(a) Definitions. As used in this chapter:

Ask a landlord/tenant law question, get an answer ASAP!
Thousands of highly rated, verified landlord/tenant lawyers.
Evictions, ejectment actions, unlawful detainers and more.
Click here to chat with a lawyer about your rights.

(1) “Accrued interest” means the interest due on a security deposit as provided in subsection (i) of this section, compounded annually to the extent applicable.

(2) “Commissioner” means the Banking Commissioner.

(3) “Escrow account” means any account at a financial institution which is not subject to execution by the creditors of the escrow agent and includes a clients’ funds account.

(4) “Escrow agent” means the person in whose name an escrow account is maintained.

(5) “Financial institution” means any state bank and trust company, national bank, savings bank, federal savings bank, savings and loan association, and federal savings and loan association that is located in this state.

(6) “Forwarding address” means the address to which a security deposit may be mailed for delivery to a former tenant.

(7) “Landlord” means any landlord of residential real property, and includes (A) any receiver; (B) any successor; and (C) any tenant who sublets his premises.

(8) “Receiver” means any person who is appointed or authorized by any state, federal or probate court to receive rents from tenants, and includes trustees, executors, administrators, guardians, conservators, receivers, and receivers of rent.

(9) “Rent receiver” means a receiver who lacks court authorization to return security deposits and to inspect the premises of tenants and former tenants.

(10) “Residential real property” means real property containing one or more residential units, including residential units not owned by the landlord, and containing one or more tenants who paid a security deposit.

(11) “Security deposit” means any advance rental payment, or any installment payment collected pursuant to section 47a-22a, except an advance payment for the first month‘s rent or a deposit for a key or any special equipment.

(12) “Successor” means any person who succeeds to a landlord’s interest whether by purchase, foreclosure or otherwise and includes a receiver.

(13) “Tenant” means a tenant, as defined in section 47a-1, or a resident, as defined in section 21-64.

(14) “Tenant’s obligations” means (A) the amount of any rental or utility payment due the landlord from a tenant; (B) a tenant’s obligations under the provisions of section 47a-11; and (C) the actual reasonable cost of changing the locks of the dwelling unit pursuant to section 47a-7b, if the tenant has not paid such cost.

(b) Amount of security deposit. (1) In the case of a tenant under sixty-two years of age, a landlord shall not demand a security deposit in an amount that exceeds two months’ rent.

(2) In the case of a tenant sixty-two years of age or older, a landlord shall not demand a security deposit in an amount that exceeds one month’s rent. Any landlord who has received a security deposit in an amount that exceeds one month’s rent from a tenant who becomes sixty-two years of age after paying such security deposit shall return the portion of such security deposit that exceeds one month’s rent to the tenant upon the tenant’s request.

(c) Exemption from attachment and execution. Assignment to successor. Any security deposit paid by a tenant shall remain the property of such tenant in which the landlord shall have a security interest, as defined in subdivision (35) of subsection (b) of section 42a-1-201, to secure such tenant’s obligations. A security deposit shall be exempt from attachment and execution by the creditors of the landlord and shall not be considered part of the estate of the landlord in any legal proceeding. Any voluntary or involuntary transfer of a landlord’s interest in residential real property to a successor shall constitute an assignment to such successor of such landlord’s security interest in all security deposits paid by tenants of such transferred residential real property.

(d) Payment of security deposit and interest at termination of tenancy. (1) Not later than the time specified in subdivision (2) of this subsection, the person who is the landlord at the time a tenancy is terminated, other than a rent receiver, shall pay to the tenant or former tenant: (A) The amount of any security deposit that was deposited by the tenant with the person who was landlord at the time such security deposit was deposited less the value of any damages that any person who was a landlord of such premises at any time during the tenancy of such tenant has suffered as a result of such tenant’s failure to comply with such tenant’s obligations; and (B) any accrued interest. If the landlord at the time of termination of a tenancy is a rent receiver, such rent receiver shall return security deposits in accordance with the provisions of subdivision (3) of this subsection.

(2) Upon termination of a tenancy, any tenant may notify the landlord in writing of such tenant’s forwarding address. Not later than twenty-one days after termination of a tenancy or fifteen days after receiving written notification of such tenant’s forwarding address, whichever is later, each landlord other than a rent receiver shall deliver to the tenant or former tenant at such forwarding address either (A) the full amount of the security deposit paid by such tenant plus accrued interest, or (B) the balance of such security deposit and accrued interest after deduction for any damages suffered by such landlord by reason of such tenant’s failure to comply with such tenant’s obligations, together with a written statement itemizing the nature and amount of such damages. Any landlord who violates any provision of this subsection shall be liable for twice the amount of any security deposit paid by such tenant, except that, if the only violation is the failure to deliver the accrued interest, such landlord shall be liable for ten dollars or twice the amount of the accrued interest, whichever is greater.

(3) (A) Any receiver who is authorized by a court to return security deposits and to inspect the premises of any tenant shall pay security deposits and accrued interest in accordance with the provisions of subdivisions (1) and (2) of this subsection from the operating income of such receivership to the extent that any such payments exceed the amount in any escrow accounts for such tenants. (B) Any rent receiver shall present any claim by any tenant for return of a security deposit to the court which authorized the rent receiver. Such court shall determine the validity of any such claim and shall direct such rent receiver to pay from the escrow account or from the operating income of such property the amount due such tenant as determined by such court.

(e) Liability of successor and receiver re payment of security deposit. A successor, other than a receiver, shall be liable for the claims of tenants of such property for return of any part of such security deposit which is or becomes due to such tenant during the time such successor is a landlord. A receiver’s liability for payment of security deposits and interest under this section shall be limited to the balance in any escrow account for such tenants maintained by such receiver in such receivership in accordance with subsection (h) of this section and to the operating income generated in such receivership.

(f) Nonresident landlord. Any landlord who is not a resident of this state shall appoint in writing the Secretary of the State as the landlord’s attorney upon whom all process in any action or proceeding against such landlord may be served.

(g) Action to reclaim security deposit. Any person may bring an action in replevin or for money damages in any court of competent jurisdiction to reclaim any part of such person’s security deposit which may be due. This section does not preclude the landlord or tenant from recovering other damages to which the landlord or tenant may be entitled.

(h) Escrow deposit. (1) Each landlord shall immediately deposit the entire amount of any security deposit received by such landlord from each tenant into one or more escrow accounts established or maintained in a financial institution for the benefit of each tenant. Each landlord shall maintain each such account as escrow agent and shall not withdraw funds from such account except as provided in subdivision (2) of this subsection.

(2) The escrow agent may withdraw funds from an escrow account to: (A) Disburse the amount of any security deposit and accrued interest due to a tenant pursuant to subsection (d) of this section; (B) disburse interest to a tenant pursuant to subsection (i) of this section; (C) make a transfer of the entire amount of certain security deposits pursuant to subdivision (3) of this subsection; (D) retain interest credited to the account in excess of the amount of interest payable to the tenant under subsection (i) of this section; (E) retain all or any part of a security deposit and accrued interest after termination of tenancy equal to the damages suffered by the landlord by reason of the tenant’s failure to comply with such tenant’s obligations; (F) disburse all or any part of the security deposit to a tenant at any time during tenancy; or (G) transfer such funds to another financial institution or escrow account, provided such funds remain continuously in an escrow account.

(3) (A) Whenever any real estate is voluntarily or involuntarily transferred from a landlord, other than a receiver, to a successor, including a receiver, such landlord shall withdraw from the escrow account and deliver to the successor the entire amount of security deposits paid by tenants of the property being transferred, plus any interest accrued pursuant to subsection (i) of this section. If at the time of transfer of such real estate the funds in such account are commingled with security deposits paid by tenants in real estate not being transferred to such successor, and if at such time the funds in such account are less than the amount of security deposits paid by all tenants whose security deposits are contained in such account, such landlord shall deliver to such successor a pro rata share of security deposits paid by tenants of the real estate being transferred to such successor. (B) Whenever any real estate is transferred from a receiver to a successor, such receiver shall dispose of the escrow accounts as ordered by the court which appointed such receiver. The order of such court shall provide for the priority of the present and future rights of tenants to security deposits paid by them over the rights of any secured or unsecured creditor of any person and shall provide that the funds in such account shall be delivered to the successor of such receiver for immediate deposit in an escrow account for tenants who paid security deposits.

(4) (A) The landlord shall provide each tenant with a written notice stating the amount held for the benefit of the tenant and the name and address of the financial institution at which the tenant’s security deposit is being held not later than thirty days after the landlord receives a security deposit from the tenant or the tenant’s previous landlord or transfers the security deposit to another financial institution or escrow account.

(B) If the commissioner makes a written request to the landlord for any information related to a tenant’s security deposit, including the name of each financial institution in which any escrow account is maintained and the account number of each escrow account, the landlord shall provide such information to the commissioner not later than seven days after the request is made.

(i) Payment of interest on security deposits. On and after July 1, 1993, each landlord other than a landlord of a residential unit in any building owned or controlled by any educational institution and used by such institution for the purpose of housing students of such institution and their families, and each landlord or owner of a mobile manufactured home or of a mobile manufactured home space or lot or park, as such terms are defined in subdivisions (1), (2) and (3) of section 21-64, shall pay interest on each security deposit received by such landlord at a rate of not less than the average rate paid, as of December 30, 1992, on savings deposits by insured commercial banks as published in the Federal Reserve Board Bulletin rounded to the nearest one-tenth of one percentage point, except in no event shall the rate be less than one and one-half per cent. On and after January 1, 1994, the rate for each calendar year shall be not less than the deposit index, determined under this section as it was in effect during such year. On and after January 1, 2012, the rate for each calendar year shall be not less than the deposit index, as defined in section 36a-26, for that year. On the anniversary date of the tenancy and annually thereafter, such interest shall be paid to the tenant or resident or credited toward the next rental payment due from the tenant or resident, as the landlord or owner shall determine. If the tenancy is terminated before the anniversary date of such tenancy, or if the landlord or owner returns all or part of a security deposit prior to termination of the tenancy, the landlord or owner shall pay the accrued interest to the tenant or resident not later than twenty-one days after such termination or return. Interest shall not be paid to a tenant for any month in which the tenant has been delinquent for more than ten days in the payment of any monthly rent, unless the landlord imposes a late charge for such delinquency. No landlord shall increase the rent due from a tenant because of the requirement that the landlord pay on interest the security deposit.

(j) Investigation of complaints by commissioner. Order. Jurisdiction. Regulations. (1) Except as provided in subdivision (2) of this subsection, the commissioner may receive and investigate complaints regarding any alleged violation of subsections (b), (d), (h) or (i) of this section. For the purposes of such investigation, any person who is or was a landlord shall be subject to the provisions of section 36a-17. If the commissioner determines that any landlord has violated any provision of this section over which the commissioner has jurisdiction, the commissioner may, in accordance with section 36a-52, order such person to cease and desist from such practices and to comply with the provisions of this section.

(2) The commissioner shall not have jurisdiction over (A) the failure of a landlord to pay interest to a tenant annually under subsection (i) of this section, or (B) the refusal or other failure of the landlord to return all or part of the security deposit if such failure results from the landlord’s good faith claim that such landlord has suffered damages as a result of a tenant’s failure to comply with such tenant’s obligations, regardless of whether the existence or amount of the alleged damages is disputed by the tenant. For purposes of this section, “good faith claim” means a claim for actual damages suffered by the landlord for which written notification of such damages has been provided to the tenant in accordance with the provisions of subdivision (2) of subsection (d) of this section.

(3) The commissioner may adopt regulations, in accordance with chapter 54, to carry out the purposes of this section.

(k) Penalties. (1) Any person who is a landlord at the time of termination of a tenancy and who knowingly and wilfully fails to pay all or any part of a security deposit when due shall be subject to a fine of not more than two hundred fifty dollars for each offense, provided it shall be an affirmative defense under this subdivision that such failure was caused by such landlord’s good faith belief that he was entitled to deduct the value of damages he has suffered as a result of such tenant’s failure to comply with such tenant’s obligations.

(2) Any person who knowingly and wilfully violates the provisions of subsection (h) of this section on or after October 1, 1979, shall be subject to a fine of not more than five hundred dollars or imprisonment of not more than thirty days or both for each offense. It shall be an affirmative defense under the provisions of this subdivision that at the time of the offense, such person leased residential real property to fewer than four tenants who paid a security deposit.

(3) Any person who is a landlord at the time an interest payment is due under the provisions of subsection (i) of this section and who knowingly and wilfully violates the provisions of such subsection shall be subject to a fine of not more than one hundred dollars for each offense.

(4) No financial institution shall be liable for any violation of this section except for any violation in its capacity as a landlord.

(l) Rights not limited. Nothing in this section shall be construed as a limitation upon: (1) The power or authority of the state, the Attorney General or the commissioner to seek administrative, legal or equitable relief permitted by the general statutes or at common law; or (2) the right of any tenant to bring a civil action permitted by the general statutes or at common law.