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Moradi v. Thomas

A-6486-96T5 (N.J. Super. App. Div. 1998) (Unpublished)

LEASES; SECURITY DEPOSITS—If at the time of termination of a residential lease, the amount owed by the tenant exceeds its security deposit, the landlord can retain the deposit without becoming liable for double the amount of the security deposit.

A lease provided for a security deposit. The tenant fell behind in rent several times and dispossess proceedings were filed and settled several times. When the tenant owed five months rent, the landlord filed a successful dispossess action.

The landlord did not return the security deposit. The lower court interpreted N.J.S. 46:8-21.1 as entitling the tenant to a credit equal to double the security deposit. The Appellate Division reversed because it interpreted the language of the statute that provides for a doubling of the security deposit to do so only to the extent that a tenant is entitled to a net recovery. Here, the tenant was not entitled to a net recovery. In fact, the amount of the outstanding rent far exceeded the deposit. Lanzi v. North, 295 N.J. Super. 80 (App. Div. 1996) was held to be not to the contrary. In Lanzi, the tenant was entitled to a doubling of its deposit because its landlord did not return the deposit for almost one year, and the tenant’s deposit exceeded the amount of rent due.


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