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  1. #29
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    Jan 2006
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    Default Re: Filing a Surety Bond Instead of a Security Deposit

    Quote Quoting lill
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    f the amount exceeds the bond amount, the bond company goes after the tenant. The landlord does not go after the tenant.
    why would the bond company go after the tenant if the damages exceeds the bond amount? Since when can a bond company ever go after a purchaser of a bond for an amount greater than the bond payment to a third party?




    that's some creative construction there but I don['t think it is true. Go ahead and prove me wrong if yuo can.

    Quote Quoting aaron
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    The common law remedy is separate and apart from any statutory remedy. The statute does not eliminate the common law remedy, and that remedy therefore remains available even if you don't comply with the statute in order to avail yourself of a statutory remedy.
    ok, so how can you make these 2 things work together:


    *236 It is undisputed that defendant notified plaintiff by phone. But he did not send plaintiff written notice of his intention to retain the security deposit or provide the written itemized list of damages or other obligations required by MCL 554.609; MSA 26.1138(9).
    Furthermore, the provisions in § 13 which permit the landlord to sue in certain circumstances are inapplicable here, because the landlord waived his right to the security deposit under § 10. MCL 554.613; MSA 26.1138(13).
    Even if that were not the case, defendant neglected to commence an action for a money judgment on the amount in controversy within forty-five days after plaintiff terminated his occupancy. The act makes failure to comply with the requirement "a waiver of all claimed damages and makes [the landlord] liable to the tenant for double the amount of the security deposit retained." MCL 554.613(2); MSA 26.1138(13)(2).

    *236 It is undisputed that defendant notified plaintiff by phone. But he did not send plaintiff written notice of his intention to retain the security deposit or provide the written itemized list of damages or other obligations required by MCL 554.609; MSA 26.1138(9).
    Furthermore, the provisions in § 13 which permit the landlord to sue in certain circumstances are inapplicable here, because the landlord waived his right to the security deposit under § 10. MCL 554.613; MSA 26.1138(13).
    Even if that were not the case, defendant neglected to commence an action for a money judgment on the amount in controversy within forty-five days after plaintiff terminated his occupancy. The act makes failure to comply with the requirement "a waiver of all claimed damages and makes [the landlord] liable to the tenant for double the amount of the security deposit retained." MCL 554.613(2); MSA 26.1138(13)(2).
    that makes section 10 and section 13 both basically meaningless. So what if the landlord did not give notice as 10 requires, He gives back the deposit,. So what? So what if he did not file suit within 45 days? It doesn't matter because he can still sue the tenant.


    It makes those 2 laws basically worthless. I don't get it.

    Quote Quoting lill
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    The landlord does not go after the tenant since the landlord has already been paid in full.
    and how does the bond agency prove damages? This is not a simple debt contract. It is a disputed claim. That means the plaintiff, whomever they are, must prove their claim for damages. Does the bond agency know how old that carpet is so a proper depreciation can be applied? Does he have all the proofs of the damages; pictures, receipts for replacement of any particular item, the time spent repairing anything damaged? If nothing else, logistically is makes no sense to even consider operating in the manner you claim to be "the way it is". Expecting the boding agent to sue the tenant and then stand in place of the landlord (due to assignment it would be possible) and be able to prove the claims for damages? I'm not seeing it make any sense at all.


    In fact, why would the bond company pay the landlord a penny more than the bond amount? That is not a very good business model to start. Bond agencies pay out whatever the bond was valued at, max.

    OK, aaron & K, this case more clearly supports the common law right as aaron stated:

    https://scholar.google.com/scholar_case?case=11715163901019462588&hl=en&as_sd t=80000006


    I still don't agree with it as it simply makes the law requiring the landlord to make claims in a timely manner irrelevant. I find it difficult to accept that was what the laws were intended to do, especially given the LTRA was created to protect the tenant more so than the landlord. The ability to simply ignore those 2 sections of law do just the opposite.


    but I still find nothing even close to suggesting lills claims as correct. I guess it's in that never to be found single contract that all bonding agencies in all states use for issues such as this. It would seem given its extensive use it would be available somewhere in this seemingly infinite internet.

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