California · Civil Code §1950.5(i)–(k)California tenant security deposits when selling a rental: transfer or return, the buyer's statement and joint liability

When a California landlord's interest ends – by sale or otherwise – the landlord or its agent must, within a reasonable time, either transfer the remaining security, after lawful deductions, to the successor and then notify the tenant by personal delivery or first-class mail of the transfer, any claims against the deposit, the amount deposited and the successors' names, addresses and telephone numbers, or return the remaining security to the tenant with an itemized accounting; either one relieves the landlord of further liability for the deposit (Cal. Civ. Code §1950.5(i)). Before a voluntary transfer, the landlord gives the buyer a written statement of the security remaining, an itemization of any deductions and which of those two options it elected; failing to do so doesn't affect the validity of title (§1950.5(j)). If the landlord doesn't comply with subdivision (i), the buyer is jointly and severally liable with the landlord for repaying the security, and may not demand a new deposit from the tenant until it first makes restitution or gives an accounting – unless, after inquiry and reasonable investigation, it believes in good faith that the deposit was transferred or returned (§1950.5(k)).