Chapter 12 – Housing – Article 5 – Security Deposits
12-5-1 Withholding Security Deposit; Statement of Damages; Liability of Lessor
A lessor of residential real property containing four (4) or more units, who has received a security deposit from a lessee to secure the payment of rent or to compensate for damage to the leased property may not withhold any part of that deposit as compensation for property damage unless he has, within thirty (30) days of the date that the lessee vacated the premises, furnished to the lessee, delivered in person or by mail directed to his last known address, an itemized statement of the damage allegedly caused to the premises and the estimated or actual cost for repairing or replacing each item on that statement, attaching the paid receipts, or copies thereof, for the repair or replacement. If estimated cost is given, the lessor shall furnish the lessee with paid receipts, or copies thereof, within thirty (30) days from the date the statement showing estimated cost was furnished to the lessee, as required by this Section.
If no such statement and receipts, or copies thereof, are furnished to the lessee as required by this Section, the lessor shall return the security deposit in full within forty five (45) days of the date that the lessee vacated the premises.
Upon a finding by a Circuit Court that a lessor has refused to supply the itemized statement required by this Section, or has supplied such statement in bad faith, and has failed or refused to return the amount of the security deposit due within the time limits provided, the lessor shall be liable for an amount equal to twice the amount of the security deposit due, together with court costs and reasonable attorney’s fees.
12-5-2 Transferee Liability
In the event of a sale, lease, transfer or other direct or indirect disposition of residential real property, other than to the holder of a lien interest in such property, by a lessor who has received a security deposit or prepaid rent from a lessee, the transferee of such property shall be liable to that lessee for any security deposit, including statutory interest, or prepaid rent which the lessee has paid to the transferor. The transferor shall remain jointly and severally liable with the transferee to the lessee for such security deposit or prepaid rent.
12-5-3 Interest to Be Paid by Lessor on Security Deposits; Rate
A lessor of residential real property, containing four (4) or more units, who receives a security deposit from a lessee to secure the payment of rent or compensation for damage to property shall pay interest to the lessee within thirty (30) days of termination of the lease agreement. Such interest shall be computed from the date of the deposit through the date of payment of the interest at a rate equal to the interest paid by the largest commercial bank, as measured by total assets, having its main banking premises in this State, on minimum deposit passbook savings accounts as of December 31 of the calendar year immediately preceding the inception of the rental agreement, on any deposit held by the lessor for more than six (6) months. Such interest rate shall be set forth in the rental agreement.
12-5-4 Time for Payment
The lessor shall, within thirty (30) days after the end of each twelve (12) month rental period, pay to the lessee any interest, by cash or credit to be applied to rent due, except when the lessee is in default under the terms of the lease.
12-5-5 Application of Article
This Article does not apply to any deposit made with respect to public housing.