The previous owner came back and called the police. They left 2 boxes in the garage and a love seat. We thought it was just stuff the previous owner didn’t want. We offered the stuff to them but they didn’t want to take it. 2 weeks later we got a call from a law firm demanding restitution. They said we should have given the previous owner a notice, even though they had moved out of the property.
Although I am not an expert on the law I am not aware of a specific test for determining occupancy. It is hardly reasonable that a couple of boxes and a small couch in the garage constitutes occupancy so it sounds to me like you have a pretty good case. Unfortunately in our legal system you do not have to be wrong to be sued. You have to decide if it is worth the fight or if you want to negotiate with them so the problem just goes away.