Tenant Security Deposit

[Gruffin]

Hello, and thank you for taking the time to help with my question.

I was wondering if I put down a security deposit when I rented a retail space and the landlord lost the property back to the bank a couple years later while I was still a tenant. Are they still liable for the security deposit?  The bank told me they did not get any security deposit from the owner when they took back the property back from him.

Thanks for all your help.

Cory

[Veto]

Hello, and thank you for taking the time to help with my question.

I was wondering if I put down a security deposit when I rented a retail space and the landlord lost the property back to the bank a couple years later while I was still a tenant. Are they still liable for the security deposit?  The bank told me they did not get any security deposit from the owner when they took back the property back from him.

Thanks for all your help.

Cory

[Worrell]

Cory-

I do not know the answer to your question; however it presents an interesting situation.

The bank took over the property where you have your retail space and I assume they have accepted the terms of your lease - or they would have asked you to move-out when they took control of the property. If they did not provide you with a new lease at that time, and they have honored the terms of your lease for the last few years, it seems unfair for them to say that they do not recognize the fact that you had posted a security deposit with the landlord.

Check your lease text, many leases actually stipulate if the bank or other new owner of the property is responsible for your security deposit if in fact the original owner does not transfer the deposit funds to the successor interest in the property.

In your next lease, specify that the landlord must return the security deposit to you upon transfer of the property and that the landlord remains liable for the deposit amount if it fails to return the security deposit to you.

-Jim