Ask a landlord-tenant lawyer and get answers ASAP
I'm Lucy, and I'd be happy to answer your questions today. I'm sorry to hear that this happened.
What state are you in? Was there any evidence to alert you to the leaking pipe while you were living there?
Under California law, a landlord may only deduct from a tenant's deposit for unpaid rent at the time of leaving and actual damage to the apartment. A tenant is not responsible for things that just happen to break while the tenant is living there, or reasonable wear and tear. That means that your landlord has no legal right to keep your deposit for the leaking pipe. I understand that he could try to sue you and you don't want that, but if he does, you can countersue for the entire deposit that he withheld.
On top of that, when a landlord withholds a tenant's deposit in bad faith, the tenant is allowed to sue for TWICE the deposit as a penalty, meaning that if you go to court, you can get three times what you initially paid. Cal. Civ. Code, Section 1950.5. If you send the landlord a copy of that statute along with a demand for the return of your deposit, it's possible that he'll see the wisdom is NOT pursuing you for the damage caused by the leaky pipe.
He's supposed to have sent you a written, itemized statement of deductions from your deposit within 21 days after you vacate. If he didn't do that, it's further evidence of bad faith and makes it even more likely that a judge would rule in your favor. The fact that he told others how nice the apartment looked when you left should count in your favor, because you can call those people in to testify if necessary.
You don't have to give the landlord warning before you sue. You could choose to go to the local Small Claims Court and sue for 3x the deposit on the twenty-second day after you move out. But if your primary goal is not to get sued, it may help to send a letter first.
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I'm sorry, but we're not able to review documentation and provide commentary. That would require hiring a local attorney and paying an hourly lawyer's fee. Do you have a specific question about your rights and obligations or about any of the information I provided?
Did you read my response? Because I feel that it was quite clear that you do NOT have to pay him.
Not only that, you can sue him for A LOT OF MONEY. If that did not come through to you, please let me know so I can help clarify.
If your #1 concern is to not be sued, then you have the ability to pay him, write "under protest" on the check, and then sue for a full refund of what you paid PLUS three times your security deposit. You do not need a lawyer to sue, and you do not need to pay an unscrupulous landlord for things the statute has made quite clear are not your obligation.