In Beebe v AG Managment Company, LLC, an unpublished Michigan Court of Appeals opinion, Tenants on a month to month tenancy gave 45 days’ notice of termination on February 20, 2019. One of the tenants turned in keys on April 5, 2019, but the other tenant still had possessions in the property and did not vacate or turn in keys until April 11, 2019. The landlord prepared an itemized list of damages prorating rent through April 11, 2019, and mailed it on May 6, 2019, with a partial refund of the security deposit. The tenants contested the balance and, when the landlord failed to file suit within 30 days of vacating, filed suit against the landlord. The trial court determined that tenancy did not end until April 11, when keys were turned in. The trial court also determined the landlord was excused from filing suit within 45 days of the end of occupancy because there was a written agreement regarding final disposition of the security deposit.
The court of appeals reversed in part. The court agreed that “occupancy” did not end until April 11, 2019 when the last set of keys was turned in. Thus, landlord’s itemized list of damages was timely. However, the court reversed the trial court’s decision that there was a written agreement regarding the security deposit, finding there was conflicting testimony that needed to be resolved.
The court of appeals also reversed dismissal of the conversion count of the tenant’s complaint: if the trial court on remand found the landlord did not comply with the Landlord Tenant Relationships Act by timely filing to retain the security deposit, the court could find that the Conversion statute was violated because the landlord exercised wrongful dominion over the tenants’ security deposit.