Matthew Hung, Claimant(s), v. Enealia Nau, Defendant(s). (2026)

BACKGROUND

Claimant brought this case against his former landlord to recover his security deposit with interest from November 1, 2025, and for breach of warrantee of habitability, for a total of $10,000. In October of 2023, claimant entered into a one-year lease agreement with defendant, which ran from October 1, 2023, to September 30, 2024. The lease was renewed from October 1, 2024 to September 30, 2025, and thereafter the lease was not renewed, turning the occupancy to month-to-month tenancy from October 1, 2025.¹ He put down $3,400 as security deposit, which was never returned to him upon holding over his tenancy.

On March 17, 2026, claimant gave notice to defendant, via text message, that he would move out by April 4, 2026, with no objection from defendant. Claimant actual move out date was April 10, 2026. This was less than a 30-day notice, as well as 10 days into the new month. Claimant acknowledged the extra 10 days and proposed paying prorated rent for that period. Claimant and defendant agree that claimant made efforts to assign his tenancy, however, those efforts did not materialize before claimant moved out on 04/10/2026, leaving the space without an occupant. It is also undisputed that defendant did not provide claimant with an itemized statement setting forth grounds for withholding his security deposit within 14 days of the vacatur, as provided by General Obligations Law § 7-108.

In defense, defendant argues that; 1) she was not required to provide itemized statement for the retained deposit because claimant broke his lease, that the statute does not apply to broken leases; 2) claimant did not give 30-day notice of his vacatur, and that no New York State law allows for pro-rating of a month-to-month lease; 3) you do not get security deposit if you move out mid-month owing rent.

DISCUSSION

Security deposit belongs to the tenant and must be returned to the tenant upon vacating the premises, within 14 days of the tenant moving out of the premises. See GOL 7-103(1). See also Gable v. Cahill, 69 Misc 3d 128(A) (NY App. Term. 2020). The law also states that the landlord must provide the tenant with itemized statement detailing the basis for withholding any portion of the deposit within 14 days. General Obligations Law ("GOL") § 7-108 prescribes:

This section shall apply to all dwelling units in residential premises, unless such dwelling unit is specifically referred to in section § 7-107 of this title.

(1-a)(e) Within fourteen days after the tenant has vacated the premises, the landlord shall provide the tenant with an itemized statement indicating the basis for the amount of the deposit retained, if any, and shall return any remaining portion of the deposit to the tenant. If a landlord fails to provide the tenant with the statement and deposit within fourteen days, the landlord shall forfeit any right to retain any portion of the deposit.

'A tenant's security deposit remains the property of the tenant but may be held by the landlord "as security to the performance of the contract or agreement" and must be returned at the conclusion of the tenancy, absent proof, for example, that the tenant caused damage beyond that attributable to ordinary wear and tear.' Gable v. Cahill, supra (quoting GOL § 7-103(1), citing Quijano v Rowinski, 64 Misc 3d 128[A], 2019 NY Slip Op 50990[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019]).

Defendant argues that claimant was not entitled to an itemized statement detailing basis for the amount of deposit retained because he moved out in the middle of his month-to-month tenancy, thereby forfeiting the deposit in lieu of that month's rent. Basically, defendant is arguing that GOL§ 7-108 would not apply where deposit is retained for rent owed. The court disagrees. GOL 7-108(1-a) (b) clearly states in pertinent part, as follows:

The entire amount of the deposit or advance shall be refundable to the tenant upon the tenant's vacating of the premises except for an amount lawfully retained for the reasonable and itemized costs due to non-payment of rent

'Non-payment of rent' is specifically referenced in the law, so, evidently, the law anticipates that any amount retained for unpaid rent is to be part of the itemized statement to be provided to the tenant within 14 days of vacating the premises. Since this law is targeted to protect tenants' security deposits from abuse, its scope would logically include all purported grounds for retaining any portion of the deposit, to avoid any unintended loophole.

Moreso, the plain text of GOL § 7-108(1-a)(e), which directs the landlord to provide itemized statement within 14 days, does not place any limitation on what should be itemized, rather it just states " . itemized statement indicating the basis for the amount of the deposit retained." Id. This language is broad and sweeping. It is not the job of this court to place a narrow construction on this statute, as urged by defendant. The plain and simple language of the statute is to be applied. "[I]f the language of a statute is plain and unambiguous, there is neither need nor warrant to look elsewhere for its meaning." Roosevelt Raceway, Inc. v. Monaghan, 9 NY2d 293, 304, 174 N.E.2d 71, 75 (1961) (citing Meltzer v. Koenigsberg, 302 NY 523, 525, 99 N.E.2d 679). The statute should not be interpreted in a manner that limits its scope. If the legislature wanted a narrow or limited construction of this statute, it would not have done so.

Thus, the failure of defendant to provide this 14-day itemized statement to claimant should, without further, entitle claimant to the entire amount of deposit in the amount of $3,400. But what about the argument that since claimant moved out 10 days into the new month of April 2026, he forfeits the deposit in lieu of the April 2026 rent? Here, defendant is right that "Where, as here, rent is due and payable on the first of the month, month-to-month tenants who vacate during the month are generally liable, absent an agreement to the contrary, for the entire month's rent" Deban v. Hoevener, 34 Misc 3d 141(A), 950 N.Y.S.2d 491 (App. Term 2012). Thus, it appears that claimant may be liable for the entire April 2026 rent, but since defendant herself failed to comply with GOL § 7-108 which requires reporting of any amount retained regardless of the reason for the retention, she may not retain any portion of the deposit. The analysis does not stop here.

This brings us to the last, and in the court's view, the most compelling argument by defendant. The text exchange between the parties on April 2, 2026 (Eight days before claimant moved out) reads as follows:

Claimant: We are approved and set for an April 10th move out. I figure the prorated rent for these 10 days to be 1133(sic), if you can confirm that math. Let us know what we need to do on our end before we leave.

Defendant: Matt & Victoria, Nothing (sic) in your last lease, or NY law authorizes prorating the rent. If you occupy an apartment for any part of a month, you are responsible for the month. You've already caused us economic loss by not giving us at least a month's notice of your intent to vacate. And we've been unable to list and show the apartment due to extreme clutter that extends beyond your door. Now we have to take the 2nd half of the month to paint and repair whatever we need to repair, and show the apartment in May. You told us you were vacating the apartment on the 4th. We made arrangements to paint and clean the apartment because we had a potential tenant moving in on the 15th. That tenant is now gone and we will most likely not be able to rent until at least June 1, maybe later.

Defendant argues that "[T]hese text messages from the defendant are an itemized statement indicating the basis for retaining the security deposit" and that "[N]othing precludes the landlord from providing notice in advance that a tenant's failure to give proper notice of vacatur or leave timely will result in the forfeiture . of the deposit ". However, claimant counters that the text exchange did not satisfy the requirements of GOL 7-108(1-a)(e), because; 1) he had not vacated the premises at the time of the text exchange; and 2) "the April 2 text says nothing about the security deposit. It does not state the amount being retained"; 3) the statute describes a window for the statement to be given after the tenant vacates and that "the statute does not describe a floor with no ceiling."

The court agrees with claimant that the text exchange of April 2, 2026, did not satisfy GOL § 7-108(1-a)(e) 'itemized statement' requirement for the reasons pointed out by claimant.

In a small claims action, "[T]he court shall conduct hearings upon small claims in such manner as to do substantial justice between the parties according to the rules of substantive law and shall not be bound by statutory provisions or rules of practice, procedure, pleading or evidence ." CCA 1804; see also CCA 1807; see also Ross v Friedman, 269 AD2d 584 [2000]; Williams v Roper, 269 AD2d 125 [2000]).

The court finds that this case is distinguishable from cases where landlords blatantly refused to comply with the strictures of GOL § 7-108(1-a)(e). Here, claimant was advised by the landlord, by the text message of 04/02/26, albeit prematurely and obliquely, that she would retain the entire deposit in lieu of April's rent. Secondly, claimant himself had offered to pay $1,133 to cover the rent for the 10 days he stayed in April. Thirdly, defendant did in fact suffer some losses because claimant did not vacate when he indicated he would, plus the fact that he vacated mid-month. And finally, as earlier found, claimant ordinarily would be responsible for the month of April 2026 rent, having moved out mid-month.

CONCLUSION

Based upon the peculiar circumstances presented here, balance of the equities, and the need to do "substantial justice between the parties and not be bound by statutory provisions or rules of practice"² , the court finds that even though defendant violated the black-letter of GOL § 7-108(1-a)(e), she did not violate the spirit of that law. "Whatever is within the spirit although not within the letter, is within the statute and what is within the letter and not within the spirit is not within the statute." Standard Acc. Ins. Co. v. Newman, 2 Misc 2d 348, 359, 47 N.Y.S.2d 804, 814 (Bronx Sup. Ct. 1944) (citing Walden v. Jamestown, 178 NY 213, 70 N.E. 466; Delafield v. Brady, 108 N.Y 524, 15 N.E. 428.). "Most often, the letter and spirit of the law are congruent, or any alleged disparities can be reconciled" Matisoff v. Dobi, 90 NY2d 127, 133, 681 N.E.2d 376, 379 (Court of Appeals 1997).

On account of the foregoing, it would be unjust to order a forfeiture of the entire security deposit. The defendant should be allowed to keep half of the money. Accordingly, it is ORDERED that claimant have judgment in the amount of $1,700  ³

Claimant's remaining contention  ⁴ is without merit.

This is the Decision and Order of this court.

Date:

Hon. Chidi A. Eze

Civil Court Judge (NYC)

FOOTNOTES

1.   See RPAPL § 232-c

2.   See CCA § 1804

3.   This is half the deposit amount of $3,400. Awarding claimant $2,300 would not do substantial justice.

4.   Claimant claims breach of warranty of habitability and constructive eviction due to construction work at the premises prior to his vacatur, however, he was unable to substantiate the claim; did not offer no proof of damages flowing therefrom, nor did he report same to any of the city agencies. He also testified that he did not even report it to the landlord.

Chidi A. Eze, J.