Penick v Trenbeth: Tenant Loses Rent Deposit Interest Claim

Case Study

The issue here is that the Tenant has not named the current Landlord as the respondent, but instead named only the former Landlord. Based on the evidence and submissions, it is clear the property was sold prior to the tenancy being terminated. Upon the sale of the property, the new Landlord is deemed to be in possession of any last month's rent deposit that the Tenant paid to the previous Landlord. The obligation to pay interest on the last month's rent deposit is similarly assumed by the new Landlord. Interest owing on any rent deposit is a covenant that runs with the land in accordance with section 18 of the Act, which means it is a matter assumed by the new Landlord upon the sale.