Aside from evictions, issues regarding the failure to properly return a tenant’s security deposit are, in my opinion, the single most litigated area in landlord-tenant law.
In Wisconsin, if a tenant has deposited a security deposit to his/her landlord as part of a residential tenancy, the landlord must comply with one of two options within 21 days after the tenant “surrenders” the landlord’s rental unit:
1. Return the tenant’s security deposit, or
2. Send the tenant a security deposit transmittal letter (which I refer to as a “21 day letter”) explaining how the tenant’s security deposit was applied.
Unfortunately too many landlords have gotten themselves into trouble when it comes to the issue of returning a tenant’s security deposit. While there are many ways to screw up, most of the mistakes that landlords make regarding this topic fall into one of three categories.
First, a landlord makes improper deductions from the tenant’s security deposit.
Second, the 21 day letter is sent late.
Third, the 21 day letter is not sent at all.
Failure to abide by ATCP 134.06 of the Wisconsin Administrative Code – which deals with security deposits in residential tenancies — can result in the tenant being awarded double damages and attorneys fees.
A little over a year ago I wrote a post on the topic of how to draft a legal 21 day letter to your tenant. Due to the continued popularity of that post I thought it would be helpful to include a video clip from a seminar that I presentedawhile back on this important topic.