Property management company withholds deposit (and charges extra) at insane homeowner's instruction. What now?
May 5, 2010 2:04 PM   Subscribe

IKYANAL/IKYANML. But I would appreciate opinions from anyone who has dealt with a messy landlord situation like this, especially in Oregon.

The players:

The Good Guys
-My wife and I

The Buck Passers (Property management company)
-Helpful property manger
-Unhelpful company owner

The Homeowner
-A crazy guy we have never met or had any contact with

We recently moved from Hillsboro, OR to Raleigh, NC after renting a house in Hillsboro for 1 year. Our landlord was a Portland-area property management company, and the person who actually owns the house is nuts.

30 days after our lease ended, we received our final accounting. At the homeowner's instruction, The Buck Passers are withholding our $2,000 deposit and also sent us a bill for an extra $1,000 on top of that. Virtually all of the charges are bogus and the property management company does not dispute that. We sent them a detailed list of the disputed charges and our explanations for why we believe they are invalid. According to our (generous) accounting, only $500 worth of the charges are legit. We have asked them to either provide justification for any charges (citing the lease) or send us a check for $1500. Their position is that they are required to do whatever the homeowner instructs them to do.

We had a good relationship with this company when we lived in the house. The property manager was great and helped us out with some issues. After we moved in she warned us that the homeowner was a little crazy. There were some minor issues, for instance we cancelled DirecTV when he only wanted a dish mounted at one physically impossible point on the house. We inquired about painting a room and he wanted us to provide him with receipts for the cans of paint in his color for when we painted it back (so we didn't bother). We were always accommodating, and very helpful with showing the house to potential tenants when we were moving out. But the final accounting is completely crazy.

For instance, we had an agreement with the property manager to have the cleaning service that they normally use clean the house after we moved out. She estimated it would cost $300 (she had seen every inch of our house several times in the last month as she showed it to prospective renters). Since we had a crazy schedule for our cross-country move we figured it was worth it. On the final accounting, the homeowner charged us $1,200 for cleaning he performed himself (2 people working 40 hours at $15/hr each). This is completely insane for our small house and the property manager agrees and acknowledges that our agreement was violated.

Some other things he charged us for include re-landscaping his backyard (these items are all upgrades, not repairs), buying anti-vibration pads for his washer and dryer (there weren't any there when we lived there?), and light bulbs and batteries for smoke alarms (which we replaced at our own expense throughout the year and I have never heard of anyone being charged for). There are more and after some research I'm confident most of this stuff would not stand up in small claims court. An unpleasant but acceptable outcome would be getting rid of the $1,000 so we wouldn't have to pay The Buck Passers anything.

After we responded to their final accounting with our disputes, they said they would pass it along to the homeowner. The property manager said that our disputes were legitimate to her. The owner responded in an email that we had never agreed to a $300 cleaning fee, that was just an estimate. (We agreed but had no other figures to go on).

We asked for a response within a week (either a check or justification for the charges). All we got was an email last night (from the property manager) with this exact content:

The owner refuses to budge.

Now I should make it clear at this point that our a lease is between us and the property management company. It describes them as the Property Managers and us as the Residents. There is no mention of The Homeowner at all. Our rent was paid to the property management company. All of our communication for the past year has been with the property management company. The final accounting came from the property management company with instructions to send a check to the property management company. We have never met, communicated, or signed an agreement with the homeowner.

But the property management company (the owner at least, the property management wants nothing to do with the homeowner and doesn't communicate with him anymore) insists that their hands are tied and they have to do whatever The Homeowner tells them to.

If we took this to small claims court in Oregon, it appears we can sue for twice our deposit ($4,000) plus filing fees and (presumably) travel expenses. The owner of the property management company seems to think that his license allows him to act as an agent for The Homeowner and that he is not liable. This seems extremely suspect to me (I mean, we have a lease with them right?), but I have researched and haven't been able to find any information about this kind of situation.

At any rate, they are not disputing any of our claims that the charges are invalid, and they have not returned any of our deposit.

This is a nightmare and it's really stressing us out. We don't have a spare $1,000 lying around (and even if we did we're not paying these people a cent). The final accounting stated that they would use a collection agency if the final bill is unpaid within 30 days (although the property manager says they have only done that twice while she's worked there, and in extreme cases where people were evicted). We have spent the last couple weeks talking to them on the phone repeatedly without getting any concessions at all. We have spent a lot of time researching these topics, writing letters and compiling spreadsheets.

So yes, we will talk to an Oregon tenant lawyer, but right now we're just looking for opinions from people who have dealt with this kind of thing. Here are some of the main questions:

Does the "I'm just an agent of The Homeowner" claim hold any water?

If this goes to small claims court, should we just sue the property management company? Do we have any grounds to sue The Homeowner?

Has anyone traveled from out of state to sue an ex-landlord in Oregon small claims court? How much of an ordeal was it?

Any advice for finding a Portland-area lawyer who can help clients without money 3,000 miles away deal with this? (MeMail recommendations would be incredible)

Any other general advice or opinions? We are kind of losing our minds here.
posted by subclub to Law & Government (5 answers total) 1 user marked this as a favorite
If this goes to small claims court, should we just sue the property management company? Do we have any grounds to sue The Homeowner?

You paid the deposit to the management company, and they sent you the demand letter, right? Then I think that is who you should sue. You can certainly ask for travel expenses when you file, but don't assume you will get those even if you prevail on the rest of the $3,000. Will it be worth it if you get the $3K but not the travel expenses? Have you told the management company and the homeowner that you intend to sue them? That may sway the decision. See if you can talk to the local (Oregon) tenant's union or a similar organization.
posted by soelo at 2:51 PM on May 5, 2010

I have done extensive research on security deposits in Texas because I'm suing my landlord here. If you were in Texas, the property management company might not be correct: According to the Texas property code the definition of the word landlord "does not include a manager or agent of the landlord unless the manager or agent purports to be the owner, lessor, or sublessor in an oral or written lease."

That said, if you sued in small claims court, sue both parties and let the judge figure it out, because it can go both ways. If the management company refuses to budge, demand that they provide you with the owner's address, and then start communicating with the owner directly, via certified mail if necessary. If a couple of letters between you and the owner don't get anywhere, you could then offer the "OK, to avoid dragging this on even further, you keep the deposit, I keep the extra $1k, and we both walk away" compromise. If that fails, consult a qualified attorney in your jurisdiction. :)
posted by fireoyster at 4:33 PM on May 5, 2010

When my boss had a similar problem -- among other things, landlord wanted her to pay $200 for a cracked plastic ice tray! -- I helped her prepare for small claims court and attended the trial. She prevailed. I was pleased to see that the judge did not like the nitpicky, obviously absurd claims of the landlord.

Based on what I learned, (I am def. not a lawyer) your case is with the management company, no matter what they try to say. They're the ones you have a signed lease with. Two thoughts:

-- Pay a friend in OR $50 to go down to the courthouse, get appropriate papers, mail to you, then you mail them back, have the friend file them, etc. Sometimes this is enough to stop the management company and get you your deposit back.

-- Or, ask all your OR friends to help find a local lawyer who can draft one mean letter to the mgt. company. This may be enough to get them to drop the additional charges and get your deposit back.

Sometimes the threat is all it takes.
posted by BlahLaLa at 5:14 PM on May 5, 2010

I'm a landlord. Unfortunately, this is a shitty practice that some landlords engage in. I doubt they really expect to get the extra money from you, they just hope to bully you into acquiescing on the original deposit. What you need to do is play hardball back.

First, ignore the angels-on-the-head-of-a-pin philosophical question of who is doing this to you. Until you're sued into court, it doesn't matter a bit.

Either on your own (here's a PIRG renter's handbook: move-out law, p. 54) or with the assistance of a lawyer back in OR:

* Gather all documentation you can of the state of the apartment on departure. Photos would be great if you took them.
* Dispute every single charge.
* State that you know your rights and you are prepared to defend them in court if necessary.
* Point out that you believe your deposit is being withheld in bad faith, and you understand that under Oregon law you are entitled to double damages.
* State a date by which, if you do not receive your security deposit in full (or with any strategic amount you wish to exclude), you will file a small claims lawsuit.

Basically, call their bluff, and they'll see that you aren't going to be cowed. That may be all that's necessary.

In future, make sure you have a walk-through the property with a representative of the landlord and a checklist (required in some jurisdictions, but you can make your own) showing what is and is not damaged, and take digital photos of everything. Good luck.
posted by dhartung at 5:41 PM on May 5, 2010

Have you considered giving a friend power of attorney to file for you and then actually show up in court if it gets that far?
posted by Shark Tail at 6:52 AM on March 20, 2011

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