Hmmm that is a tough one ~ I have it in my code of conduct that 'that while children are 'learning' and will be given a buffer on poor behavior that poor behavior on the adults part is grounds for immediate termination and forfeiting of the security deposit in lieu of notice' .... I also have that 'chronic issues with payment will result in termination of this contract without notice and forfeiting of the security deposit' so there is no question I would KEEP the deposit in a case such as this as the late payment first time is strike one and having to 'chase' them for payment is strike two and the throwing money at you, the silent treatment and so forth are strike THREE because those are all POOR behavior for a grown up to engage in!!!

However that said depends on how much conflict you want to deal with ~ if your contract is not 'clear' that they risked being terminated or loosing their deposit for such behaviour they might get even more childish and try to 'sue you' if you do not return the deposit in lieu of notice ... so depends on if you want to take that risk or just take the high road and refund it to make them go away?

When I worked in administration and we wanted to 'fire' an employee even when we had CAUSE we always just paid them severance pay in lieu of notice cause we wanted them gone with no excuse for them to make more trouble ~ it was just 'easier' to invest in paying them to be gone than to deal with them any longer just to prove we were 'right' cause with people who behave in ways they can be fired or terminated they RARELY think they were in the wrong and are the type to blame everyone else for things that go wrong in their life and think the world owes them and so forth .... and their behaviour to date has me thinking they are 'those types' who are angry with YOU because you had the balls to call them on their poor behaviour which they feel 'entitled' to behave like!