Minnesota Session Laws - 1998, Regular Session

                            CHAPTER 266-H.F.No. 2590 
                  An act relating to landlords and tenants; correcting a 
                  reference relating to certain civil penalties; 
                  providing for interest rates on security deposits; 
                  amending Minnesota Statutes 1996, sections 504.183, 
                  subdivision 6; and 504.20, subdivision 2. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 1996, section 504.183, 
        subdivision 6, is amended to read: 
           Subd. 6.  [PENALTY.] If a landlord substantially violates 
        subdivision 2, the tenant is entitled to a penalty which may 
        include a rent reduction up to full rescission of the lease, 
        recovery of any damage deposit less any amount retained under 
        section 504.20, and up to a $100 civil penalty for each 
        violation.  If a landlord violates subdivision 5, the tenant is 
        entitled to up to a $100 civil penalty for each violation.  A 
        tenant shall follow the procedures in sections 566.18 to 566.33 
        566.34 to enforce the provisions of this section. 
           Sec. 2.  Minnesota Statutes 1996, section 504.20, 
        subdivision 2, is amended to read: 
           Subd. 2.  Any deposit of money shall not be considered 
        received in a fiduciary capacity within the meaning of section 
        82.17, subdivision 7, but shall be held by the landlord for the 
        tenant who is party to the agreement and shall bear simple 
        noncompounded interest at the rate of three percent per annum 
        until May 1, 1999 2001, and four percent per annum thereafter, 
        computed from the first day of the next month following the full 
        payment of the deposit to the last day of the month in which the 
        landlord, in good faith, complies with the requirements of 
        subdivision 3 or to the date upon which judgment is entered in 
        any civil action involving the landlord's liability for the 
        deposit, whichever date is earlier.  Any interest amount less 
        than $1 shall be excluded from the provisions of this section. 
           Presented to the governor March 2, 1998 
           Signed by the governor March 4, 1998, 10:08 a.m.