CHAPTER 3. SECURITY DEPOSITS
IC 32-31-3
Chapter 3. Security Deposits
IC 32-31-3-1
Repealed
(Repealed by P.L.29-2003, SEC.2.)
IC 32-31-3-1.1
Validity of certain rental agreements
Sec. 1.1. Rental agreements entered into before July 1, 1989,remain valid and may be terminated, completed, consummated, orenforced as though this chapter had not been enacted.
As added by P.L.16-2009, SEC.31.
IC 32-31-3-2
"Cooperative housing association" defined
Sec. 2. As used in this chapter, "cooperative housing association"means a consumer cooperative that provides dwelling units to itsmembers.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-3
"Landlord" defined
Sec. 3. As used in this chapter, "landlord" means:
(1) the owner, lessor, or sublessor of a rental unit or theproperty of which the unit is a part; or
(2) a person authorized to exercise any aspect of themanagement of the premises, including a person who directlyor indirectly:
(A) acts as a rental agent; or
(B) receives rent or any part of the rent other than as a bonafide purchaser.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-4
"Owner" defined
Sec. 4. (a) As used in this chapter, "owner" means one (1) or morepersons in whom is vested all or part of the legal title to property.
(b) The term includes a mortgagee or contract purchaser inpossession.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-5
"Person" defined
Sec. 5. As used in this chapter, "person" means an individual, acorporation, an association, a partnership, a governmental entity, atrust, an estate, or any other legal or commercial entity.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-6 "Rent" defined
Sec. 6. As used in this chapter, "rent" includes all payments madeto a landlord under a rental agreement except a security deposit,however denominated.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-7
"Rental agreement" defined
Sec. 7. (a) As used in this chapter, "rental agreement" means anagreement together with any modifications, embodying the terms andconditions concerning the use and occupancy of a rental unit.
(b) The term includes an agreement, regardless of what theagreement is called, that satisfies the following:
(1) The agreement is entered into after June 30, 2008.
(2) The agreement provides for a rental period, explicitly orimplicitly, regardless of the term of the rental period.
(3) The agreement contains an option to purchase.
As added by P.L.2-2002, SEC.16. Amended by P.L.62-2008, SEC.2.
IC 32-31-3-8
"Rental unit" defined
Sec. 8. As used in this chapter, "rental unit" means:
(1) a structure, or the part of a structure, that is used as a home,residence, or sleeping unit by:
(A) one (1) individual who maintains a household; or
(B) two (2) or more individuals who maintain a commonhousehold; or
(2) any grounds, facilities, or area promised for the use of aresidential tenant, including the following:
(A) An apartment unit.
(B) A boarding house.
(C) A rooming house.
(D) A mobile home space.
(E) A single or two (2) family dwelling.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-9
"Security deposit" defined
Sec. 9. (a) As used in this chapter, "security deposit" means adeposit paid by a tenant to the landlord or the landlord's agent to beheld for all or a part of the term of the rental agreement to secureperformance of any obligation of the tenant under the rentalagreement.
(b) The term includes:
(1) a required prepayment of rent other than the first full rentalpayment period of the lease agreement;
(2) a sum required to be paid as rent in any rental period inexcess of the average rent for the term; and
(3) any other amount of money or property returnable to thetenant on condition of return of the rental unit by the tenant in
a condition as required by the rental agreement.
(c) The term does not include the following:
(1) An amount paid for an option to purchase under a lease withoption to purchase, unless it is shown that the intent was toevade this chapter.
(2) An amount paid as a subscription for or purchase of amembership in a cooperative housing association incorporatedunder Indiana law.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-10
"Tenant" defined
Sec. 10. As used in this chapter, "tenant" means an individual whooccupies a rental unit:
(1) for residential purposes;
(2) with the landlord's consent; and
(3) for consideration that is agreed upon by both parties.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-11
Jurisdiction of courts
Sec. 11. (a) The following courts have original and concurrentjurisdiction in cases arising under this chapter:
(1) A circuit court.
(2) A superior court.
(3) A county court.
(4) A municipal court.
(5) A small claims court.
(b) A case arising under this chapter may be filed on the smallclaims docket of a court that has jurisdiction.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-12
Return of deposits; deductions; liability
Sec. 12. (a) Upon termination of a rental agreement, a landlordshall return to the tenant the security deposit minus any amountapplied to:
(1) the payment of accrued rent;
(2) the amount of damages that the landlord has suffered or willreasonably suffer by reason of the tenant's noncompliance withlaw or the rental agreement; and
(3) unpaid utility or sewer charges that the tenant is obligatedto pay under the rental agreement;
all as itemized by the landlord with the amount due in a writtennotice that is delivered to the tenant not more than forty-five (45)days after termination of the rental agreement and delivery ofpossession. The landlord is not liable under this chapter until thetenant supplies the landlord in writing with a mailing address towhich to deliver the notice and amount prescribed by this subsection.Unless otherwise agreed, a tenant is not entitled to apply a security
deposit to rent.
(b) If a landlord fails to comply with subsection (a), a tenant mayrecover all of the security deposit due the tenant and reasonableattorney's fees.
(c) This section does not preclude the landlord or tenant fromrecovering other damages to which either is entitled.
(d) The owner of the dwelling unit at the time of the terminationof the rental agreement is bound by this section.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-13
Use of deposits
Sec. 13. A security deposit may be used only for the followingpurposes:
(1) To reimburse the landlord for actual damages to the rentalunit or any ancillary facility that are not the result of ordinarywear and tear.
(2) To pay the landlord for:
(A) all rent in arrearage under the rental agreement; and
(B) rent due for premature termination of the rentalagreement by the tenant.
(3) To pay for the last payment period of a residential rentalagreement if a written agreement between the landlord and thetenant stipulates that the security deposit will serve as the lastpayment of rent due.
(4) To reimburse the landlord for utility or sewer charges paidby the landlord that are:
(A) the obligation of the tenant under the rental agreement;and
(B) unpaid by the tenant.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-14
Notice of damages; refund of remaining deposits
Sec. 14. Not more than forty-five (45) days after the terminationof occupancy, a landlord shall mail to a tenant an itemized list ofdamages claimed for which the security deposit may be used undersection 13 of this chapter. The list must set forth:
(1) the estimated cost of repair for each damaged item; and
(2) the amounts and lease on which the landlord intends toassess the tenant.
The landlord shall include with the list a check or money order forthe difference between the damages claimed and the amount of thesecurity deposit held by the landlord.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-15
Remittance of full deposit
Sec. 15. Failure by a landlord to provide notice of damages undersection 14 of this chapter constitutes agreement by the landlord that
no damages are due, and the landlord must remit to the tenantimmediately the full security deposit.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-16
Liability for withheld deposits
Sec. 16. A landlord who fails to comply with sections 14 and 15of this chapter is liable to the tenant in an amount equal to the part ofthe deposit withheld by the landlord plus reasonable attorney's feesand court costs.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-17
Waiver of chapter
Sec. 17. A waiver of this chapter by a landlord or tenant is void.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-18
Disclosure of managers and agents
Sec. 18. (a) A landlord or a person authorized to enter into a rentalagreement on behalf of the landlord shall disclose and furnish to thetenant in writing at or before the commencement of the rentalagreement the names and addresses of the following:
(1) A person residing in Indiana who is authorized to managethe dwelling unit.
(2) A person residing in Indiana who is reasonably accessibleto the tenant and who is authorized to act as agent for the ownerfor purposes of:
(A) service of process; and
(B) receiving and receipting for notices and demands.
A person who is identified as being authorized to manage undersubdivision (1) may also be identified as the person authorized to actas agent under subdivision (2).
(b) This section is enforceable against any successor landlord,owner, or manager.
(c) A person who fails to comply with subsection (a) becomes anagent of each person who is a landlord for purposes of:
(1) service of process and receiving and receipting for noticesand demands; and
(2) performing the obligations of the landlord under law or therental agreement.
(d) If the information required by subsection (a) is not disclosedat the beginning of the rental agreement, the tenant shall be allowedany expenses reasonably incurred to discover the names andaddresses required to be furnished.
As added by P.L.2-2002, SEC.16.
IC 32-31-3-19
Sale of property; liability for deposits; exceptions
Sec. 19. (a) Unless otherwise agreed, if a landlord conveys, in a
good faith sale to a bona fide purchaser, property that includes adwelling unit subject to a rental agreement, the landlord is relievedof liability under law or the rental agreement as to events occurringafter written notice to the tenant of the conveyance. However, for one(1) year after giving notice of the conveyance, the landlord remainsliable to the tenant for the security deposit to which the tenant isentitled under section 14 of this chapter unless:
(1) the purchaser acknowledges that the purchaser has assumedthe liability of the seller by giving notice to the tenant; and
(2) upon conveyance the seller transfers the security deposit tothe purchaser.
(b) Unless otherwise agreed, a manager of a dwelling unit isrelieved of any liability the manager might have under law or therental agreement as to events occurring after written notice to thetenant of the termination of the manager's management.
As added by P.L.2-2002, SEC.16.