Ask a lawyer:
In the event that the landlord /agent refused to refund tenant's security deposit despite a written tenancy termination letter, what action should the tenant take?

Introduction

In Kenya, the relationship between landlords and tenants is governed by various laws and regulations, including the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, the Rent Restriction Act, and the general principles of contract law as outlined in the Law of Contract Act. When a landlord or agent refuses to refund a tenant's security deposit despite a written tenancy termination letter, the tenant has several legal avenues to pursue. This response will outline the steps a tenant can take, citing relevant laws and sections.

Table of Contents

1. Understanding the Security Deposit

   • Definition and Purpose

   • Legal Framework

2. Steps to Take When Security Deposit is Not Refunded

   • Review the Tenancy Agreement

   • Written Demand for Refund

   • Mediation and Negotiation

   • Filing a Complaint with the Rent Tribunal

   • Small Claims Court

   • Civil Suit

3. Conclusion

1. Understanding the Security Deposit

Definition and Purpose

• Definition: A security deposit is a sum of money held in trust by the landlord during the tenancy period. It serves as a financial safeguard against potential damages or unpaid rent.

• Purpose: The primary purpose of a security deposit is to cover any damages to the property beyond normal wear and tear, unpaid rent, or other breaches of the tenancy agreement.

Legal Framework

• Landlord and Tenant (Shops, Hotels and Catering Establishments) Act: This Act governs the relationship between landlords and tenants in specific types of properties.

• Rent Restriction Act: This Act applies to residential properties with a monthly rent not exceeding Ksh 2,500.

• Law of Contract Act: General principles of contract law apply to tenancy agreements, including the terms related to security deposits.

2. Steps to Take When Security Deposit is Not Refunded

Review the Tenancy Agreement

• Clause on Security Deposit: The first step is to review the tenancy agreement to understand the terms and conditions related to the security deposit. This includes the amount, conditions for refund, and any deductions that may be applicable.

• Termination Clause: Check the termination clause to ensure that the termination process was followed correctly, including the notice period and any other requirements.

Written Demand for Refund

• Formal Letter: If the landlord or agent refuses to refund the security deposit, the tenant should send a formal written demand for the refund. This letter should:

  • Reference the tenancy agreement and the termination letter.

  • Specify the amount of the security deposit.

  • Provide a deadline for the refund (usually 14 days).

  • State the intention to take legal action if the deposit is not refunded.

Mediation and Negotiation

• Mediation: Before escalating the matter to legal proceedings, the tenant can seek mediation. Mediation is a voluntary process where a neutral third party helps the landlord and tenant reach a mutually acceptable solution.

• Negotiation: Direct negotiation with the landlord or agent can sometimes resolve the issue without the need for formal legal action.

Filing a Complaint with the Rent Tribunal

• Jurisdiction: The Rent Tribunal has jurisdiction over disputes between landlords and tenants, including issues related to security deposits.

• Procedure: The tenant can file a complaint with the Rent Tribunal, providing evidence such as the tenancy agreement, termination letter, and any correspondence with the landlord or agent.

• Hearing: The Tribunal will schedule a hearing where both parties can present their case. The Tribunal has the authority to order the refund of the security deposit if it finds in favor of the tenant.

Small Claims Court

• Jurisdiction: The Small Claims Court handles civil disputes involving amounts not exceeding Ksh 1,000,000.

• Procedure: The tenant can file a claim in the Small Claims Court, providing evidence of the tenancy agreement, termination letter, and any correspondence with the landlord or agent.

• Hearing: The court will schedule a hearing where both parties can present their case. The court can order the refund of the security deposit if it finds in favor of the tenant.

Civil Suit

• Jurisdiction: If the amount in dispute exceeds the jurisdiction of the Small Claims Court, the tenant can file a civil suit in the Magistrate's Court or the High Court, depending on the amount involved.

• Procedure: The tenant will need to file a plaint, outlining the facts of the case and the relief sought. This includes the refund of the security deposit and any other damages or costs incurred.

• Hearing: The court will schedule a hearing where both parties can present their case. The court can order the refund of the security deposit if it finds in favor of the tenant.

Conclusion

In conclusion, tenants in Kenya have several legal avenues to pursue if a landlord or agent refuses to refund a security deposit despite a written tenancy termination letter. These steps include reviewing the tenancy agreement, sending a formal written demand, seeking mediation or negotiation, filing a complaint with the Rent Tribunal, approaching the Small Claims Court, or filing a civil suit. Each of these steps is supported by various laws and regulations, including the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, the Rent Restriction Act, and the Law of Contract Act. By following these steps, tenants can seek to enforce their rights and obtain the refund of their security deposit.

Answered by mwakili.com

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