What happens to our security deposit when building is sold?

[deborah53]

I rent a commercial space for my nonprofit business. We received notice first from bank that all rents were to be made to them directly as they were working with current owner to sell property. Recently the building was sold. Previous landlord and bank did a deed transfer. The bank then owned it briefly before selling to new owner. During this process we had to show proof of our security deposit with previous owner so new owner wouldn't have to charge us another one. At signing of the lease the new owner said the previous owner didn't have the security deposit and so there is none but he is not charging us for another because we showed proof of payment to previous owner.

In the event we should terminate our lease, will we get a security deposit back? Should we take previous owner to small claims court now to retrieve this security deposit and then give it to new owner?

What does Wisconsin law say regarding this? What is the law I can quote if I need to take action?

 

[army judge]

I rent a commercial space for my nonprofit business. We received notice first from bank that all rents were to be made to them directly as they were working with current owner to sell property. Recently the building was sold. Previous landlord and bank did a deed transfer. The bank then owned it briefly before selling to new owner. During this process we had to show proof of our security deposit with previous owner so new owner wouldn't have to charge us another one. At signing of the lease the new owner said the previous owner didn't have the security deposit and so there is none but he is not charging us for another because we showed proof of payment to previous owner.

In the event we should terminate our lease, will we get a security deposit back? Should we take previous owner to small claims court now to retrieve this security deposit and then give it to new owner?

What does Wisconsin law say regarding this? What is the law I can quote if I need to take action?

Your security deposit should be transferred to the new owner by the old owner as part od the sale.
That often fails to occur.
Why not ask the new owner and the old owner to insure that ALL deposits are transferred to the new owner.
Sometimes the old owner give sthe money to the former tenants, and they in turn give it to the new owner.
You can always sue anyone in any court.,
But, collecting your judgment often proves futile and frustrating.
Fewer than 20% of all judgments ever reach the hands of the prevailing plaintiff!
This is a national average.

 

[deborah53]

Your security deposit should be transferred to the new owner by the old owner as part od the sale.
That often fails to occur.
Why not ask the new owner and the old owner to insure that ALL deposits are transferred to the new owner.
Sometimes the old owner give sthe money to the former tenants, and they in turn give it to the new owner.
You can always sue anyone in any court.,
But, collecting your judgment often proves futile and frustrating.
Fewer than 20% of all judgments ever reach the hands of the prevailing plaintiff!
This is a national average.

Thank you for your answer. However, I still need to know if there is an actual Federal or Wisconsin law that deals with this type of transaction. So many places on the web that I've researched tell me specifically for certain states, but they all say the same thing.....it should be transferred but if it isn't then the new owner & seller are both responsible for the security deposit, while the new owner bears ultimate responsibility and state does not require tenant to 'chase' old landlord for money. I need to know if this is true for Wisconsin law also and where can I find this in writing?

 

[army judge]

Thank you for your answer. However, I still need to know if there is an actual Federal or Wisconsin law that deals with this type of transaction. So many places on the web that I've researched tell me specifically for certain states, but they all say the same thing.....it should be transferred but if it isn't then the new owner & seller are both responsible for the security deposit, while the new owner bears ultimate responsibility and state does not require tenant to 'chase' old landlord for money. I need to know if this is true for Wisconsin law also and where can I find this in writing?

Please do not take my answer as flippant or callous.

I do not mean it to be.

As a volunteer, I can't do legal research in response to every query posed by our users.

Our advice is meant to be general.

We sometimes post the exact cite or reference.

Often that is not possible.

I gave you a general answer to a legal dilemma.

I'm sorry, you'll have to do your own legal research.

Generally there are not laws to cover every human conflict or disagreement.

WI may have codified this situation.

If they have it is in the area of landlord tenant law.

You might contact your local small claims court, state legislators, or retain a WI attorney.

Good luck.