C. Upon termination of the residency, property or money held by the owner as
deposits may be applied by the owner to the payment of rent and the amount of
damages which the owner has suffered by reason of the resident's noncompliance with
the rental agreement or Section 47-8-22 NMSA 1978. No deposit shall be retained to
cover normal wear and tear. In the event actual cause exists for retaining any portion of
the deposit, the owner shall provide the resident with an itemized written list of the
deductions from the deposit and the balance of the deposit, if any, within thirty days of
the date of termination of the rental agreement or resident departure, whichever is later.
The owner is deemed to have complied with this section by mailing the statement and
any payment required to the last known address of the resident. Nothing in this section
shall preclude the owner from retaining portions of the deposit for nonpayment of rent or
utilities, repair work or other legitimate damages.
D. If the owner fails to provide the resident with a written statement of deductions
from the deposit and the balance shown by the statement to be due, within thirty days of
the termination of the tenancy, the owner:
(1) shall forfeit the right to withhold any portion of the deposit;
(2) shall forfeit the right to assert any counterclaim in any action brought to
recover that deposit;
(3) shall be liable to the resident for court costs and reasonable attorneys'
fees; and
(4) shall forfeit the right to assert an independent action against the resident
for damages to the rental property.
E. An owner who in bad faith retains a deposit in violation of this section is liable for
a civil penalty in the amount of two hundred fifty dollars ($250) payable to the resident.