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Do rental deposits need to be returned? B.C. tribunal rules in favour of would-be tenant who changed his mind

A "room available" sign is seen in this undated image. (Shutterstock) A "room available" sign is seen in this undated image. (Shutterstock)
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A would-be tenant will get his rental deposit back even though he backed out of his agreement before moving in, B.C.'s Civil Resolution Tribunal ruled.

The decision, posted Wednesday, outlined a dispute between a potential tenant and a person renting out a room in their home. The potential roommate paid a $250 deposit in August 2021, but when he cancelled his plans, that deposit wasn't returned to him.

The tribunal heard the would-be renter was told he didn't get a refund because the two allegedly agreed that would only happen if a new roommate was found by the end of the month.

In his decision, Richard McAndrew wrote the two did not have a formal rental agreement signed. The person looking to rent the room paid his deposit on Aug. 1, but sent a text message the next day saying he'd changed his mind.

In applying to get his refund back, the potential tenant denied agreeing that he should only get his deposit back if a replacement roommate was found.

McAndrew's decision said the man instead "demanded an immediate, full deposit refund."

"The issue of whether the applicant is entitled to a deposit refund depends on the parties’ original rental agreement," McAndrew wrote.

McAndrew said in his decision both individuals "intended to be bound by the deposit to secure the room rental," since it was paid one month before the room rental was supposed to start.

"So, when the applicant withdrew, he breached the parties' contract. This does not mean, however, that the respondent is entitled to keep the deposit," McAndrew wrote.

"I find that the respondent is only entitled to keep any portion of the applicant’s deposit necessary to offset the damages suffered from his breach of contract. The respondent has the burden of proving that they suffered any such loss or damage."

While the person renting out the room claimed they had a hard time finding a replacement, the initial would-be tenant said the rental listing was taken offline.

"The applicant texted the respondent on Aug. 5, 2021 asking if they found a new roommate because the listing was gone," McAndrew wrote.

"Further, the applicant says that he also checked the classified listing service on Aug. 9, 2021, Sept. 7, 2021 and Oct. 28, 2021 and he says that the respondent's roommate listing was not displayed on any of those dates, which the respondent did not dispute."

McAndrew determined the individual looking for a tenant "voluntarily stopped posting their advertisement" and "likely did so because they had found a new roommate by then" or because they'd decided they didn't want to rent the room out anymore.

As a result, McAndrew said the person renting out the room didn't prove they suffered in any way from the cancelled tenancy and ordered the deposit be returned. In addition, the would-be tenant was awarded just over $125 to cover CRT fees and some interest. 

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