What to do when your landlord eats deposit money

Occasionally, between 2018 and 2020, Mr Daniel invited his house agent, through whom he paid his rent, for a cup of tea.

They discussed everything from politics, to security or lack of it thereof in the neighbourhood, and had an enviable rapport. The agent often praised Daniel for being a good tenant whose rent was always paid on time.

Then the time came for Daniel to vacate the house.

“I had found a better-furnished house that was nearer the road. I had been living over a five-minute walk away from the road. As a good tenant, I wrote to him (the agent) and called to inform him that I would be leaving at the end of that month,” Daniel says. The agent agreed to inspect the house immediately.

He said everything was intact except for the usual one coat of fresh paint to give the house a facelift once Daniel had vacated. The balance from the deposit that Daniel had paid upon entering the house was, after deducting expenses for repainting, Sh7,000.

What followed was a series of phone calls to follow up on the money which the agent promised to send in a week’s time after Daniel had left.

“When the end of the month came and he had not sent the money, I let it be. I calculated what I was losing every time I called or made a visit to his agency office. I later learned he had an unwritten policy - to never refund deposits. He was paying himself for his work as an agent.”

Many complaints later, the agent was fired by the landlord. By that time, in the apartments in Gachie, Kiambu County, the tenancy was dipping at an alarming rate.

Ms Chelagat lived in a rental house in London estate, Nakuru. Cases of insecurity in the neighbourhood, however, rattled her. An immediate neighbour one day found her house broken into and the landlord’s reaction petrified Ms Chelagat.

“The landlord blamed the tenant for masterminding the robbery. Just how I wondered, could one plan to have their house robbed?” she says. The tenant did not get her deposit refund.

That same month, two other houses were broken into in the dead of the night. Ms Chelagat had paid a Sh500 viewing fee, a deposit equal to one month’s rent and a water fee prior to occupation. But at the end of that month, she left silently, only sending the landlord a message on her cellphone and leaving her Sh16,500 deposit behind.

Such cases of landlords, caretakers and agents showing hesitancy to refund tenants’ security deposits abound.

Fresh out of university, Mr Maxwell Ombati rented a house in Uthiru in 2019. He paid Sh8,000 deposit and moved into the house. When he eventually decided to leave, the landlord charged him Sh3,300 for buying paint and repainting, Sh2,100 for the shower installation and Sh300 for garbage. Mr Ombati took home Sh2,300.

“That last month, with all the rent cleared, the landlord still locked my house because I was not around,” says Ombati.

In some instances, like what happened to Ms Mary Mwangi, a media practitioner, the deposit one pays ahead of occupancy is termed non-refundable.

With their patience stretched, tenants often leave their deposit money with the landlords. The hassle and pain to try to get the money refunded are, for many, too much.

And landlords, caretakers and agents revel in the immunity that hapless Kenyans have granted them over time. They continue to charge and enjoy deposits, frustrating tenants all the time.

Mr Anthony Mutugi had been harassed by his landlord over the late payment of rent in Nakuru when his time to leave came just a month later. He demanded his deposit with the same vigour his landlord had demanded rent.

However, Mr Mutugi had to wait and only got his due months later.

Mr Jackson Lungwe, a lawyer, says that landlords prepare the standard tenancy agreement that is made to favour them over their tenants. Once signed, including by the tenant, it is binding.

“The agreement that the tenant has with their landlord is binding. Of course, such an agreement is drafted by the landlord with their best interests at heart,” he says.

Commercial premises, however, enjoy controlled tenancy. Controlled tenancy, according to the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, means a tenancy of a shop, hotel or catering establishment, and which has not been reduced into writing or, if reduced into writing, is for a period not exceeding five years. It should also contain a provision for termination, otherwise than for breach of covenant, within five years from the commencement.

If a tenant has an issue with the refund of the deposit, they could access the Business Premises Rent Tribunal. This tribunal was established in 1965, with a key mandate of making provisions with respect to certain premises for the protection of tenants of such premises from eviction or from exploitation and for matters connected therewith and incidental thereto.

Its key roles are assessment of rent, re-possession of premises by landlords, distress for rent by landlords and hearing and determination of general complaints in controlled tenancies.

“Beyond the five years (as stipulated in the Act for controlled tenancy), a tenant can go to court to claim the deposit,” Mr Lungwe says.

For a residential house, where a dispute arises over the refund of deposit money, one files a case with the Rent Restriction Tribunal under the contract.

The lawyer, however, says that the devil is in the little details that the tenant might overlook when signing a lease agreement. He says that potential tenants should make sure they are comfortable with the terms of the agreement before signing it.

“Negotiate with your interests at the fore,” he says. “Bargain well and only settle for what is deliverable.”

A law that is under development for landlords and tenants, he says, might help in addressing some of the pertinent issues that are often in the grey and that are not subject to much legal scrutiny because of the absence of a framework for the same.

The Kenya Alliance of Resident Associations Chief Executive Henry Ochieng - the umbrella body representing resident associations on consumers’ and taxpayers’ rights in Kenya, says that the lease agreement signed ahead of occupying a house defines the responsibilities of either party involved.

The deposit paid, he says, is security in place in case a tenant defaults on payment, and also to ensure that the house is in a good state when the tenant exits. “The agreement would have the tenant agreeing to renovate the house and then claiming the deposit or foregoing the deposit because that is what the landlord will use to do renovations,” Ochieng says.

The expenditures that the landlord presents to the tenant for the renovations should be sensible. In case of a dispute, the parties can use the services of a mediator, and later the rent and dispute tribunal as the first court of call.

Some tenants ensure no deposit is lost by staying on for one extra month, famously known as “sitting on the deposit”. This means they expect no refunds from the landlords when they eventually vacate.

However, this is subject to a tenant’s ability to leave the house precisely as they found it, with renovations done. Most contracts are about a tenant making ensuring the next tenant finds the house in the conditions it was when he or she entered.

And because most caretakers are hired, for this reason, the maintenance of the standards of a house, they prefer to do it themselves then leave it to the tenant. It is also required by law that the landlord of a controlled tenancy keeps a rent book in the prescribed form, of which he shall provide a copy for the tenant and in which shall be maintained a record, authenticated in the prescribed manner, of the particulars of the parties to the tenancy and the premises comprised in it, and the details of all payments of rent and of all repairs carried out to the premises.

Further, whenever an agent is appointed, the particulars of such agent shall be recorded in the rent book and authenticated by the landlord’s signature. The contract signed by the landlord and the tenant should be clear and binding.