I went through a similar situation in Massachusetts about a decade ago, although the story is much more weird (and entertaining). I'll explain the whole thing. If you just care about the legal stuff, skip to the 5th-to-last paragraph.
I moved into a duplex where the landlord lived above me. He was my age (mid-20s), and seemed nice enough (although a bit of an awkward personality). His parents owned the house, and he was fixing it up for them to move in. The lease itself was hilarious, full of random things like "the tenant will not slam the garage door like a contestant spinning the wheel on The Price Is Right".
There was a basement which was generally off-limits to me, but I did buy a washing machine/dryer while I lived there, and the only place to put it was in the basement. So I was given access. The basement had all kinds of bizarre things in it - random old TVs, aquariums, etc. Just tons of old junk. I asked about it, and was told that it was stuff left from old tenants. While I went in there every week to do laundry, the collection slowly grew, but I thought nothing of it.
After almost a year of being there, I decided not to renew the lease. I informed the landlord, and he wanted to show the place to people. I said that was fine, I just needed notice (24hr or whatever).
It was the night before a 3 day weekend, and I was leaving to go on a climbing trip. As I was getting into my car, the landlord asks if he can show the place on Saturday. I tell him sure, but I was headed out, so I wouldn't have time to clean up - the place wasn't a huge mess, but there were some dishes in the sink. He said that was fine.
I come back on Sunday evening, and I notice a Rosemary bush has been planted outside the house in the ground. I look closer, and realize that it's *my* rosemary plant. I go into the house, and the landlord has washed my dishes (hey, that's cool) and removed my houseplants (Rosemary, some aloe, some random others). He's also re-arranged the inside of my medicine cabinet, and rearranged some random other stuff. At this point, I'm incredibly freaked out. I go upstairs, ask him where my plants went - he tells me that they looked like they needed water, so he planted some outside (don't ask me what the logic was there) and brought some others into his apartment. He asks if that's okay, and tells me that he can dig them back up if I want. I'm starting to wonder about the mental state of this guy, so I tell him he can keep the plants. I wonder if there's anything else he took, but I'm just glad that he didn't think my cat looked hungry or something.
I speed up my efforts to find a new place to live. I try to keep my distance from the landlord. I don't take any more trips, and I make sure to be present when he asks to show the place. He finds a new tenant, I move out, and it's pretty uneventful. I expect to be dinged on the security deposit for 2 things: a round burn mark I made on the counter top (which was wood) by placing a hot pot on top of it, and for leaving some bags of garbage outside for trash pickup that don't fit into the normal cans. I left my new address with him (which was actually a condo that I bought - I was done dealing with sketchy landlords).
I give him a week, and then email to ask about the security deposit. He says that he's super busy with stuff, and tells me it'll be a few weeks before he gets around to getting an estimate for the countertop. Fine.
I wait a few weeks. I email him. Silence.
I wait another week. I try calling him, and leave a voicemail.
I wait some more time, and email. Nothing. Finally, I go there and knock on his door. His car's there, but no one answers. I leave a letter in his mailbox with my address, asking him to contact me about the security deposit.
At this point, there was a lot going on in my life - relationships, being busy at work, fixing up the condo, etc. It was also before I was particularly frugal. It was $1450, and I was making like $8k/month, so I just kind of dropped it. I didn't have time to deal with it.
Fast foward about a year. I have some blender which broke. Either the glass carafe broke but the base was fine, or vice-versa. Either way, rather than throwing it away, I put it on Craigslist's free section in case someone wanted it. Someone emails me, saying they'll be driving through my neighborhood shortly and want to pick up the blender. They have their phone number and first name in the email. I'm getting ready to respond, when I realize that the name and email style looks familiar. I realize that it's the same way my old landlord used to write. I look up his phone number in my contact list, and sure enough - it's my landlord. It occurred to me that the stuff in the basement wasn't from tenants - the guy just collected free junk off CL or something. And now he wanted my blender.
I email him back, saying that he's welcome to the blender.. but he also owes me a security deposit. He responds saying that he will drop off a check, but that he had to take money out for fixing stuff. I respond that it's fine, please come by and drop off the check/pick up the blender. He follows up saying that something came up, and that he couldn't come by now, but he'd be by later in the week.
At this point, I'm pissed. Getting the money back would be nice, but I'm more pissed that the guy had the nerve to do this to people. I was fortunately in a position where $1450 didn't make much of a difference in my life, but I could see it being a huge issue for someone living paycheck-to-paycheck. I looked up MA tenant laws, and discovered that there was a deadline for getting back a security deposit, and that any money removed from the deposit had to be itemized. I also discovered that the landlord is required to keep security deposits in a separate bank account, and tell me the account number (this information came in useful later when I moved from MA and became a landlord myself, renting out the condo). The landlord did none of this, though to be fair - I'd rented in 3 or 4 different apartments in MA, and *no* landlord had ever given me information about a security deposit account. The penalty for a landlord not returning a security deposit before the deadline is that the tenant is entitled to 3x the deposit. 1450 * 3 = $4350. Now we're talking about some real money.
I send him certified mail asking for the security deposit, including my address. I make a copy of the letter. The landlord signs for it, so I now have proof to show a judge that he's seen my letter.
I wait the requisite 30 days or whatever. Then I file in small claims court. I get assigned a date. The day arrives, I take off work and show up. There's a whole lot of waiting around. Finally they call my name, and call the landlord's name (whoa, he showed up!). We are told to go to a separate room. There's a judge who has us both come to the front. Before we even get to talk, he looks over the documents I filed (lease, certified mail, my bank statement showing the paid security deposit) and asks if we'd be willing to talk with a mediator. We both say yes, so we go to another room.
The mediator talks to both of us separately. He's an ex-lawyer who is doing this for fun. He tells me that he can't give me legal advice (note: I hadn't contacted a lawyer at all). He looks over my stuff, and kind of implies that.. yeah, I'm gonna win this. He goes over to talk to the landlord. The landlord is getting visibly upset. Finally, he motions me over. The landlord has a picture of the burn mark, and says that I needed to pay for that. I calm explain that yes, I would have been happy to - if he'd returned any of my calls/emails. I explain that the law requires him to give me a list of things taken out of the security deposit within X days, and that legally he now owes me $4350. He looks at the mediator, who kind of gives him a pained "yeah, you're fucked" look. The landlord starts talking about how hard to was to find a contractor, and how he doesn't have that kind of money, and how his parents don't know the first thing about being landlords, how they control all of his money and they're broke and so on.
It was pretty clear that he was having issues (family, money, maybe substance abuse or others things?), and I did feel bad about burning the countertop. I tell him that if he can pay me $1500 tomorrow, we can consider the matter settled. He tells me that he can't pay until the end of the week. I say fine. We go back in front of the judge, the mediator tells the judge that we've reached an agreement and the details of the agreement. The judge basically threatens the landlord ("if the check isn't received, this will get very bad for you..").
At the end of the week, I get a check for $1500 dropped off in my mailbox. I never hear from the landlord again, although I like to think that he's at least returning security deposits to his tenants these days. Someone else on CL takes the blender, which sadly means I can't call this the story of how I sold a broken blender on Craigslist for $1500.. :)