Court Opinion

ID: 5162038
Source: CourtListenerOpinion
Date Created: 2022-01-02 02:56:11.925381+00
Date Added: 2024-06-11T08:25:40.017716
License: Public Domain

MULLARKEY, Justice,
specially concurring:
Because the respondent failed to meet his burden of proving that “the primary function” of his check for $1360.00 was to serve as a security deposit, I concur in the result reached by the majority. See § 38-12-102(2), 16A C.R.S. (1982). I write separately because I would base the holding on a different rationale.
In order to determine whether the respondent’s payment was a security deposit, the majority focuses on whether the payment was performance of an obligation under the rental agreement. The opinion states that the payment involved in this case was not a security deposit because it was payment in full of the rent, and, therefore, it did not serve to secure the tenant’s performance under the lease. At 1238. However, the majority opinion does not provide a framework for determining under what circumstances an advance payment does secure the tenant’s performance so that it should be considered to be a security deposit. In my view, the analytical key is whether the payment serves the purpose of a “security deposit” as the term is used in the Security Deposit Act and to answer that question we must look to the Act.
We have repeatedly stated that, “In construing statutes, we must choose a construction that serves the purposes of the legislative scheme.” Colorado Dep’t of Social Servs. v. Board of County Comm’rs, 697 P.2d 1, 18 (Colo.1985) (citing Smith v. Myron Stratton Home, 676 P.2d 1196, 1199 (Colo.1984)). In this case, the legislative declaration, section 38-12-101, states that the Security Deposit Act should be construed liberally to implement the legislature's intent to “insure the proper administration of security deposits and protect the interests of tenants and landlords.” Therefore, the procedure for obtaining the return of a security deposit should be simple, straightforward, and not overly technical. See generally Yee, The Colorado Security Deposit Act, 50 U.Colo.L.Rev. 29, 29 (1978-79) (“The Act was designed to make it economically feasible for the tenant of a residential dwelling unit to secure repayment of his security deposit at the termination of the lease, even though the amount of the deposit was too small to justify filing suit.”); Comment, Landlord-Tenant — Security Deposits — Colorado’s Wrongful Withholding of Security Deposits Act: Three Litigious Snares in an Untested Law—Colo.Rev.Stat.Ann. §§ 58-1-26 to -28, 49 Denver L.J. 453, 453 (1972-73) (Act was a response to “widespread situation of disparate bargaining” which resulted from the knowledge that “tenant’s expense in enforcing his right to the return of the security deposit through the judicial process would virtually always exceed the amount of the recovered deposit.”).
Another well-settled principle of statutory construction is that the court must consider the act as a whole and give meaning to each of its provisions. See, e.g., Martinez v. Continental Enter., 730 P.2d 308, 315 (Colo.1986); People v. Yellen, 704 P.2d 306, 310 (Colo.), cert. denied, 474 U.S. 1036, 106 S.Ct. 603, 88 L.Ed.2d 582 (1985). Here, the definition of a security deposit in section 38-12-102(2), i.e., that a security deposit is an advance or deposit of money which secures the tenant’s performance, seems circular if read out of context. The definition is clarified, however, by reading it together with the stated legislative purpose and the provisions governing the treatment of security deposits set forth in section 38-12-103(1). Section 103(1) provides that after the tenancy ends, if the tenant has fulfilled his obligations under the rental agreement, the entire security deposit will be returned; if the tenant has not performed satisfactorily, the landlord can retain all or part of the deposit by following the procedure set forth in section 38-12-103(1). Thus, the purpose of a security deposit is to “secure” the tenant’s performance by giving the tenant an incentive to perform satisfactorily so that the *1241money will be returned at the end of the lease and by providing a remedy for the landlord in the event the tenant does not perform satisfactorily. This interpretation is consistent with the common understanding of a security deposit as a classification which “accommodates the landlord’s desire for protection and the normal expectation of the tenant for a return of all or part of the fund at the end of the tenancy.” R. Schoshinski, American Law of Landlord and Tenant § 6:27, at 452 (1980) (footnote omitted). See generally Black’s Law Dictionary 1217 (5th ed. 1979) (defining security deposit as “[m]oney deposited by tenant with landlord as security for full and faithful performance by tenant of terms of lease, including damages to premises”).
The respondent, who was the tenant and the plaintiff below, had the burden of showing that the payment was intended to serve as a security deposit. See generally R. Schoshinski, supra, § 6:27, at 451 (1980) (classification of deposit is based on parties’ intent). It was not enough for the respondent to testify, as he did here, that he expected to get his money back if he cancelled before the date when his reservation began. That is not a security deposit for purposes of our law.
The respondent had to prove that his money would have been returned after he stayed in the condominium if he satisfied the terms of the lease. He could have met this burden by introducing evidence that the parties intended that (1) he would pay an additional $1360.00 as rent for the four days when he stayed in the condominium; and (2) the petitioners would keep the $1360.00 deposit check he had already sent for as long as one month after he checked out and then would return it only if he had complied with the rental agreement, pursuant to section 38-12-103(1). Such evidence clearly would have shown that the check was not prepayment of rent but was intended to be a security deposit. The respondent, however, introduced no evidence from which the court could conclude that the parties had intended the security deposit to be held pursuant to section 38-12-103(1) and he therefore failed to meet his burden of proof.1
In conclusion, I agree with the majority opinion that the language adopted by the parties is not dispositive. See § 38-12-102(2), 16A C.R.S. (1982). Therefore, the mere fact that a rental agreement describes a payment of money as an advance payment of rent, a rental reservation deposit, or the last month’s rent does not mean that the payment is not a “security deposit” within the meaning of the Security Deposit Act. However, the plaintiff has the burden of showing that the payment meets the statutory definition for, and fulfills the purposes of, a security deposit. The respondent did not meet this burden. Accordingly, I agree that the judgment of the court of appeals should be reversed and that the trial court’s order should be reinstated.
I am authorized to state that Justice YOLLACK joins in this special concurrence.

. The majority notes that the condominium information sheet "was never transmitted to the respondent,” At 1238, but still relies in part on its provisions. Because the petitioners neither gave the respondent a copy of the sheet nor informed him of its contents, the sheet can be no indication of the parties’ state of mind. It is irrelevant to the issue in this case and I would rely solely on the respondent’s failure to meet his burden of proof, rather than on any affirmative showing by the petitioners.