State sues Chapel Hill landlord over security deposits

Cooper filed suit against Ware Investments LCC and its managing officer, James Ware Kelly, last week, seeking to stop what he called deceptive practices and win money back for student renters.

“Some landlords need to be taught a lesson,” Cooper said in a statement. “The law on security deposits is clear, and they must follow it.”

Kelly and his company rent apartments and houses to university students in Chapel Hill and Durham. Cooper's lawsuit alleges that security deposits are deposited in personal or regular business accounts instead of being placed into a separate trust account, as required by law.

When tenants’ leases end, Ware Investments and Kelly withhold security deposits and don't provide a written record of any charges for which the deposits have been used, according to the lawsuit.

Tenants in Orange County have filed numerous suits in the past against Kelly and Ware Investments over security deposits, Cooper said.

“Across the state, many college students will soon be moving into apartments for the new school year, and we want first-time renters to know their rights so they can avoid getting ripped off,” he said.