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Chatterjee v. Iero

380 N.J. Super. 46, 880 A.2d 496 (Law Div. 2005)

LEASES; SECURITY DEPOSITS—No matter how described, even as a pet deposit or as a pet damage deposit, the maximum aggregate residential security deposit remains one and one-half months’ rent.

A tenant rented an apartment. As a condition for entering into the lease, its landlord required three deposits: a security deposit, a “non-refundable pet deposit,” and a “refundable pet deposit.” Later, the landlord sued the tenant for rents and damages. The tenant filed a counterclaim against the landlord, asserting that the landlord violated the security deposit law. In New Jersey, the amount of the security deposit a landlord may charge a residential tenant is limited to an amount equal to one and one-half times the monthly rent. The landlord argued that the pet deposit was not covered by New Jersey’s security deposit law. Rather, the landlord claimed that the pet deposit was a separate agreement that was not intended to be part of the security deposit. Rather, it was intended to compensate the landlord for damage specifically caused by the pet. As support for its position, the landlord pointed to the fact that the pet deposit clause was not included in the same section of the lease as the security deposit. It also pointed out that the pet deposit was paid by separate check, not as part of the security deposit. The Court, noted that when interpreting a statute, one must look to the plain meaning of its words. The section of the security deposit law that deals with the monetary limits of the security deposit is entitled, “Limitation on amount of deposit.” The Court found that the use of the word “limitation” clearly demonstrated the legislature’s intent to cap the amount of security a landlord could charge a residential tenant to secure performance under the lease. It did not matter how a deposit was characterized, as long as the total amount being held by the landlord did not exceed one and one-half months’ rent. The Court rejected the landlord’s argument that the parties intended the pet deposit to be outside the scope of the security deposit law. It noted a later section in the security deposit law, declared as void any attempted waiver of the requirements of the security deposit law.

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