Many tenants in Nigeria pay a caution fee, security deposit or other form of deposit when taking possession of a rented property. The money is usually intended to protect the landlord against damage to the property, unpaid bills or other obligations of the tenant.
The problem often arises when the tenancy ends and the landlord refuses to return the deposit.
A tenant may hear statements such as:
- “The money is not refundable.”
- “It is part of the rent.”
- “You damaged the property.”
- “I will refund it when I am ready.”
- “The previous tenant never got theirs back.”
Whether the landlord is entitled to retain the money depends on the nature of the payment, the tenancy agreement, the reason for the deduction, etc.
A tenant who is entitled to a refund does not have to simply abandon the money. There are practical and legal steps that can be taken to recover it.
What Is a Rent Deposit?
The expression “rent deposit” is often used loosely in Nigeria to describe different payments made by a tenant.
It is therefore important to establish exactly what the tenant paid.
A payment described as a caution fee or security deposit is different from rent paid in advance.
Caution Fee or Security Deposit
A caution fee or security deposit is generally money held as security against specified obligations of the tenant.
Depending on the agreement, it can be used to cover matters such as:
- damage caused by the tenant;
- unpaid utility bills;
- outstanding obligations under the tenancy agreement;
- missing items belonging to the landlord; or
- other losses expressly covered by the agreement.
It is not ordinarily the same thing as rent.
Rent Paid in Advance
Rent paid in advance is consideration for the tenant’s occupation of the premises for the agreed rental period.
It should not automatically be described as a security deposit.
For example, if a tenant pays ₦2 million as one year’s rent, that ₦2 million is rent. If the tenant separately pays ₦200,000 as a caution fee, the ₦200,000 has a different legal character.
This distinction becomes important when the tenancy ends.
Is a Caution Fee Refundable in Nigeria?
Generally, where a payment was genuinely made as a security or caution deposit, it is refundable subject to legitimate deductions authorised by the tenancy agreement or otherwise legally recoverable from the tenant.
The landlord is not entitled to simply convert a security deposit into additional income because the tenancy has ended.
The precise entitlement, however, depends on the agreement and the circumstances.
The safest approach is to examine the document or receipt describing the payment.
If the tenancy agreement expressly states that the caution fee is refundable at the end of the tenancy, subject to specified deductions, the tenant has a clear contractual basis for demanding its return.
If the agreement is silent, the nature and purpose of the payment, the parties’ conduct and the surrounding circumstances become important.
Can a Landlord Keep the Entire Deposit?
Not simply because the tenant has vacated.
A landlord who intends to retain all or part of a security deposit should have a legitimate basis for doing so.
For example, the landlord can have grounds to deduct the reasonable cost of repairing damage actually caused by the tenant where the tenant is contractually responsible for that damage.
The landlord should not treat ordinary deterioration resulting from normal use as though it were automatically compensable damage.
The question is whether there is a legitimate loss for which the tenant is responsible.
What Can a Landlord Deduct from a Security Deposit?
The answer depends on the tenancy agreement and the applicable law.
Common legitimate deductions can include:
- the reasonable cost of repairing damage caused by the tenant;
- unpaid utility bills attributable to the tenant;
- unpaid rent or other sums contractually owed;
- the cost of replacing missing items belonging to the landlord; and
- other amounts which the tenancy agreement validly permits the landlord to deduct.
The landlord should be able to explain the basis of the deduction.
A tenant should therefore ask the landlord for a breakdown where the landlord refuses to refund the entire deposit.
Can a Landlord Deduct Money for Ordinary Wear and Tear?
Ordinary wear and tear is different from damage caused by the tenant.
A property naturally deteriorates through ordinary occupation.
Examples can include:
- minor marks on walls;
- ordinary fading of paint;
- normal deterioration of fittings through age;
- reasonable wear to flooring; and
- other deterioration resulting from ordinary use.
A landlord should not automatically charge the tenant for every change in the condition of the property.
Where the landlord claims that the tenant caused damage, the tenant should request evidence of the alleged damage and the cost of rectification.
What If the Landlord Says the Deposit Is Non-Refundable?
The first question is:
What exactly did the tenant agree to pay?
The word “fee” alone does not necessarily determine the legal character of a payment.
If the payment was expressly described in the tenancy agreement as a non-refundable fee, it must be distinguished from a payment expressly described as a refundable caution or security deposit.
The court will look at the agreement and the circumstances surrounding the payment.
A tenant should therefore not assume that every payment called a “caution fee” is automatically refundable without examining the agreement.
Conversely, a landlord should not simply label a genuine security deposit “non-refundable” after receiving it if that is inconsistent with the parties’ agreement.
What If There Is No Written Tenancy Agreement?
The absence of a written tenancy agreement does not necessarily prevent a tenant from recovering a deposit.
The tenant can rely on other evidence showing:
- that the money was paid;
- the amount paid;
- who received it;
- the purpose for which it was paid;
- the condition of the property;
- the circumstances in which the tenancy ended; and
- any agreement concerning repayment.
Evidence can include:
- bank transfer records;
- receipts;
- WhatsApp messages;
- text messages;
- emails;
- photographs;
- videos;
- witness testimony; and
- communications with the landlord or agent.
This is another reason why tenants should retain records of all payments made in connection with a tenancy.
What If the Landlord Says the Deposit Was Used for Repairs?
The tenant should ask for details.
A proper response would be to request:
- a description of the alleged damage;
- photographs or other evidence of the damage;
- the cost of repairing the damage;
- receipts or invoices where available;
- the amount deducted; and
- the balance remaining from the deposit.
The tenant should not accept a vague statement such as “I spent the money repairing the house” without asking what was repaired and why the tenant is responsible for the cost.
What If the Landlord Claims the Tenant Damaged the Property?
The condition of the property when the tenant moved in becomes important.
Suppose a wall was already cracked when the tenant took possession. If the landlord later claims that the tenant caused the crack, the tenant’s evidence of the property’s original condition can become decisive.
This is why tenants should take photographs and videos before moving into a property and immediately before handing it back.
Where possible, the condition of the property should also be recorded in an inventory signed by both parties.
Can the Landlord Deduct the Cost of Repainting the Property?
Not automatically.
The question is whether repainting is necessary because of damage caused by the tenant or simply because the property requires ordinary maintenance after normal occupation.
A landlord should not automatically charge a departing tenant for completely repainting a property simply because the tenancy has ended.
If, however, the tenant has caused unusual damage to the walls beyond ordinary use, the reasonable cost of restoring the affected areas can become a legitimate claim, subject to the tenancy agreement and applicable law.
What If the Landlord Has Not Refunded the Deposit After Several Months?
The tenant should not allow the matter to remain indefinitely unresolved.
The first practical step is to make a formal written demand.
The demand should state:
- the amount paid as the deposit;
- the date it was paid;
- the date the tenancy ended;
- the date possession was delivered;
- the fact that the tenant has complied with the relevant obligations;
- the amount the landlord has retained;
- any explanation previously given by the landlord; and
- the amount demanded for refund.
The tenant should also give the landlord a reasonable deadline for payment.
A written demand creates a clear record and often resolves the dispute without litigation.
What Should a Tenant Include in a Demand for Refund?
A demand letter should be precise rather than emotional.
It should identify the payment and explain why the tenant believes it is due.
For example:
“We write to demand the refund of the sum of ₦300,000 paid as a refundable caution/security deposit in respect of the tenancy at [property address]. The tenancy terminated on [date] and vacant possession was delivered to you on [date]. No outstanding rent, utility bill or damage attributable to our client remains unresolved. We therefore demand payment of the deposit within seven days.”
Where the landlord claims deductions, the letter can request a detailed statement of the deductions and supporting evidence.
What If the Landlord Ignores the Demand?
If the landlord ignores a properly made demand, the tenant can consider commencing appropriate proceedings to recover the money.
The appropriate forum and procedure depend on:
- the amount claimed;
- the location of the property;
- the applicable state law;
- the terms of the tenancy agreement; and
- the nature of the claim.
For smaller monetary claims, a Small Claims Court procedure can be available in jurisdictions where the relevant small claims regime applies.
In Lagos, landlord and tenant disputes can also be taken through alternative dispute resolution mechanisms. The Citizens’ Mediation Bureau of the Lagos State Ministry of Justice provides free mediation services for landlord and tenant disputes and other civil disputes. (lagosstatemoj.org)
Mediation can be particularly useful where the amount involved is relatively modest and the parties want to avoid the time and expense of litigation.
Can a Tenant Sue a Landlord for Refusing to Refund a Deposit?
Yes, where the tenant establishes a legal entitlement to the money.
The claim can be based on the tenancy agreement, the nature of the payment, the circumstances of the tenancy and the landlord’s failure to account for or refund money that is due to the tenant.
The tenant should be prepared to prove:
- payment of the deposit;
- the amount paid;
- the purpose of the payment;
- the termination or determination of the tenancy;
- delivery of possession;
- compliance with relevant obligations; and
- the landlord’s failure to refund the amount due.
Where the landlord has made deductions, the tenant can challenge deductions that have no contractual or legal basis.
What Evidence Should a Tenant Keep?
A tenant seeking to recover a deposit should gather all relevant evidence.
Payment Evidence
Keep:
- bank transfer receipts;
- payment confirmations;
- receipts;
- statements of account; and
- acknowledgements from the landlord or agent.
Tenancy Documents
Keep:
- tenancy agreements;
- renewal agreements;
- inventory documents;
- receipts; and
- correspondence concerning the tenancy.
Property Condition Evidence
Keep:
- photographs;
- videos;
- inspection reports; and
- evidence of the condition of the property at the beginning and end of the tenancy.
Communication
Keep:
- WhatsApp messages;
- emails;
- text messages;
- letters; and
- voice notes where relevant and lawfully usable as evidence.
These records can make a significant difference if the dispute eventually reaches court.
What If the Landlord Claims There Are Unpaid Utility Bills?
A landlord can have a legitimate claim for utility charges that are the tenant’s responsibility under the tenancy agreement.
However, the landlord should identify the amount claimed and the basis for it.
A tenant should request:
- the relevant bills;
- meter readings;
- the period covered;
- evidence of the outstanding balance; and
- the amount deducted from the deposit.
If the tenant agrees that the amount is outstanding, it can properly be deducted where the agreement permits it.
If the tenant disputes the amount, the disputed sum should not simply be retained without explanation.
Can a Landlord Use the Deposit to Cover Rent Arrears?
Where the tenant genuinely owes rent and the tenancy agreement permits the deposit to be applied against such obligations, the landlord can have a basis for making the deduction.
However, a landlord should not manufacture arrears simply to avoid refunding the deposit.
The landlord’s claim should be supported by the tenancy records and evidence of the amount actually outstanding.
Does a Tenant Lose the Deposit by Leaving Before the Tenancy Expires?
Not automatically.
The consequences of leaving before the expiration of a tenancy depend on the tenancy agreement and the circumstances.
A tenant who vacates early can be liable for obligations arising from an unlawful or unauthorised early termination, depending on the agreement and applicable law.
The landlord may therefore have a claim that is separate from the question of the deposit.
A tenant should not assume that the deposit must be returned in full merely because the property was handed back early.
Equally, the landlord should not automatically keep the entire deposit without establishing the loss suffered.
What If the Landlord Sells the Property?
The sale of the property does not automatically extinguish every monetary obligation arising between the landlord and tenant.
Where a deposit was paid to a landlord or property manager, the tenant should establish who is responsible for holding and refunding the money.
If ownership or management changed during the tenancy, the tenant should preserve documents showing:
- who received the deposit;
- who managed the property;
- when the property changed hands; and
- what was agreed regarding the tenant’s deposit.
This can become particularly important where the former landlord says the new owner is responsible, while the new owner says the former landlord retained the money.
What If the Agent Collected the Deposit?
The tenant should identify the capacity in which the agent received the money.
An agent who received the deposit on behalf of the landlord cannot simply treat the money as the agent’s own money if the payment was made for the landlord’s account.
The tenancy agreement, receipt and payment records should be examined to determine the parties’ respective obligations.
Does the Lagos State Tenancy Law Specifically Regulate Every Security Deposit?
The Lagos State Tenancy Law 2011 regulates the relationship between landlords and tenants and contains provisions concerning tenancy agreements, rent, obligations and recovery of premises. However, it should not be represented as though it creates one universal statutory refund timetable for every caution or security deposit.
The contractual terms and nature of the payment remain important.
Furthermore, the Law does not apply to every premises in Lagos. It expressly excludes certain premises and areas, including Apapa, Ikeja GRA, Ikoyi and Victoria Island.
A tenant should therefore establish which law applies to the particular premises before relying on a statutory provision.
What About the Lagos Tenancy and Recovery of Premises Bill 2025?
The Lagos State Government announced in 2025 that amendments to the tenancy law were being pursued, with a bill forwarded to the State House of Assembly. The official Lagos State Ministry of Justice material describes the measure as a bill for legislative action, rather than presenting it as the existing operative Tenancy Law.
Accordingly, tenants should not treat provisions contained in a proposed bill as though they have already replaced the Lagos State Tenancy Law 2011.
For a specific dispute, the legislation actually in force at the relevant time should be verified.
How Can a Tenant Prevent a Deposit Dispute?
The best way to recover a deposit is to create evidence before the dispute arises.
Before Moving In
The tenant should:
- obtain a written tenancy agreement;
- ensure the deposit is clearly identified;
- obtain a receipt;
- take photographs and videos of the property;
- prepare an inventory;
- record existing defects; and
- obtain the landlord’s acknowledgement where possible.
During the Tenancy
The tenant should:
- report significant defects promptly;
- retain evidence of repairs and complaints;
- pay rent and agreed charges on time;
- retain payment records; and
- avoid causing unnecessary damage.
Before Moving Out
The tenant should:
- inspect the property;
- repair damage for which the tenant is responsible;
- settle outstanding utility bills;
- take photographs and videos;
- arrange a joint inspection where possible;
- return the keys; and
- obtain evidence confirming delivery of possession.
These steps can substantially reduce the scope for disagreement over the deposit.
What Should a Tenant Do If the Landlord Makes an Unreasonable Deduction?
The tenant should first request a written explanation and supporting evidence.
If the landlord deducts ₦200,000 for “repairs”, the tenant should ask:
What was damaged?
When was the damage identified?
What was the cost of repairing it?
What part of the tenancy agreement permits the deduction?
Is there an invoice, receipt or other evidence of the expense?
If the landlord cannot satisfactorily establish the deduction, the tenant can formally demand the disputed amount.
Can the Tenant Recover Interest on the Deposit?
Not automatically.
Whether interest is payable depends on the terms of the agreement, the nature of the deposit and the legal basis of the claim.
A tenant should therefore distinguish between:
- the principal amount of the deposit;
- interest expressly agreed upon;
- interest awarded by a court; and
- any other monetary relief available under the circumstances.
The tenant should not assume that every security deposit automatically earns interest simply because the landlord held the money.
Conclusion
A tenant who has paid a genuine caution or security deposit is not required to simply accept the landlord’s refusal to return it.
The first step is to establish what the payment was for and what the tenancy agreement says about it. Where the deposit is refundable and the landlord has no legitimate basis for retaining it, the tenant can demand its return.
Where deductions are claimed, the tenant should require the landlord to identify the damage, unpaid obligation or other basis for the deduction and provide an appropriate account of the amount retained.
A tenant should also remember that evidence is critical. Payment records, tenancy agreements, inventories, photographs, videos, inspection records and correspondence can determine whether a deposit dispute is resolved quickly or becomes prolonged litigation.
Where negotiation fails, the tenant can consider mediation or appropriate legal proceedings to recover the money. In Lagos, the Citizens’ Mediation Bureau provides free mediation services for landlord and tenant disputes. (lagosstatemoj.org)
If your landlord has refused to refund your caution fee, security deposit or other money paid in connection with your tenancy, Lexforte Attorneys can review your tenancy documents and evidence, assess whether the landlord is entitled to retain the money and take the appropriate steps to recover the amount due to you. Contact Lexforte Attorneys for professional assistance with rent deposit recovery and landlord and tenant disputes in Nigeria.