My question involves landlord-tenant law in the State of: Oregon
I am leasing and began renting to a man (I'll call John) with a verbal agreement that he'd sign the lease if we got along. I asked for NO deposit. About a month in, I requested he sign the lease but he refused. Meanwhile, a former roommate, aware of John living there, requested John pay him some of his deposit. John thought this was fair and paid the former roommate $100 of the original $333 per person deposit.
A few months later, when pressed to sign the lease again he refused, claiming he was moving out of town in a few months. I didn't like this and wanted someone stable to sign the lease. I found a friend to move in and I told John she didn't want a third roommate. (Trying to coax him to leave). He said he just needed to stay another month and would be gone. We agreed to let him stay.
Again, my former roommate surfaced, requesting more money from John. I told him it was up to him if he wanted to pay but keep in mind I would not be getting another roommate to pay his deposit back (as he had paid to my former roommate). Presumably out of laziness to find a place, he paid my former roommate $100.
John finally moved out and a month later was hounding ME for his $200 deposit back. I asked him if he was blind because:
1) There was no roommate to replace him
2) He had not paid me, but my former roommate.
I don't see how I owe him money. How do I respond to John when he is threating legal action?
Keep in mind there was no written agreements.

