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What amount of damages should Pam be allowed to collect from

1. Louis leased a building to Pam for five years at a rental of $1,000 per month; Pam deposited $10,000 as security for performance of all her promises in the lease, which was to be retained by Lois in case of any breach on Pamâ??s part. Pam defaulted in the payment of rent for the last two months of the lease. Lois refused to return any of the deposit, claiming it as liquidated damages. Pam sued Louis to recover $8,000 (the $10,000 deposit less the amount of rent due Louis for two months) What amount of damages should Pam be allowed to collect from Louis? Explain.

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This is an excellent scenario and question that many tenants face in an industry full of scamming landlords that try and make an extra buck. Fortunately for the tenant there are federal and state laws associated with landlord-tanants. The federal law is very vague and in order to narrow down the answer it would be important to name a specific State that the renter is affected. I will give you a break down of the federal laws relating to deposit requirements and I will give an example of a States deposit laws. This will ultimately lead me to the answer to your question. In addition, I will provide the references to the location of where you can find all the landlord-tenant laws for every U.S. State.

Federal Law (The last paragraph of this legal explanation pertains to your question, however, understanding where it comes from is important)

Under Federal Landlord-Tenant safety deposits a landlord, if requiring a deposit, can require a specified security deposit to simply ensure that a tenant responsibility takes care of the property that is being rented. This also ensures that the tenant follows all the terms and conditions of the written agreement when the property is rented. For example, if the landlord specifically states in the renters agreement that the renter is not allowed to have pets, but the renter brings pets into the home then the landlord can keep the deposit to replace all necessary parts of the property.

Under Federal a landlord cannot use ...

Solution Summary

1. Louis leased a building to Pam for five years at a rental of $1,000 per month; Pam deposited $10,000 as security for performance of all her promises in the lease, which was to be retained by Lois in case of any breach on Pamâ??s part. Pam defaulted in the payment of rent for the last two months of the lease. Lois refused to return any of the deposit, claiming it as liquidated damages. Pam sued Louis to recover $8,000 (the $10,000 deposit less the amount of rent due Louis for two months) What amount of damages should Pam be allowed to collect from Louis? Explain.

$2.19