[RPPTL LandTen] Surety bond release for residential security deposit

Wed Jan 6 12:49:35 PST 2010

I have been presented with the following fact pattern on behalf of a
tenant. Lease provides 

    A.    if Tenant does not timely pay rent, delinquent amount accrues
interest at the highest rate allowed by law. 

    B.    for a fee for burdens of dealing with late payment.  The fee
is calculated as 5% per month of the late amount.

While I am used to seeing a processing fee which is a fixed number on
top of specified interest rate, specifying the fee as percentage of rent
owed is new to me.

Two arguments jump out 

    1.    if the fee is interest, it is usurious, as the fee by itself
is 60% per annum 
    2.    if the fee is not interest it is an unenforceable penalty.
The fee can not be compensation for the time value of money as it is
covered by the interest charge. Liquidated damages which are unrelated
to the harm and disproportionate to the harm would be the classic
penalty. 

Does anyone have any experience with this or know the law?  Thank you. 

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________________________________ 

        From: landten-bounces at lists.flabarrpptl.org
[mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Neil B.
Shoter

        Sent: Wednesday, December 23, 2009 3:53 PM 
        To: RPPTL Landlord Tenant Committee 
        Subject: [RPPTL LandTen] Surety bond release for residential
security deposit 

        Has anyone dealt with the release of a bond for residential
security deposit under Section 83.49?   This particular surety bond
needs to be released but the release that was received includes a
requirement that the State of Florida sign off on it, and no one seems
to know which office or department of the State deals with these bonds.
Any ideas???

         <http://www.shutts.com/shutts100.jpg>          Neil B. Shoter 
        Partner / LEED Accredited Professional  
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