security deposit; the only way to get a part of the deposit back was if some repairs costs less and there was money left over.

In a lot of places, the deposit is an entirely separate issue from rent. Even if you do owe some rent, and it sounds like you do, some landlords are prohibited from collecting that from a security deposit. What does your lease say about the deposit? Cross check that with your state and local laws.

We took the advice to make our security deposit a different amount than monthly rent to highlight the difference. As a landlord, we don't want tenants to think the funds can be used either way, in case they want to skip paying their last month's rent and "use" the deposit instead. That doesn't work because we need a bit of time after they leave to determine if any repairs or extraordinary cleaning is required, and what that will cost.

mannylee said: I did pay August rent in full before August 1st, so I was covered until August 31st in terms of rent. Should I be held liable for all of September?

What does the lease say in terms of partial months? Depending on the language, you might owe all of september as well.

So the new rent amount was supposed to be effective with the September payment or did you owe an additional $100 for August? Since it sounds like you moved out to basically opt-out of a rent increase, I wonder how that plays into rules for giving notice? I also wonder (both what the lease and laws) say about notice for rent increases.

She gave zero days notice on the rent change, and you notified her you were leaving at the next month end?

That sounds entirely reasonable to me, no matter what the statute might say.

taxmantoo said: She gave zero days notice on the rent change, and you notified her you were leaving at the next month end?

That sounds entirely reasonable to me, no matter what the statute might say.

I hope you are right, taxmantoo!

Any landlords out there? What do you think?

Thanks Tim. My parents are landlords and I have helped them along the years with notices and such. We gave three months notice for rent increases and were always prompt with repairs.

This landlord seemed really nice but did not follow through on a lot of things. I had to buy smoke detectors and a carbon monoxide alarm and get reimbursed. I guess the lesson is to not trust people too easily. It sucks because I don't want to lose faith in people. I'm only 24.

First off, stop talking about pro-rating, you are confusing us. If partial months are NOT specified in the lease, most States infer that the rental terms go either between periods that rent is due, or through calendar months. If you are on a month to month lease, and you terminate on the 15th, you usually are required to pay the entire next month, unless that situation is specifically addressed in the contract.

Secondly, when did you pay the August rent? Next, when did the landlord say the rent was increasing, and when would it be effective?

In most month-to-month leases, even if it is not stated in the lease, local law assumes that the lease is automatically renewed for an additional 30 days when you pay for the current 30 day period. (i.e. When you pay for August, you are extending your lease through the end of September. This is where 30 day notice kicks in. By paying for August, you agreed to extend the lease an additional month. However, if she made the rent increase effective for September, she very well likely violated the leasing terms herself. You can't change a contract term when the renter is still obliged under contract to abide by it. A landlord can not adjust rental prices until a time when the lessee had an option either to renew or terminate the lease. I'd say that you have a good case and would encourage you to continue to sue for double damages, as is allowable in NJ. My take is that the landlord made the lease and 30 day notice requirement null and void by invalidly increasing the rent. Technically I think you probably should have terminated, effective the end of September, and then stayed one additional month at the original rent, as her increase was invalid. However, given the circumstances, I think a judge would give you a favorable decision if the landlord was the first to violate the agreement. In my estimation, the lease was voided the day she increased the rent, and she has no claim to the security deposit.

Interesting. The fact that the landlord gave 0 days notice should play in your favor, as the 30 days rule seems to apply equally to both parties. Of course IANAL and I have no experience in how Judges think...

Usually, you have to give thirty days' notice before moving out, but your Landlord also had to give you 30 days notice before raising the rent. You could argue that you were due double the wrongfully-withheld portion of your security deposit.

You also said it was a basement apartment. In New York, basement apartments usually are not legal for human habitation because the certificate of occupancy would not be suitable for this use. Therefore, in New York, you could sue for a refund of all the rent you paid for that illegal apartment. In fact, landlords in NY who rented a space without a suitable certificate of occupancy can't even evict a tenant in housing court. You have to file an action for ejectment in Supreme Court, at great cost and trouble.

I just sent an email to a friend who works in NJ PIRG. She says you might prevail, but you didn't quite follow the right procedure.

When the landlord sent you the "Change in lease terms" letter, you should have replied that you refused the change in terms. The landlord then could have terminated your lease and either agreed with you on a move-out date, or begin the eviction process. Alternatively, you could have rejected the change in lease terms, and then terminated the lease voluntarily, which would have required you to give 30 days notice BEFORE the final month, which would have put you through the end of September. However, if you present a case that you felt the rent increase was an undue hardship and that you replied quickly, then a judge might find in your favor as the landlord may appear to be acting in bad faith. However, depending on the juridiction, NJ law might technically favor the landlord, as they don't have to tell you that you have an option to refuse rent increases.

Thank you for the replies.

Here is the letter from the landlord (verbatim):

August 8, 2009

Dear Manny,

First of all as a tenant, as a friend and a neighbor we love you very much, and I need a reasonable request from you. As you know our house is worth with heat, electric and parking lot 1,100 dollars but I need to ask you only, if you can add 100 dollars on the rent from now on. You can feel free to compare other places to find out its reasonable. Also you can apply home state rebate because I turned your place legal. I really appreciate for your understanding.

Thank you
(landlord)

bossusa said: isnt it illegal to rent an apt in the basement in the first place?

Not as long as you have a certificate of occupancy.

mannylee said: Thank you for the replies.

Here is the letter from the landlord (verbatim):

August 8, 2009

Dear Manny,

First of all as a tenant, as a friend and a neighbor we love you very much, and I need a reasonable request from you. As you know our house is worth with heat, electric and parking lot 1,100 dollars but I need to ask you only, if you can add 100 dollars on the rent from now on. You can feel free to compare other places to find out its reasonable. Also you can apply home state rebate because I turned your place legal. I really appreciate for your understanding.

Thank you
(landlord)
The letter is vague and somewhat poorly worded. But I dont think it says the rent is increased starting today as you stated in the OP. I would interpret "from now on" to mean from the next month's rent payment. It still may be short of the 30 days notice required to increase rent.
Also, the letter is drafted more as a request, not as a formal notice. Somewhat akin to "can I borrow $100" to which you could very well say "sorry, no."

Finally, IANAL.

The OP said he wanted to move out anyway. No matter how polite the landlord is in email form, 30 day warning for the rent increase was not provided (August 8 -> September 1). Given this, I don't think the OP was unreasonable in this situation (he gave only two days less notice than the landlord) and the landlord should return the deposit.

Since the landlord implied in her notice that the place was not "legal" at some time in the past it is easy to assume that no taxes were paid on that rental income. In case you don't prevail in small claims on your way out give your ex-landlord a copy of IRS Form 211. See if she wants to talk again after that.

mannylee said: ...NJ statute:

Notice terminating lease and notice of rent increase.

The law requires that, for a landlord to raise your rent, you must be given proper written notice. A proper notice must inform the tenant that the current written or oral lease is being ended and that the tenant can stay in the rental unit by signing a new lease at a higher rent. (See The correct way to increase the rent.)

If your lease is monthly, a proper notice must explain that your existing lease will be terminated or ended in one full calendar month. You must receive this notice at least one month before your lease ends. The notice period may be greater, depending on what your current lease says. If your lease is for one year, the notice must explain that your lease will terminate on the date the lease ends, and you must receive this notice at least one month before that date. The notice can be for a longer period, such as 90 days before the lease is to end, if the lease requires it.

In addition to ending the lease, the notice must also say that, at the end of your current lease, you have the choice of accepting a new lease at the higher rent. If you decide to sign the lease and stay on as a tenant, you must pay the rent increase. Cite: Harry’s Village, Inc. v. Egg Harbor Tp., 89 N.J. 576 (1982).

Any notice of a rent increase that is not in writing and is not divided into two parts—(1) ending the old lease and (2) beginning a new lease at a higher rent—is not legal, and you do not have to pay the increase.


I am wondering if I should play that card when I go to court. She did say "the rent will be $900 from now on" on the rent increase notice dated August 8th. All replies are greatly appreciated.

I think you definitely play that card in court. Memorize that part of the statute and be sure to bring a copy of her written notice of rent increase with you. If it does not meet those requirements above, I believe you'll win $1,600. I would explain your own failure to meet the minimum notice of lease termination as a direct result of your landlord's illegal rent increase. I seriously doubt the judge would see it differently.

Please post your results in this thread.

mdford said: I wonder how much she had to pay her lawyer in addition to this judgement... good work sticking it to her!

He's 24 and she is elderly.

Ewwwww