After a tenant moves out of a residential unit in Moncton, the property manager discovers significant damage to the hardwood flooring, estimated at $2,500, which clearly goes beyond normal wear and tear. The tenant's security deposit was $1,000. What is the property manager's obligation regarding the deposit and the additional costs?

Question: After a tenant moves out of a residential unit in Moncton, the property manager discovers significant damage to the hardwood flooring, estimated at $2,500, which clearly goes beyond normal wear and tear. The tenant's security deposit was $1,000. What is the property manager's obligation regarding the deposit and the additional costs?

Answer options:

• Return the full security deposit to avoid legal disputes, absorbing the damage cost.
• Withhold the full security deposit and bill the tenant for the remaining $1,500 difference for damages.
• Return the security deposit, but sue the tenant in small claims court for the entire $2,500. ✅ Apply the security deposit towards the damages and inform the tenant of the remaining balance owed, providing an itemized statement.

Correct answer: Apply the security deposit towards the damages and inform the tenant of the remaining balance owed, providing an itemized statement.

Explanation: Under most Residential Tenancies Acts, including New Brunswick's, a landlord can retain a portion or all of a security deposit for damages beyond reasonable wear and tear. The property manager must apply the deposit and then seek to recover the remaining balance from the tenant, always providing an itemized statement as per standard practice.