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A Texas landlord who retained a couple’s $2,600 security deposit and sued them for additional money after they moved out has lost most of her appeal against a judgment in the tenants’ favour.
In a memorandum opinion dated October 15, 2026, the Texas Fourteenth Court of Appeals upheld the lower court’s decision in Yunan Angelina Zhou v. Adrienne Rawlings and Corey Rawlings, while correcting the calculation of damages and prejudgment interest. The dispute centred on alleged repair, cleaning, rekeying and painting costs, as well as whether the landlord had wrongfully withheld the deposit under Texas law.
The ruling leaves the tenants’ main victory intact.
Dispute began after the couple moved out
The case arose from a residential lease between Zhou and the Rawlingses. At the end of the tenancy, Adrienne and Corey Rawlings moved out of the house they had rented from Zhou. Zhou alleged that the property required repairs, cleaning, rekeying and painting after the couple left. She retained their $2,600 security deposit and demanded additional payment for the work she claimed was necessary.
When the couple did not pay the additional amount, Zhou filed a lawsuit in justice court, alleging breach of contract and fraud.
The Rawlingses responded with counterclaims, seeking statutory damages and other relief over the landlord’s retention of their security deposit.The dispute eventually reached Harris County’s County Civil Court at Law No. 2, where the case was heard in a trial without a jury. The court ruled against Zhou on her claims and awarded the Rawlingses damages under Texas’s security-deposit law, along with prejudgment interest, attorney’s fees, costs and post-judgment interest.
Zhou then appealed the judgment to the Texas Fourteenth Court of Appeals.
Why the security deposit became central to the case
Texas law places specific obligations on landlords who retain security deposits after tenants leave a rental property. Under Section 92.104 of the Texas Property Code, a landlord may deduct amounts for which a tenant is legally liable under the lease or for breaching it, but cannot retain money to cover normal wear and tear. The law also generally requires landlords who make deductions to provide a written description and itemised list of the charges, subject to statutory exceptions.
Section 92.109 of the Texas Property Code provides that a landlord who, in bad faith, retains a security deposit may be liable for $100, three times the portion of the deposit wrongfully withheld, and reasonable attorney’s fees.Zhou challenged the statutory award, arguing that the Rawlingses had not provided a forwarding address as required by Texas law. She maintained that this failure meant they were not entitled to the damages awarded.
However, the appellate court concluded that it could not overturn the trial court’s decision on that basis because the record was incomplete. Neither party had requested a court reporter to record the trial proceedings, leaving the appeals court without a transcript showing what evidence had been presented.
Missing trial transcript weakened the appeal
The absence of a trial transcript proved important to the outcome. Zhou argued that the evidence did not support the rejection of her breach-of-contract and fraud claims, or the statutory damages awarded to the Rawlingses.
The appeals court explained that a party challenging the sufficiency of evidence must provide an adequate appellate record. Without a transcript, the court generally presumes that the missing portions support the trial court’s judgment.The judges also clarified that the trial court had not simply dismissed Zhou’s claims because there was no evidence. Rather, it had found that she failed to establish her claims by a preponderance of the evidence.
Because Zhou could not demonstrate from the available record that the trial court’s findings were legally or factually incorrect, the appeals court rejected her challenges to the underlying claims and the statutory liability finding.
Appeals court corrects damages calculation
Although the court largely upheld the judgment, it agreed with Zhou on two calculations. First, the judgment had awarded the Rawlingses both the original $2,600 deposit and $7,800 in treble damages.
The tenants agreed that this counted the deposit twice. The appeals court therefore modified the judgment to set the total damages award at $7,800. Second, the court agreed that prejudgment interest had been calculated incorrectly.
It reduced the amount from $3,019.36 to $158. The court rejected Zhou’s challenge to the attorney’s-fee award because the missing trial transcript prevented it from assessing the evidentiary basis for that award. The court affirmed the judgment as modified on October 15, 2026. The decision preserves the tenants’ main victory while correcting the monetary calculations. It does not establish that landlords can never deduct repair costs; rather, it reinforces the importance of complying with security-deposit requirements and providing a sufficient record when challenging a court’s findings.