Security Deposits

Landlord keeps security deposit, tenant sues for double damages

Ostovich v. Sanderson, Court of Appeals of Wisconsin, District. Two, No. 98-0260-FT (1998)

Question before the court:

      Does a landlord have to prove he followed the Security Deposit Law to avoid damages?

Facts of the case:

      Tenant, Ostovich rented an apartment in July 1996. She moved out when her lease ended on July 31, 1997. Her security deposit was never returned, nor did she receive a statement itemizing deductions from the deposit. Wisconsin law required landlords to return security deposits with an itemized statement, if any damages were withheld, within 21 days after a tenant vacated an apartment.

      Ostovich sued the landlord for double damages. According to Wisconsin law, any tenant suffering monetary losses because of a landlord's failure to return a security deposit within 21 days could sue for twice the amount of his or her damages.

      The landlord claimed he asked Ostovich for her forwarding address so he could mail the security deposit check to her, but she refused to give i to him. According to the landlord, Ostovich said to mail the check to her last known address, which was his rental property. He claimed he mailed the security deposit check and an itemized list of damages to her last known address on Aug. 21, 1997, and that neither the letter nor the check was ever returned.

DECISION for tenant:

      The court, finding Ostovich's story most likely, ruled for Ostovich and awarded her double damages, plus court costs and attorney's fees.

      The landlord appealed, arguing the court acknowledged he mailed the letter in a timely fashion when it said he wasn't trying to unfairly profit from Ostovich's deposit because he returned $604 of her $1,000 deposit. The landlord also argued that because the court stated both his story and Ostovich's story were believable if considered independently, the court acted against the weight of the evidence by ruling in favor of Ostovich.

DECISION: Affirmed.

      The trial court was in the best position to evaluate the credibility of Ostovich and the landlord, because that court actually saw and heard the testimony. Therefore, the appeals court couldn't overrule the trial court's judgment unless the evidence indicated the trial court's decision was clearly wrong.

      When the court said it was clear the landlord wasn't trying to profit from Ostovich's deposit, the court was saying the damages the landlord assessed against the security deposit were reasonable - not that the check was mailed within the 21-day period. Because the court didn't find the landlord returned the deposit in a timely manner, it didn't have to consider the landlord's assertion - that by merely mailing correspondence, he could assume the correspondence was delivered and received.

      Although the trial court said both stories were believable and both parties testified honestly regarding their beliefs about "what was due and what wasn't due," this didn't mean the court improperly ruled in Ostovich's favor. The first statement simply indicated both the landlord's testimony and Ostovich's testimony were somewhat credible; the second statement merely addressed the reasonableness of the damages deducted from the deposit. A court's decision didn't have to be overturned merely because some evidence could have supported a different ruling.

 Also see: Cogswell v. Robertshaw Controls Company, 274 N. W.2d 647 (1979). State v. Bunch, 529 N. W.2d 923(1995).