Maine has very specific laws that protect the rights of residential tenants. It is very easy for an unsuspecting (or willfully ignorant) landlord to violate those rights. These problems often arise at the end of tenancy.
Maine has very specific laws regarding the handling of security deposits. A Landlord can keep a security deposit only for specific reasons and must follow a specific course of action.
I. A Landlord must have a valid reason to keep any of the Security Deposit.
First, a Landlord may keep all or a portion of the Security Deposit to pay for certain things:
(1) Damage caused by the Tenant that exceeds normal wear and tear
(2) Unpaid rent
(3) Unpaid utility charges
(4) The costs of storing and disposing the Tenant’s unclaimed personal property
- Don’t Charge for normal wear and tear: A landlord cannot keep the security deposit for normal wear and tear. Do not charge for routine upkeep. You can only charge for damage beyond wear and tear.
Examples of things you cannot charge for: old carpets, chipped or faded paint, worn finish on wood floor, damage from storms, fire damage caused by someone other than the Tenant, vandalism by someone other than the Tenant.
Examples of things you can charge for: broken windows, holes in the wall, trash or other items that have to be thrown away, installing new locks because the Tenant kept the keys.
- Interest: Unless there is an agreement to do so, the Landlord does not have to pay the Tenant interest when returning a security deposit. If the property is subsidized housing, check the Lease and confirm with the housing authority.
II. A Landlord must quickly either return the Security Deposit or mail a letter detailing what the Security Deposit is being used to pay.
The Landlord must either (1) return to the Tenant all of the security deposit or (2) send the Tenant letter to the Tenant’s “last known address” that explains and itemizes how the proceeds of the Security deposit are being spent (and returning any remaining, unused portion of the Security Deposit.)
- Beware of Deadlines: The amount of time a Landlord has to do this depends on whether the Tenant had a lease.
If there is a written rental agreement, then the Landlord must take action within the time stated, not to exceed 30 days.
If it is a tenancy at will, then the Landlord must take action “within 21 days of the termination of the tenancy or the date the Tenant leaves, whichever occurs later.”
- WARNING: Even if the last known address of the Tenant is the vacated rental unit, the Landlord should still send a certified letter to that address. It is possible that the Tenant gave the post office a forwarding address. Regardless, if the Landlord don’t send the letter, you may be liable to the Tenant for double the amount of the security deposit.
Abandoned Personal Property
Ultimately, a Landlord is allowed to dispose of abandoned personal property (and charge the costs to the Tenant), but only after following certain steps.
First, the Landlord must store everything in “a safe, dry, secured location.”
Second, the Landlord must send written notice to the Tenant by first-class mail with proof of mailing to the last known address of the Tenant. That notice must list the property that is being stored and state that the Landlord intends to dispose of the property. The notice should further state that if the Tenant does not respond to the notice within 7 days and pick everything up within 14 days, then the Landlord will
- dispose of any property that has no reasonable fair market value; and
- either (a) return the property only if the Tenant pays for rent owed, damages, and costs of storage or (b) sell the property for fair market value and “apply all proceeds to rental arrearages, damages and costs of storage and sale. All remaining balances must be forwarded to the Treasurer of State.”
Only then, after the 7 or 14 days has elapsed, can the Landlord dispose.
• WARNING: Don’t throw away any valuable stuff: Under Maine law, a Landlord must sell anything that has “reasonable fair market value” and apply the proceeds to the debts for rent, damages, and storage/sale costs.
• BIG EXCEPTION: At the time the Tenant is moving out (or afterwards), the Tenant can waive these rights to their abandoned property. However, the Landlord needs to either get this waiver in writing from the Tenant, or confirm the waiver in writing to the Tenant. So have the Tenant send you an e-mail or note telling you that they do not want any property that they leave behind and that you can do whatever you want with it.
A judge will not award money damages in an eviction case. If the Tenant owes the Landlord more than the amount of the security deposit, then the Landlord may sue the Tenant in a separate lawsuit.
Here are a few things to consider:
- Choice of Court: After the security deposit is deducted, if the amount owed is less than $6,000, then then the Landlord may choose to bring the matter either in Small Claims Court or in District Court (for a trial before a judge) or even Superior Court (for a jury trial). Small claims court is quicker, takes less attorney fees, and is otherwise less expensive than the other Court proceedings. However, Small Claims Court allows only for damages less than $6,000 (though it is possible to also be awarded court costs). Even if the amount owed is more than $6,000, it may be overall better to elect to pursue only $6,000 to be able to go through Small Claims Court.
- Attorney’s Fees: A Landlord may collect attorney fees only if the lease provides for “the award of attorney’s fees to the prevailing party after a contested hearing to enforce the lease or tenancy at will agreement in cases of wanton disregard of the terms of the lease.” In other words, a court will not award attorney’s fees if the lease is silent about Attorneys’ fees or if the lease merely states that the Tenant will pay the Landlord’s attorneys’ fees. For a Court to award attorney’s fees, the lease must state that either party shall be entitled to attorney’s fees if they win.
For additional information, please see Pine Tree Legal Assistance. Their fabulous website was one source for this post.
Andy Pierce represents both Landlords and Tenants. If you would like to speak to Andy, please contact Drummond & Drummond.