Lastra v. Intercontinental Investments Co. , 1987 Mo. App. LEXIS 5126 ( 1987 )

CLARK, Judge.

Appellants sued respondent claiming actual and punitive damages for failure of respondent to refund a security deposit paid in conjunction with the lease of an apartment. The issue in the case is whether § 535.300, RSMo 1986, limits the amount appellants may recover to twice the sum deposited and withheld.

The evidence, stated most favorably to appellants, established that on May 19, 1984, the parties entered into a lease of an apartment in Clay County. The term was one year from June 1, 1984 to May 31, 1985. At the time the lease was made, the apartment was occupied by another tenant and appellants were told that possession on June 1 was not assured. The lease was orally modified by agreement that possession would be delivered between June 1 and June 4 with rental pro-rated accordingly.

On May 30, 1984, appellants contacted the apartment manager with regard to a date for possession of the premises. They were then informed that the previous agreement could not be met and that the apartment would not be available until June 14. This was not acceptable to appellants who made arrangements for rental of accommodations elsewhere.

At the time the lease was made between appellants and respondent, appellants paid a security deposit of $300.00 to guarantee against damage to the apartment. The agreement provided that the deposit was refundable upon surrender of the premises if the tenant was not then in default., When appellants learned the apartment would not be available as promised, they requested a refund of the security deposit. The request was denied on the basis that, the sum would be applied against rentals until the apartment was re-let. In fact, new tenants were obtained immediately with no loss of rentals to respondent. The security deposit was not tendered to appellants until September, 1985.¹

Appellants filed a multi-count petition and had a jury trial. At the close of the evidence, the court sustained respondent’s motion for a directed verdict as to the count for conversion of the deposit and struck a dependent count in punitive damages. The court ruled that appellants had not offered substantial, competent evidence of any misapplication of the security deposit, and further held the claim for a return of the deposit to be limited in damages by § 535.00, RSMo 1986. The remainder of the case was submitted to the jury for decision in accordance with the statute. A verdict for appellants in the amount of $600.00 was returned and judgment was entered accordingly.

Appellants present three points which collectively argue that the trial court erred in failing to submit their claims for actual and punitive damages in conversion and in sustaining respondent’s motion for directed verdict. Although the trial court included a finding that appellants failed to make a case in conversion for want of proof of any misapplication of the funds, it is unnecessary to consider arguments on the merits of that ruling. The court’s concurrent finding that appellants’ cause of action was limited by § 535.300, RSMo 1986, was sufficient to support the decision. Whether appellants proved a diversion of the deposit to purposes other than that for which the deposit was given, as appellants discuss in the first point briefed, is immaterial.

In the relevant point, appellants say that § 535.300, RSMo 1986, does not preclude their recourse to a common law claim for conversion because the statute contains no express provision to this effect. The relevant portions of the statute read as follows:

Within thirty days after the date of termination of the tenancy, the landlord shall:

(1) Return the full amount of the security deposit; or

(2) Furnish to the tenant a written itemized list of the damages for which the security deposit or any portion thereof is withheld,....

Section 535.300.2, RSMo 1986.

If the landlord wrongfully withholds all or any portion of the security deposit in violation of this section, the tenant shall recover as damages not more than twice the amount wrongfully withheld.

Section 535.300.5, RSMo 1986.

Security deposit is defined as meaning “any deposit of money ..., which is furnished by a tenant to a landlord to secure the performance of any part of the rental agreement, including damages to the dwelling unit.” Section 535.300.7, RSMo 1986.

The gist of appellants’ argument is that the statute applies only when a security deposit is wrongfully withheld and if appellants prove conversion by misapplication of the fund to an unauthorized purpose, that is a conversion not within the ambit of the statute, or at least not expressly included.

The primary purpose of all statutory construction and application is to ascertain the intent of the legislature. A statute is not to be subjected to such a strained or narrow interpretation of the language as to defeat the purpose of the enactment. Cook v. Burke, 693 S.W.2d 857, 861 (Mo.App.1985). If a statute gives a remedy in the affirmative for a matter which was actionable at common law, this does not take away the common law remedy. But where a new right or means to acquire the right are given and the statute also provides an adequate remedy, then the injured parties are confined to the statutory remedy. Everett v. County of Clinton, 282 S.W.2d 30, 34 (Mo.1955); see also Ridings v. Thoele, Inc., 739 S.W.2d 547 (Mo. banc 1987).

It is apparent from the language of § 535.300, RSMo 1986, that the rights of a landlord to receive and retain security deposits are sharply limited, both as to the period of time within which such deposits may be held and the purposes to which the deposits may be applied. For example, the statute precludes the taking of a security deposit in excess of two month’s rent, it requires an itemization of any damages for which a deposit is claimed as indemnity and it entitles the tenant to notice and an opportunity to be present when damages are inventoried. The tenant is granted an absolute right to a refund of the security deposit within thirty days unless all or a portion of the deposit is withheld for the damages the statute specifies.

Section 535.300.5, RSMo 1986, also provides for the tenant’s remedy in the event the landlord does not comply with the statute and make the refund. In that event, “the tenant shall recover as damages not more than twice the amount wrongfully withheld.” Prior to enactment of this statute, a tenant in the circumstances of appellants could resort to a common law remedy for refund of a security or rent deposit by an action for conversion or for breach of contract and could recover only upon proof of the elements of the cause of action stated. The statute, however, has created a new right with respect to such claims rendering it unnecessary for a tenant to prove the common law elements of conversion or breach of contract. The tenant-claimant need only show that the deposit was not refunded within thirty days and that no itemized list of damages to which the deposit was applied has been furnished by the landlord. The subject of claims for refund of security deposits to tenants has been pre-empted by the legislative enactment which created the rights and obligations and limited the allowance of damages to not more than twice the amount of the deposit.

In the present case, appellants’ claim falls squarely within the provisions of § 535.300, RSMo 1986. A refund of the deposit was due appellants on or before July 1, 1984. They did not receive the refund and no itemized list of damages was furnished by respondent. Appellants were entitled to judgment for twice the amount of the deposit, but no more. Appellants were confined to the statutory remedy and the trial court correctly so ruled. Whether appellants proved or could have proved a misapplication of the funds is immaterial.

The judgment is affirmed.

SHANGLER, P.J., concurs.

PRITCHARD, J., dissents in separate opinion.

1 . The record is not clear as to whether appellants did receive payment of the deposit refund on the date mentioned by the witnesses or whether the late payment tender was refused. If payment was in fact made, then the jury verdict should have been reduced by that amount. Respondent makes no complaint of a duplicate recovery and we therefore do not consider the issue further.