DARDEN, J.
ISSUE
Whether the small claims court’s judgment granting DiGiacomo’s claim for the return of her security deposit is contrary to law.
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1. Surrender and Acceptance
At issue is whether the small claims court properly interpreted and applied the Indiana’s Security Deposits Statute (“the Statute”), Indiana Code chapter 32-31-3 et seq., determining when the parties’ lease terminated. Questions of statutory interpretation are questions of law that are reviewed de novo on appeal. Mayberry Café, Inc. v. Glenmark Const. Co, Inc., 879 N.E.2d 1162, 1170 (Ind. Ct. App. 2008).
The Statute governs landlords’ duties to return security deposits to tenants. Figg v. Bryan Rental Inc., 646 N.E.2d 69, 71 (Ind. Ct. App. 1995). …
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The primary aim of the Statute is to provide for the timely return of the tenant’s security deposit and to protect the tenant from wrongful withholding of the deposit by the landlord. Lae v. Householder, 789 N.E.2d 481, 485 (Ind. 2003). The notice requirements are meant to apprise the tenant of the specific damages or liability claims that the landlord is attempting to offset against the security deposit. Id. “In a nutshell, the [S]tatute provides that the landlord must refund the deposit, net of damage claims, within forty-five days and supply an itemized list of any damages claimed to reduce the amount to be refunded.” Id. “Failure to refund and supply the itemized list results in a waiver of any claim for damages and exposes the landlord to liability for the tenant’s attorney fees.” Id.
“[I]t is the termination of the lease agreement which triggers the 45-day notice provision.” Figg, 646 N.E.2d at 73. “Termination of a lease agreement occurs when the tenant surrenders the tenancy and the landlord accepts the tenant’s surrender.” Floyd v. Rolling Ridge Apartments, 768 N.E.2d 951, 955 (Ind. Ct. App. 2002) (citing Rueth v. Quinn, 659 N.E.2d 684, 688 (Ind. Ct. App. 1996)).
“A surrender of tenancy is a yielding of the tenancy to the owner of the reversion or remainder, wherein the tenancy is submerged and extinguished by the agreement.” Mileusnich v. Novogroder Co., Inc., 643 N.E.2d 937, 939 (Ind. Ct. App. 1994) (citing Grueninger Travel Service of Ft. Wayne, Indiana. Inc., v. Lake County Trust Co., 413 N.E.2d 1034, 1038 (Ind. Ct. App. 1980)). “Surrender may be express or by operation of law.” Id. Surrender arises by operation of law when the parties to a lease “take an action that is so inconsistent with the subsisting landlord-tenant relationship as to imply they have both agreed to deem the surrender to have taken effect.” Id.
Here, Eppl asserts that “there was no legal surrender and acceptance [when DiGiacomo vacated the premises] on February 13, 2009.” Eppl’s Br. at 10-11. He asserts further that the 45-day clock began to run after February 28, 2009, the last day of DiGiacomo’s leasehold period.
In support of his claim, Eppl relies upon Grueninger and Floyd. In Grueninger, we rejected the tenant’s claim that its delivery of the keys to the landlord and the landlord’s acceptance thereof constituted acceptance of surrender and termination of the lease. We held that “the mere delivery of the keys to the landlord without other acts to show the landlord accepted the keys as a surrender of the premises, [wa]s not sufficient to release [the tenant] from [ ] liability.” 413 N.E.2d at 1039 (emphasis added).
In Floyd, tenant Floyd signed an original one-year lease and paid a security deposit. She subsequently signed a one-year renewal lease; however, she vacated the premises mere days before the close of the renewal lease period. Within approximately a month of her departure, the landlord sent her an itemization of damages. Floyd filed suit, alleging, inter alia, that the itemization was untimely because the landlord had not delivered it at the end of the original lease period. The trial court inferred from the parties’ conduct that no itemization of damages was required at the end of the original lease term and concluded that the lease had terminated (and the 45-day clock had commenced to run) at the end of the renewal lease term.
In affirming the trial court, we found that Floyd’s actions were inconsistent with surrender of the tenancy, namely, that: (1) she did not vacate the premises at the end of the original lease term, choosing rather to inhabit the premises through much of the renewal lease term; (2) she had not provided the landlord with notice of her intent to either “discontinue occupancy or terminate her obligations under the rental agreement” before her departure; and (3) she continued to pay rent after the original lease term ended and throughout the renewal lease term. Id. at 957. Thus, we concluded that “Floyd’s actions indicate[d] that she did not intend the rental agreement to terminate until [the end of the renewal lease term]”; and that the landlord’s provision of the itemization of charges against the security deposit within forty-five days of the close of the renewal lease term comported with the Statute. Id. at 955-56.
In Figg, tenant Figg entered into a written one-year lease agreement. Approximately five months before the end of his lease term, Figg’s attorney returned the keys and informed the landlord that Figg had vacated the apartment. The landlord demanded that Figg continue to pay rent until the end of the lease term or until a new subtenant was found. In response, Figg paid a month’s rent to cover the final month of his leasehold term. Subsequently, his attorney demanded that the landlord return Figg’s security deposit and refund the rental payments for the period between the time that he vacated the premises and the end of the lease term. The landlord responded that Figg’s security deposit had been applied to the outstanding lease obligation through the end of the lease term. Thereafter, the landlord sent an itemized list of damages to Figg. The landlord sued Figg and was granted summary judgment.
In affirming the trial court, we found that the landlord’s conversation with Figg, wherein the landlord demanded that Figg continue the lease agreement “was not a decisive, unequivocal act . . . which manifest[ed] [his] acceptance of Figg’s surrender.” Id. at 74. We concluded that Figg had surrendered the premises when he stopped paying rent in accordance with the lease agreement, and that the landlord accepted Figg’s surrender when it sent the itemization of damages to Figg.
Here, as in Floyd, DiGiacomo’s conduct does not indicate that she intended the rental agreement to terminate until the end of February. The record reveals that she paid rent through the end of February and she never requested, nor did the parties discuss, a pro rata refund of monies paid for the period between her vacation of the premises on February 13, 2009 and the end of the month.
Moreover, it is undisputed that in late November or early December, DiGiacomo requested, and Eppl agreed, to a holdover month-to-month tenancy so that DiGiacomo could “stay just for a couple more months.” (Tr. 11). Pursuant to this oral contract, DiGiacomo was bound, commencing on January 1, 2009, to adhere to the agreed rental terms for two additional months. Her telephone call to Eppl that she was vacating the premises on February 13, 2009, predated the close of the extended leasehold term; and, further, did not constitute the typical notice of the termination of a month-to-month leasehold. See I.C. § 32-31-1-4 (a month-to-month tenancy may be terminated by giving a one-month notice).
Further still, DiGiacomo cannot demonstrate that Eppl took any decisive, unequivocal action on February 13, 2009, that manifested his acceptance of her surrender of the premises. Without more, DiGiacomo’s mere delivery of the keys is not sufficient to demonstrate that Eppl actually accepted the surrender of the premises, and thereby, released DiGiacomo from liability as of that date. See Hirsch v. Merchants Nat. Bank & Trust Co. of Indiana, 336 N.E.2d 833, 839 (Ind. Ct. App. 1975) (“[m]ere yielding of the premises by the tenant to the landlord does not constitute surrender or acceptance.”); see also Grueninger, 413 N.E.2d at 1039 (“the mere delivery of the keys to the landlord without other acts to show the landlord accepted the keys as a surrender of the premises, [wa]s not sufficient to release [tenant] from [ ] liability.”).
Rather, as in Figg, Eppl’s only decisive, unequivocal action that manifested his acceptance of DiGiacomo’s surrender occurred on April 10, 2009, when DiGiacomo received his itemization of damages letter, which did not contain a demand for March’s rent payment. We therefore conclude that the oral lease agreement herein terminated as of February 28, 2009, and Eppl’s 45-day period began on said date. See Floyd, 768 N.E.2d at 955 (“termination of a lease agreement occurs when the tenant surrenders the tenancy and the landlord accepts the tenant’s surrender.”); see also Figg, 646 N.E.2d at 73 (“it is the termination of the lease agreement which triggers the 45 day notice provision”).
Based upon the foregoing, we conclude that Eppl’s itemization of damages letter was timely because it was sent within forty-five days of the termination of the lease agreement. Thus, we find that “the evidence is without conflict and leads to but one conclusion which is opposite from that reached by the [small claims court].” Mayflower, 714 N.E.2d at 797. Accordingly, we conclude that the small claims court erred in concluding that Eppl cannot claim damages because of “the itemization being untimely,” (see Order 2); and its judgment that DiGiacomo was entitled to the return of her security deposit is contrary to law. We therefore reverse and remand to the trial court with instructions to vacate its judgment, including attorney’s fees, in favor of DiGiacomo and to enter judgment in favor of Eppl.
NAJAM, J., and BAILEY, J., concur.