My friend and I met with the landlord of a house that is currently in disrepair. She assure dus that by move in day that it would be fixed up. We both signed the lease in front of her, and agreed to return in to her one week later with the other four signatures for the 6-person house. Upon seeing the condition of the house, the other four did not want to sign, so we told the landlord that we could not fill the house and no longer wanted to live there. The lease was never returned and security deposit never paid. Does she have the ability to demand payment or take us to court?

Don't sweat it. If she doesn't have a lease she doesn't have a leg to stand on. Just make sure you don't return it to her and pay nothing. I am a landlord and she has plenty of time to fill her vacancy.