SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
A-5390-94T1
J.C. MITCHELL,
Plaintiff-Respondent,
v.
FIRST REAL ESTATE EQUITIES, INC.,
a New Jersey Corporation,
Defendant-Appellant.
________________________________________
Submitted February 14, 1996 - Decided February 29, 1996
Before Judges Baime, Villanueva and Kimmelman.
On appeal from the Superior Court of New
Jersey, Law Division, Special Civil Part,
Union County.
Feinstein, Raiss & Kelin, attorneys for
appellant (Jessica L. Rogin, on the brief).
Respondent, J.C. Mitchell, did not
file a brief.
The opinion of the court was delivered by
KIMMELMAN, J.A.D. (temporarily assigned).
Defendant appeals from a Special Civil Part award of double
damages in the amount of $758, for failure to refund to plaintiff
the balance due on a security deposit pursuant to N.J.S.A. 46:8-21.1. We reverse and remand for the entry of judgment in
accordance with this opinion.
The facts are relatively simple and not in dispute. The
matter resolves itself into a determination as to when the lease in
question was terminated and a mathematical calculation of the
amount due. Plaintiff, as tenant, was subject to a one-year lease
of an apartment located at 157 West Third Avenue, Roselle, New
Jersey. The lease ran for a term from June 1, 1994, through June
1, 1995, at a monthly rental of $620. A security deposit with
accumulated interest amounted to $979 and was held by defendant as
landlord.
On February 7, 1995, without notice and without payment of the
February rent, plaintiff surreptitiously vacated the apartment.
After being informed by the building superintendent that the
apartment was vacated, defendant notified plaintiff by letter dated
February 15, 1995, sent by certified mail, that plaintiff "broke
the lease agreement" and that rent for February 1995 and March 1995
totaling $1314 would be charged against the security deposit of
$979, leaving a balance due defendant of $335. Immediate payment
of $335 was demanded.
In an attempt to mitigate damages, defendant was able to re-rent the apartment commencing March 3, 1995, at a monthly rental of
$600 or $20 per month less than the rent plaintiff was required to
pay for each of the three months remaining under plaintiff's lease.
On March 6, 1995, plaintiff filed a pro se complaint in the
Special Civil Part for the return of the security deposit of $979
claiming that he moved out on February 5, 1995, and that defendant
had not returned his security deposit. Whether plaintiff moved out
on February 5, 1995, or on February 7, 1995, as claimed by
defendant, is not now material.
At the trial, defendant's counsel conceded owing plaintiff
$359 but offered no calculation to support that figure.
Nevertheless, the trial court, without inquiring as to the method
of calculation, accepted that figure, doubled it because the
balance of the security deposit had not been returned to plaintiff
within 30 days of February 5, 1995, and arrived at a judgment of
$758See footnote 1 plus court costs. Simply put, the trial court, without
taking any testimony, failed to consider that it was plaintiff who
breached the lease.
The preliminary issue is when the 30-day period for the
doubling of security deposit funds begins to run. N.J.S.A. 46:8-21.1 provides in pertinent part as follows:
Within 30 days after the termination of the
tenant's lease . . ., the owner or lessee
shall return by personal delivery, registered
or certified mail the sum so deposited plus
the tenant's portion of the interest or
earnings accumulated thereon, less any charges
expended in accordance with the terms of a . .
. lease . . . to the tenant . . . . The
interest or earnings and any such deductions
shall be itemized and the tenant . . .
notified thereof by personal delivery,
registered or certified mail.
. . . .
In any action by a tenant . . . for the
return of moneys due under this section, the
court upon finding for the tenant . . . shall
award recovery of double the amount of said
moneys, together with full costs of any action
and, in the court's discretion, reasonable
attorney's fees.
Here, the plaintiff's (tenant's) lease ran until June 1, 1995,
and was not terminated by plaintiff's premature vacation of the
apartment whether it was on February 5, 1995 or February 7, 1995.
Plaintiff's moving out was a breach of the lease rather than a
termination within the meaning of the statute. Accordingly, the
30-day period within which the security deposit must be returned
did not commence to run on either of said dates. Because of
defendant's successful effort at mitigation, we regard the
termination of the lease to have been March 3, 1995, the date on
which defendant was able to re-let the apartment and definitively
determine its damages. Under such circumstances, the statutory 30-day period would then begin to run.
As noted above, on March 6, 1995, plaintiff filed a complaint
in the Special Civil Part to recover double the amount of the $979
security deposit alleging that he moved out on February 5, 1995 and
30 days had elapsed without its full return. Plaintiff, in his
complaint, ignored mention of defendant's letter of February 15,
1995, advising him that the lease ran until June 1, 1995, and that
his security deposit was insufficient because rent was claimed for
the months of February and March. Apparently, when the complaint
was filed, plaintiff was unaware that defendant had been able to
re-let the apartment just three days earlier. Thus, the filing of
the complaint was premature because, as far as plaintiff knew or
should have known, he had breached the lease and it had not been
terminated by his earlier moving out without paying the February
and March rent.
The filing of the complaint, for the purpose of recovering
double damages under N.J.S.A. 46:8-21.1, was also premature since
the statutory 30-day period, which we now hold commenced on the
date of the re-letting, had not yet expired. The date of the re-letting determines the date of the "termination" of the breached
lease under N.J.S.A. 46:8-21.1 because that date establishes the
earliest time when the landlord can fix damages and determine the
amount of the security deposit that may be retained or must be
returned.
As of March 3, 1995, defendant's damages are calculated as
follows: $620, being the rent due for February 1995, and $60,
equal to $20 per month lost by defendant because of the lower
rental being received for each of the three months remaining under
the breached lease.See footnote 2 Thus, the aggregate of the damages incurred
by defendant is $680 and deducting that sum from the security of
$979 leaves a balance due plaintiff of $299.
In our view, the premature filing of the complaint before the
running of the statutory 30-day period bars plaintiff from
recovering double the amount due. It was not until the March 3,
1995 re-letting that plaintiff became entitled to any recovery of
his security deposit.
Accordingly, the judgment appealed from is reversed and this
matter is remanded to the Special Civil Part with instructions to
enter judgment for $299 in favor of plaintiff without costs and
without attorney's fees.
Footnote: 1 The amount of $758 was erroneous in and of itself because earlier in the hearing the court calculated the total judgment to be $718 plus court costs of $25.00. Footnote: 2 We have chosen to ignore that part of paragraph 3 of the lease which calls for a late charge of $75 for a rental payment more than 5 days late. It would appear that $75 is excessive in relation to a monthly rental of $620. Defendant makes no claim for the late fee as part of its damages, perhaps for the same reason. Neither does defendant make claim for an administration fee of $75 under paragraph 8 of the lease to cover its costs for processing the re-letting of the apartment.