I manage a property for a husband and wife who both signed a Residential Leasing and Property Management Agreement (TAR 2201). After the tenant vacated, the wife called to inform me of her split from her husband and asked me to forward the tenant’s security deposit to her, so she could make improvements to the property. She planned to live there until matters were settled with her husband. The husband also called. He asked that I return the security deposit to the tenant, less any deductions for damages beyond normal wear and tear. I took deductions from the security deposit and the sent the balance, along with a written description and itemized list of deductions, to the tenant. Will I be liable to the wife since I’ve already refunded the remainder of the security deposit to the tenant? Will I be liable to the tenant if the tenant disputes the deductions I’ve taken?

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  • I manage a property for a husband and wife who both signed a Residential Leasing and Property Management Agreement (TAR 2201). After the tenant vacated, the wife called to inform me of her split from her husband and asked me to forward the tenant’s security deposit to her, so she could make improvements to the property. She planned to live there until matters were settled with her husband. The husband also called. He asked that I return the security deposit to the tenant, less any deductions for damages beyond normal wear and tear. I took deductions from the security deposit and the sent the balance, along with a written description and itemized list of deductions, to the tenant. Will I be liable to the wife since I’ve already refunded the remainder of the security deposit to the tenant? Will I be liable to the tenant if the tenant disputes the deductions I’ve taken?

No. The wife is not automatically entitled to the security deposit. If the tenant has caused damage to the property beyond normal wear and tear, both the wife and the husband are entitled to the funds, not just the wife. Furthermore, the Residential Leasing and Property Management Agreement (TAR 2201) authorizes you, as the property manager, to account for the security deposits you hold in a trust account and take any deductions from the deposits in accordance with the lease and the Property Code. Hence, you will not be liable unless you’ve failed to account for the security deposit. Also, you will not be liable to the tenant if the tenant disputes the deductions you’ve taken, because the agreement indemnifies you from any claim or loss from a tenant for the return of the security deposit.

Source: TAR

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