Security deposit is legal — Rent Assessment Board

BY JEDIAEL CARTER Staff reporter

Saturday, January 30, 2016

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Contrary to the predominant belief, the Rent Assessment Board has stated that charging a security deposit before renting a property is indeed legal.

Chairman of the Board, Janice Nelson Brown, told the Jamaica Observer that once the deposit is in keeping with section 24 of the Rent Restriction Act, it is lawful.

"Now what section 24 basically says is that you are not to charge sums in excess of the rent or in addition to the rent which will be considered a premium or a fine," Nelson Brown explained.

Section 24, subsection 1 of the Act states that a person shall not... require the payment of any fine, premium, or other like sum, or the giving of any consideration in addition to the rent. It further outlined that where any such payment or consideration shall be paid after the commencement of this Act, the amount or value thereof shall be recoverable by the person by whom it was made or given or his personal representatives.

"The courts have interpreted that section to be that a security deposit can be charged once it is returnable based on the happening of certain events. So it’s not a situation where the rent is $10 and the security deposit is $10 and you can’t get back the security deposit. Once the deposit is returnable in certain circumstances, usually if there is no damage to the property, if there is no outstanding utilities or if there is no breach of the rental agreement then the deposit is returnable and in those circumstances it is entirely legal," she clarified.

The members of the Board in an interview highlighted that though charging a deposit is legal, the act of renting a premises without being registered as a landlord is unlawful.

They encouraged landlords to make an effort to register their properties, highlighting that it is in breach of the act.

"We still have to appreciate that not everybody is going to come in and register you have persons who might just be renting a room at the back and don’t consider themselves landlords when technically they are and so the gap is there and it is something that we have recognised that we need to look at, we just have not got to the stage yet where we can capture all of that information," Nelson Brown stated.

Senior Director of Housing Management Authrine Scarlett told the Sunday Observer that since 2008 there have been 1,589 properties registered.

"In 2008 for example there were 381 applications to be registered, in 2009 we had 303 and for last year, 2015, there were 123 applications for registration," Scarlett highlighted.

"Over the years landlords are constantly coming in for registration, we might not have them in the levels that we would want to see but they are coming in," she also stated.

This has been the Board’s reality despite the fact that the process to be registered is simple as described by the Board officials.

"Currently it is just a one-off process so once you apply to be registered you are register," Scarlett informed.

A mere $20 is also charged to complete the application.

When asked whether such a low fee affected operations, Scarlett said: "In terms of the low registration fee having an impact on the operation, it doesn’t. In fact it should be an incentive to all landlords to come and registered because the fee is so cheap."

The Rent Assessment Board is the body created under the Rent Restrictions Act, responsible for addressing disputes arising between landlords and tenants as well as issues relating to arrears of rent and security deposits.




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