B.C. landlord tries using deposit as rent credit and it backfires | Daily Hive

B.C. landlord tries using damage deposit as rent credit and it backfires

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A seemingly amicable landlord and tenant relationship in B.C. turned sour due to a dispute over a rent deposit.

The Residential Tenancy Branch posted a dispute decision earlier this month, after a tenant submitted an application for a recovery of the security deposit ($1,325) as well as the filing fee for the application ($100).

According to the decision, the tenancy began on Nov. 15, 2024. The monthly rent was $2,650, and the deposit was half that amount; the tenant also paid an additional $1,325 for a pet deposit. The decision goes on to say that the tenancy ended in May 2025 and that the tenant agreed for the landlord to keep $150 for cleaning and damages.

The remaining balance owed to the tenant as of May 2025, including interest, was $2,526.31.

When the tenancy ended, the tenant began a new tenancy in a different rental unit but with the same landlord.

“Rent for the new rental unit is $1,900, and deposits for the new unit were required
and paid,” the RTB decision states.

However, instead of returning the $2,526.31 to the tenant, the landlord credited it to the account for the new tenancy. The landlord used $1,900 of that amount to pay for the tenant’s rent for July 2025.

“The remaining $626.31 was initially held as a credit for further owed future rent,
but was returned to the tenant in person after repeated requests by the tenant for its
return. The Agents stated that it was returned on June 30, 2025, and the tenant stated
that it was returned on either July 1, 2025, or July 2, 2025,” the RTB’s decision reads.

The tenant sent numerous emails requesting the return of the deposit.

“The tenant stated that despite these requests, the landlord refused to withdraw the $1,900.00 in rent from their account in accordance with their PAD agreement for July 2025 rent, and instead used their previous security and pet damage deposit for this without their consent. The tenant stated that they are therefore owed double the $2,526.31 that was owed to them as of May 31, 2025, less the $626.31 returned.”

The respondent disagreed with the suggestion that they owed double the amount.

The RTB said while it appreciated the landlord’s position, the landlord wasn’t entitled to keep the deposit against the tenant’s wishes. RTB’s decision insinuates that the landlord felt that returning the deposit would’ve been administratively tedious.

“Section 38(6) of the Act states that if the landlord does not return the security and pet
damage deposit or file a claim against the tenant within fifteen days, the landlord must
pay the tenant double the amount of the security and pet damage deposit,” the RTB notes.

Ultimately, the result of the rent dispute meant the B.C. landlord was ordered to pay $4,500, which included the $100 for the application filing fee, and the return of double the deposits, plus interest, minus the amount already returned.

RTB

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