How to get a villa security deposit back in Bali without a handover report: a case study

At the end of a long lease in Bali, you are moving out, and the owner announces that the whole security deposit will go on repairs. You disagree, but you have no proof of "how it was at move-in". We walk through a real case.

The situation

A foreigner rented a villa in Bali for one and a half years. The security deposit was about 28 million rupiah. After the tenant moved out, the owners kept the entire deposit.

At first they pointed to stains on the floor and the condition of the walls. Later they added a collapsed ceiling, the pool, the garden and the keys. There were no receipts, no estimate and no report signed at move-out. There were photos and videos with no date.

For several weeks the client tried to reach an agreement on his own, without result. Then he came to us.

The legal reality: by default, the law is not on the tenant's side

KUHPerdata (the Civil Code of Indonesia) allocates the risks as follows:

• If an inventory and condition list (pertelaan) was drawn up at move-in, the tenant returns the property in the condition recorded in the list. Wear and tear over time and damage that could not have been avoided are not counted (Art. 1562).

• If there was no list, the tenant is presumed to have received the property in good condition and must return it in the same condition as regards routine upkeep. Only the tenant can prove otherwise (Art. 1563).

• The tenant is responsible for damage that arose during the lease, unless they prove it did not happen through their fault (Art. 1564). The tenant is also responsible for damage caused by those who lived with them (Art. 1566).

The conclusion: without a handover report with photos and dates, the tenant starts the dispute from a weaker position. The law does not regulate the security deposit itself separately; its fate is determined by the contract and the evidence.

Why the client's position still turned out stronger

The presumption in favor of the owner does not relieve the owner of the duty to show that the damage actually existed, arose specifically during the lease and is worth the amount claimed. Our legal specialist built the position on this:

• the owners' photos and videos had no date or metadata: it is impossible to confirm when they were taken;

• the claims about the ceiling, the pool and the garden appeared only after move-out and after the owners had started work at the villa;

• there is no move-out report signed by both sides, no item-by-item estimate and no receipts;

• part of what was claimed is natural wear and humidity. The security deposit covers minor damage and furniture, not the capital condition of the house.

How the process went

• Document analysis. The client provided the contract, the correspondence, his own photos and a timeline. Our legal specialist prepared a written assessment of the strong and weak points of the position.

• First somasi (somasi — an official pre-trial demand letter). Our legal specialist drew up a letter to the owners, and the client revised and supplemented the text twice so that the letter reflected the facts exactly.

• The owners' reply was generic and without evidence. Our legal specialist demanded in writing that they confirm the dates the photos and videos were taken and split the claims into separate items.

• Second somasi — firmer, with a breakdown of each claim. After it, the owners offered to return 15 million rupiah.

• Negotiations. The client made a counteroffer of 20 million and, with the help of our legal specialist, secured his position. The owners agreed.

• Settlement agreement. Our legal specialist drew it up, and the parties signed the document.

At the start, the owners did not intend to return anything. In the end, they committed in writing to return about 70% of the security deposit. Some of the payments arrived late, and our legal specialist continues to monitor performance against the schedule.

Why not court

We told the client plainly: with a dispute amount of 28 million rupiah, a full lawsuit is economically doubtful. The costs and the time could be comparable to the security deposit, and one of the owners is outside Indonesia. A police report is also not suitable: this is a civil dispute over a security deposit, not a crime. To learn how it ends when someone takes matters into their own hands and keeps items in place of a deposit, read our case about the criminal case over a deposit.

What a tenant should do — before and after

• At move-in, draw up a report with dated photos and videos and have the owner or manager sign it. This is the main protection under Art. 1562–1563.

• Set out the conditions for returning the security deposit in the contract: the deadline, the procedure for deductions, and the obligation to confirm them with receipts.

• At move-out, draw up a report signed by both sides with photos and a list of keys. If the owner refuses to sign, record a dated walkthrough video and send it in the correspondence the same day.

• Do not accept claims that appear after move-out without evidence that the damage arose on your watch.

• If you could not reach an agreement, move on to a letter from a legal specialist. In this case, the owners offered money for the first time only after the second somasi, although before that the client had corresponded with them on his own for several weeks.

• In a settlement agreement, do not sign a general waiver of claims until you have received the money.

A similar villa lease dispute: the owner demanded 100 million rupiah for repairs.

If an owner is keeping your security deposit and you cannot reach an agreement on your own, send us the lease, the correspondence and the photos. Our legal specialist will assess the strong and weak points of your position and advise whether to move on to a somasi. Contact us for details.