HOUSE BILL 331

53rd legislature - STATE OF NEW MEXICO - first session, 2017

INTRODUCED BY

Elizabeth "Liz" Thomson

AN ACT

RELATING TO PROPERTY; DEEMING LANDLORDS TO HAVE COMPLIED WITH THE REQUIREMENT TO RETURN TENANT DEPOSITS AND ITEMIZED STATEMENTS OF DEDUCTION BY MAILING THE STATEMENT AND ANY PAYMENT BY CERTIFIED MAIL.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. Section 47-8-18 NMSA 1978 (being Laws 1975, Chapter 38, Section 18, as amended) is amended to read:

     "47-8-18. DEPOSITS.--

          A. An owner is permitted to demand from the resident a reasonable deposit to be applied by the owner to recover damages, if any, caused to the premises by the resident during [his] the term of residency.

                (1) Under the terms of an annual rental agreement, if the owner demands or receives of the resident [such] a deposit in an amount greater than one month's rent, the owner shall be required to pay to the resident annually an interest equal to the passbook interest permitted to savings and loan associations in this state [by the federal home loan bank board] on such deposit.

                (2) Under the terms of a rental agreement of a duration less than one year, an owner shall not demand or receive from the resident [such] a deposit in an amount in excess of one month's rent.

          B. It is not the intention of this section to include the last month's prepaid rent, which may be required by the rental agreement as a deposit as defined in Subsection [D] E of Section 47-8-3 NMSA 1978. Any deposit as defined in Paragraph (1) of Subsection A of this section shall not be construed as prepaid rent.

          C. Upon termination of the residency, property or money held by the owner as deposits may be applied by the owner to the payment of rent and the amount of damages [which] that the owner has suffered by reason of the resident's noncompliance with the rental agreement or Section 47-8-22 NMSA 1978. No deposit shall be retained to cover normal wear

and tear. In the event actual cause exists for retaining any portion of the deposit, the owner shall provide the resident with an itemized written list of the deductions from the deposit and the balance of the deposit, if any, within thirty days of the date of termination of the rental agreement or resident departure, whichever is later. The owner is deemed to have complied with this section by mailing by certified mail the statement and any payment required to the last known address of the resident. Nothing in this section shall preclude the owner from retaining portions of the deposit for nonpayment of rent or utilities, repair work or other legitimate damages.

          D. If the owner fails to provide the resident with a written statement of deductions from the deposit and the balance shown by the statement to be due, within thirty days of the termination of the tenancy, the owner:

                (1) shall forfeit the right to withhold any portion of the deposit;

                (2) shall forfeit the right to assert [any] a counterclaim in [any] an action brought to recover that deposit;

                (3) shall be liable to the resident for court costs and reasonable [attorneys'] attorney fees; and

                (4) shall forfeit the right to assert an independent action against the resident for damages to the rental property.

          E. An owner who in bad faith retains a deposit in violation of this section is liable for a civil penalty in the amount of two hundred fifty dollars ($250) payable to the resident."

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