Wednesday, 28 November 2012

Ontario: Illegal Security Deposits

From time to time clients bring me some odd leases that have been drafted, not by lawyers, but by landlords themselves.  For the most part the terms are reasonable and generally enforceable.  However, one area that is always problematic, is anything to do with security deposits and "additional charges".  Often, the security deposits seem reasonable and the additional charges for things like late payment of rent charges (sometimes as interest) and charges for "included" furniture are not shocking to the conscience.  The problem though, is that the vast majority of the charges levied in this way are illegal under the Residential Tenancies Act.


With respect to security deposits in Ontario, the only legal security deposit is a rent deposit for the last month's rent that a landlord must collect on or before entering into a tenancy agreement.  This means that it is Illegal to demand a security deposit for things like damage to the rental unit--whether or not the charge is refundable.  A landlord simply can not get "extra" security under the law.  The legal limitations in this regard are set out in section 105 (Security Deposit Limitation) of the Residential Tenancies Act and section 106 (Rent Deposit May be Required).

The restriction on security deposits and what may legally be charged to tenants has many landlord's very upset.  The source of the upset may be summarized as a feeling that the government is unnecessarily curtailing what a property owner can do with their lands--even to the extent of over-riding the terms of a contract willingly entered into by a tenant.  The argument generally goes that a landlord should be allowed to offer his premises on whatever terms he wishes and if a prospective tenant does not like it--then they do not have to rent the unit.  This argument finds a fair amount of favour among land owners and often they point at the laws that apply to commercial tenancies in Ontario to demonstrate that people can successfully negotiate the terms of leases--that work--without the nanny state interfering.  That being said, this simply is not the law in Ontario.

Given the restriction on security deposits, landlords will sometimes try to come up with other creative charges to circumvent the prohibition on security deposits.  The law has answered such schemes with section 134 of the Residential Tenancies Act that says:  ADDITIONAL CHARGES PROHIBITED.  This section makes it illegal for a landlord to directly or indirectly with respect to any rental unit collect or require or attempt to collect or require from a tenant or prospective tenant of the rental unit a fee, premium, commission, bonus, penalty, key deposit or other like amount of money whether or not the money is refundable.  The section goes further to catch even other scenarios (see the link above to read the legislation). 

What I think is quite iumportant to note is the prohibition on even just asking the tenant for such a charge.  I have seen it often enough where a landlord, knowing the proposed charge is illegal, decides to try it on with the tenant.  If the tenant accepts it then the charge is taken---if the tenant objects, the landlord figures that there is no harm in trying.  I note here, that in fact there is "harm in trying" as it is illegal to even propose an illegal charge to a tenant.  Proposing it, may indeed be enough for charges to be laid against a landlord under the Residential Tenancies Act pursuant to the Provincial Offences Act.  In my opinion, this will be more likely where the landlord can be demonstrated to be pursuing such charges knowing full well that the charges are not proper.

The issue of legal and illegal charges and security deposits needs to be of equal interest to landlords and tenants.  For tenants the interest is to avoid paying what the law says need not be paid.  For landlords, complying with the law has its own reward which in this case is to avoid being taken the Landlord and Tenant Board by your tenant or worse, having the Investigations Branch lay charges against you.

Michael K. E. Thiele
Ottawa, Ontario
Lawyer
2012

250 comments:

  1. and when a tenant moves out and takes my fridge and stove with them what recourse do i have? what incentive do they have to NOT take advantage of me?
    and when they move out and my house interior is painted black? I get the privilege of paying someone to repaint the whole house?
    A security deposit is enough incentive to keep tenants in check

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    1. Maybe you should be screening for better quality tenants. Don't rely on credit scores (if they exist in Canada), ask them to prove their rent payment history for the past 12 or 24 months. (Copies of cancelled checks or money orders, DON'T take the previous landlord's word as they might be trying to pass a problem tenant on to the next schmuck.) Also see if they have any utilities in collection. As long as you verify they pay their housing and utilities, what does it matter to you if they are slow payers on their credit cards or if their last car was reposessed?
      Best of luck, hopefully no one steals your appliances

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  2. Anonymous: Your comment reflects the frustration of a great many landlords who enter their rental units after tenants have vacated only to find the place destroyed and appliances missing. The leveal of destruction caused by some tenants is simply unbelievable. While this is true, the fact remains that security deposits are illegal and taking one could get you in serious trouble. Also, the reality is that the type of damage you are talking about is very likely not going to be covered by any security deposit that you take (i.e. the damage or the stolen applicances are worth more than the security deposit). The more practical answer is better screening of tenants, getting guarantors where circumstances warrant, insurance, and regular inspections for maintenance etc..

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    1. "The more practical answer is better screening of tenants, getting guarantors where circumstances warrant, insurance, and regular inspections for maintenance etc.. " Well that's all well and good, but after screening my tenants were OK for 2 and half years, now suddenly they can't/won't pay the rent. The s deposit will cover one month's rent (January in this case), but not the damage I'm beginning to see to the paint and other places. Now I have the privlage to pay for their mess/damage. How is that fair?

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    2. Chris: Please don't think that I am an apologist for the current laws. My statements in this blog are about what the law actually is, good, bad or ugly. As a lawyer I have represented both sides and I've made the arguments in favour of both landlords and tenants depending on who my client at the time is. The simple fact is that damage deposits (in addition to last month's rent) will cause a landlord grief as, like it or not, they are currently illegal. Interestingly, the Ontario government had a pending bill that was defeated (in the last year or so) that would have allowed the collection of a damage deposit in addition to the last month's rent deposit.

      The point about better screening, getting guarantors, inspections, insurance, is that you hopefully have a tenant that will care about being sued or a guarantor who will care about it (i.e. they will have something to lose if you sue and win). Regular inspections, in theory, let you catch the beginnings of damage before it gets out of hand and you can evict and sue for the damage.

      "Fair" is an interesting concept, but with respect, in the business of renting units for profit the relationship between landlord and tenant is contractual with an overlay of statutory obligations and rights. "Fair" in the philosophical sense is, for the most part, irrelevant as well it should be given the subjective nature of the concept.

      Hopefully you are documenting the damage in your unit, good photos and repair estimates--with those you should be able to win a judgment against the tenants in either the small claims court or the Landlord and Tenant Board if they are still in possession.

      Good luck.

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    3. Can you not contract out of the provisions of the Residential Tenancies Act? I went as far as calling the Board several times and each I was told that if the Tenant and the Landlord had a written contract where such a condition existed, there wasn't much a Tenant could do about it. I'm finding this very frustrating as I can't seem to get the answer I'm looking for.

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    4. Hi Ricky:

      Thank you for the question and let me offer what I think is the definitive answer. If you're still not satisfied let me know and I'll see what I can come up with for you.

      So, to start, regard should be had to section 3 of the Residential Tenancies Act. It states: "3(1) This Act applies with respect to rental units in residential complexes, despite any other Act and despite any agreement or waiver to the contrary."

      From this section you should understand that the provisions of the Residential Tenancies Act will apply to "rental units" and "residential complexes" as those terms are defined in the Residential Tenancies Act. Hence, if you try to avoid the application of the Residential Tenancies Act by writing in a contract that you are excluding the RTA, or that the RTA does not apply, those provisions would be void by virtue of this section. This means that you can not contract out of the RTA if the premises over which you are contracting are fit within the definition of the provisions in the RTA. To know what the definitions are the best place to start is section 2 of the RTA as that is where certain critical terms are defined.

      The next place you will want to look is section 4 of the RTA. This section provides as follows: "Subject to section 194, a provision in a tenancy agreement that is inconsistent with this Act or the regulations is void"

      What you should take from this section is that any agreement in a lease that contravenes any provision of the Residential Tenancies is not enforceable----meaning, neither tenant nor landlord has the legal right to make a deal that contravenes the RTA even if it is with full consent and understanding of the rights being over-ridden. The classic example is "maintenance". A landlord puts into a lease that the tenant is responsible for winter maintenance (snow removal). That clause is contrary to the landlord's maintenance obligation and hence is void (there is specific caselaw that reinforces this position).

      The two foregoing provisions are the main ones that answer your question. A clause in a lease is not enforceable if it operates to preclude the operation of the RTA (contrary to the definitions) or it operates to over-ride the provisions of the RTA generally.

      Does this mean that Landlord and Tenant can't agree to any kinds of odd or unusual clauses in a lease? No, that is not a fair conclusion. What should be clear is that a landlord and tenant may contract for any terms that they wish, so long as none of those terms violate the provisions of the RTA. Given how all encompassing the RTA is; it is indeed true that it may be difficult to find any significant points to contract over that are not somehow touched by the provisions of the RTA.

      I hope that answers your questions. If not, I'd be pleased if you shared the specific clauses that you are concerned about in your lease and I might be able to address them for you and everyone else reading this article.

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    5. Your opinion about security deposits needs updating in line with changed regulation in order to reflect current status !

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    6. Hi Anonymous: I appreciate the heads up though I wish you would provide more detail of what you mean. I've confirmed on e-laws that section 105 RTA remains the same (no change there) and section 106 RTA remains the same. I don't see how a regulation will change the specific provision of the statutory language--but maybe so! If you have seen a regulation that expands the scope of security deposits then I'd love to see it and of course I'll put it on the blog here. In fact, in the context of Landlord and Tenant Law that would be seriously big news changing many decades of established practice. As I think about it, I did see a Bill (Bill 145) that was called An Act to amend the Residential Tenancies Act, 2010, and its purpose was to allow a landlord to collect a damage deposit as well as a rent deposit. The sponsor of that Bill was Joyce Savoline and it appears from the www.ontla.on.ca site that the Bill was defeated on February 24, 2011, meaning it did not become the law.

      If there is something else that you've come across please let me know and I'm pleased to give you credit in this blog if you wish. Your comment is instructive to other people reading this to be aware of the date the blog was written, and of course that the content of the articles should always be verified against current legal sources at the time that it matters to you.

      Michael K. E. Thiele

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    7. I would like information on where I can file a complaint against a landlord. My son was a student renting a room in a housing. He had until the end of the month to move his things out. We he went to move and he informed the landlord he would be coming on that day, he borrowed a truck and when he arrived all his things were thrown in a dumpster. His clothes are all missing, his bedding was wet, all his important papers were thrown in the garbage. His painting and electronic equipment are missing. Please direct me to the proper channels.

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    8. Hi: Take a look at this link: http://www.mah.gov.on.ca/Page142.aspx . Aside from a complaint to this Ministry, you can of course also pursue legal action against the Landlord at the Landlord and Tenant Board and in the Superior Court of Justice.

      Michael K. E. Thiele

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    9. This comment has been removed by the author.

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  3. I appreciate all of the information that you have shared. Thank you for the hard work!
    - eviction lawyer cambridge

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  4. Hi,

    Not sure if I'll get a response, but I figure why not.

    My boyfriend and I have been renting a place for about a year now - we re-signed our lease as the place is liveable enough, we've also made a lot of improvements to the property, nothing extreme, just cleaning up the yard, fixing small things etc.

    When we signed the lease, they asked for a "first month's deposit" for Nov 2012 - we wrote it up and they cashed it before our move in day (Nov 1st 2012) on Sept 28th 2012 (which was expected, all good, moving on). We wrote up another 11 cheques - as they requested for the rest of our lease. We later got a call that they required a Nov 1st cheque -we explained that the cheque they already cashed was the first month's deposit, they said no, it was the "last month's" deposit (I have in writing that the first cheque was our first months deposit, but no bother - we got the October 2013 cheque back from them and tore it up - as they had already cashed it as our last month's deposit (aka Oct 2013).

    Now that we're entering our second lease term, we've given them 12 cheques as requested, and they're saying that we need to give them a cheque for Oct 2013 (which is the cheque they cashed before we moved in). We feel they're trying to get away with making us pay a security deposit without actually saying anything along those lines as I suspect they know it's illegal.

    I've responded, that our Oct 2013 cheque was the cheque they cashed before we moved in and am waiting for a response. But what can we do if they come back and outright say they need a security deposit now that we've lived there for a year? We're good tenants and have actually improved their property, plus I don't want to say "well thats illegal" and then have them decide to kick us out.

    Please advise,

    Thanks!

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    1. In response to dolphinchick, I could be wrong, but I believe the Residential Tenancies Act prohibits a landlord from requiring a series of postdated cheques. Mr. Thiele might correct me on this, but I believe this to be the law.

      They can ask you for first and last, but not for every cheque.

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    2. Hi Thomas: You are correct. Mike

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  5. Hi, thank you very much for the comment. If I understand your comment correctly, your landlord is not giving you credit for a last month's rent deposit that you already paid. Presumably, you can get out each cancelled cheque, line them up--or make a photocopy of each, and demonstrate that since the month you move in (Nov 1 2012), they have cashed 12 cheques--even though you have only been required to pay 11 cheques of rent (November 2012 to September 2013---which is 11 cheques). If you show them the cancelled cheques they will have to agree if they are reasonable people.

    If they are not reasonable people--it will be important to get the explanation for why they are not giving your credit for all of the months of cashed cheques. Perhaps they will say the tenancy started sooner than November 1, 2012? Hopefully you will have a lease that proves the start date or there is a memo on the cheque.

    If it turns out that there is no Last Month's Rent deposit, and you can indeed prove the payment for the first month's rent is the November 2012 cheque, then the landlord is simply out of luck in getting you to provide a Last Month's Rent deposit after the commencement of the tenancy. It does not mean that the last month is free--it just means that whenever you give a notice of termination that you will need to pay the last month of rent in the normal course.

    Your last comment about being kicked out suggests a view that the landlord has the right to ask you to leave. The reality is that they do not have that right other than for "cause" or the limited not for cause grounds as set out under the Residential Tenancies Act. Insisting on your rights can not be the basis for eviction and they can't just say that they want you to move out. Be aware that after your term ends the lease automatically renews on a month to month basis, whether the landlord likes it or not, and you get to stay--forever if you please--or until such time as the landlord gives you a valid Notice of Termination. Be aware that the basis for a Notice of Termination--on not for cause grounds is fairly limited.

    Good luck.

    Mike Thiele

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  6. Hi,
    What if the to-be tenant proposed that he is willing to pay down (prepaid) several months rent in advance and is written as such in their Offer to Lease Agreement, would you think we as the landlord stand a chance in front of the LTB should the tenant decided to revert later on ?

    Thank you
    -Albert

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  7. Hi Albert: An interesting question---there is indeed a way for it to be okay but the argument to make it "okay" arises from case law. On the plain wording of the Residential Tenancies Act prepaid rent in excess of a Last Month's Rent deposit would indeed appear to be illegal and your experience at the Board would generally be that you can not hold this much prepaid rent. However, there is a line of caselaw where certain prospective tenants would be denied a rental unit because they have bad credit or no credit history and no work history or discernible source of income. Those tenants (often from abroad) would be denied many apartments on the credit check basis. Allowing them to pre-pay rent--so long as the pre-paid rent is not demanded or required has been found to be "okay" and not in breach of the RTA--even though the RTA suggests that such a payment would be illegal. It is still a difficult situation, but as I've said not impossible, and it depends entirely on the circumstances.

    Michael Thiele

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    1. Hi Michael:
      Thank you for your prompt reply to my original question.
      Would you see it as even better, if the prospective tenant signs a declaration in such that "Tenant for his own benefit and convenience, is agreed and accepted by the Landlord to prepaid (said 6 months) rent in advance" ?
      Again thank you for your time.
      -Albert

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    2. Certainly, if the tenant wanted to write something like this it would be helpful in clarifying that you did not require such a payment. Such an indication would be helpful if at any time the tenant stated you required such a payment and took you to the landlord and tenant board on the basis of you requiring an illegal deposit. You should also note that "for his own benefit and convenience" is not a reason that the Board would let you keep the pre-paid rent if the tenant should ask for it back (in my opinion). I think the best that this does for you is avoid any finding that you required an illegal deposit. Once the tenant asks for it back there is no reason, based on these facts, for you to keep the money as security for the prepaid rent. Hence the un-usused portion of the prepaid rent would have to be returned.

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    3. Hi Michael,
      Thank you so much for your view point and opinion in this particular subject, and I enjoy reading other articles in your blog as well.
      All the best !
      -Albert

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    4. Micheael

      The landlord is saying there are damages and he is going to get them fix then I need to pay for them. How would he know on June the 5 if there were damages on Sept. 15,2013. we did a walk about and he agree we would talk about the damages but now he is just going to fix things and bill me. he has 2500.00 of my money already. Need help

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    5. Hi there: It is difficult to comment as I need some more facts. If you did a walk about in June 2013--is this the time you moved in? Did damage happen between the time you took possession and the present date? Ultimately, you are only responsible for damage you caused either negligently or wilfully. A landlord can pursue you either through a Notice of Termination in form N5, or he can pursue you directly with an application to the Board for only damage, or he can sue you in the small claims court. Ultimately, the landlord can only get money if he gets a judgment. If he is proceeding by way of N5 (Notice of Termination of the tenancy for damage) then you have the right to remedy the situation (i.e. fix, pay, or make arrangements with the Landlord). If you can give more facts I can try to give you more information. If you are looking for help--consider speaking to duty counsel at the Landlord and Tenant Board or go see a lawyer at a community legal clinic. They can give you quick specific answers after a short interview. Good luck.

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  8. Hello Michelle

    In paid first and last months rent, plus a demand deposit. I move in May 15,2013 moved out Sept. 15,2013. my lease was for 5 months. I how find out the the landloard cash my $2500 demand deposit. Can he do that.

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  9. Hi there. I'll make certain assumptions in commenting on your question. First that it is an Ontario tenancy, that your rent was paid up for each month and that the tenancy was lawfully terminated after 5 months. I presume you gave notice that you were leaving after the 5 months or that there was an agreement to terminate the tenancy. If this is accurate, then the landlord had no legal right to cash any demand deposit. In fact, the Landlord had no legal right to be holding a demand deposit as the only legal amount he can have is the first and last month's rent. It would be interesting to know what the landlord's logic is--does he have an explanation of why he cashed the cheque?

    Michael Thiele

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  10. Hi Michael,

    I recently signed a lease agreement to rent a new house in Ontario with myself and three other people and in the agreement was the regular last months rent deposit ($1300) as well as an additional $500 damage deposit. I had heard of this before and thought we had to pay it or she wont rent to us. We didn't want to lose out on the place so we agreed to it anyways and signed the lease. We are scheduled to move in October 1st and have just found out that it is illegal in Ontario to charge anything beyond last months rent and she could face a large fine for it.

    My question is since we signed the lease are we bound to pay the $500 regardless, or since it is illegal that part is void and she can't do anything if we do not pay?

    She said that we could take an extra couple months to pay it in installments and we would get it back after we move out pending there are no damages. So I was thinking we would move in and get the keys before bringing up the fact that it is illegal so that she can't withhold the keys from us.

    Also this article was brought to my attention when looking for answers. It states an amendment to the rules allowing landlords to charge up to an additional 25% damage deposit. This is the only documentation I have found stating that it is allowed so is this accurate?

    http://www.ontla.on.ca/web/bills/bills_detail.do?locale=en&BillID=2445

    Thank you for the input.

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  11. Hi and thanks for the comment. I had forgotten about the attempt to amend the Residential Tenancies Act to allow damage deposits. The Bill, seeking to amend the RTA in this respect, was defeated and it did not become law. Hence, you landlord is not presently entitled to charge you a damage deposit. Whether your new/prospective landlord knows that a damage deposit is legal or not can not presumed either way. It is truly surprising to me how many landlords do not know the basis elements of landlord and tenant law in Ontario. If the ignorance is innocent the landlord would likely react in a reasonable manner. However, it certainly is possible that it is an intentional violation of the law and hence the reaction you assume might arise could indeed happen. Query whether you want to "find out" after you move in that your landlord is a total scoundrel and is prepared to make life difficult for you as a trouble maker. Maybe you want to find out now? Of course, in a tight rental market you sometimes take what you can get and jealously guard your rights even if the landlord is a bit of a handful. How you decide to proceed isn't so much a legal question as it is a practical landlord and tenant relations issue. You seem well apprized of the possible reactions and seem able to anticipate possible reactions. How you go with it is a matter for you to decide. If you don't mind, I'd be interested to hear how this turns out when you eventually claim back the damage deposit or do a set off from rent of the amount.

    Michael Thiele

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  12. Hi Michael,

    I was wondering how binding, if at all, a rental application is in Ontario?

    I am finding some confusion online between applications and leases. I recently filled out an "application" after viewing a prospective apartment. The document asks questions about income, credit history and asks for references. The document DOES NOT get into the particulars of rent amounts, duration, etc. It seemed to me to be more of an application like one would fill out to apply for a job. There was a blurb at the end of the document about authorizing him to contact/investigate, etc. We DID NOT provide a deposit of any kind.

    What I am concerned about now is that the man said it would take a couple of days to get back to us about the application. In the meantime, we are viewing additional places because time is of the essence and we don't want to miss out on any option because we were waiting around. Does signing this "application" preclude us from signing another application of a similar nature? Is this application at all a binding document or is it merely an investigative tool to the next step (signing a lease)?

    Thanks!

    p.s. your blog proved very detailed and insightful!

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    1. Thanks for the question and an interesting one at that! I will at some point prepare a more thorough answer based on the caselaw on this issue. What I see at the heart of your question is a matter of contract formation and the law surrounding offer and acceptance and consideration (consideration is the money or the thing of value that needs to flow between the parties to form the contract).

      Certainly there is law that supports the conclusion that you have reached (or fear) which is the possibiilty that an application to rent is interpreted as an "offer to rent". The Offer to Rent, along with a deposit (or even without a deposit) may be worded or structured as being capable of acceptance by the landlord and once accepted you have a formal contract--with the mutual obligations of both parties now binding. This is the angle often taken by landlords who receive an application, along with a deposit, and refuse to return the deposit when the tenant advises they are no longer interested or don't wish to sign a formal lease. Of course, in a tight rental market, a landlord can quickly re-rent to someone else and there is an argument that a rent deposit needs to be returned on mitigation principles alone.

      The argument that you will hear from some landlords is that vetting a tenant costs money in the form of credit checks and employee time in calling references and paying sales agents. Hence these landlords want to the deposit to at least cover the costs even if they won't hold you to the lease that formed on their acceptance of your offer to lease.

      Practically speaking, for you right now, you may wish to make it clear on the rental application that you are not offering to rent a unit until a deposit is paid, or indicate that you are seeking only "approval" as a tenant and seeking an offer from the landlord to rent you a unit which you can either accept or reject. By filling in applications, without presenting a deposit, you are in a stronger position as the landlord would have to chase you if they wished to maintain the position that the application was in fact an offer to lease and that a lease was formed upon the landlord's acceptance of the offer---query how many landlords would go through the effort? A further alternative, if the application truly is an offer to lease (i.e. you're offering to rent the premises if accepted), perhaps putting a time limit on the offer (12 hours, 24 hours, etc.) after which time it is void would give you some certainty. Another option, and what we often do in making offers in litigation is to state that the offer is open for acceptance until it is withdrawn--that way, just before taking another place you could withdraw any outstanding applications to rent.

      Also, it would be interesting to know if the landlord is accepting multiple applications at the same time or is dealing with applications on a first come first serve basis (i.e. accepting the first applicant who meets criteria versus selecting the best applicant from a group of applicants). How the landlord receives and reviews applications would, I think, be relevant in considering whether an application is an offer to lease or simply an application to be considered as a prospective tenant.

      Good luck.

      Michael Thiele

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    2. We gave the landlord $1800 last month rent with the application to rent. She cashed the cheque but says she won't to rent to us. And she is refusing to refund our money. What do we have to do to get our deposit back. She says she can't wait 6 days for our Equifax credit report and will rent to someone else. There were errors we had to correct in the credit report thus the delay.

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    4. See the T1 application available on the Landlord and Tenant Board website. See the 4th page of the application, it applies to your situation. Good luck.

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    5. Thank you for replying so promptly. We filled out the T1 and made one more attempt to get the landlord to refund the deposit or to let us move in. She refused. I suspect she will tell the LTB that we broke the agreement. How can we prove that we acted in good faith ... we arranged to transfer the utilities on Feb 1 when the lease was supposed to start.
      There were costs to do this. Is there a way to recover those costs too through the LTB?
      I wonder how many others have had this happen and how to protect ourselves next time. It looks like the landlord has all the cards...our offer to rent, our deposit and the keys she won't give us.

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  13. I am leaving my rental at the end of this month (October) after over two years. While I have a great relationship with my landlord and have never had any issues with him regarding the rent or deposits, it's the condo board who is know demanding a damage deposit ($200) in order for them to put the elevator on 'service' so I can move out.
    I have never been a condo owner, nor have I paid condo fees - all that was taken care of by my landlord as he owns the unit. Should I pay this damage deposit to the condo board?

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  14. Hi: Thanks for a very interesting question. The short answer is that if you "have" the money then go ahead and pay the deposit to facilitate the move out. There is little point in derailing your moving plans etc., over $200.

    The more interesting question is whether the $200 fee is legal, whether you have to pay it, and whether it is refundable. There is no doubt that the $200 charge, levied directly by the person you consider your landlord, would be illegal. A landlord can not charge you for moving out or charge you a damage deposit (which this effectively is). What is a little less clear is whether a Condominium Corporation is entitled to levy such a charge. It has been a while since I've reviewed the Condomimum Act so I'm not sure if it has been amended to allow such a charge. What is interesting about th provisions of the Condominum Act is that it has provisions that dovetail with the same types of procedures as under the Residential Tenancies Act for the purposes of eviction of tenants. However, I have no recollection of there being anything about a Condo Corp being entitled to collect damage deposits from tenants who are renting in a building--for a security deposit or otherwise. At best, I think, the Condo Corp could demand a deposit from the owner as opposed to the tenant of the owner. The owner could only charge the tenant for actual damage caused upon demand or after suing the tenant in the Superior Court (not at the Landlord and Tenant Board as the tenant would be out of possession at that stage).

    Presuming there is no precedent on point and the legislation leaves the matter a little vague (and presuming even that the Condo has a by-law authorizing such charges) and interesting case would be for the tenant to apply to the Landlord and Tenant Board to determine whether this is an illegal charge. The definition of Landlord is sufficiently broad to include more than one entity as a Landlord. The Condo Corp, I think, easily fits the definition of a landlord and it would be reasonable to name the Condo Corp as a respondent to the application to the Board. If the Landlord and Tenant Board finds that the Condo Corp is a landlord I suspect that there would be no issue in getting an Order that the money be returned.

    What makes this fact scenario interesting is that there are some conflicts between the Residential Tenancies Act and the Condominium Act and how those conflicts are resolved is not necessarily as you would expect. Condo rules and by-laws are often more stringent than the provisions of the Residential Tenancies Act and there can be a conflict when the Condo insists that tenants abide by its rules.

    From the sounds of it, you are likely to have the damage deposit returned in any event, so that may solve the problem for you. However, if you want to make the point, ask the landlord and tenant board to determine the validity of the charge in the first place and seek a remedy (such as a fine) that is not made moot by the Condo Corp. simply paying your back the money before the hearing.

    If you do proceed with this, I would really appreciate you letting me know how this turns out. It is a very interesting fact scenario.

    Michael K. E. Thiele

    ReplyDelete
  15. Hello,

    This is a great article and has been very helpful in a situation I am currently going through - in which my landlord demanded a cash deposit to "book" the elevator during my move out in case there were damages to the elevator from moving furniture. I informed him that I would not need to book the elevator since I had arranged to leave my furniture in the unit for the next tenant, a great arrangement since he needed furniture and I couldn't bring it with me as I'm moving far away. Anyways, I told him that and he got a bit flustered and said that regardless I would still need to pay the deposit in cash and upon returning all of my keys and after he inspects the apartment and it is clean of any dirt/dust I would get my deposit back (completely unrelated to the original ruse of it being for elevator damage). Anyways another tenant overheard our conversation and he told me that it's in fact illegal to demand that a deposit be made in cash (i had offered the landlord a cheque but he said it must be cash), is this true? If so I can't find any specific legal document that backs up this statement.

    Thanks so much for your help!!!!

    ReplyDelete
    Replies
    1. Hello:

      The cash deposit--whether in cash or by cheque--that you are being asked for is in fact illegal. The authority is section 134 of the Residential Tenancies Act. I've cut and pasted it below from the legislation. Hope this gives you the authority you are looking for. Michael K. E. Thiele

      Illegal Additional Charges

      Additional charges prohibited
      134. (1) Unless otherwise prescribed, no landlord shall, directly or indirectly, with respect to any rental unit,
      (a) collect or require or attempt to collect or require from a tenant or prospective tenant of the rental unit a fee, premium, commission, bonus, penalty, key deposit or other like amount of money whether or not the money is refundable;
      (b) require or attempt to require a tenant or prospective tenant to pay any consideration for goods or services as a condition for granting the tenancy or continuing to permit occupancy of a rental unit if that consideration is in addition to the rent the tenant is lawfully required to pay to the landlord; or
      (c) rent any portion of the rental unit for a rent which, together with all other rents payable for all other portions of the rental unit, is a sum that is greater than the rent the landlord may lawfully charge for the rental unit. 2006, c. 17, s. 134 (1).
      Same
      (2) No superintendent, property manager or other person who acts on behalf of a landlord with respect to a rental unit shall, directly or indirectly, with or without the authority of the landlord, do any of the things mentioned in clause (1) (a), (b) or (c) with respect to that rental unit. 2006, c. 17, s. 134 (2).
      Same
      (3) Unless otherwise prescribed, no tenant and no person acting on behalf of the tenant shall, directly or indirectly,
      (a) sublet a rental unit for a rent that is payable by one or more subtenants and that is greater than the rent that is lawfully charged by the landlord for the rental unit;
      (b) collect or require or attempt to collect or require from any person any fee, premium, commission, bonus, penalty, key deposit or other like amount of money, for subletting a rental unit, for surrendering occupancy of a rental unit or for otherwise parting with possession of a rental unit; or
      (c) require or attempt to require a person to pay any consideration for goods or services as a condition for the subletting, assignment or surrender of occupancy or possession in addition to the rent the person is lawfully required to pay to the tenant or landlord. 2006, c. 17, s. 134 (3).

      Delete
    2. This is great, but it refers to "any rental unit." The damage deposit is not for the unit, it's for the building. Where does it say that that is illegal?

      Delete
    3. If a damage deposit is asked for by the property management company, for the building, not the rental unit as is specifically referred to in the act, then what? I do not see anything mentioning that in any of your responses, as you appear to not have read some of these questions at all.

      Delete
    4. Hi: Provide the language of the clause for the security deposit "for the building" that does not include the rental unit. The security deposit "for the building" is what I presume you have to pay to get the "rental unit". In your scenario, is it possible to rent the rental unit, sign a lease, and get possession of it without paying a security deposit "for the building"? If not then its just semantics and it clearly is caught by this section. If you can rent the unit, without paying the security deposit "for the building" then no problem.

      M. Thiele

      Delete
  16. Hi Michael,

    Thank you for this blog post!! You have helped me and my neighbours out huge. Our building was sold mid Nov 2013. Our new landlords are now trying to get us to pay our rent by post-dated check or e-transfers. I in the past have paid cash, which was an option for rent payment in the paperwork the new landlord had given me, but when I told him I paid cash, 2 days later he emailed me and said he didn't feel comfortable with me paying cash and wanted me to go with the etransfer option. But had to pay cash for December rent, when I asked for a rent reciept he told me he doesn't give those out unless asked. So I asked again and he said he would email me something to confirm payment for December rent and that was 12 days ago. Also the tenants above me we're late with their rent and now are told by our new landlord that they have to pay a late payment fee of $16.. I told her NOT to pay it.. I can tell the landlord is doing this knowing full well it is illegal! Not sure what to do, but all this is has happened in the 1st month of them taking over so I am scared it will get worse.

    Thanks
    Lea

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    Replies
    1. Hi Lea: It's unfortunate that your new landlord is making these demands and asking you for things that are illegal. If you find that the demands continue or the extent of the demands escalate you may consider an application to the Ontario Landlord and Tenant Board or perhaps even a complaint to the Investigations Branch of the Ministry of Housing (they may investigate and press charges in some circumstances where the breaches of the RTA are serious.)

      Make sure that you maintain a record of everything that you do with this landlord. Often, the biggest problem is a lack of evidence and proof that you paid something or did something. Presume that you will be put in a position of proving your actions and that should ensure that you get and retain receipts etc..

      Good Luck.

      Michael K. E. Thiele
      Ottawa Lawyer

      Delete
  17. Hi Michael,

    Wow this is such a helpful blog, I had a question I am hoping to get answered.

    A friend of mine is a landlord. He has been holding a security deposit of 1 month plus last month rent in advance. The tenant has 2 dogs, and that is why they agreed to this. The Landlord and the tenant both had 2 separate real estate agents who represented them and neither mentioned it. He decided to return the security deposit right away, but he is afraid that legal action can be taken against him...

    Your advice is much appreciated

    Brian

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    Replies
    1. Hi Brian: There is very little for your friend to be worried about. While the security deposit for damage that might have been caused by the dogs is "illegal", it isn't illegal in the sense of criminal code illegal. The reason for the deposit is understandable and it doesn't sound like there was anything oppressive in obtaining it. In fact, it is arguable that the deposit was received (requested and delivered) with the professional advice of real estate agents who one could reasonably expect to have knowledge of such things. With the deposit returned I don't see any legal action that could reasonably be taken. In my experience the Board would not give much consideration to an application filed at this stage and I certainly don't see any charges flowing from this. The biggest thing really was the return of the deposit and once that was done, without the need for orders or demands from Investigations Branch or the Board this issue was resolved.

      Thanks for writing.

      Michael K. E. Thiele
      Ottawa Lawyer

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    2. Hi Michael,

      Thanks for your reply, when my friend tried to return the security deposit. They refused to receive it. And the tenant said that the landlord shouldn't have asked for it. Said smirking that my friend should hold onto that.

      Thanks a lot for your help.

      Brian

      Delete
    3. one more thing, apparently the real estate agent warned him that it is illegal. but he asked a FRIEND who is a paralegal and told him that it is legal...........
      Is there any liability on the two real estate agent????
      this was 2 years ago. he returned one of the two security deposits after 1 year and the second since they refused to receive he just didn't deposit one month rent to cover for the second security month.. and informed them of this - this is for this month-
      how bad a situation is he in........ he read that he can be fined $25000.....
      Now he wants to move in the house himself. They wanted to stay month to month...... he filed the form and gave it to the tenant. but they told him that they will take him to court..


      Thanks again

      Brian

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    4. Hi Brian: All that I can infer from this comment is that the tenant is into some kind of gamesmanship and thinks himself to be some kind of legal genius. If that's the case and your friend has that kind of a tenant (and there certainly are tenants who relish the conflict and fight at the LTB), then your friend needs to get in to see a lawyer(I'd be happy to see him if he's in Ottawa) or a paralegal. If the tenant is trying to "set up" your friend then its time to consider broader strategic options to be in the best possible position when the tenant files his inevitable application.

      Michael K. E. Thiele
      www.ottawalawyers.com

      Delete
    5. Brian:

      In reply to your "one more thing" comment, I almost have to laugh out loud at the convoluted facts. I teach a Landlord and Tenant Law course at a local college and your fact scenario is quickly becoming one of my exam questions. Questions of professional negligence are outside of the scope of this blog. I would only offer an opinion on that kind of question after a detailed interview and investigation of the facts and even then, negligence is rarely a yes or no, black or white, concept.

      Your comment now seeks to raise limitation period questions (statute barred issues) and as the passage of time is so great (especially in the landlord and tenant context), one begins to wonder why all the stress and worry now about a situation that has subsisted for such a long time. Two years and the tenant hasn't done anything? Practically speaking you'd think that the tenant is unlikely to take steps at this stage especially if the "smirk" implies knowledge of the alleged breach of the RTA.

      Given the convoluted history, and now a desire to occupy the home under an N12 (Landlord's own use), your friend needs much more help than can be provided in this blog. I strongly recommend that he obtain legal advice from a lawyer or paralegal that has experience in Landlord and Tenant matters.

      Michael K. E. Thiele
      www.ottawalawyers.com

      Delete
    6. Thanks a lot for your help and advice, I will sure tell him. Unfortunately we are near Toronto....
      Again thanks this is a super helpful blog

      Delete
    7. I am wondering if you can help us . We rented an apartment in a duplex Nov 15/14 we paid first and last months rent at the time of signing the 1 yr lease. I received and inheritance recently and decided to purchase a home. I gave my landlord a letter stating my 60days notice on March 31/15 to end May 31/15 we met with them on April 4/15 and they agreed to ending the tenancy but wanted us to pay till June 15/15 because they are getting married May 30/15 and going on their honeymoon but I stated we couldn't afford to do this and pay for a new mortgage, so we agreed to move out May 25/15 which gave them time before there wedding to go in after we leave and clean up etc. before the new tenants move in June 1/15. Then on April 10/15 we get a letter from them stating that my last months rent is non. refundable since I broke my lease with them and that I now owe theme rent for May 1st as well. Can they legally do this ? Its like paying them double which I cant afford and don't find fair since they cashed my last months rent cheque back when we moved in Nov/14. Sorry so long to explain

      Delete
  18. I gave first and last month with cash and received a receipt but not a rental agreement. The receipt does note first and last, as well I have emails and text messages about the place so I believe this is more a verbal agreement than written at this point. It all seems great though and I may just be having second thoughts. Also I realize only now that I don't have the real address of the landlord, only the rental address. Should I be concerned? Any recommendations?

    ReplyDelete
  19. Thanks for submitting this. From this description of the facts it sounds like you have a oral agreement (not written or implied). An oral tenancy agreement is perfectly legal and enforceable. The emails and text messages are useful to inform the details about the tenancy agreement. Hopefully they deal with things like rent amount, what's included in the space (storage etc), utilities. Even if they don't deal with these things it's not the end of the world. These terms will be established by the practice of what is actually done. For example, you move in and hydro is paid by the landlord, this goes on for several months and then one day the landlord says you should pay the hydro. Ideally you have a lease that sets out who pays the hydro but in your case it is an oral agreement and nothing is explicit about who pays the hydro. What would the Board do? It would look to see what the practice had been, analyze emails, perhaps the advertisement of the rental unit, and all things surrounding the tenancy to determine what the intentions actually were. This may sound like a fairly big deal but I can tell you from experience that it is a fairly common exercise at the Landlord and Tenant Board.

    Should you be concerned? I don't think so especially not if your landlord is an experienced and honourable type of landlord. Of course it is a new relationship and it is difficult to gauge the kind of person that he is. You could, of course, ask for a written lease that sets out the basic terms of the relationship as this would not be an unreasonable request. The landlord's response to such a request may be informative of what kind of person you're dealing with.

    Lastly, the Residential Tenancies Act provides many terms that protect you and sets out a basic framework of all tenancies. In my view, the rules imposed by the RTA are such that the need for a written lease is substantially reduced. To that end, and to your last point, see section 12(3) of the RTA as well as the consequence provisions that follow when a landlord fails to provide mandatory basic information such as an address for service of legal documents:

    Name and address in written agreement

    12. (1) Every written tenancy agreement entered into on or after June 17, 1998 shall set out the legal name and address of the landlord to be used for the purpose of giving notices or other documents under this Act. 2006, c. 17, s. 12 (1).

    Copy of tenancy agreement

    (2) If a tenancy agreement entered into on or after June 17, 1998 is in writing, the landlord shall give a copy of the agreement, signed by the landlord and the tenant, to the tenant within 21 days after the tenant signs it and gives it to the landlord. 2006, c. 17, s. 12 (2).

    Notice if agreement not in writing

    (3) If a tenancy agreement entered into on or after June 17, 1998 is not in writing, the landlord shall, within 21 days after the tenancy begins, give to the tenant written notice of the legal name and address of the landlord to be used for giving notices and other documents under this Act. 2006, c. 17, s. 12 (3).

    Failure to comply

    (4) Until a landlord has complied with subsections (1) and (2), or with subsection (3), as the case may be,
    (a) the tenant’s obligation to pay rent is suspended; and
    (b) the landlord shall not require the tenant to pay rent. 2006, c. 17, s. 12 (4).

    After compliance

    (5) After the landlord has complied with subsections (1) and (2), or with subsection (3), as the case may be, the landlord may require the tenant to pay any rent withheld by the tenant under subsection (4). 2006, c. 17, s. 12 (5).


    Good luck in your new place.

    Michael K. E. Thiele
    www.ottawalawyers.com

    ReplyDelete
  20. Hi Michael,
    I came across your blog when I was trying to find out if a landlord can charge a prepaid amount in addition for rent that is late in being paid. I had a feeling what the landlord was doing was illegal, and your blog confirmed it for me. I even have a letter addressed to the tenant indicating exactly what is owed in rent from the landlord with no mention of a "prepaid" amount also owed.

    This landlord, for years, pirated cable services from a cable provider and then turned around and sold those cable services to their tenants for profit. They also charge huge fees above the rent they charge tenants if tenants don't comply with certain services, such as having the unit sprayed for cockroaches. And in addition to their illegal activity, they do not give their tenants the interest earned on the last months' rent. Tenants do not receive letters from the landlord that any interest owed to them from the last months' rent is being applied to it to bring it up-to-date, so there is no way of knowing if this is being done.

    How can a landlord behave so illegally and yet be allowed to continue to rent?

    ReplyDelete
    Replies
    1. Hi Soozi: Thanks for your comment. Unfortunately you are not the only tenant who has such a landlord. I'm not sure that the reason matters, but one wonders if your landlord is behaving this way intentionally knowing the law and not caring or whether the landlord is simply ignorant of the law. In the end though, it doesn't matter as tenants are being harmed by this conduct. It seems fairly clear that landlords get away with this kind of behaviour because there is no licensing nor inspection of business practices on a regulatory basis. The only way that a landlord gets sanctioned is by tenants taking action at the Landlord and Tenant Board. Perhaps some landlords consider the occasional losses at the Board to be a small price to pay for a generally profitable business practice that happens to be illegal. Enforcement of the RTA and the charges that can be brought under it (by the government) is spotty at best and certainly there is limited activity in this regard in eastern Ontario. A way to encourage compliance with the RTA would be for the government to actually direct active enforcement of the provisions of the RTA and advertise those enforcement actions in the community.

      Michael K. E. Thiele
      Ottawa Lawyer

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  21. Hi Michael,
    I am a landlord and I recently received notice from my tenant that he will be leaving the unit in April. He has requested the interest on the last month's rent deposit. Ordinarily, this would not be an issue. However, this tenant has been late on the rent nearly every month for 3 years, usually paying some at the beginning of the month, then the remainder in a couple of weeks. In effect, I have been giving this tenant an "interest-free loan" every month because the RTA allows this. Had this tenant gone to Money Mart instead in order to pay the rent in full and on-time, he would have incurred hundreds of dollars in charges over these many months. Is there no provision in the RTA that would take this into account? (I have a feeling that I know what the answer is)

    The really bad part of the story, is that two years ago I was successful in obtaining a court order to have this tenant evicted. At the time, the tenant was nearly 4 months in arrears. Then, a miracle happened and the tenant got a new job and paid me all the arrears (over $4,000) prior to the termination date. Although I still had the option to terminate the tenancy, I decided to give the tenant another chance (and have regretted it ever since). Could I at least say that the last month's rent deposit was only reinstated after these arrears were repaid? I mean technically, there was no deposit in my account for over two months.
    Thanks,
    P

    ReplyDelete
    Replies
    1. Hello P

      It's fair to say that you should trust your "feeling" on this one. I certainly understand what you're getting at in the history of the tenancy and your arguments appeal to a sense of basic fairness. That, however, is not how the Residential Tenancies Act works on this point. From your email I presume that you did not ever increase the rent in accordance with the guideline? Hence the Last Month's Rent deposit never had to be topped up? In the last several years the lawful rent increase would have equalled the interest payable on the Last Month's Rent deposit and hence nothing would be payable to the tenant.

      As you are looking for potential angles, take a careful read through section 106 of the RTA. This is the section on Last Month Rent interest and perhaps look closely at section 106(6) and note the words "on the amount of the rent deposit". These specific words are interesting in the context of the Order you obtained which the tenant apparently did not void within the time provided by the Board. Perhaps you can point to a period of time where there was no Last Month's Rent deposit and hence there was "no amount" on which to pay interest.

      Taking the argument further you could try to assert that the old tenancy was terminated and that a new one was started but in the end I don't think this helps you as you will owe LMR interest for the prior tenancy (if you argue that there is a new tenancy after the Board's order). However, given the passage of time, perhaps it is arguable that the debt owed to the tenant (LMR interest on the "first" tenancy) is not collectable because the debt is statute barred.

      Anyway, those are some ideas for you to play with looking at section 106. Note of course that the LMR interest is likely to be very small given the low interest rates in the past few years. Interest is simple interest, not compounded, so you may consider looking at the amounts and the machinations you have to go through to challenge the debt and the time represented by a Board hearing. On the other hand, if you have time and wish to argue the point, the Landlord and Tenant Board is a fairly cheap place to argue cases as there is a very limited exposure to costs at the Board.

      Best of luck. If you fight it I'd appreciate a copy of the Board decision if it is "interesting".

      Michael K. E. Thiele

      Delete
  22. Hi, this is a great article. As I interpret the statement "Unless otherwise prescribed, no landlord shall, directly or indirectly, with respect to any rental unit... collect a penalty", the landlord cannot collect a penalty if it was not prescribed. The definition of prescribe is: "to lay down, in writing or otherwise, as a rule or a course of action to be followed". This means if the landlord and tenant agree to a late rent penalty, in writing, in a legal contractual agreement, then the penalty shall be allowed. If there was no prior agreement in writing, then the penalty is not "unless otherwise prescribed", and is therefore illegal. Has there been any previous argument to this aspect?

    ReplyDelete
  23. Interesting comment and I think on the definition of the word you would have an argument. Unfortunately, the definition of the word prescribed is set out in section 2 of the RTA. And there, paraphrased, you will find that prescribed means prescribed by regulations. You may find the regulations on the landlord and tenant board website.

    Michael K. E. Thiele

    ReplyDelete
  24. Hello Mr. Thiele, I recently moved out of a Co-op where they required the 1st month's "membership fees" (rent) and a deposit (originally called "member's loan") amounting to 130% of the rent. When I joined the co-op, the manager and then-board members were very accommodating to disabled pensioners like me. After the original board was dispelled and the original property management fired, the new office management brought with them a belligerent attitude, creating a hostile and toxic environment. The conditions in the co-op became unbearable for me and I gave the required 65 days notice to vacate. The unit was inspected and confirmed in good condition. I gave instructions to the board to deduct my last month's rent from my deposit and gave them my new address with instructions to mail the balance to my new address within the required 30 days or contact me with instructions as to when I could pick up the check. The office manager sent me 2 letters in the first 2 business days of the month stating that I owed $20 late charge for the first day my rent was late, then an additional$50 for being more than "2 days late" with my rent. My questions are: How can they charge late fees when they already have my money in their possession? Would they not have to refund my deposit and then charge me? What recourse do I have if they don't refund the balance of my deposit or tag on additional charges against my balance? Thank you

    ReplyDelete
    Replies
    1. HI Michelle: Co-op matters are very different than regular Landlord and Tenant Matters. What you describe sounds vindictive and mean spirited and it is difficult to understand what the legal basis would be for these charges. In order to begin to analyze your concerns I would have to ask you many more questions and review the Co-op rules/by-laws. Given the amount at stake it is unlikely that you would proceed to Court, but that is where you would have to go if unable to get satisfaction with the Co-op.

      Michael K. E. Thiele

      Delete
    2. Hi Michael, thank you for your quick reply to my inquiry about what could be done when a co-op is requiring we pay the last month's rent when they have a deposit amounting to 130% of the rent and then charge me the rent plus a $50 late charge, plus $107 for cleaning the carpets on the stairs, which didn't need cleaning, etc. Basically, you were right that in the case of co-ops tenant laws don't usually apply and this bowl of mixed nuts which comprised the Board and the property management company seemed very smug in that fact. So I used my superior intelligence and the fact I had nothing to lose to observe that those people haven't come up against anyone who was willing to fight them on the issue. So I wrote the the property management company's CEO, HR manager, and the office supervisor, CC'd my emails to a friend who is a lawyer and social justice advocate, got a paralegal from ACORN, a tenant's rights advocacy group, to research the issue for for me, sent links to my numerous newspaper, TV and radio interviews which covers various social justice campaigns in which I participate regularly; (being confident in their ignorance), I convinced them that if I take them to court I had much more to gain than the $352 they were bilking me on and finally explained that the $352 was my grocery budget for this month, so since I can't go shopping, I have nothing better to do than fight them on the already late refund of 100% of my balance...Long story short: they refunded my balance and claimed it to be (an 8-week long) "misunderstanding". It helped a lot to know you and your readers are also in the struggle. Thanks

      Delete
  25. I was wondering if you can provide any input on a situation for us. My fiancé has given 2 months notice to move out on March 31 and in the letter I made sure to include that as per the law the $550 deposit he paid when moving in would be sufficient for the final months rent. We thought it was all fine but when he showed up to fill our a landlord reference form he says that we need to pay an additional months rent at the start of March and he would refund anything extra to us after moving out. I should of seen it coming because when the rental began he refused to refer to it as last months rent at all costs.

    I am really frustrated and do not know what to do. I thought he'd understand that it was illegal and on top of that we can't afford to pay him a months rent plus pay our new landlord first/last on the new apartment! We don't want to give him anything but we are nervous of the repercussions - I fear he will cause problems for us in the last month once he finds we are not paying an additional months rent. I've already typed up a letter based on your post about how it it illegal for him to demand such a thing and we are not comfortable with that. I also added that we'd be more than willing to discuss when moving out how to handle any unreasonable damage… I just don't know if there is anything I need to avoid saying so we aren't obligated to anything unreasonable.

    ReplyDelete
    Replies
    1. You have it right and from what you describe there is nothing to be worried about from the perspective of "not saying something". The Last Month's Rent (LMR) is for the last month of rent. It doesn't matter what the landlord wants to call it or even if he refuses to call it a LMR deposit. It is illegal for him to hold any other kind of deposit. From how you describe it, it sounds like he wants to be holding additional funds so that he can ding you with repair costs--even minor ones--and then refund you the balance. The amount that he dings you will not be big enough to take him to Court or to the Tribunal for so he will count on you just walking away. This is not proper or legal and is exactly the kind of strategy that the Landlord and Tenant Board should punish with a significant fine or alternatively for charges to be laid against the Landlord under the POA.

      Hope that helps you. You are proceeding correctly.

      Best of luck.

      Michael K. E. Thiele

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    2. Thank you so very much for your answer, it certainly alleviates the anxiety I have been having with this frustrating situation of ending our tenancy. We certainly feel he is thinking that if he takes the $550 he can then use that to pay for absolutely anything to clean/repair the apartment that he knows we wouldn't agree to pay for.

      Delete
  26. Hi there I just have a question about security deposit. My husband and I are looking at renting a house and have been asked for first and last months rent and an additional $500.00 security deposit. If we refused to pay this can he turn us down as tenants? How do I talk to him about this without makeing him angry?

    ReplyDelete
    Replies
    1. Hi there. What a terrible position to be in. The practical reality is that if you start "making trouble" your prospective landlord is quite possibly going to forget your name and never rent to you. Is this legal? No it is not. However, it is reality and you have to ask yourself what you are prepared to do about it. The other question is whether you want to actually rent from a landlord who is doing something illegal in demanding a damage deposit--do you really want to enter into a relationship with a landlord who is starting off making illegal demands?

      If the answer is yes, or you just need to get into this particular apartment, you may want to consider paying the damage deposit (by cheque etc.), getting possession of the rental unit and then demanding that the landlord return it. If he refuses you have a number of options on how to get it back. You could set it off against future rent or you could file an application to the Board. Either way, you will win this battle. However, as your question/comment intuits, you will become less than popular with the landlord and you may find that living in the unit becomes an unpleasant experience. Again, the landlord can't technically do anything--but he is already prepared to make illegal demands so is the law really going to stop him? Perhaps, perhaps not.

      Hope that helps

      Michael K. E. Thiele

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    2. Hello Michael,

      Thank you so much for this blog. I have a bit of a situation. Our landlord cashed our last month cheque before we move in, he is allowed to do that? Then he wanted 12 post-dated cheques.
      There was a pipe burst while we were away, even if we left the heat on. Now he is asking us to pay his insurance deductible. is that legal?
      Thanks

      Delete
    3. Hello: In Ontario, the LMR (Last Month's Rent deposit) may indeed be cashed by the landlord prior to you taking possession. In fact, Landlords need to ensure they have the LMR on hand before giving a tenant possession otherwise the law gives them no effective way of getting an LMR once the tenant has possession. So that part is legal. Your landlord's request for 12 post dated cheques is not legal. He is not entitled to demand post dated cheques. It is a convenience for him--and sometimes for the tenant as well. If you do not want to provide them you do not have to. Whether you have any liability for the flooding caused by the burst pipe depends on whether you were responsible (negligent, careless etc.) for the pipe bursting. If a Court or Board would find you liable then you would indeed be responsible for the deductible. In fact, you could be liable for the entire repair cost and the landlord's insurance company could choose to sue you for all of the costs. In this regard, if you get proper legal advice, there could be a strategic advantage to paying the deductible within the context of a Landlord and Tenant Board proceeding. If a landlord proceeds against you for only their out of pocket costs this may result in all additional legal claims for the damages/repairs being extinguished by operation of law. It would be worth it for you to see a lawyer or paralegal on this point if you can. Lastly, if you have tenant's insurance the claim in relation to the burst pipe and the allegations against you is exactly what that insurance is for. Tenant's insurance would deal with the whole claim and even provide you with a lawyer.

      Hope that helps

      Michael K. E. Thiele

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    4. Hello, YESSSSSS, it did help. Thank you so much.

      Delete
  27. Friend offers tenant a place and tenant gives current landlord 60 days notice on March 1st. Tenant was not looking for new place, but has a toddler and is very concerned about the amount of cigarette and marijuana smoking in building, so was extremely happy for the offer. On March 4, friend advises they are unable to follow through with new place. Tenant immediately contacts current landlord to withdraw notice to vacate. Please advise what tenant's chances are of withdrawing notice and not having to move. Your advise would be really appreciated. Thank you.

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    1. Generally speaking, if the Notice of Termination given by the tenant is a valid Notice of Termination then the Termination of the tenancy is enforceable by the landlord. There is no "right" to rescind a Notice of Termination to continue a tenancy. That being said, the landlord could agree to letting the tenant stay but that is a choice of the landlord.

      Michael K. E. Thiele

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    2. Thank you so much for your advice. Thankfully this situation has been resolved and landlord has agreed to continue tenancy.

      Delete
  28. Excellent questions and answers! Thank you Michael for this Page.
    My question is: As a landlord I have a tenant who is not paying his rent (in Ontario) . I gave him the notice to evict if no rent is paid. If they do leave I loose $600 since I was nice in the past and delayed a payment. Is there any way for me to go after the tenant to get the money? I find it mindbogeling that if I am late in paying bills, such as electricity, I need to pay interest or loose service. If a tenant does not pay rent there is not much we can do.

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    1. Hi Oren: I presume you gave your tenant an N4 Notice of Termination for Non Payment of Rent. Properly filled out the form should include all rent arrears. The form also captures all going forward rents that may come due after the service of the notice but before it is voided by payment. If your tenant vacates in accordance with the notice then you will not be able to get a Judgment from the Landlord and Tenant Board as you may only apply to the Board if the tenant is in possession at the time the application is commenced. Where the tenant vacates and you are still owed money then you may sue the tenant in the small claims court for all outstanding amounts.

      Michael K E Thiele

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  29. Hi Michael, I really enjoy reading your blog and I've learned quite a few things, but I was hoping to find information concerning my current issue. Unfortunately, I was unable to find one so I figured I'd ask you directly!
    My husband and I found a beautiful house we are very interested in renting. We visited in February and though the bones of the house were very attractive, but it no longer looked like the advertised pictures. The current tenants pretty much destroyed it. After the visit, we discussed with the landlord's wife that we loved the house and would be interested in renting under the condition that the necessary repairs would be performed. All was agreed and the date was set for a move in on March 1st. Well the tenants didn't move out until March 7th. We reconnected with the landlord and they promised to hold the house for us if we gave them 500$ deposit that they would put toward the last month's rent, move in rescheduled for March 15th (after the repairs were completed).
    Well March 15th come and a new issue pops up, the husband (owner) changed his mind and no longer wants to rent he wants to sell. We visited the wife and asked to have our deposit money returned but she insists that my husband should speak to her husband since she doesn't agree to sell. My hubby was able to change his mind and we agreed to meet (one again) tonight (March 23rd) to sign the lease. Well they presented us with a lease asking for 1000$ damage deposit and they stipulated that needed to perform monthly inspections to verify we are maintaining the cleanliness of the house and that we aren't damaging it as well! Personally I'm exhausted and stressed out and I'm just turned off! I wanted to ask you, can we get our 500$ deposit back if we decide to pull out of this drama? We gave them a certified cheque, I believe they cashed it. Are they allowed to request entry on a monthly basis? I know the damage deposit is illegal, can I use that illegal act as a valid reason to pull out? Thanks, in advance, for your help!

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    Replies
    1. HI Tasha: Thank you for the interesting problem/question. Whether you are entitled to a return of your deposit is going to depend on the characterization of the facts to date. There is enough case law that confirms a deposit given along with a rental application is "lost" if the landlord approves the application for renting and applies the deposit for rent as the tenancy agreement is formed on the Landlord's acceptance of the rental application. Then again, there is law that holds the "deposit" must be returned if after the application is tendered the landlord seeks to impose a penalty or forfeiture of deposit if a lease is not entered into. The shorter answer to your question is "yes" and "no" depending on characterization of the facts.

      However, this landlord seems to be pursuing contractual terms that are illegal. Hopefully you have these terms in writing--have they been put into the draft lease or in emails? Further, is the demand for monthly inspections for cleanliness and damage inspection documented? The inspection demand is an interesting one that needs to be considered in the context of section 27(1)(5) Ontario RTA. Section 27 sets out the rights of entry into a rental unit with Notice. S. 27(1)(5) provides other reasons for entry as contained in the lease agreement (hence your landlord asking for these rights). S.27(1)(5) however, limits the reasons for entry as contained in the lease agreement to something that is "reasonable". Are monthly inspections reasonable? Context of course, is everything, and the landlord will rely on their previously bad experience with tenants who damaged the property to argue it is reasonable. You, presumably, find the condition objectionable and unreasonable as it infringes on your privacy if you get a monthly visit that judges your housekeeping (to a standard of ordinary cleanliness is what the law requires) against whatever the landlord thinks is ordinary cleanliness. Another thought is that the landlord is not actually going to inspect on a monthly basis but is seeking to reserve the right to inspect for these reasons on a monthly basis if there is cause of concern. Is this the sense of what is happening in the negotiation?

      At this stage, given the difficulty you are having in getting a lease, and what appear to be numerous alarm bells going off in your head, it may very well be for the best to pull out of this transaction. As you withdraw from the transaction it is important to characterize it properly and make sure you maintain the correspondence from the landlord. I do think that the "illegal" terms that the landlord seeks to impose are helpful to you. However, the "inspections" are also quite helpful as I think these terms, as they are the subject of negotiation over a fundamental term of the lease (i.e. privacy, cleanliness, maintenance) reflect that no agreement has yet been reached---meaning your application to rent has not been accepted. In this sense you are not withdrawing from a concluded tenancy agreement (i.e. trying to get out of a lease) but instead are asserting that you and the landlord could not come to terms on an acceptable lease (illegal security deposit and "reasonable" terms of access to the unit). If you successfully characterize the transaction in this way I see no legal basis for the landlord to retain the deposit.

      Hope this helps. Good luck.

      Michael K. E. Thiele

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  30. Hello Michael,
    I am currently having an issue with my landlord. The house is split where the landlord lives in the basement apartment and I share to upstairs with two others. The only common room between the upstairs and downstairs apartments is the laundry room which is upstairs with me. The apartment was furnished by the landlord. A friend of mine threw up on the couch. The couch was washed and steam cleaned so there is no odor or stain, but before it was cleaned, the landlord came up to do the laundry and saw puke on the sofa. The landlord is now demanding the my friend and I replace the couch as well as the love seat because he believes the couch to be forever unclean and he wants the couch and love seat to match. The furniture was already several years old with several cuts and holes in the fabric, but he is demanding two brand new couches. Does he have any grounds here, or is he just trying to take advantage of us.

    Please help.

    Thanks

    ReplyDelete
    Replies
    1. Hi and thanks for your question.

      On these facts the landlord has absolutely nothing. As the couch is clean and in as good a condition as it was before the vomit incident the landlord has no grounds to demand brand new couches (or even other used ones).

      Michael K. E. Thiele

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    2. Thank you so much

      Delete
  31. Hello i have moved into swelling dec 2013 paying first last just to have many issues with aprt heating no egress contacted property standards thn she gets oder to fix nxt day files to evict her application dismissed,,,in the meantime she removed my washer dryer on lease wrking fireplace on lease. So now city involved and apt deemed unsafe unfit i have four days to collect wht i can and come bck whn renos permit order is done... Nice but owner decided to not do renos just yet so now im not aloud to go pack my entire apt and get ready to move ... i understand sleeping there but im jailed from my home and always paid my rent i had a breakdown few days ago on meds and hve no means to pay for another truck movers 1st last rent ree hook ups costs .. im in ahhhhh of all this Stressed tenant

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    Replies
    1. Matty: A nightmare situation. I assume from your comment that your home has been condemned and now the landlord is failing to take steps to repair the unit. Your situation begs for you to have a lawyer helping you through this--perhaps a legal clinic would take you on and guide you. There are many variables so I can't even begin to give you a conclusive answer. My gut reaction to what you describe--leads me to this broad outline of a game plan. 1) seek shelter--even if an emergency shelter for the City you live in. 2) apply for a subsidized rental unit while in shelter (i'm assuming you don't make much money)--perhaps you could get a Rent Geared to Income (RGI) which adjusts your rent based on earnings. 3) Once shelter is taken care of, file a T2 application with the Landlord and Tenant Board--(with a T6 if you can afford the filing fee--note there is soon to be a fee waiver available from the Board). In that application describe your story in an attachment. As a remedy you will ask for the landlord to store your possessions until you can retrieve them, a 100% rent abatement, a return of all rent paid, damages for breach of covenant of quiet enjoyment, expenses incurred to date, if you find a new apartment to rent the rent differential between current rent and new rent, moving costs, utilities hook up costs etc.. Normally you would wait to get all of the costs together and file one application once you have all your evidence. In this case, I'd file quickly to get the issue of the condemning of the unit before the Board, get an Order requiring preservation of your property. Perhaps you will have a hearing in stages. You are best guided through this by a lawyer or paralegal but I appreciate they are hard to get (hence this blog).

      The reality is that you are likely not going to be living in this property again. The goal now has to be to get compensation for all losses---plus some general damages (the Board does have jurisdiction to award these)--and of course a new home.

      Sorry for your luck in picking such a terrible landlord.

      Michael K. E. Thiele

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  32. Mr. Thiele,
    Thank you for these very informative discussions. On March 1st of this year, my landlord here in Ontario taped a letter to the front of my town house giving me "60 days notice to move from the date you have received this letter which is Feb 28th." The reason's for ending the Tenancy were numerous: (Please note that spelling errors are the Landlords)
    1/ "I have asked you to corporate with me to try and sell this home. Its quite obvious this is not working out"
    I am not sure what he would like as far as cooperation goes. Since October of 2013 there have been 32 showings and 9 open houses, all permitted by me with a phone call notice of entry from the listing Brokerage.

    2/"My lease says "NO DOGS" you didn't respect my wishes."
    My daughters gave me a puppy for a birthday present April of last year. The landlord was aware of this and initially had some concerns over damage to the new hardwood floors installed prior to me moving in February 1st, 2013.

    3/"My lease shows your daughter and yourself on the lease, that too has been broken. You now have in addition, a girlfriend, a son and another daughter living at the townhouse."

    This, upset both my wife and I, and we both read the Residential Tenancy Act on e-laws and visited the LTB and responded to the Landlord in writing. The conclusion of our letter stated to him..."your statement "this letter is giving 60 days notice to move...." is deemed void as you have failed to comply with the requirements to evict a tenant prescribed in the Residential Tenancies Act, 2006. No action will be taken on my part, or the other occupants domiciled at this location, to vacate the premises within the time frame you have prescribed.

    While reading the RTA I discovered that the $6000.00 the Landlord collected for 1st month, last month and damage deposit was illegal. In addition on 2 occasions in the last 15 months I had 2 rent cheques returned NSF... I immediately issued bank drafts to the landlord with penalty of $200.00 for each cheque totaling $400.00. I also discovered this was illegal. I asked the landlord to refund $2,258.30 in the next 10 days, and if he didn't, I would file a Form T1 with the Landlord and Tenant Board.

    I filed a T1 and the hearing was last Friday. The Landlord sent an Agent who requested an Adjournment because the Landlord was out of town. The member granted the adjournment till after May 10th.

    Just wanted to share my on going Saga and your comments would be appreciated your comments.

    ReplyDelete
    Replies
    1. Thanks for sharing your experience. I will be very interested in the outcome of your hearing when it finally does get heard. Please let me know!

      Michael Thiele

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    2. Hello Mr. Thiele,
      Sorry for late reply.... the landlord has been ordered to pay me back the $2,258.60. But... now the fun begins. He has now started posting notice of entry for inspection.

      Notice #1 reason for entry "to determine condition of the unit is in good state of repair and fit for habitation and complies with health and safety.
      Date and Time of Entry ..... between the hours of 8:00 am and 8:00 pm. I requested by voice-mail, email and text that he be more specific... he showed up at 7:10 pm and did not do an inspection just a walk through.

      Notice #2 posted reason for entry: "perform small maintenance and repairs".
      Date and Time of Entry... between 8:00 am and 8:00 pm. I again requested that he be more specific and give me a window for when he will be there.... his response was... "I don't have to the Residential Tenancy Act says between 8:00 am and 8:00 pm". He did not even show up that day....

      Now today he had an agent hand deliver a NORI form N2 Unit Partially Exempt giving me 90 days notice of a rent increase of 25%...

      Is this legal... we have been renting this freehold townhouse now for almost a year and a half.

      Your thoughts would be greatly appreciated.

      Delete
    3. Hi: I guess you are right the fun has begun. I'm sorry for you as the landlord is clearly now going to do everything in his power to harass you into moving. The entry notices can amount to harassment and you may indeed have a T2 application if you can collect satisfactory evidence as to the purpose of these notices. With respect to the Notice of Rent Increase (NORI) take a look at section 6(2) of the RTA. Units mentioned in this section are partially exempt from the Act with respect to rent increase restrictions. If your unit does fall within the definitions (and is exempt), you do still have an argument/fight to resist the rent increase as it is fairly clear that it is retributive for enforcing your rights. The Board has--in such circumstances--refused an otherwise lawful rent increase when the purpose of the rent increase is to punish the tenant for enforcing their rights.

      Best of luck.

      Michael K. E. Thiele

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    4. Good Afternoon Mr. Thiele,
      Thank you for your quick reply. I am fairly certain that section 6(2) of the RTA does not apply to this unit, as it is a freehold townhouse built in 1994. I will be contacting the LTB and inquiring as to how I should proceed.

      Thank you again for your informative views on Landlord and Tenant Law in Ontario.

      Scott

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  33. Good Day Michael,

    Thank you for your ongoing running Blog... it is very helpful.

    I am a landlord (you answered a question above for me... that battle is on-going) and I have a single level home divided into two units. Based on my experience renting each unit to different people vs. renting the whole house as one unit does not work well since voice and noise is not blocked well. The house was not built by me and I do not think the previous people insulated the floors/walls to block noise. This has led to friction between tenants, to the point that a family I had is now leaving one of the units.
    My question is... can I ask the other tenants to leave the unit they are in now so I can convert the house to a full house rental unit? If the current tenants want to rent the whole house, I would negotiate with them a rental agreement. I am not sure how much construction would be needed to say for sure that the tenants should leave due to construction.

    Thank you for your insight.
    Oren

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    Replies
    1. Hi Oren: That is an interesting question. At first blush, my immediate thought is to say no. In order to terminate the tenancy of the remaining tenant you would need a ground for termination under the Residential Tenancies Act. Unfortunately, such a ground does not immediately jump to mind. As such, your best bet may be to try to negotiate a termination of the tenancy and sign an agreement to terminate with the remaining tenants. If they do not leave, or are unwilling to negotiate, and you really needed to try and find something, I'd consider a little research into a Form N13 (Conversion, Demolition, Repair). It isn't a conversion--but perhaps it is a demolition or a repair. A demolition in the sense that one rental unit will disappear or a repair in that the work to turn two units into one might be so extensive as to require vacant possession and a building permit. Whether an N13 fits, or not, would require a little bit more research and some more "facts". I have a sense that the N13 might be a stretch--but other than the N13 I can't think of any other Notice of Termination available under the RTA that you could serve (save for any "for cause" reasons that tenants might give you).

      Hope that helps.

      Michael K. E. Thiele

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  34. Thank you Michael for the quick and informative response.
    Oren

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  35. Hello.
    I paid a 'last month' deposit to hold an apartment I had seen on internet (Ontario). As I was living far away I had to rely on the photos posted. Last week I actually saw the apartment in person. Wow, it was not the same as the one posted online and was horrible. I would not imagine living there. I have since said that I no longer wish to hold this apartment. The landlord has now offered to refund me half of the deposit. I had never received anything in writing or verbally saying that it was a 'non refundable' deposit. Can I insist for a full refund? Many thanks.

    ReplyDelete
    Replies
    1. Hello: Whether you are entitled to a refund or not depends on whether a tenancy agreement was entered into and how the landlord is characterizing retaining half of the deposit. If the landlord is charging a "penalty" or "fee" then the amount is likely refundable in full. If there is no tenancy agreement but only a deposit to hold the unit pending a view of the unit and signing a lease then it is difficult to see how the landlord is permitted to retain any money. If the facts are that a lease was entered into and you are now resiling from that lease agreement and the landlord is applying the LMR to chargeable rent and seeking to re-rent the unit then it will be more difficult to get the LMR back---and in fact, the landlord may be entitled to additional damages for lost rent until the unit is re-rented. Of these options, the outcome in your situation depends on what the facts are and what the Landlord and Tenant Board finds them to be. If it is clear that there is a tenancy agreement and the landlord has not re-rented the deal offered by the landlord may in fact be quite favourable to you.

      Hope that helps

      Michael K. E. Thiele

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    2. Thank you for that.
      No I did not sign any contract, I just paid a 'last month deposit' to hold the apartment after filling out an application form. Also at no time did they say that the deposit was 'non refundable'. So in fact, as I did not sign any tenancy agreement and the rental had not even begun, then I should be entitled to a full refund? The company is still advertising several units in the building and I believe they are not finding it easy to rent them because of their current state, nothing like they describe or photos they show. How do you think I should proceed with this? Many thanks.

      Delete
    3. As I indicated before, whether you have success or not depends on the findings of fact by the adjudicator---is there a lease (written, oral, or implied)? I appreciate you saying there is nothing written or signed--but there is a transfer of money. How will the landlord and tenant board characterize that transfer of money? Will the landlord say that this was the consideration for the landlord taking the unit off the market and agreeing to rent it to you---i.e. the foundation of an enforceable lease? I don't think, based on what I've read here, that you have a guarantee of success in suing the landlord for the return of the entire deposit. Anyway, the applicable section is section 135 RTA (Money Collected Illegally). You would fit your application into a T1 application.

      I generally don't answer the question of how I think a client should proceed. Everyone's motivation is different and then sometimes principle comes into the matter. When pushed, I tend towards the bean counting methodology and look at the possible return, balanced against the risk, and the time needed to pursue it. You've been offered half of the deposit back. How much is the deposit? How much are you fighting for? If the sum is small you have to ask yourself if your time is worth the work to chase it. If the sum is large (and I appreciate that what is a large sum is relative to one's means) maybe taking the risk of losing all of it (versus getting back half) is too big a risk? You will have to take time off work, potentially attend the Board more than once, what will it cost you in lost wages to prosecute this claim? There are a lot of factors that go into deciding whether to pursue a claim and only you can know whether it is worth it to you.

      Michael K. E. Thiele

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  36. Hello Michael,
    This blog is absolutely a great resource for new tenants and landlords. Here is my question :
    Im renting a house to a couple with no current employment as they are in the process of starting a business. I had inquired with them (via email) if they would be willing to pay first and last 2 months worth of rent as this would alleviate some of my concerns with their financial situation. They agreed and are happy that they will be able to move in for May as we had several applications.

    As you know this is considered to be illegal by RTA (which is simply ridiculous as it will work against the tenant and landlord in this case). My inquiries for recommendation for you is:

    If I do accept it, should I specify in the lease that due to financial concerns and no stable income the tenant has willingly placed this deposit?

    Will this void the entire lease?

    Would it be better to specify this on a separate document?

    We are leaving $5000+ off furniture in the home - is their anyway to add a damage/furniture deposit to the lease legally?

    Is it best for me to completely forget about accepting the additional month of rent?

    ReplyDelete
    Replies
    1. Hello: That you want the security of another month's rent is entirely understandable as the tenants would not otherwise qualify to rent. Unfortunately the RTA speaks against an extra deposit like this and in most circumstances it is characterized as an illegal deposit. Should the tenants take issue with it, they could seek an order returning the excess deposit and if inclined could ask for you to be fined. The lease itself would not be voided and your tenants would bed permitted to remain as tenants in the premises. In law there is usually an exception to every rule--but such exceptions are rare in Landlord and a Tenant matters. In relation to extra security deposits it is difficult to find a way around. However, characterizing payments as prepaid rent I. Circumstances where a lease would otherwise be refused has been held to be legal by the Superior Court. That case, in my view, is exceptional but it proves that there can be exceptions to even the most stringent rules. Interestingly, the Court commented using the same logic you state about this playing against the tenant and being a barrier to tenancy that the legislation does not intend. That being said, if the tenants sought a refund the Board would likely be against you from the start as the presumption is one of illegality.

      Michael K E Thiele

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  37. Hi Michael,

    Just stumbled upon this and it has been really helpful/reassuring. Myself and two other tenants have been living in a place since last May. As the property manager was a Realtor, we thought we had to pay a Damage Deposit of $1,000 has they had outlined in their lease. So we agreed. The landlords moved back to Canada early, after traveling, and contacted us in early February, trying to get us to leave early so they could move into the house (our lease was until April 30 this year). When it became rushed to try and move, and their story kept changing of why they needed to move in early, we just ended up saying we were staying until the end of the lease. During this month we have been accommodating to their many visits, and even agreed to allow them to sell their kitchen while we were living there (the place came furnished). Myself and the other two tenants started moving out mid-April, but hadn't fully moved out yet when the landlords came into the house to do a "walk through" 5 days before the end of the lease. At that time, they told one of the tenants they would be keeping our damage deposit because of "issues". We have asked for what these issues are and how much, hoping we could address them before the end of the lease. They have also gone ahead and brought in a cleaning lady, and started preparing the house for renovations. Even though we are no longer living there, we still have some stuff there, and the lease goes until the 30th. Doing research, we learned that Damage Deposits are illegal in Ontario, and when we told them this, and that we expected the damage deposit + interest, and interest owed to us from the Rent Deposits, they responded with the message that they are seeking legal matters. There is also a clause in our lease that says if any legal issues arise, the losing party must cover the legal fees. Is this legal? Any advice on how we should proceed?

    ReplyDelete
    Replies
    1. Hello: Unfortunately what you describe is not uncommon. The fact is that the security deposit is illegal and you are entitled to receive it back. If the landlord refuses to return the money it is a fairly simple application to the Landlord and Tenant Board. You could also as the Board to fine the landlord for this illegal deposit--which is more likely to happen if you establish that you asked for the security deposit to be returned and the landlord refused (i.e. make the demand in writing).

      The landlord's only angle to avoid paying you back any money is to prove that you caused damage to the premises. While proving that you caused damage will not make the security deposit lawful--any judgment that the landlord gets against you for damage (beyond normal wear and tear) could be set off against the security deposit owed to you. As such, while you are still in possession of the unit (rent paid to end of April)--you should attend there and take numerous photographs and video of the entire unit. Take a few photos or video with a current newspaper in it (to prove the date of the video) or alternatively show the front of a smartphone showing date and time. The point of the photos is to prove the condition of the unit upon turning it over to the landlord. Ask the landlord to come and inspect the unit for a move out inspection (in writing) with the point being to give you an opportunity to address anything the landlord finds to be a problem. You can at least decide what to do about any complaint---i.e. ignore it, fix it, get a quote, etc..

      Whether you can contract to pay legal costs is an interesting question. In the circumstances that you describe I would not be worried about it. I can't think of any reason why you would not win your application for a return of the security deposit---and presuming that you have not damaged the premises--you now have an opportunity to record and collect evidence proving the condition of the premises at the end of your lease (i.e. the landlord will have a harder time manufacturing evidence against you). If a move in inspection was done---or if there is any evidence of the condition of the premises at the commencement of the tenancy--you should make sure to get it or keep it for the future. A landlord will have up to 2 years after the end of the tenancy to sue you for any damage--make sure to preserve your evidence for at least that long.

      Hope that helps

      Michael K. E. Thiele

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  38. Thank you for this resource Michael!

    I have lived in my current apartment for six years. In February of this year my building was sold and a new manager took over. I gave my sixty days notice recently and am scheduled to move out may 31st. When I moved into this unit six years ago there were several deficiencies that were never addressed despite several verbal requests (cracked bedroom door broken electrical outlet) as well as a room that has been left painted another color (not white). In addition the unit was filthy and I needed to spend 3 days cleaning it. Now that I'm moving out the new landlord is threatening to charge cleaning and painting fees in addition to fees for other deficiencies. Seeing as my apartment was in poor repair when I moved in and I maintained it in good order, minus standard wear and tear of six years, I feel this is unfair. I would appreciate your opinion on whether they have the legal authority to issue a blanket cleaning fee ($120) in addition to fees for painting and other repairs.

    Thanks

    ReplyDelete
  39. Hi Dano: The short answer is that the landlord is not permitted to levy such a charge. Your explanation is quite reasonable and I would make sure to send the landord a letter with these facts (by email or fax to prove delivery). Upon moving out make sure to take some photographs of the unit, video as well, wide angle showing the whole room and close ups showing detail. Make sure to take photos of the inside of the oven and the fridge (cupboards, closets, etc.). Keep this evidence for at least two years in case they come back to chase you after you move out. Having a witness come to look at the unit would also be helpful so you have evidence to prove the condition of the unit when you return it. You can ask the landlord to write you a note stating that they have no claims in relation to your tenancy---but they do not have to provide it. If they assert a claim to the contrary---and you feel a need to deal with it (i.e. can't stand to wait possibly two years for the landlord to make a claim)--you might consider filing a T2 application asking the Board to rule on the question---it is a bit of an odd application to bring---but it would hopefully bring the issue to a head and make the landlord assert a claim or let you go.

    Cheers

    Michael K. E. Thiele

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  40. Hi Michael,

    Thank you for posting so many articles/responses. Your blog has been an excellent resource! I was hoping you may be able to offer some insight into my current situation. Two other tenants and I had shared a unit with a lease that expired on April 30/2014. We had moved most of our belongings out to other rental units prior to April 26; however, I still had some items left in the previous unit as well as some furniture that was stored in the garage. It was my intention to return to the unit on the 26th and 28th to clean the property as well as collect my remaining belongings. I received a text message on April 26 indicating that the landlords were planning to change the locks on the subsequent day (they were moving back into the unit on the 30th. Upon learning this information, I sent an email making it very clear of my intentions to return to the unit. The landlord’s representative replied that they would not change the locks until April 28th (after I removed my furniture) and that they would be conducting renovations sometime thereafter. I returned to the unit on the evening of April 26th and realized that all my remaining items had been stuffed into a garbage bag and placed inside the garage. In addition, all of the baseboards in the unit had been removed. None of the tenants were at the unit on April 27th. On the morning of April 28th we did a video walkthrough of the entire unit and all furniture/items (as indicated by a checklist completed at the commencement of the tenancy). To our surprise, all of the carpets on the upper floor had been ripped out and rolled up, with brand new under pad on the floor. We also found several marks in the walls that had not been there as of April 26th. On April 30, we received a list of 7 items indicating over $3500 worth of damages, half of which was replacement costs for the carpets. The landlords claimed that they had the right to enter the unit to perform renovations based on the fact we had cancelled utilities prior to the 26th. They also claimed that they required complete replacement of the carpets and under pad due to pet dander (both landlords claim to suffer from cat allergies). There are pictures indicating that the carpet was in exceptional condition (no stains, marks, etc) before it was torn up. Three of the seven items on the list have no pictures indicating damage (one of which being the carpet). One of the items was nowhere to be found on the item checklist we received at the commencement of the tenancy (there is no previous photograph of its existence either). The remaining 3 items (2 of were legitimately damaged by the dog) have minor damage and can be repaired easily; however, the landlords claim they want the items replaced brand new (total value is $1600+ despite not having any proof of purchase). The landlords are now threatening to take us to small claims court. The tenant with the dog offered to negotiate damages for the table and rug. The landlords declined, insisting that they were owed the full $3500. All tenants have never had an issue in any previous unit and have great references from landlords over 6 years of renting. Despite being in the unit lawfully on numerous occasions in March and April there was no effort on the part of the landlords to notify us of any damages beyond normal wear and tear prior to April 30. It is evident that they are trying to take advantage of the fact we left the unit early in order to seek compensation for damages we did not cause. What would be the best course of action to proceed with through the Board? Can they admit photos and documentation as evidence of damages when it was collected during an unlawful entry into the unit? Any advice you could offer would be greatly appreciated!!

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    1. Hi and thanks for this question. Your comment and question is at a fairly advanced level and you have a clear appreciation of many of the legal issues at play here. Addressing everything you raise would simply be too long--so I'll give you a limited reply but recommend that you seek legal counsel for thorough legal advice before acting on any of the informationI provide.

      The first thing to appreciate is that the landlord is unable to proceed against you at the Landlord and Tenant Board. Being out of possession, the Board has no jurisdiction to entertain the Landlord's damage claim. As such, you could indeed file an application to the Board for the illegal entry--and seek damages for the illegal entry (disturbance of your property, deny opportunity to clean etc.,). You could even ask the Board to fine the Landlord for the illegal entry. On top of that, and query, whether you could ask the Board to find that the unit was vacated and returned in a satisfactory condition to the landlord---ask for this finding in consequence of the landlord's illegal entry and destruction of the evidence (rolling up of carpets etc.).

      The landlord could indeed submit any evidence in response to your application---even evidence collected during an illegal entry. There are relatively few exclusions of evidence in a civil context--especially an administrative law context. Of note, though is that the landlord's evidence against you at the Board can not lead to a remedy as the landlord can not file an application against you. At most, the evidence results in a reduction of your claim to damages/abatement.

      The inability to handle all aspects of the claim (i.e. the Landlord's claim) at the Board may lead to an argument by the landlord that the Board should refuse to hear your case. This is a compelling argument if the landlord also files a small claims or superior court action against you at the same time. The argument would be that you could assert your T2 claim in a defence and defendant's claim in the Small Claims Court. Of course the Small Claims court process is much longer and in that sense the Board process is better from your perspective. Given the landlord's conduct, I think you have an advantage by proceeding at the Board notwithstanding that the landlord may try to get your Board applicaiton stayed.

      Hope that helps a bit. There are so many issues in what you raise--it would be worthwhile to sit with counsel and strategize on how to proceed.

      Michael K. E. Thiele

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  41. Hello there!

    My situation is pretty simple. I am just looking for a few tips how I could try and remedy this situation without going to great lengths. I rented a house and everything was done through a relator for both parties, myself and the landlord. A lease was drawn up. Now mind you I did not know at this point that it was illegal to ask for another deposit other than last months rent at the time. I have a dog, and they requested that I give them a $1000.00 deposit in case the dog damaged anything. Now I assumed that everything would be legal since we had realtors handling this but I guess I was wrong. So I gave the deposit which they cashed the day we moved in. We moved out April 15th, 2014, almost a month ago now and they have still not returned my deposit. When I gave them the required 60 days notice I requested that the deposit be returned to me the day of the walk through ( April 15, 2014 ) this was the advice of my realtor. I have in writing from the landlord stating that if everything was in good condition that they would return the deposit on site the day of the walk through, little did I know, they didn't even bring a cheque with them. They did a walk through and stated there is no damage ( I have in writing ) just that they wished a few things to be better cleaned. So we went back and did this and have been going back and forth with them for weeks. They just keep making excuses about not having time to go back and make sure everything is to there liking, they say the money is not an issue yet it seems to be taking a long time. Im just looking for a few tips how I could maybe get their attention and speed things up, as I am sure they think they are dealing with a lady that has no clue about any of her rights. If I have to go to the tenant board or take further action I will do so, but If I don't have to I would like to avoid it. Any advice would be appreciated! Thanks!

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    1. Hi: There are many ways to proceed with this so I don't think that there is necessarily a right answer. If you have reached the point where you think you are being stalled and toyed with then I would recommend preparing a T1 application for a rebate of the illegal charge and also prepare a T2 application asserting that the charge was illegal, seeking an order that the landlord not charge these amounts in the future, assert that the damage charge is intended to dissuade pet ownership and hence ask the landlord and tenant board to fine the landlord and order a rent abatement. Once you have issued the applications serve the landlord and see if that brings them to the table. If not, proceed with the hearing.

      Best of luck

      Michael K . E. Thiele

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  42. Hi Michael,

    I have been renting a room in a home for a year (as of May 1st), living with the owner and her teen-age son. There have been issues throughout, the main one being lack of heat during the winter months (15 - 17 degrees celsius) yet not being allowed a space heater. There were a variety of other rules set, such as me not being able to have friends or family over without giving her at least 24 hours notice, etc. Because the space is in an ideal location for all the places I work and the rent price is reasonable ($450), I put up with these things and agreed to her terms. At the meeting where she set down all these terms, there was a verbal agreement made that we would both do the other the courtesy of giving the other at least one month's notice should one of us want to discontinue our rental arrangement.

    On Thurs, May 8th of this month, I gave her my official notice that I would be moving out at the end of June, and since I have paid last month's rent when I moved in, that would cover June. When she read my notice letter, she stated to me that she had decided that day to kick me out at the end of May. Though this inconvenienced me to make my moving-out arrangements a month early, I didn't take issue. What I DO have issue with is that she is holding my last month's rent hostage, saying I won't get it back until she takes a damages assessment once my things are moved.

    I am an excellent tenant- very clean, tidy, live alone with no pets, don't smoke, quiet. I have not created any damages. But I am very, very concerned that she will say and do anything to keep that money. What is considered wear and tear? For example, can any of these things be held against me, in getting my rent back- nail holes in walls (I think 7 in all) where artwork was put up, small scratch on wooden drawers, bathroom sink slightly clogged.

    Are there any legal steps I can take to get this money back that don't include lawyer fees? I don't have the money to pursue this in court.

    Thanks in advance for your help and advice.

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    1. Hi: If the money is not returned then the only legal route is to proceed with a claim in the small claims court. You can do this without a lawyer. The key is to have evidence. So, make sure to take a lot of pictures and video of the premises when you move out. Do this even if you don't expect to sue her---she might just turn around and sue you. Try to get a move out inspection signed and get her to commit in writing to the condition of your room. Try also to get a witness (who will show up in Court should that be necessary) to see the room when you move out.

      If you are not prepared to go the Court route then I think you are out of luck if she doesn't negotiate anything with you on a voluntary basis.

      Good luck.

      Michael K. E. Thiele

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    2. Thank you for your advice. Is there any information online you could recommend to me, that touches upon the rights of a room renter, and the rights of the person doing the renting? My assumption is that a lot of tenant law doesn't include my situation.

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    3. Hi Again: The law that applies to a situation where you are renting but are not covered by the Residential Tenancies Act is the law of contract. You can find a lot of information on the law of contract but I suspect that it is not what you are expecting it to be. There is no "code" or law about the rules for renters who are not covered by the Residential Tenancies Act. The law that applies to a situation where the RTA has no application is the law of contract and more precisely the principles of contract law and the whole of the common law. If you are curious about the law of contract then I think the only way to get a good sense of it is to buy a text book on the subject. There is an author by the name of Fridman--I think his text is Fridman on Contract--it is an excellent text covering the breadth of the subject.

      Michael K. E. Thiele

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  43. Hi Michael i have a quick question for you. I have been renting an apartment from Skyline in Owen Sound Ontario for the last 6 years. I had a call from credit alert services informing me that Skyline has recently pulled my credit WITHOUT my know how or permission. I have NEVER given anyone permission for this and was wondering what legallities there are to this. This happened 4 days ago and when i call Skyline head office in Guelph Ont they had no answers for me... what are my options. enviro-clean@hotmail.com

    Thanks


    Robert

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    1. Hi Robert: I know they need permission--but I don't know the implications of doing a search without permission. I've posted your comment and if anyone reading this knows the answer I'll post that reply. This is the kind of question that for me needs a little research. If you want to try your hand at caselaw research try it at www.canlii.com it is a free legal research site (all Canadian). If I trip across the answer I'll post but that is unlikely in the next week or so.

      Good luck

      Michael K. Thiele

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  44. I am a tenant who will be paying the annual term upfront on the day of possession. Do I still require a deposit to seal the agreement? If so, does it have to be first and last? Or just first month's rent? Confused. As realtor says 1st and last now.

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    1. Hi: There is no legal requirement to pay a last month's rent deposit. The RTA permits one to be collected but it is not a precondition to "sealing the agreement".

      Michael K. E. Thiele

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  45. Hey Michael,

    Our landlord made us pay a $500 security deposit when we moved in. Now 2 years later we are moving out and realized he cashed the cheque 2 years ago when we moved in. Now in the lease we signed, a point in it mentioned the security deposit and how it would be used. He is trying to charge us for garbage removal, cleaning lady costs, and his time. Does signing the lease make these charges legal? We just found out the deposit was illegal in the first place.

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    1. Hello: The security deposit is not made legal by the fact that it is included in the lease. In fact, the Residential Tenancies Act provides that anything in a lease that is inconsistent with the RTA is not enforceable at law. You could easily bring an application to the Board requiring the Landlord to return the security deposit to you. Presumably you are out of possession of the unit which means that the landlord can no longer file an application against you at the Board. If the landlord's charges for garbage removal and cleaning are bogus then he would have to be very careful about choosing to sue you in the small claims court. Normal wear and tear and a normal cleaning and preparing the unit for the next tenant are not chargeable to the prior tenant. If you left the premises in a poor condition (lots of garbage, excessive need for cleaning) then the landlord can demand that you pay these costs and if you don't he can sue you in the small claims court. The key to deal with such a claim is to have evidence of the condition of the premises when you moved in and when you moved out.

      Best of luck to you.

      Michael K. E. Thiele

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    2. We left all the garbage in bags and boxes on the front porch, the whole house was empty though. For the garbage the charges are the dump runs and his time. The house should not have taken double cleaning time as we swept and vacuumed the house before we left, even Lysol wiped tables and walls. Will he have any chance if he can't provide receipts?

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    3. Hello: What you describe sounds reasonable and hence the landlord would not be entitled to charge you for the things he is charging. Presumably the garbage you left on the porch was left there because it wasn't garbage day when you moved out? Sweeping, vacuuming, wiping down tables and walls is all excellent and more than what many tenants do at the end of their tenancy. The deposit is illegal and you can get an order requiring him to return it without much difficulty. The landlord will have the burden to prove that you left excessive garbage etc., in the premises if he is going to successfully sue you in the small claims court.

      Michael K. E. Thiele

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    4. Hey Michael,

      I again want to thank you for all your help on this so far! We called our landlord today and informed him that he he wasn't going to pay us that we would proceed with a T1 Form and then end up in court. He countered that with saying that he will send us the $500 then send us a bill for his services rather than take it from the security deposit. Would we be legally responsible to pay that bill or can we accept that course of action and disregard the following invoice.

      Thanks again.

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    5. Hi: The landlord has little choice but to return the money to you as retaining it is illegal. If he does send you a bill you may of course pay it, ignore it, or negotiate an acceptable amount. If you choose not to pay the bill but ignore it or offer something less the landlord will have to choose whether to drop it or sue you in the small claims court. The risk of that to you is only significant if he has a good case or if he can prove a case that the judge believes. If he sues and wins, you can expect to pay the additional costs of filing the application, some interest, and perhaps some costs. If there is no merit to his claim, and you successfully defeat his claim you can ask for your costs to be paid by him.

      Goodl luck.

      Michael K. E. Thiele

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  46. Hi Michael,
    thank you so much for this blog post, and for keeping up wiht comments. It's been extremely helpful in our situation.
    We found an apartment that we very much wanted to rent, but when it was offered to us the terms were 1st and last + $300 damage deposit. Asking for a deposit raised red flags immediately, and I did my research and found it was indeed illegal. I talked to the landlord and insisted that while we definitely wanted to rent the apartment, we would not pay the deposit on legal grounds. He seemed ok with that, and it sounded like all was going forward until today he informed us he no longer wanted to rent to us. All of our references already checked out. It sounded like a perfect fit, but clearly our refusal to comply to their request of an illegal charge scared them off. We have lost a week of apartment hunting over this.
    Is there any action we could take to report this? I don't want anyone else to go through the same hassle, or worse, pay it and end up in a potentially bad situation.
    Any advice would be welcome.
    Thanks!

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    1. Hi: I'm sorry to hear about your unfortunate experience. Indeed, when my clients have asked me "what to do" about charges like this (and they really want the apartment) I've said to go ahead and pay the deposit and only after getting possession challenge the charge. Of course, you could look at your experience as a blessing as you now know that your almost future landlord was unconcerned about the law and unconcerned about treating tenants "legally". It might be the best thing to not be in that tenancy.

      Anyway, to your question. Presuming you don't want to spend a lot of time on this, I would recommend a complaint to the Investigations Branch of the Ministry of Housing. Here is a link http://www.mah.gov.on.ca/Page142.aspx . If the link dies, just google the phrase. This branch is charged with investigating breaches of the RTA and if they do investigate your complaint they can lay charges against the landlord in Provincial Offences Court. Note of course, if they lay charges, that you may be summonsed to testify.

      Good luck on the apartment hunt.

      Michael K. E. Thiele

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  47. Hi Michael,
    Thank you for writing this extremely informative post. My husband and I would truly appreciate your insight into our dilemma:
    We rented a condo unit for 3 years and recently moved out in May 2014. Prior to starting our tenancy, our landlord requested a series of post-dated cheques as well as a "security deposit" in the amount of $500. At that time, we did not know that a "security deposit" is illegal under the RTA and according to your blog post. After we moved out, our landlord refused to give us the "security deposit" cheque back on the grounds that my husband and I left the condo in a "filthy state". To avoid drawing the story out, I will tell you that when we moved in, the condo was already quite run down from previous tenants and our landlord did not do an inspection. We documented all the pre-existing damages in an e-mail to our landlord back in 2011 and thus we feel confident that we have the proof required that we took possession of an already run down unit and did not cause any damages.
    Our landlord has refused to refund our $500 security deposit on the grounds that we caused damages to the unit and that the money used to renovate the condo for resale purposes "far exceeded our deposit". My husband and I have been exemplary tenants and feel we have been wronged. What do you suggest is our next course of action to reclaim our "security deposit"? In addition, can you please confirm if this is still an illegal practice as of June 2014?
    We truly appreciate any advice you have.
    Regards,
    Laura

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    1. Laura:

      With respect to the un-returned security deposit take a look at the T1 form available on the Landlord and Tenant Board website. Use this form to file an application to seek an order against the landlord to return the money. You should have little difficulty getting an order because the landlord will not be permitted to raise any of the "repair" issues that he mentions to you. Because you are out of possession he can not file a claim against you at the Board. However, if he feels strongly enough he could pursue you at the Small Claims Court over his claim.

      With respect to a security deposit. The law has not changed. Take a look at section 105 and section 106 of the Residential Tenancies Act. The only deposit that a landlord may take is a deposit towards the last month's rent in the maximum amount of one month of rent.

      Hope that helps. Please let me know how the hearing goes.

      Michael K. E. Thiele

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    2. Michael, thank you so much for your prompt reply. I am happy to say that the landlord decided to settle with us rather than risk legal action, although he insists there is nothing illegal about security deposits according to his legal counsel. In any case, I trust your information and I also called the Tenant Board which also confirmed it. Thank you again for your reply!
      Laura

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  48. Hey Michael. I am a tenant in Ontario. I provided first and last months rent for my apartment. In previous tenancies in other apartments, I have paid nothing on my 12th month of rent, to recover the deposit. My current landlord either has a different interpretation, or has forgotten which month was the 12th month, and I have been served an eviction notice.
    A few questions and points. First, my rental contract with them does not appear to stipulate how this money should be used, and is not inconsistent with my interpretation. Is my interpretation legal invalid?
    Second, they propose to evict me on the 26th of the month, 4 days before my "last months" rent would pay for, provided that the money was used to cover the rent. Is this legal? I have technically paid them enough money to cover until the end of the month. Am I to be reimbursed partially for my last months rent, if I am evicted before I have run out of credit with them?
    Finally, can I dispute this interpretation with the Board on the day of the eviction hearing, while agreeing to pay according to their interpretation if I lose the hearing. Is there any way to formally dispute these matters without being evicted?

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    1. HI: The Last Month's Rent (LMR) deposit is to be used for the last month's rent. So, if you are on a fixed term for 12 months and have given a valid notice to terminate for the end of the 12th month (i.e. 60 days before then end of term) then the LMR should be used for the 12th month. If you have not terminated your lease by notice, then your tenancy will automatically continue after the current one year term--meaning that the 12th month can not be your last month as your tenancy has not been terminated by notice from you. The expiry of a lease term--does not, in Ontario, end the lease.

      If you presently have an N4 Form you may pay the rent and void it by the termination date. After the termination date the landlord may file an application to the Board in form L1--which will result in a hearing being scheduled. The fee for the application is $170, which fee will be added to the amount you owe should the landlord win the application. If you wish to make a legal argument in relation to the LMR and the case will be only about rent arrears (i.e. no other issues combined into the application), then you are fairly safe to allow the matter to proceed to hearing so that you may argue your legal point. If you lose, the Board will terminate your tenancy for non-payment of rent, however, the Board MUST also give you an opportunity to void the termination order by paying the rent arrears plus the costs of the application. In a rare case there may be some additional costs for legal fees (quite rare).

      Michael K. E. Thiele

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  49. Hi Michael, I recently moved out of a rental property on July 1st 2014 and I lived there since July 1st 2012. My landlord is currently trying to charge us for not cutting the lawn because we didn't have a lawnmower and he expected us to buy a new one. Is he allowed to charge us after we have moved out even though he didn't provide us with the necessary equipment? Also I was looking at the lease and saw that he asked for the last 2 months as a "contract deposit", which we paid, but not I see that that was illegal. Is there anything I can do about that now? Also we have not been paid any interest on our deposit. I believe we should have been paid that but should it be based on the full deposit we put down or half of it, 1 months rent?

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    1. Hi Ryan:

      The question about law maintenance is an interesting question. Does your lease say anything about who is responsible for cutting the grass? What happened during the summer of 2012 and 2013? What is the legal basis for the landlord's claim that you are responsible for grass maintenance (i.e. what is his legal theory)?

      There is an important case from the Ontario Court of Appeal that provides that landlord can not actually require tenants to do the maintenance work that is imposed on the landlord under the Residential Tenancies Act (Montgomery v. Van--it is about snow shoveling). Query whether lawn maintenance falls into the category of maintenance. There is a small claims court case that suggests that lawn maintenance is different than snow shoveling---but I'm not entirely confident that the small claims court case is properly decided.

      Generally speaking, my view is that a landlord is responsible for maintenance and that maintenance includes "lawn care". The statutory basis for this statement is section 20 of the RTA which provides: A landlord is responsible for providing and maintaining a residential complex, including the rental units in it, in a good state of repair and fit for habitation and for complying with health, safety, housing and maintenance standards". That section 20 includes "lawn care" finds support in the opinion of the Jack Fleming a respected authority and author (see page 63, Ontario Landlord and Tenant Practice, 2014).

      Even if the landlord provided you with a lawnmower I do not believe that he may require you to use it as part of your lease. In accordance with the decision in Montgomery v. Van, a landlord may enter into a separate contract with a tenant to provide the maintenance services--and certainly in the face of a breach of that contract damages may flow. Did you have a separate contract to provide lawn care?

      Subject to further information from you--I have difficulty seeing how you can be liable for the lawn care.

      With respect to the two month deposit--that indeed was illegal. I presume that you received a credit for the two months? If not, and he is trying to scoop one of the deposits by alleging lawn care breaches then you may indeed file an application to the Landlord and Tenant Board and get the money refunded. The landlord will owe you interest on both amounts. Given that the two month deposit is illegal you may request that the Board also fine the landlord. Take a look through some of the earlier comments in this blog and you will see a discussion about which of the Forms to use.

      Best of luck.

      Michael K .E. Thiele

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  50. Hi Michael,

    Need some advice we are not sure if there is anything we can do with what we just found out through the bank. Our line of credit and savings acct is $12,000.00 in the hole. Went to the bank the manager told us it was from cheque's cashed in 2012-1013 they were postdated cheques and it hit us we rented an apartment July 1st 2012 in a house landlord lived in basement with another renter who has lived there 20 yrs, we gave her postdated cheques on accepting the apartment through her real estate agent. She came to us when she cashed the cheque and told us they were no good we went to the bank teller told us it hasn't gone through we waited day or two landlord again banging on the door wanted her money and the cheque's were bad we agreed to pay her cash first of each month as long as she gave us a receipt which she did we asked for the cheque's back and she kept putting it off honestly we never thought to much about it until the contract ran out and we did not resign she became very upset and from that point on was a landlord from hell..we did our best to last but with my daughter it wasn't a good environment so we left Feb 1st of 2014. We also were not allowed to claim the rent on our taxes as she freaked and said we couldn't or she would have to raise the rent then found out that the apartment wasn't legal and the kitchen in basement wasn't legal :( we had to purchase our own alarms and there is also other illegal stuff going on which was another reason as my daughter was cluing in on the activity, wont say here only on request. we were taken for a ride and now are in the hole and have to pay it all back to the bank :( she scammed us :( and i feel we aren't the first ones she asked me many times to do some shady things with the government i told her no she is on her own. is there anything we can do or we just have to bite the bullet? and chop it up as a experience I would just like warn other tenants to be aware of her even if we cant go after her for the money she took...she collected $2,300.00 a mth when rent was only $11,50.00 pls help if possible thank you. I apologize if this is a lot of rambling but i am still very upset still pretty fresh from earlier today.

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    1. Hi M. Howes: The time line is a little unclear. Given the amount of money at stake it is definitely worthwhile to meet a lawyer and sit down. If she is the owner of the property then collection of a judgment should be easy enough. Depending on the timing this may also be a matter for the police because it strikes me as an obvious fraud. If you can establish a double paid rent you can sue her to get the money back and perhaps even file an application at the Board to get it back. To provide a clear answer I would need to sit with you, go through it step by step, and match up the time line and the payments and the dates of the cheques that were cashed. Can you order the improperly cashed cheques from the bank so that the timing is apparent from the deposits of the cancelled cheques? I have seen similar cases and in fact sued a landlord for doing the same kind of thing and was successful. Time is not your friend though and it is imperative that you get in to see a lawyer quickly. This is not a difficult legal case---the question is what do your provable facts demonstrate. If you have the facts perhaps you can find a law firm with an articling student who can run this matter for you fairly cheaply.

      Best of luck

      Michael K.E. Thiele

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  51. Before I signed my 2 year lease in a new apartment building in Barrie, Ont last year, I (and other prospective tenants) were given the incentive of 1 month's free rent in each year of the lease. This was a verbal incentive. The landlord honoured it the first year, but now with the 2nd year of the lease fast appraoahing, some are thinking that it might not be honoured for the 2nd year. My question is, is a verbal incentive binding upon the landlord? It seems to me that having honoured the first half of the incentive, the precedent is set and the landlord would have a hard time arguing that he isn't bound by the verbal agreement, especially as it was made to several new tenants.

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    1. Hi:

      Rent discounts, the math is enough to make me shudder. You would think that a simple discount would be a simple enough thing to apply. Anyway, in your situation, I think the two month's of free rent (two rent free periods of one month each) is entirely enforceable and legal. The section of the Act to look at is section 111 RTA which explicitly discusses rent discounts and sets out the broad framework of valid and legal discounts.

      You will note that section 111 RTA makes use of the word "prescribed". "Prescribed" is like a code word that tells lawyers that there are additional rules in relation to the things mentioned in this section in Regulations. Regulations have legal affect but they are lesser in authority than a statute. In this instance, you should take a look at Ont. Reg. 516/06 to the Residential Tenancies Act. If you look up the RTA on www.canlii.org--narrow your search to Ontario and then search Residential Tenancies Act, select it, and then you will see a tab on the right entitled "regulations"--you will find the regulation there. Then take a look at section 10--which provides, I think, the answer you were looking for. It states: "The only condition prescribed for the purpose of subsection 111(2) of the Act is that the discount must be provided for in a written or oral agreement". Hence, the answer to your question of whether a "verbal" agreement in relation to discounts is enforceable--the answer is obviously yes. That being said, proving the existence of an "oral" agreement can be difficult and proving the terms can be tricky--however, if you convince an adjudicator that the agreement existed then it is legally enforceable by the Board.

      Best of luck.

      Michael K. E. Thiele

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  52. Before signing my 2 year lease in a brand new building, I (among others) was promised 1 month free for each year of the lease. I moved in at the end of August 2013 and was paid no rent for October. So, the verbal promise is half kept. A few of us in the building are wondering if the landlord will honour the promise for the 2nd year of the lease and give us October 2014 rent free. The promise was verbal, but more than one of the rental agents stated it before we signed. My question is, are verbal agreements binding when made on behalf of the landlord, especially when made to more than one tenant and by more than just one of the rental agents?

    ReplyDelete
    Replies
    1. Take a look at the comment above---July 24, 2014

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  53. Hi Micheal
    A couple things I like to run by you,My building hasn't had a superintendent on the premises for three months,the landlord has asked the tenants to meet him in the front lobby to hand in their rent at the beginning of each month.He will not accept cash as payment,only cheques or money orders, I have always paid with cash the last twenty years of being a tenant.Now he put letters under the door asking tenants to do e-mail transfers, account transfers,or by mailing a series of post-dated cheques,or a money order. and to allow three business days to insure they arrive on time.Now being I am presently disabled and receive my money at the end of the month,how am I going to put a money order in the mail 3 days before the rent is due? Is any of this legal?

    ReplyDelete
    Replies
    1. Hi:

      How the rent is paid is a matter of contract subject only to the provisions of the Residential Tenancies Act. Over time, the manner of payment is also determined by the practice of what is actually done. So, paying your rent in cash, for the last 20 years (in this building?) is certainly the established way of paying rent. The landlord can not just unilaterally change the way the rent is paid. With respect to post dated cheques it is illegal for the landlord to require them. Section 108 of the Residential Tenancies Act provides as follows:

      108. Neither a landlord nor a tenancy agreement shall require a tenant or prospective tenant to,
      (a) provide post-dated cheques or other negotiable instruments for payment of rent; or
      (b) permit automatic debiting of the tenant’s or prospective tenant’s account at a financial institution, automatic charging of a credit card or any other form of automatic payment for the payment of rent.

      The request to send a cheque in advance (3 days) to make sure it gets there on time is in effect a request for a post dated cheque. That is illegal. Requesting other forms of payment to be set "in time" is also illegal. The Landlord needs to provide you with a way to pay your rent on the day that it is due. In your circumstances, if you have been paying your rent in cash for 20 years in this building then I'd say you have the right to continue to do so in this manner. You mention being disabled so I presume that this is relevant to your ability to get out to pay the rent etc.. The landlord should accommodate you as a matter of human rights. It seems to me that you and your landlord need to have a conversation to find something that is mutually satisfactory. If he is unwilling to work with you, be aware that the law will be leaning in your favour on these facts.

      Michael K. E. Thiele

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  54. Hi great blog from what I have seen answers to has answered one of my questions on topic of abusive harrassing landlords so I will be seeking compensation for that issue. As a person with disabilities I am currently on a waiting list for suitable housing so here's my issue which I think I have answer where I am now cable and internet is included in rent but with the conversion of cable to digital everyone hers has lost most stations because landlord refuses to get the free digital boxes needed to receive digital signal. If I read agreement to increase or decrease rent sec 125 I/we should be entitled to ask for a rent decrease because his refusal to get digital boxes constitutes a decrease in services or facilities am I correct in this??

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    Replies
    1. Hi: I won't commit to saying that you would be successful but I do think you have a point with respect to the reduced quality of the cable television service. The section you cite (125) I don't think is the correct one in this instance--but instead take a look at section 130. The definition of "services and facilities" in section 2 is helpful as it includes cable television facilities. The question I'd be interested in is whether this means the removal of the ability to receive cable television--i.e. the landlord removes access to the building for a cable provider or for some reason terminates the main connection--or is this broad enough to include the reduction of programming over cable television facilities that the landlord was providing. I don't know the answer to this off the top and a case law search is warranted to see if it has been decided before. Arguably, the landlord has contracted to provide cable television and when the cable television system changes he must also make the change--i.e. get the boxes.

      If you pursue this please let me know the outcome.

      Michael K. E. Thiele

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    2. Hi thanks for reply yes 130 is more suitable and no he not refusing cable provider access just a matter of him going to cable provider and asking for x number boxes if I understand what u saying it is broad enough as all tenants are affected I certainly will let you know outcome thanks for reply

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    3. Hi again well an update on my July 31 post. I had an arguement with landlord about the cable issue. At first he tried to tell me he would only provide boxes if we as tenants would agree to paying him a deposit on the box required to change to digital stations. I argued the point of it being illegal to charge a security deposit. Hemust have contacted the RTA himself on the sections I quoted in regards to the issues as he is nowoff to pickup the required boxes. I tthank you for your insight and knowledge

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  55. Hi, I'm ending my 2 years lease on September 1st. When I got the place, I gave my first and last month plus a security deposit of $600 in case of any damages done within those two years. Can I ask for interest on that security deposit and were they allowed to ask me that deposit in the first place? It was our first time renting. Thanks!

    ReplyDelete
    Replies
    1. Hi Josee: In Ontario security deposits, like the $600 one you paid, are illegal. Your landlord was not permitted to ask you for it. You may of course ask for interest on the amount and the landlord should pay it. If the landlord tries to "use" a portion of the security deposit for damage he alleges in the unit you can go to the Landlord and Tenant Board and get an order for the return of the whole amount (without deduction of any kind). The Board may also choose to fine the landlord for taking the illegal security deposit--the likelihood of which is greater if the landlord refuses to return the money to you.

      Michael K. E. Thiele

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  56. Hi, I moved out of an apartment (in Ontario) 3 months ago and am still trying to get my $100 key deposit back, but the property office is treating it as a damage deposit and is refusing to return it. The apartment was damaged by one of my room mates (A), but a second room mate (B) told the office that the damage was done by both A and me, and now neither A or I will be given our KEY deposits back. The deposit was clearly a "key deposit" in my copy of the lease and on the check I signed (which I have a photocopy of). If I cannot convince the office that I did not do the damage in question, can I fight this based on the fact that they are using a key deposit as a damage deposit and that a key deposit more than the cost of making a new key is unlawful?

    Andrew

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    Replies
    1. Hi Andrew:

      From your description of the rental circumstances I'm guessing the situation is like a rooming house with each person in the unit being responsible for rent for their own room and the common areas being shared? On this basis some people move in, some people move out, and each person moving in or out has their own separate tenancy agreement with the landlord.

      If you were charged an actual key deposit then this would have to be returned upon the key being returned to the landlord. Such charges are legal under section 17 (3) of O.Reg. 516/06 Residential Tenancies Act. It is legal if it is refundable--but as it isn't being refunded then it would be an illegal charge under section 134 of the RTA and you can bring an application to the Board in form T1.

      To the extent that your "key" deposit is being treated as a damage deposit that is just outright illegal and contrary to section 134. If the landlord will not return the money the application to the Board is again in form T1.

      best of luck

      Michael K. E. Thiele

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    2. Thanks Michael. If I do end up submitting a T1 and am awarded my deposit back, will I be stuck paying the $45 charge for submitting the form, or will the landlord/office be forced to reimburse me? That's almost half of my deposit.

      Also, there was a $5 check required from my dad because he was my guarantor. The excuse they had for that is that it was a traceable transaction and part of the lease so they could get him to pay for any damages. That doesn't sound legal either, but not worth pursuing by itself and risking $45 to complain.

      Andrew

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    3. Andrew: Filing fees are indeed recoverable after a hearing if you win. Meaning, you get an Order for the amount owed to you plus the fee. Of course you are right with respect to the sum in question. Is it really worth it given the amount in play? That however is not a legal question, it turns on whether you have the time or inclination to pursue this with the landlord.

      Michael K. E. Thiele

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  57. Hello Michael,

    Thank you very much for the informative page, really makes understanding the act easier. I'm in a situation where my 1 year fixed term lease is coming to an end at the end of the month, however I am planning on staying month to month until I know where I am off to (I would of course provide 60 days notice prior to leaving). Prior to the beginning of my lease term, I paid both first month and last month's rent, which should cover me until the end of August.

    My landlord is insisting that I pay for the month of August and that the last month's rent will go towards my "last month" whenever that may be. I was always under the impression that the last month's rent was for a fixed term lease, and was planning on paying by the start of every month beginning in September. Have I been mistaken and am I required to pay for August?

    Thanks in advance for your help.

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  58. Hi: Thank you for this question as this very question leads to confusion on the part of both landlords and tenants all the time. The proper application (i.e. legal application) of the Last Month's Rent deposit is to the last month of the tenancy and not the last month of a term. In this instance your landlord is correct in that the deposit will be carried over into the month to month portion of your tenancy and it will be applied when you give proper notice to terminate the lease. In the interim, you are entitled to interest on the deposit (though minimal) it will match the guideline increase amount.

    Hope that helps clarify the issue.

    Michael K. E. Thiele

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    Replies
    1. Thank you very much Michael, I will be sure to clear everything up with my landlord on Monday and keep that in mind for future lease agreements.

      Hope you have a great weekend.

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  59. Hi Michael,
    Thank you for the valuable information that you provide! My wife and I recently found a room for our daughter to rent as she is attending school out of town. We verbally agreed to rent the room and agreed to etransfer $1450 the following day ($600 for first month - Sept. 2014; $600 for last month - August 2015; and a $250 security deposit). The date of the etransfer was July 16, 2014. On July 27, 2014, our daughter was offered and accepted a program at a different school. We let the landlord know on that date, and requested that the money be returned. We have been told that the $1200 will be returned in late August or first week of September, but that the security deposit will not be returned, as this is the reason that the deposit was required in the first place. The landlord is in the process of renting out the room to another student and insists that no money will be returned until that happens. The house is very nice and it is a great location for students, so we don't think that the landlord will have any trouble renting the one room left. There is nothing in writing, as a lease was to be completed on the Labour Day weekend, when all the students moved in. We do have emails of conversations and dates, and etransfer records. Should we insist on all of the money being returned? What should our next step be?
    Thanks very much.

    ReplyDelete
    Replies
    1. Hi. Based on the facts as you describe I'm inclined to conclude that you are in a committed landlord and tenant relationship with the landlord even though the contract (lease) is not signed. At law, under the Residential Tenancies Act, a tenancy agreement is written, oral, or implied. Certainly there is enough in what you describe to create a valid and binding tenancy agreement. If there is a valid agreement you have no right to terminate the lease at this point. Just calling and saying that you've changed your mind does not entitle you to terminate your tenancy agreement with the landlord. Now, you make a good point in that the unit is desirable and the landlord is likely to re-rent the room quickly and lose no money. If that is the case then the landlord has mitigated his losses and he is not entitled to claim damages against you for lost rent. However, there is the question of payment for seeking out a new person to rent--that is a possible claim. If the landlord does not re-rent the unit then I would not be surprised if the rent money you've paid is not returned at all or at least a portion of it is retained.

      Presuming that the rent money is returned and the unit is re-rented you could take the position that the security deposit is illegal (which it is under the RTA). Demand the return of this money and if the landlord does not return it then you could decide to bring an application to the Landlord and Tenant Board. You would, in my opinion, win that application. The landlord may decide that it isn't worth it and just pay you the money ordered by the Board or alternatively, the landlord might decide that this is unfair, that he did you a favour in mitigating and re-renting, and the he now wants to be paid for his trouble and he will sue you in the small claims court. Whether he would win or not depends on how the facts come out.

      In my view, this situation calls for a little bit of understanding of being in the other guy's shoes. The $250 security deposit is illegal, but at the same time you don't have the right to get out of your lease. The landlord does incur the hassle of finding someone else and "fairness" will dictate that he be compensated for that hassle. Now $250 seems like a lot for the "hassle" so perhaps something more reasonable can be agreed upon--maybe actual out of pockets (presuming he pays to advertise?), plus something reasonable depending on the amount of work needed to re-rent the unit.

      Michael K. E. Thiele

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  60. I am looking at renting a house and I require a co-signer. No problem, my brother has agreed to cosign for me. However, the Landlord has now stated that the rent cheques MUST come directly from my cosigner, and not from me. Of course my cosigner does not want the hassle of having to collect from me, then paying the landlord.

    Can the landlord do this?

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    Replies
    1. Hi : I've never heard of a landlord trying to impose such a requirement. I don't think that the RTA speaks specifically to this issue bug ultimately I think that such s demand is totally unworkable in any event. I don't think that the Board would enforce such a clause as your co-signor might agree and then change his mind. The RTA requires that tenant be given an opportunity to pay and stay. If a lease term precludes this possibility then the term would be void under the Act. Hence, even if agreed to the clause, I don't think, would withstand scrutiny.

      Michael Thiele

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  61. Hello,
    Thank you for the information.

    You mentioned above "This section makes it illegal for a landlord to directly or indirectly with respect to any rental unit collect or require or attempt to collect or require from a tenant or prospective tenant of the rental unit a fee, premium, commission, bonus, penalty, key deposit or other like amount of money whether or not the money is refundable."

    However, it is stated on the Landlord and Tenant Board page that the landlord CAN ask for a key deposit. Here is the link:
    http://www.ltb.gov.on.ca/en/Key_Information/STEL02_111479.html

    Could you advise?

    Also, all the notices (from Landlord to Tenant and vice versa) should be in writing. But nowadays, email, (let alone text) is the main way of communication. Can the Landlord and Tenant agree and sign in the Tenancy Agreement at the beginning of tenancy that corresponding by email (with the email address provided in the agreement) is as valid as the written paper notice?

    Thank you.

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    Replies
    1. Hi Sani: Thank you for the question and I'm pleased to respond. As noted in the original blog I provided a link to section 134 as the wording of the entire section is key. The section does make illegal the charges that are indicated and the wording from my article is from the legislation. However, the beginning of section 134 also contains the phrase "unless otherwise prescribed". This phrase means that the government, by regulation, may make clarification, exceptions, rules, to the statutory provision. These "prescribed" matters are then put into a Regulation to the legislation. The Regulation that applies in this instance is O/Reg. 516/06 and specifically section 17 (which I have cut and paste below). If you review the website link that you provided and section 17 you will see that the Board site is paraphrasing the regulation and setting out the exceptions. Looking further, I think you can see that these exceptions are in fact quite narrow and that the general prohibition is maintained. Take notice that these charges are generally for reimbursement of exact costs and/or are refundable.

      You've highlighted the issue of "key deposit" and I think that the language of section 134 and the regulation in relation to refundable key deposits or copies of keys is not what is being referred to in the section when it says "key deposit". The "key deposit" reference in section 134 is, I believe, a reference to a phenomenon where landlords in an extremely tight rental market once charged a "key deposit" on top of rent etc., to new tenants to get the keys to their new apartment. It was kind of like a signing bonus for landlords--where tenants had to pay a premium to be allowed to rent the apartment.

      With respect to "written" notice I think you are out of luck on the "email" provision for giving notice to a tenant. I see the argument that "written" should include an email as it is "words on a screen" much like "words on a page". The problem as I see it is not how something is written but how it is delivered or given to the tenant. The manner of giving the written notice is set out in section 191 of the RTA and Rule 5 of the Rules of Practice. None of these provisions allow for service by email as all of the options contemplate the delivery of an actual piece of paper (or fax). There may indeed be a work around (exception) in that you could serve a Notice by email or text message for that matter and so long as the recipient acknowledges receiving the notice and acknowledges becoming aware of the contents of the message then I think you could validate this form of service under section 191 (2) of the RTA.

      Michael K. E. Thiele


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    2. PROVISIONS OF THE REGULATION

      Exemptions from s. 134 of the Act
      17. The following payments are exempt from section 134 of the Act:
      1. Payment for additional keys, remote entry devices or cards requested by the tenant, not greater than the direct costs.
      2. Payment for replacement keys, remote entry devices or cards, not greater than the direct replacement costs, unless the replacement keys, remote entry devices or cards are required because the landlord, on the landlord’s initiative, changed the locks.
      3. Payment of a refundable key, remote entry device or card deposit, not greater than the expected direct replacement costs.
      4. Payment of NSF charges charged by a financial institution to the landlord.
      5. Payment of an administration charge, not greater than $20, for an NSF cheque.
      6. Payment by a tenant or subtenant in settlement of a court action or potential court action or an application or potential application to the Board.
      7. Payment to a landlord or tenant of a mobile home park or land lease community at the commencement of a tenancy as consideration for the rental of a particular site.
      8. Payment of a charge not exceeding $250 for transferring, at the request of the tenant,
      i. between rental units to which subsection 6 (1) or (3) of this Regulation applies, if the rental units are located in the same residential complex, or
      ii. between rental units in a residential complex that is described in paragraph 1, 2, 3 or 4 of subsection 7 (1) of the Act.
      9. Payment of an amount to reimburse the landlord for property taxes paid by the landlord with respect to a mobile home or a land lease home owned by the tenant

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  62. Glad I found this blog. My husband and I are moving out of our rental unit at the end of September and our landlord has included a clause in our lease that says we must arrange and pay for "professional cleaning of the unit, appliances, and carpet upon vacating" and even sent us contact details for his preferred cleaning company, and that if we don't, they will arrange it and charge us a $75 administrative fee. Can he enforce this? We are planning to clean the unit ourselves, and paying for "professional services" will cost of hundreds that we don't have.

    ReplyDelete
    Replies
    1. Hi: I can offer you my opinion but I caution you that there will be a contrary opinion on the point that under some circumstances may find favour with the Board. In any event, I first take issue with what "professional cleaning" actually means. Is there such a thing as a "professional" cleaner? Do you get licenced in professional cleaning, certified by some institute, get a degree in cleaning? I don't think so and in fact would guess that being a "professional" cleaner is nothing more than calling yourself a professional cleaner or perhaps printing a business card and charging for cleaning. So--I think the word professional is meaningless and unenforceable.

      Beyond that, what if you hire a "professional" cleaner but only ask them for 10, 15, or 30 minutes and the place was really dirty to start with. Clearly, the professional will not have sufficient time to clean the unit--but is the requirement of the lease met if a professional comes in for 15 minutes, passes a vacuum and feather duster and leaves? I think any reasonable person would say that this is not what is meant by "professional cleaner". I think in using the word "professional" what is being implied is a certain grade or caliber of cleaning. Now query, is there a difference between the quality of cleaning done by different professional cleaners? From experience I can absolutely attest to there being a huge difference not only between different professional cleaning companies but also amongst different cleaners working for the same professional cleaning company.

      Bearing this in mind then, what really does 1) professional mean and 2) what standard of cleaning doe the clause in your lease imply? My view is that the clause as you've quoted " professional cleaning of the unit, appliances, and carpet upon vacating" is meaningless and unenforceable.

      I also believe that the clause, if interpreted as requiring the hiring of a premium cleaning service with their platinum cleaning package that the clause is illegal under the RTA pursuant to section 4 (clauses in a lease contrary to the RTA are void).

      The legal requirement and responsibilities of tenants for maintaining the cleanliness of a rental unit is set out in section 33 of the RTA. It provides: The tenant is responsible for ordinary cleanliness of the rental unit, except to the extent that the tenancy agreement requires the landlord to clean it.

      The standard of cleanliness in a rental unit is "ordinary cleanliness" and I think this is all that the landlord may require of you upon the return of the rental unit. The clause in your lease can be picked apart for being vague and uncertain. However, even if the clause in your lease were made crystal clear to indicate a particular professional cleaning company and a particular level of service to rise to a level of cleanliness I think the clause would be unenforceable as the Ontario Legislature has determined that tenants are only responsible for ordinary cleanliness in their units.

      Good luck and please let me know how it turns out.

      Michael K. E. Thiele

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  63. Pls is it legal for landlord to ask for postdated cheque from me?
    What are the legal ways to pay rent in Ontario?

    ReplyDelete
    Replies
    1. Hi: It is not legal for a landlord to require post-dated cheques. However, if providing post dated cheques is convenient for you and the landlord will accept them then it is fine to provide them. In what form (manner of payment) rent is paid is dependent on the landlord's set up. Your options to pay rent would be cash, cheque, or cheque equivalent like a bank draft, money order, postal money order. If your landlord is set up for it, sometimes you can pay by online banking, email money transfer, debit, credit, or sometimes even the landlord will give you the details to allow you to deposit directly to their bank account by going to their bank.

      Out of all of these methods payment in cash is probably the worst form of payment. As a tenant, sometimes you are called upon to prove that you paid the rent. WIth cash there is a greater risk that you cant prove the payment. While you have a right to a receipt, sometimes the receipts are not issued (landlord forgot the receipt book), sometimes you lose the receipt. With a cheque, drafts, you can often times get a copy of the negotiated cheque to prove payment.

      Hope that answers your question.

      Michael K. E. Thiele

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  64. Our landlord mentioned that we will have to pay extra if they do not find a new tenant for our place before we move out. Her reasoning is they cannot enter and show our place when we are not home because we have a dog (apartment is pet friendly - mentioned on original lease). Am I right in assuming this makes no sense and she's completely nuts?

    Thanks for all your information in this blog!

    ReplyDelete
    Replies
    1. Hi: While your landlady may indeed be completely nuts I'm not sure that I can confirm that here! However, with respect to the issue about having to pay extra because you have a dog that strikes me has downright silly and absurd. If you have given your proper Notice of Termination for the requisite number of days or you've entered into an agreement to terminate then there is no basis to demand more money from you just because you have a dog in the unit. I don't see such an argument getting any traction at all with a Court-----that being said, maybe, maybe, maybe if the landlord could prove that your dog is a vicious beast and that you refuse to be at all cooperative in tying up the dog, putting the dog in a kennel, or restraining the dog at a specific time for entry and showing the unit then the landlord might have a point. I think a reasonable tenant, faced with this kind of assertion by the landlord would suggest or propose that there be a specific time of entry to show the unit to a prospective tenant and perhaps in that time take the dog for a quick walk, take the dog outside etc.. It wouldn't take very long, it is cooperating and most of all it takes the thrust out of the landlord's point entirely. There is no reason why a landlord couldn't arrange a specific time of entry with you to show the unit.

      Hope that helps

      Michael K. E. Thiele

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  65. Hi Michael,

    I am just wondering if the security deposit is illegal, is there a way I can charge payments for damaged flat? I mean the tenants will be unreachable after the lease ends and I will have to cover whatever that's needed for the repair. I can also prove the damage is caused by the tenant. Also, the tenants indeed already agreed on the security deposit(which is really just a small amount), is it true that they can still come back and sue the landlord for that after the lease ends and most part of the deposit has been returned? What the possible penalty will be in that case? Thanks a lot!

    ReplyDelete
  66. Hello Michael,
    Had a tenant just left on October 29th. I've signed a paper for exchanging the key deposit and keys. When leaving, tried both keys and one was the wrong one! The tenant got surprised and apologized for that and even offered to give back part of the deposit and promised to drop it off the day after. I was also going to exchange the keys with the new tenant the day after, I trusted him as he was a very good tenant so didn't get the deposit back and asked him to hand in the key first in the morning. The day after not only didn't he drop off the key but also he brought up an issue about our lease agreement that's valid until end of October and nobody is allowed to enter the unit as it's still his, so he's keeping the key until Nov. 1st!!!! From that moment I found out that he's lost the key. In the paper that I signed with him on 29th, I also mentioned that the lease agreement has terminated. It's October the first and he hasn't responded to any of my emails about the time that he's dropping off the key.
    My question is, if he's lost the key, should I charge him for changing the whole lock as for the security? I'm sure he won't pay it but at least I need to know if this is legal to send him such an invoice? He's done some damages to my unit as well but I just noticed it the day ofter as was dark and couldn't see all the details properly. Please guide me what to do. Appreciate it.
    Mojan

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    Replies
    1. Hi Mojan: Can you tell me what kind of key this was. Security key with restricted copying, key fob, or just a regular key that can be copied. Thanks Michael Thiele

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  67. Thanks Michael for replying to my post.
    Actually the key can be copied, but I'm concerned now about the security of the new tenant. The key was made by a specific company though and I called them and it would cost only $30, if we want to replace it with the exact key. I am now thinking about changing the whole lock. I'm sure that he has lost it.. My husband is saying there is no need to change the whole lock and we can order the key ourselves but I don't trust this person anymore and so concerned about the security of the unit. I'm thinking about sending him an email and give him two options: whether he's bringing back the key by Nov. 3rd or he has to pay the cost of a new lock. Please let me know what you think? Appreciate it.
    Regards,
    Mojan

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    Replies
    1. Hi Mojan: The issue of keys and deposits raises several concerns. The first section that comes to mind is section 134. It provides (in part) as follows:

      Additional charges prohibited
      134. (1) Unless otherwise prescribed, no landlord shall, directly or indirectly, with respect to any rental unit,
      (a) collect or require or attempt to collect or require from a tenant or prospective tenant of the rental unit a fee, premium, commission, bonus, penalty, key deposit or other like amount of money whether or not the money is refundable;
      (b) require or attempt to require a tenant or prospective tenant to pay any consideration for goods or services as a condition for granting the tenancy or continuing to permit occupancy of a rental unit if that consideration is in addition to the rent the tenant is lawfully required to pay to the landlord.

      There are exemptions to these provisions and they are provided in the Regulations as follows:

      Exemptions from s. 134 of the Act
      17. The following payments are exempt from section 134 of the Act:
      1. Payment for additional keys, remote entry devices or cards requested by the tenant, not greater than the direct costs.
      2. Payment for replacement keys, remote entry devices or cards, not greater than the direct replacement costs, unless the replacement keys, remote entry devices or cards are required because the landlord, on the landlord’s initiative, changed the locks.

      The question is whether the charge you wish to make against the tenant is legally chargeable. Certainly, it seems that charging the former tenant for replacing a key to the lock of the apartment is something that may be done. But, does the law authorize you to charge him for a new lock? I think that is difficult to make out on the legislation especially given section 17(2) of the Regulation. Query whether you need to actually change the lock or just have it re-keyed and whether this would be considered the same thing as replacing keys or whether that would be a lock change? Frankly, I wouldn't pursue it because I don't think the law is clear enough on this point. You had the right idea with the refundable key deposit--it is just unfortunate that you returned it prior to verifying that you had the right keys.

      Ultimately, I do believe that changing the lock (likely by re-keying) is the smart way to go. Your new tenant should not ever be in a position of being able to say to you that the former tenant was able to gain access to the unit because you failed to provide a secure locking mechanism. That is an invitation to litigation in the event that something goes wrong. As a tenant is not allowed to change the locks it is not something that you can say the tenant should have done upon moving in.

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    2. Sorry...Michael, one more thing. We had a paper signed that the agreement terminated on October 29th but he was still mentioning that we have an agreement until Oct. 31. Can we have that paper as a proof that there was no agreement between us during 30 and 31 of October? Thanks.

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  68. Hi Michael, thank you so much for your help on this. I totally agree with you... It's very unfortunate that I returned the key deposit while found out that one isn't the right one, perhaps it was because the tenant was a very decent person and never had any problems with. He has a high level position in a popular company and nobody can ever think that he might do such a thing!!! Also the rent for the unit is over $6000, so paying for a new key wasn't something that could have been an issue for him. We had a very good relationship as a landlord and tenant.....What a big mistake I did to trusted him.....Well, I'm going to pay for re-keying the unit. It's just hard to explain it to the new tenant. I don't want him to know that the former tenant lost a key, as these two tenants had problems with each other once before, when visiting the unit to rent. It's a long story...Anyway... I'm going to call the key company tomorrow for changing the whole lock. Thanks again for all your help.
    Warm regards,
    Mojan

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  69. Hi Michael - for what I can see this is a very helpful blog. Have a very interesting (and long) situation for you. I had a pre-construction condo in Toronto when work was taking me out of the country. While away we were notified of occupancy (we were trying to assign the unit but were unsuccessful) so we used an agent to find tenants. The tenants voluntarily provided 6 months rent because they were students and had no income (this was not at our request - they presented it to our agent. We questioned it but were told this was fine) - I understand that this is now a grey area. This was a brand new, un-lived in unit.......so in the most perfect condition. As time passed we discovered that we had a nightmare on our hands. Before we took title the builder needed to enter the unit to look/repair insurance items. The tenants tried to prevent him from entering even though 24+ hours notice was given. Once finally inside he discovered punch holes in the door, the brand new hardwood floors destroyed (deeply scratched and badly damaged and in the bedrooms from dog pee even though lease agreement said no pets) and the unit in general in disgusting upkeep. I received details in an email and arranged a visit to the unit on my trip back to Canada - it was worse than he described. They would not let me into the bedrooms to see the state of the unit even though I gave them weeks notice of my visit and called before coming by. On top of this, their English is poor so their agent was the key communication point. After this experience (our life savings into this place) we decided we needed to come back to Canada and take occupancy of the unit....so I had to quit my job. I explained I would be filing an N5 (damage), N11 (occupancy), and an L2 (tenant board)....at this point the agent said she spoke with them and they agreed to vacate the unit on December 31, 2014 and repair all damage to the floors, appliances, etc. Wanting to avoid the process of going to court this was agreed and a N12 (early termination) was drafted and signed. This is where it goes south. Afraid that they would attempt to end the tenancy and not repair the damage an Annex was added for them to acknowledge which items needed to be repaired on or before leaving the unit which was also signed by them which also stated that the landlord could use their deposit to repair the damage if it was not fixed when they left. The agent advises me in mid-Oct that they are leaving on October 31st and all damage will be repaired. Relieved that this is all coming to an end, stupidly I do not amend the current N12 to show 10/31. The tenants vacate the unit on the 31st and when I arrive to inspect, the floors are still destroyed, and while the unit has been cleaned the damage has not been fixed. I ask them whats going on and they now say they are not fixing anything and want to go to court over it and will not return the keys until their rent is refunded. At this point I have the locks changed and their building access cancelled because my 9 month pregnant wife and I need to move in.

    I'm worried that I am somehow in the wrong here even though these guys have destroyed my unit, refused to repair anything, clearly have no money as they are students over from Hong Kong and would rather go to court now that they have left the unit. On top of that they showed up at the building and said that they still are in possession on the unit until the end of the year.

    Do I have any rights? I am not your typical landlord - I was just looking for someone to live in my unit while I was out of the country and it has turned into the biggest nightmare of my life. I am worried that I am going to be left with a $6k-$8k repair bill.

    Any feedback would be greatly appreciated and very sorry for the length of this message.....I left out some of the other issues we had with them to save space!

    Adam

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    1. HI Adam: The situation you describe is difficult. You are best off to be guided through this process by an experienced landlord and tenant lawyer. Experience will be the key to getting good advice. The 6 month's of prepaid rent can be problematic but characterization may make it legal depending on circumstances you haven't described here. You've referred to an N12--you mean N11--for December 31, 2014 to terminate that is the unit return date. Query whether the earlier notice for October 31 amends the N11 and whether the agent binds the tenants. If done in writing and you accepted the earlier termination arguably the old N11 was replaced by another agreement to terminate. While it is preferable to use the forms--it is not absolutely required. If you are in possession now and they have vacated then you may wish to simply stand firm and put them to the task of making an issue of it at the Board. You should be represented in this process--simply telling an adjudicator your side of this and hoping for the best is not going to be satisfactory. I expect that if they take you to the Board they will look for fines (illegal rent deposit), illegal lock out, etc.. From what I see in your description I think you will have a satisfactory answer to any such claim but your answer needs to be presented by an experienced lawyer---i.e. there are weaknesses in your position that if not explained properly could hurt you. With respect to the repair bill---the likelihood is that you just took a serious hit. Recovering a judgment against foreign students with no money is unlikely. If you want to try to get the money, document the damage very clearly (photos and video), get two to three repair estimates, have the work done, and then sue them in the small claims court. You can normally get a paralegal to do this for you for a reasonable fee. Do try to find an experienced paralegal with a good reputation. You should be able to recover most of the paralegal's fee as costs in the proceeding (presuming you win). The trick of course will be recovering the judgment against impecunious foreign students with no assets in Canada (which seems unlikely to me).

      You ask the question about whether you "have any rights". You do, of course, have rights under the RTA. Your tenants also have rights though and hence it is a matter of competing rights. You should not presume that just because something bad happened to your unit (i.e. it's quite damaged) that the system will come to your rescue. I appreciate that you are not a landlord and frankly, in what has happened to you it shows. There were other options, faster ones, with more aggressive outcomes that were available to you when the tenants were still in possession. You have lost some of your best options by having proceeded in the manner that you did. It is for this reason that I strongly recommend that you continue with proper legal representation.

      Best of luck

      Michael K. E. Thiele
      www.ottawalawyers.com

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  70. Thanks for your feedback Michael. What about using their money I have on hand to make the repairs since they signed something saying that this was allowed? If I do this and return the difference am I opening myself up to additional legal issues?

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    1. Hi Adam: Whether the amount collected was "legal" or "illegal" is a legal question. They could put that in issue by filing an application with the Board seeking a return of the illegally collected rent. I'm not sure how much of the 6 months of rent is left to their termination date. In any event, they could argue for the return of what is left. If they bring such an application to the Landlord and Tenant Board you would not be in a position to file a claim against them for damage to the unit. The reason being that once they are out of possession of the unit, the Board has no jurisdiction to entertain your claim if it is issued after they moved out (this is regardless of how meritorious the claim might be). An interesting argument might be to see if the Board would entertain an argument in set-off---i.e. you owe over-paid rent but you should be able to deduct the costs of repairs from that overpaid rent. If the Board would not entertain it--and generally I think the answer will be that they won't, then your remedy is to sue the tenants in small claims court. That process will take much longer than the Board process. However, there will be a procedural overlap if they try to convert a Board Order into a Small Claims Court Order for enforcement purposes. You could bring a motion to stay the enforcement of the Board Order pending the resolution of the Small Claims Court Act--that relief, or something similar like payment into Court etc, is something that I would reasonably expect to get.

      I'm not sure that the foregoing paints the clearest roadmap for you. It is procedural gymnastics and you need to understand how the systems work. If I understand the facts correctly, I would be comfortable with you using the money to fix the place, resisting any tenant application, and if need be, suing them at the end. That being said, you may face some rather fierce opposition/criticism for proceeding this way and I wouldn't be surprised if the tenant(s) file applications against you and seek rather significant remedies against you. You would have to be prepared for that possibility. You also need to be prepared to take some risk in case an adjudicator simply does not see it your way. The safest way to proceed is to return the money, do the repairs, write a demand letter asking for payment, and then suing them for not paying. It is also the fastest way of ending up with an unsatisfied judgment. In my view, if you retained the money, explained how it was applied (for repairs) and returned the balance, then in the end of the legal wrangling I think you would be vindicated. What would be helpful to you, along the way, is for you to have a lawyer, to speak with their lawyer, to respond to the circumstances based on what everyone does while the case proceeds. It is impossible to predict exact behavior and depending on what it is your best strategy may change as the tactics of the tenants change. While I expect that the risks you take in this position would be worthwhile, note that there still is risk to you. Whether you are able to bear the financial burden of taking risk is something that only you can know.

      Michael K. E. Thiele

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    2. Very, very helpful insight. Much appreciated.

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  71. Hi Michael,

    Thanks for all the legal advice on this blog. Just a couple of quesitons for you, as a LandlLord:

    1. My tenant, a student going to school in Ottawa, signed a 9-month lease for a basement apartment that I'm renting out on August 1st, 2014 so naturally the lease term would end April 30th, 2014. On November 2nd, I received a text from her saying that she is considering moving back home because of problems at school, etc. She has already provided my first and last month's rent as well as post dated cheques with the last one as at March 1, 2015. I had already deposited my November 1st, 2014 cheque so I'm covered for rent until the end of the year. At that time she said her last day would probably be in December. Now 8 days later on November 10th, 2014, I received another text message that she has already moved home and the basement is now empty. She does not make an attempt to assign the lease to anyone and I don't want to charge her past December so now I'm looking for someone to move in as soon as possible. So right now, I'm stuck with looking for a new tenant, hopefully can move in by January, 2015. What kind of recourse can I ask for my tenant?

    So for the new ad I put up for this rental, I'm asking for first and last month's rent with postdated cheques preferred (in the ad). Can I make this ask? I've done this in the past and all my tenants appear to be ok with it. In terms of a deposit, is the only additional fee I can request a key deposit? Can I advertise that parking is additional fee (which I see quite often on other ads) or cable tv is additional or even a second person accomodating the basement apartment (to cover additional hydro/water costs)?

    Thanks,

    Jeremy

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    1. Hi Jeremy:

      The first thing I would do with your tenant is ask her to confirm that she has returned possession of the rental unit to you. If she confirms this, then you are free to proceed to look for a new tenant to rent the apartment. You want to have this confirmation as your existing tenant, having paid up her rent for this month and arguably the next if you have agreed to terminate at the end of December, can not be said to have abandoned the rental unit. Abandonment is impossible with paid up rent. As such, she could come back at any time and seek to occupy the premises that she has paid for.

      If the tenant confirms that she has returned vacant possession of the unit to you then you may proceed to try to re-rent the unit. If you re-rent it quickly you should return the rent money that the former tenant paid--less your expenses for re-renting, of the period of time that there is an overlap. If you are unsuccessful in re-renting the unit before the end of December then you will be out the rent money that your tenant was obligated to pay to you. If you have been trying to diligently re-rent (i.e. mitigating losses) and you have not agreed to an early termination you could demand that the tenant make good your loss. If she does not pay voluntarily you could sue her. Make sure to diligently try to re-rent and keep a clear record of your attempts at re-renting (all of your advertisements) and all steps you take to try to find a new tenant. If you do not mitigate properly you will be denied damages by the Court as you are under a legal obligation to minimize the extent of your losses for the benefit of your tenant.

      For you new advertisement. I think it's fine to ask for post-dated cheques on a voluntary basis but putting it in the advertisement is simply inviting trouble. Arguably, putting the "preferred" in the advertisement suggests that you will discriminate in favour of an applicant who will give you post dated cheques even though you are not legally allowed to ask for post dated cheques. Denying someone or preferring someone over post dated cheques is asking for trouble. I wouldn't advertise it even though the chance of it becoming a big problem, I would guess, is small. With respect to additional fees, you will see the basis for the refundable key deposit in the other posts in this blog. It is permissible to rent parking separately from the lease. Cable television is normally the responsibility of the tenant so I don't understand this one. Charging for a second person occupying the unit is not permissible. You can not dictate who stays with the tenant in the unit and can't charge for other occupants. This is discrimination on the basis of family status and with a properly motivated tenant--could get you in serious trouble with the Human Rights Commission. Charge the tenant a rent based on the unit be occupied by the maximum number people lawfully entitled to occupy the space.

      Michael K. E. Thiele
      www.ottawalawyers.com

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  72. As of July 1st 2014 my sister and i moved out of the house we were renting. Our old landlord just sent us a notice (date being November 19 2014) saying we owe over 800$ in damages. Is there a time limit for this? Also is there anyway we can fight this? how often are landlords required to change over the carpets? our had not been changed in almost 7 years.

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    1. Hi: In Ontario the "standard" limitation period is 2 years. There are other limitation periods for other kinds of cases but 2 years is the typical one for suing a tenant for damages to a rental unit. With respect to fighting the landlord's claim you may of course deny that you are responsible for the damage he claims. The landlord, in order to collect this money from you will need to get an Order/Judgment. As you are out of possession of the rental unit and I presume he never started any legal process with you at the Landlord and Tenant Board he will have to sue you in the small claims court. You will be entitled to defend yourself there.

      With respect to carpets there is no required change period. A landlord may simply look at the condition of a carpet and judge based on the condition of the carpet whether it needs to be changed or not. That being said, the RTA has a schedule in Ontario Regulation 516/06 that sets out the anticipated useful life of a carpet---and that is indicated as 10 years.

      If your landlord is suing you for damaged carpets the landlord will not be entitled to brand new carpets at your expense. Normally, you would only be responsible for that portion that was left as the remaining useful life that the landlord lost. That only happens if it is demonstrated that the damage you did to the carpet was beyond ordinary wear and tear.

      Good luck

      Michael K. E. Thiele

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    2. They sent us an email with a list of things they wanted us to pay for, adding up to the 800$ and we replied asking them to send us copies of the receipts...they have yet to reply to us..My main concern is that they had the unit rented out as of sept 1st. Legally our lease ended July 31. I'm asking why wait until November to contact us. Wouldn't these things been taken care before renting the unit out? If the unit was left in such bad shape wouldn't they want it fixed before someone rented it? We already told them we would pay for the damages our cat made to the carpet around the doors however that was the only thing. The only thing they asked us to do before we moved out officially was to have the carpets professionally cleaned and have a receipt for it..which we did. After that we got no response or anything from them. We tried to set up a walk through with them but they wouldn't work around our schedule and then said " we don't need you present for the walk through" i really just seems shady to me.

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  73. Our landlord is refusing to pay us deposit money. We're already moved out of the place. We even paid the rent for the last month. We lived there for 4 years. Before moving, we did fresh paint job for all the walls, cleaned all the whole house including appliances and did steam, shampoo carpet cleaning. Now, they're saying apartment has roaches which we're not responsible. Earlier, we told them the issue verbally but they didn't do anything about it. I had to pay out of my pocket for pest control and I have a receipt for that. The whole apartments block is effected due to roaches. We've already moved out 2 weeks ago and I handed over the keys on Dec 31. When we handed over the keys, they didn't object on anything. And place was given in a super clean shape. They were supposed to give us the deposit money back but they're refusing. They're saying their new tenant refused to enter because they spotted roaches. Please let us know what are out options?

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    1. Hi: You have been taken advantage of as you have done much more than you needed to do. You actually have a claim for more than just your Last Month's Rent deposit as the landlord was required to do the pest control. It's not clear from your question whether the landlord required you to do the painting, shampooing etc., if so, you have a claim for those expenses as well. If you did it just because you thought you should you likely don't have a claim. In any event, for all of these issues you may file an application to the Landlord and Tenant Board. If you attend the Board they can provide you with the applications or you can download the forms from the Landlord and Tenant Board website.

      Good luck.

      Michael K. E. Thiele

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  74. Yes, the landlord threatened us to do the painting and shampooing etc. They wanted their place to look like brand new even though we were living here for the last 4 years. And we paid all dues including rent+maintenance fee+utilities on time. We never missed even a single payment or delayed. According to them small marks & nicks are not part of normal wear and tear. Those were mainly near the main door entrance which is very narrow. Yes there were crayon marks in my sons room which we accepted to repainted by professional but they asked us to pain the whole home. The funny thing is that home was never painted before when we called our painter to do the paint. He told us that those were plain white walls delivered to them by the builder. The A/C stopped working in June 2014, they never fixed it despite many reminders but used delaying tactics to pass the summer.
    Thanks to your blog. Now, we know deposit money was illegal and they took advantage of us being new immigrant. Now we feel that we are being cheated, fooled and robbed. My wife is in distress after our last meeting with them. They were threatning and harassing us and claiming to sue us for $50000 due to roaches issue. They’re blaming us to be careless. We told them about this issue. And other neighbours are having the same issue. We did the pest control so we could live healthy and safe as family. Please let us know where do we stand in the eyes of law?

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  75. Also to clarify, that is security deposit not LMR. We paid the LMR already.

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    1. HI Again: What has been required of you is illegal--which I trust you now know. Security deposits, other than a Last Month's Rent deposit are also illegal. You are very clearly owed some money and if the case is properly put together the landlord may very well be fined. Depending on how the emails read this is the type of case that may even support charges against the landlord under the RTA prosecuted under the Provincial Offences Act.

      I'm very sorry for you that you feel cheated, fooled and robbed. You should know that there are many people who are taken advantage and you are not alone in this experience. At this stage you should see about hiring a lawyer or paralegal (or a free one from a legal clinic or the student legal aid at a law school if you live near one) to draft and pursue a claim against the landlord. While the law certainly allows you to represent yourself you would be well served in hiring an experienced lawyer or paralegal. On your facts as you describe them, I think you could reasonably expect success against the landlord and hence with careful budgeting with your lawyer/paralegal you should be able to come to financial terms that make representation affordable.

      Good luck.

      Michael K. E. Thiele

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  76. Hello Michaelove,

    This blog is very helpful but I was wondering if you could help out a little with my situation.
    My boyfriend and I were looking to rent a basement apartment and we found one that we were very interested in and gave them a last month's rent deposit as well as my boyfriend signed the six month lease. There was a clause in regards of pets that stated that we needed written consent to have any. Well about two weeks after my boyfriends grandfather passed away and we inherited two small dogs. We immediately informed the landlord and asked if it was OK and if we could get written consent for them and he refused to and said it was because of allergies. He and my boyfriend and I all agreed that we would not rent the unit and that he could look for more prospective tenants. It has been another two weeks since anday we have asked several times for our deposit back and he does not respond and he has already cashed the deposit cheque. Is this legal? Last he said he would keep it and deduct any money he is out if he can't find another person to rent in time.

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  77. Hi Micheal,

    I need some advice and I am hoping you can help me. Currently, my landlord has given me an N12 form because the new purchaser wants to move in. My lease is scheduled to end October 31, 2015. In my lease there is a clause that the landlord has the right to sell, which is fine, no issues there. It states that upon selling, if the purchaser wishes to move in prior to the end of the lease, the tenant will have 60 days to vacate the property. The purchaser does not want to take over our tenancy and wants to move in.

    Do we have to move out before the end of our lease?


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    1. Hi: In my opinion the clause you describe in your lease is void--i.e. not enforceable. In Ontario it is not possible, at the time of signing the lease, for a tenant to give a notice of termination nor for the landlord and tenant to agree to a termination of the tenancy or to agree to the termination of the tenancy as a condition of granting the tenancy. The applicable section of the Residential Tenancies Act is section 37--your particular facts are governed by section 37(5).

      While I think the clause is void, the landlord may still try to evict you on the strength of it. If you look at the N12 it should be clear from the notes that you do not have to move out and that the landlord must then file an application to the Landlord and Tenant Board. It is at this hearing that you would argue that the N12 is not allowed to be effective prior to the end of the term of the lease (Oct 2015). The landlord would then argue the early termination provision which you would then argue is void as per section 37(5). Note that in law very few things are absolute and while I think your position is very strong a whole lot comes down to argument and presentation of facts so don't be too complacent about putting forward this position. If you didn't want to wait to find out about the enforceability of the clause you could try to ask the Board sooner for a ruling by using the T2 form (a little unusual to do so but fair enough).

      If your landlord does proceed to the Board on the N12, the Board will set an entirely different termination date than the one in the N12. You can argue for more time, a more reasonable time etc.. Even if the clause were enforceable, you could argue for delay based on the exercise of discretion of the adjudicator.

      Good luck

      Michael Thiele
      www.ottawalawyers.com

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  78. Hello Michael,

    It is great to find this site, where you kindly provide lots of info. After going through it there doesn't seem to have the same case as mine. So I am typing here my situation or issue to see if you could please advise.

    I am a new landlord of a property (house). One of my tenants signed one year lease with me from Jan to Dec 2014, taking one room in the house, but she left at early Sept due to some reason. Before she left she emailed me (I was on vacation) saying she would find some one to take her room (sublet), but she didn't find one. The day before she left my house, we had potential tenants came see the house and chose another room (note, this new tenant didn't take the leaving tenant's room and of course nothing to do with her). Later, the new tenant wanted to change his room for some reason to the above mentioned girl's room but that happened after the girl had left. About a week later, the girl heard someone used her room (actually strictly speaking it is the room she used to live) and emailed me asking if she could get her last month deposit back. To be nice to her, plus considering that I got well along with the tenants in the house and treated each other like friends and that the room was leased without waste, I agreed to give her last month rent back by end of year. During Christmas holidays last month, I deposit the one month rent MINUS $50 for her damage to the bed frame (it was broken by her during her stay and not repairable). When she knew that (my deduction), she was mad at me and claimed to sue me, and used lots of bad words, looking like she totally became another person. Her argument is: I shouldn't deduct from her deposit, or I should discuss with her before I did it. My justification is: the money I returned her is not originally legally defined last month deposit, and her last month deposit is legally not refundable because she left without sublet her room. It is just my kindness and generous to her, so I could deduct the damage cost. Plus, it is just part of the original cost (I bought for about $75) , and even smaller portion of one month rent, $375. She didn't see the big favor I did to her, instead misinterpreted my willingness to give one month rent back, and said I am in violation to law (can't deduct anything from deposit) and wanted to sue me.

    Michael, I think here the key point/question is whether or not her last month deposit is refundable, even if later I agreed to give it back to her. My answer is NO simply because she failed to find someone to take over her lease before she left. Otherwise she could get it (last month deposit) before she left. My willing to give it back to her doesn't mean she could legally get it back, so it is two different things. In theory, I could give part of it, or simply keep it all, all up to me. Now I gave her all but minus small portion for damage, she even became mad at me and claimed to sue me, how could? No conscience at all!

    Michael, would you please advise? Meanwhile, do you have any division/office in place outside Ottawa, like Toronto? Just in case.

    Thank you very much, and I appreciate your time! You don't have to advise in too much detail, a short piece of advice would be enough.

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    1. Hi:

      I am going to presume that you are renting out rooms in a rooming house and that the premises and the leases with the individual tenants are covered by the Residential Tenancies Act. What you describe in your facts supports this assumption but I mention it just in case you are living it the home or there is some other exemption that you have not mentioned.

      You are using the word "sublet" incorrectly in this scenario. As the tenant leased for a year and was looking to leave permanently what she should have sought to do is "assign" her lease to a new person. If people sublet they have an intention to return to live in the unit. Clearly you were okay with an assignment and hence the tenant was not allowed to simply move out of her unit without making satisfactory arrangements with you. The fact that she simply moved, while still obligated to you through her lease, makes her responsible to you for the ongoing rent. However, you have a duty to mitigate your rental losses--that means you need to try to re-rent her room to someone else. That attempt was made, and the person who came in did not initially want her room. That is fine and in fact you have no obligation to re-rent her room before renting any other available room in the building.

      The way I see it, you are entitled to use the rent on deposit for the rent that became due after she left. You are entitled to keep the rent deposit right up to the point that you mitigated and re-rented her room. After re-renting your former tenant's obligation to pay rent ceases (presuming you are re-renting at the same rent).

      Your tenant is technically correct that you are not allowed to simply deduct damage from a rent deposit. However, doing the deduction is the most practical way of getting paid for the damage as the alternative--demanding payment and then suing--is simply not realistic for $50.

      Good luck

      Michael K. E. Thiele
      www.ottawalawyers.com

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    2. Hello Michael, thank you very much for your advice! It is clear to me now. The question remaining is how the judge sees this if we go to court. One additional fact that is in my favor is that the tenant is going abroad (leave Canada) shortly, so I will have no way to get that $ back, as she even refused to pay it right now even when she is still in the country. The law indeed over-protects the tenants and someone should take the lead to call the law makers to improve it. Thanks again, and I appreciate your time!

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  79. Hi Michael. This has been a very informative blog. I have read many many posts, but I don't have time to go through them all to find my situation so I thought I'd type it up.

    I am a new landlord and my tenant signed a lease from Dec 10, 2014 to Dec 10, 2015. Due to financial reasons, she gave me 3 months notice in January which would have put her to April 10th to move out. She said she was "being nice" giving that much notice, but that she would run out of money after 3 months.

    After two weeks or so I advertised the house for rent and started screening new tenants. The current tenant then suddenly claimed she had no money and had to get out ASAP and wanted out by Feb 10th so that she could get her LMR back. Luckily I found a tenant willing to move in on her hopeful date, however the tenant then requested that I refund her LMR before she moves out, and before she signs the N11 form (agreement to terminate tenancy form). I didn't agree to that and said it didn't make sense to refund her LMR before she signs the agreement to end tenancy, especially since she is in possession of my house, appliances and furniture.

    She then proposed to sign the agreement at the same time as receiving her rent deposit back, but still wants it done two weeks before her move-out date. Her new claim is that she can't afford to move out without that $1200 because she has to pay a moving company, and a storage company for her stuff.

    How should I proceed? I have a new tenant scheduled to move in on Feb 10th, utilities have been scheduled to change, yet this current tenant won't sign an agreement to move out unless I refund her LMR at the same time.

    This tenant had good references although she had no prior rental history as she owned a house with her ex. She should be getting child support both from the government and from her ex. I don't see how she can have zero dollars to her name and need the $1200 to pay a moving company.

    As a first time landlord with this being my first tenant, I hope this isn't a sign of things to come.

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    1. Hi: This is a terrible situation to be in and I suspect the worst from your tenant. Please be aware that the notices she has given you are all invalid. The only way to terminate a tenancy in this context is by an agreement to terminate. While you do not have to absolutely use the N11 form--it certainly is preferable. Arguably you already have an agreement to terminate but this is now complicated by the fact that she won't sign an N11 without getting money from you--which suggests that she does not intend to terminate her tenancy. I think you are right to be suspicious about her intentions and I certainly would not pay her anything without a consent order terminating the tenancy.

      If, on the strength of her communication terminating the tenancy and your replies you can make out an agreement to terminate the tenancy early you may wish to consider filing an L3 Application to the Landlord and Tenant Board immediately. Depending on your paperwork, thoroughness and quality of the written evidence, the Board may issue an Order terminating the tenancy and evicting the tenant without holding a hearing. The tenant will have the right to move to set it aside, but then at least you would be at a hearing where you could be certain about having an eviction order in exchange for a payment.

      Given the timing of this it is unlikely that you will be in a position to get possession of the unit by February 10--unless of course the tenant moves voluntarily. The Landlord and Tenant Board process risks taking longer than you have.

      The alternative of course is to simply continue with the tenancy and require payment of the rent. When she doesn't pay you can choose to terminate the tenancy for non-payment of rent.

      Good luck

      Michael K. E. Thiele

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  80. Hi Michael,

    Your thread is very informative! My husband and I are landlords and we currently rent out our basement to students. We currently have one student living in one of the rooms and the other is vacant. In our contract with her, we realized that we did not state that her rent was for the one bedroom but verbally she does know that ( I'm going to make that correction on future contracts) We just realized recently that we did not lock the 2nd bedroom and have noticed that she has had friends staying over in it occasionally. Is it just a matter of giving 24 hours notice to enter the apartment to lock it? It probably sounds silly but I just want to ensure that I'm legally doing this correctly as I've read things about not having the right as a landlord not to allow people to stay.

    Also with sharing a house with our tenant does that change any of the RTA rules? We only share an entrance so no kitchen or bathroom or anything like that

    Thank you!

    Pam

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    Replies
    1. Hi Pam:

      From what you describe I do think the RTA applies to your tenancy with your tenant as the most common exemption (when a landlord lives in a house with a tenant) is the sharing of a kitchen and/or bathroom. If you wish to see if the other exemptions apply to your relationship with this tenant you can take a look at section 5 and 6. It is interesting to note that there are complete exemptions as well as partial exemptions. The partial exemption in section 6--specifically the rules relating to rent--are significant as they apply to rent increases. If your house fits into this exemption you would not be limited to the amount of a rent increase.

      Presuming that the RTA applies, you would indeed have to provide the tenant with 24 hours written notice of entry--make sure the notice complies with section 27 of the Residential Tenancies Act.

      Entering the unit to lock the door on the second bedroom is an interesting "idea". If the tenant acknowledges that she did not rent the space and that it does not form part of the rental unit then of course it would not be a problem. However, because you lease is silent on the point and the tenant has or "is" using the space from time to time you might find yourself in a tough spot trying to regain control of this bedroom. Unless your lease sets out the fact that you have the right to put another tenant in that space and that the new tenant would share the bath and kitchen and common spaces in the apartment with the current tenant, it becomes a little bit hard to believe that the intention all along was to exclude the use of that space (presuming a credibility contest between you and the tenant--where the tenant is stating the extra bedroom does form part of her rented space).

      Certainly your existing tenant has a right to privacy and you must respect her rights under the RTA. Getting control of that second bedroom and documenting how it might be used in the future (i.e. putting another tenant into it who would share space with the existing tenant) is important. Hopefully your tenant is honourable and will acknowledge the oral deal you made with her. Allow, of course, for the possibility that there is a genuine misunderstanding if she does not abide by your recollection of the oral conversation. The paperwork is normally considered to be the expression of the intention of contracting parties and if your paperwork is "wrong" you may find the Board will hold you to it regardless.

      Good luck

      Michael K. E. Thiele

      Delete
  81. Hello,


    I have a quick question. I moved into a house in September 2014 till May 2015. But in January I found out I will not be getting enough osap to pay for rent so I found someone to sublet. With my landlords consent. The landlord made a lease for her and she signed it. They told me I would receive my last months rent back on February 1st. Then on February 1st the landlord refused to return my rent as the new tenant hasn't paid it yet.


    Is this right? Can I be punished because the new tenant hasn't paid even though I'm not on the lease anymore?


    Thank you

    ReplyDelete
    Replies
    1. Hi: It would be helpful if you would clarify a few things. Do you still live in the unit? Did you sublet or assign your lease? Sublet means you are going back before the end of term (and are responsible for the rent) and assign means you gave up all rights to return and are not responsible for rent from the date of the assignment. There is another option here though unusual but you say the landlord drafted up a lease for the tenant. Is that a new lease, with a new term--i.e. is it a lease like your tenancy never existed? If it is this last one I'd say it is arguable that this was not an assignment (nor a sublet) but instead a termination of your lease on consent. If it is this last one I'd say you are entitled to get your LMR back so long as the landlord is not out of pocket in the rent--meaning you paid the rent right up tot he new tenant taking over the unit. The landlord should have obtained an LMR from the new tenant for the new tenancy (not an assigned tenancy). If it is an "assignment" the question of LMR's is a bit tricky as the Residential Tenancies Act does not provide much help for transferring LMR's to assignees or in getting LMR's paid out to tenants or are replaced by assignees. Certainly, if the assignee doesn't offer up an LMR it is understandable why the landlord would not pay out your LMR. As an assigned lease the landlord can hold the LMR for the last month of the term of your leased (now assigned lease). Hence, if this is an assignment I don't see a strong argument for making the landlord pay out the LMR to you. You have a better claim--albeit at the Small Claims Court--against the assignee.

      Michael K. E. Thiele

      Delete
  82. Hi Michael. My wife and I were looking to rent in Ontario. We were required to give last month’s rent with the application. The landlord has made it increasingly harder to get approved and as a result we have decided not to rent from them. They will not release the last month’s rent even thou we never entered a lease agreement. Is this legal or should I contact a lawyer?

    Thank you in advance for you advice. From the previous responses I see you truly care about people’s rights.

    ReplyDelete
    Replies
    1. Hi Philip: There is no easy or clear answer to your question. The best I can give you is "maybe". There are circumstances where a tenant who has applied with a deposit is entitled to a refund of the deposit. The opposite is also true and sometimes a landlord is allowed to keep the deposit. An awful lot turns on the wording of the application and the wording of the documents that you signed in relation t to the deposit. Generally speaking, it is better for you if there are words like "forfeit" or "penalty" in the documents as that will give rise to an obligation to reimburse the money. Note that you can make an application to the landlord and tenant board to have the money refunded. As it is a tricky area, consider getting legal advise--if even just for an hour so you can be shown the relevant caselaw for the purposes of argument at the hearing.

      Good luck

      Michael K. E. Thiele
      www.ottawalawyers.com

      Delete
  83. hello i am very confused on rental offers and monies accompanying them.
    on march 6th i viewed an apartment that i was very interested in, i went to the rental office and filled out the application. the first paragraph said:
    "upon signing this offer, acceptance is deemed granted unless otherwise notified by the landlord. the landlord has 7 days to accept this offer, failing which the offer is revoked. in the event that i withdraw or cancel this offer prior to the 7 days or after this offer has been accepted, my deposit will be forfeited and i acknowledge that i will be liable to any loss of rent and any other costs or damages suffered by the landlord."
    the second paragraph reads:
    " if accepted, i understand as a result of my signature appearing on this offer, a binding lease has been entered into in accordance with the terms of this offer and lease form and all attachments."

    not understanding this i did not leave a deposit but signed the application.
    then today march 11th, the rental agent called and asked that i bring the deposit as soon as possible to ensure my acceptance. what does this mean? i am so confused any help would be greatly appreciated. and then she said the have a drop box for the deposit if i miss business hours, how am i suppose to get my receipt then?

    ReplyDelete
  84. I recently sold my house, and decided to rent until I found my "perfect home". I'm currently in a Townhouse complex with 40(+) units owned by a corporation. I paid first, and last months rent (almost $3600.00), then the day before we signed the lease I was requested to make an additional deposit of $200.00 to "guarantee the utilities will be cleared" once I vacate. What makes no sense is that the utilities are in my name (not included), and whether or not I deiced to be irresponsible regarding my bills, is of no concern to the landlord. My thought, is that the landlord is banking on that some of the tenants will have an outstanding balance on their accounts, and not bother to request this money back- a bit of a scam really. By this point, I have been here for two years- with the intention to leave this summer. I've received two notices advising me of the interest on my deposit, yet they are reserving this amount (with my deposit/additional fee) until I leave. Are they not required to pay out the interest yearly?. In addition, as stated above, is the $200.00 for questionable reasons legal?. Thank you, and take care, Lisa

    ReplyDelete
  85. Micheal…great blog!. A few quick questions. 1) I'm renting one of 40(+) town homes owned by a corporation. As expected, we were requested to pay first, and last months rent- $3600.00. Just days before we signed the lease, there was an additional request to pay $200.00 to "guarantee when we vacated the premisses that the utilities would be cleared". The utilities are in my name, and the onus is on me to pay. The landlord is not liable of I'm delinquent. This seems like a suspicious request, and maybe the landlord is banking on some tenants never asking to be reimbursed if they owe on their accounts. Is the second fee of $200.00 legal?. 2) Two years have passed, and we have yet to receive any interest on the deposit(s). When I inquired, the property manager informed me that they were keeping the interest, and would include these amounts with the deposit(s). Is this common practice?. Thank you, in advance, for any assistance…take care.

    ReplyDelete

IMPORTANT NOTICE

Any answers provided are intended to reflect the Law of Ontario, Canada. The answers are not legal advice and no one should rely on the answers provided as legal advice. The answers are intended to be general information about Ontario Law and are the personal view of the author based on the limited facts provided to the author. The answers may not be legally accurate and may indeed be contrary to the law of Ontario. Answers and conclusions drawn may have been different if facts had been shared that have not been disclosed in the comment/question. This blog is intended to assist people in learning about Ontario Landlord and Tenant Law. However, if you have actual legal problems this blog should under no circumstances replace proper legal advice obtained by retaining a lawyer or licensed paralegal to advise you. Nothing in this blog, comments submitted or answers provided, gives rise to a solicitor and client relationship. Comments are published as submitted and commenters should be aware that if they identify themselves in a comment that their identity will become public upon the comment being published. Comments that have been published may be deleted upon request to the author.

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About Michael Thiele

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Ottawa lawyer and partner at Quinn Thiele Mineault Grodzki LLP.  Graduate of Queen's University in Kingston, Ontario.  Called to the bar in Ontario in 1997.  Undergraduate degree at Colby College, Waterville Maine, U.S.A.