Monday, 9 May 2016

Residential Tenancies Act Amendments: Consultation!

The Ontario government is going through a consultation process respecting proposed amendments to the Residential Tenancies Act.  Public consultation has been extended to the end of June 2016.  The government has produced a consultation paper that lays out many different proposed amendments and asks questions about issues arising in the context of residential landlord and tenant relationships.  Your comments are invited and may be sent to the following coordinates:

You can provide your input by email or by post. 
Mail:  Residential and Commercial Tenancies Unit
Housing Policy Branch
Ministry of Municipal Affairs and Housing
777 Bay Street, 14th Floor,
Toronto ON  M5G 2E5
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Consultation by government with respect to legislative changes is one way that citizens have to tell the government what is wrong or right or what needs changing in any particular system.  The Residential Tenancies Act certainly takes a lot of criticism from many people--tenants and landlords--as there is fairly common perception that the RTA favours one side or the other.  Which way the bias goes tends to depend on whether you're talking to landlord or a tenant.
Anyway, as I was saying to one of my partners, I must participate in this consultation as it is only through participating that I think I have the moral right to complain when my suggestions don't rise to the top of the change pile.  That is a little tongue in cheek, but I do sincerely think that when offered an opportunity to comment about things we care about or which affect us that we should take the opportunity to do so. Who knows how our own experience may influence drafting or changes to legislation.  So that being said, how does one comment?  Above you can see the government website, the request for comments, the links and the where to send your thoughts.  That being said, what should one's comments look like?  Certainly, in this respect I am no expert but I considered it when preparing my comments.  The key I thought, was to be concise and speak directly to proposed changes in a clear manner.  Whoever is tasked with reading all of the "comments" is unlikely to spend a lot of time deciphering unintelligible rantings.  Having a clear axe to grind is likely not helpful either.  With this in mind, I thought that I would comment only on the proposals that I actually had something to say about.  I thought I would share my comments on the proposals with you just to see if this might spark a debate.  Anyway, below you will find an excerpt "proposal" from the government's consultation paper (link above) and my comment on that proposal immediately following it.

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May 6, 2016
Residential and Commercial Tenancies Unit
Housing Policy Branch
Ministry of Municipal Affairs and Housing
777 Bay Street, 14 th Floor
Toronto, ON M5G 2E5

Dear Sirs:

Re:     Consultations to proposed changes to Residential Tenancies   Act Feedback and responses to discussion questions
Please accept this letter as my feedback and response to the consultation paper respecting changes to the Residential Tenancies Act, 2006.   I have been practicing residential landlord and tenant law for 20 years and have extensive experience in the Residential Tenancies Act .  As counsel, I represent landlords, tenants, and non-profit housing corporations.


1.2     Proposal: Explore whether to allow landlords to pursue certain issues (e.g., rental arrears, utility arrears, damage) at the LTB for up to 12 months after a tenancy has ended.

Comment:     The procedural blocks, the rules of evidence, locating the former tenant and serving the Plaintiff’s Claim, the time involved, and possible costs sanctions at the end of trial in the Small Claims Court serves to minimize/weed out frivolous and minor claims.  Removing cost/procedural barriers to litigation in a Landlord and Tenant Board process may invite litigation that would normally not be pursued.  The current system (Small Claims Court) generally limits claims to serious claims.  I don’t think the system should encourage minor claims that can be filed without consequences (i.e. costs) as it may fill dockets with trivial matters at the expense of important ongoing disputes between current landlords and tenants.

2.1     Proposal: Require tenants to disclose any issues that they intend to raise at rental arrears eviction hearings to the landlord prior to the hearing

Comment:     This proposal speaks to the issue of prejudice/trial by ambush.  The unfairness to landlords is the ambush on issues they have not prepared or have evidence for.  Presently, I see many Landlords object to tenant issues and then they are offered an adjournment or some time in the hallway to review the tenant’s evidence.  The offer of an adjournment causes further prejudice as the arrears grow.   Fairness dictates that everyone before the Board knows the case to be met (and it is required under s. 183 RTA).   The only change I’d recommend is that Landlords be given the right, in the face of any tenant issues being raised, to an adjournment that maintains the status quo.  Meaning, the case is adjourned with an Order requiring the tenant to pay rent for the remainder of the month from the date of the hearing (forthwith to the Landlord or into the Board) and all future rent arising prior to the return of the application in full and on time.  The failure to make these required payments leads to the “standard order” being made ( a voidable pay and stay order).  Failure to pay the required amounts should not prejudice the tenant’s right to file a T2/T6 or other tenant application.  The RTA does not presently support the self help notion of withholding rent for maintenance issues etc..  Proceeding as this comment suggests recognizes that the tenant has with-held rent for alleged outstanding issues but does not force payment for the “past” when some of the with-held rent may have been used for damage, alternate accommodation etc. for which the tenant intends to seek compensation/abatement.  

2.3     Proposal: Explore whether any changes should be made to the process for appealing decisions of the Landlord and Tenant Board to the Divisional Court


Comment:    There need to be extensive changes in the Appeal process.  The change though, is not only in the Residential Tenancies Act .  The change needs to also  be in the Rules of Civil Procedure .  Landlord and Tenant Board appeals are currently dealt with as regular appeals of Court judgments.  It needs to be recognized that Landlord and Tenant Board orders are not regular court judgments and a unique appeal process should apply to these orders.  

Landlord and Tenant Board processes are Board driven in that the Board schedules a hearing and moves the case along once the application is filed.  Currently, an appeal to the Divisional Court is party driven , meaning that the Court does nothing to move an Appeal along after the filing of a Notice of Appeal.  An appeal to the Divisional Court will sit, for years, if the parties do nothing.  The automatic stay on eviction will stay in place so long as the appeal is pending.  The Divisional Court registrar does not actively exercise the dismissal power under the Rules of Civil Procedure.

The Divisional Court motion process to dismiss an appeal for delay or failure to perfect or for being frivolous and vexatious and without merit requires the preparation of a motion record, affidavit(s) and factum.  It is expensive relative to the complexity of many appeals.  This is unfair to landlords.  In my experience, Landlord’s rarely appeal decisions given the costs, which deprives us of appellate authority on important Landlord and Tenant issues.

Deciding to appeal a Landlord and Tenant Board decision is effectively impossible for an un-represented person.  Done properly, an appeal requires a Notice of Appeal, Certificate Respecting Evidence, Appeal Book, Compendium, Factum, Certificate of Perfection, Transcripts, and Requisition.   All of these are required in triplicate for the Court and a copy for the opposing side and one for yourself.  I’ve done dozens of appeals and with lots of experience it takes me days to create the final product that is an Appeal to the Divisional Court.  For many appeals it is too complicated and expensive a process.

I recommend an over-haul to appeal rules relating to Landlord and Tenant matters.  The process should still trigger an automatic stay of eviction on the filing of a Notice of Appeal.  However, that filing of the appeal should result in an automatic Order requiring the tenant to pay ongoing rent in full and on time and to file proof of payment with the Divisional Court registrar.  The landlord should on requisition to the Registrar be able to get an order lifting the stay if ongoing rent is not paid on time.

The Appeal process and hearing of the Appeal should be Court driven .  However, a three judge panel of the Divisional Court is too high a level of Court for most appeals.  The appeal should be to a single judge of the Divisional Court.  The Appeal should be heard as a “motion” on a regular list of the Superior Court with a Superior Court Justice putting on his Divisional Court hat for the purpose of the Appeal.

The Landlord and Tenant Board should prepare an extensive form laying out the traditional/usual grounds of appeal that are normally pursued.  The landlord or tenant would then file the appeal form with the Landlord and Tenant Board and the Landlord and Tenant Board would file the Appeal with the Divisional Court after preparing a record (see below).  Various check boxes on the Notice of Appeal form and space to allow an explanation of the reason for appeal should be provided to the prospective appellant. .

The Landlord and Tenant Board would prepare a Notice of Stay (upon filing of the Appeal) and serve it on the Sheriff.   The Landlord and Tenant Board would collect the appeal fees charged by the Divisional Court.  The LTB would then prepare the “Record” of the proceeding (similar in the way the Federal Court Rules require an adjudicative body to deliver the record to the Federal Court in a Judicial Review proceeding).  The Landlord and Tenant Board would prepare a transcript of the proceeding (estimate the charge and charge it to the appellant before it is prepared) and prepare an appeal book with all of the exhibits and evidence that was before the Member.  

The Landlord and Tenant Board would then file the Notice of Appeal and the Record with the Superior Court/Divisional Court and set the matter down for a hearing before a Divisional Court Judge.  At that point the LTB is finished unless the LTB is intervening in the appeal.   The parties are served with a copy of the Notice of Appeal, the Record, and the Hearing date of the Appeal.   The parties are provided with a form advising that they can prepare a factum, book of other documents, evidence, whatever they would like to submit (no new evidence needs to be explained) and that they must serve it and file it with the Court by a certain number of days before the scheduled appeal.   Failure to comply and the implications of that are left in the discretion of the Judge scheduled to hear the appeal.

I think the foregoing would be highly effective in moving appeals forward–quickly and efficiently while preserving the importance of getting appellate authority on important issues within residential Landlord and Tenant law relationships.   The key is having the system drive the process and not require or rely on the parties to take action to move an appeal forward.  The present injustice is largely in the ability to file an appeal and sit back and do nothing without much consequence.


3.1     Proposal: Explore whether to allow landlords to terminate a tenancy based on violation of no-smoking provisions in tenancy agreements.

Comment:     Medical marijuana is the next big problem.  Tobacco is fairly easy as are e-cigarettes and breaching a non-smoking clause does in fact lead to evictions as the contracted ground of “non-smoking” is a lawful right interest or privilege.  A breach is enforceable through the N5 and as long as the prohibition of the behaviour can be shown to be rational/reasonable then eviction follows. Hence it is enforceable in current RTA.  What would be useful is a clarification of what is meant by “lawful right interest or privilege” with an indication that lawful rights include contracted terms in lease agreements that are not otherwise voided by the RTA.

Medical marijuana is a growing issue as neighbours are bothered by the smell and the second hand smoke of medical marijuana is bothering neighbours and landlords.  Tenants with authorizations claim smoking it is a right.  Getting them to go outside or smoke at a window is not too difficult in the summer—but the winter is a real problem as they don’t want to go outside when it is very cold and hence they smoke inside.   Balance the right to medicine, duty to accommodate (HRC) and the right of others to not have to breathe marijuana smoke.

4.1     Proposal: Allow emailing of certain landlord and tenant notices, upon consent of both


Comment:     Landlord and Tenant Board hearing rooms are not equipped to deal with electronic forms of evidence.  What if the form, notice, does not comply with the RTA.  How does a tenant prove the non-compliance in a Board hearing, how is the evidence of the notice or form that was actually sent produced into evidence?  In printing the document that was electronically sent there is the possibility of manipulation of the form/notice just by the program, printer, etc..  In circumstances where the form or notice becomes an issue the lack of a hard paper copy is going to make hearings very difficult.   Adjudicators will be asked to look at smart phones, tablets, laptops and none of those documents will form part of the record.  We need paper until the Board can receive electronic forms of evidence.
PART II: RENT INCREASE GUIDELINE REVIEW

Comment:     The rent increase guideline formula is becoming increasingly irrelevant as the number of exempt units from rent control increases.   The rent increase guideline formula needs to bring into its application rental units that are otherwise exempt under section 6(2).  To encourage development and building rental units the exemption is fair to maintain but I think the exemption should be capped at 15 years.  After 15 years those exempt units should be subject to the rent increase guideline.   Amend section 6(2) to be a sliding time-line.   Landlords are realizing that the exemption can be used for eviction purposes contrary to the security of tenure philosophy underpinning the RTA.



These are my comments on the proposed amendments.

___________________________
Michael K. E. Thiele


6 comments:

  1. Hello Michael,

    I have a question about your last point discussing rental guidelines. I guess I just want clarification. Right now rentals built and used as rental properties before 1991 have to follow the yearly guidelines, all other's do not, am I right? So are you saying that all rental units no matter the year built should follow the guidelines, or none of them should have to follow them and Landlords should be able to set their own rent and/or raise it more than once a year?

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    1. Hi Jennifer:

      The annual guideline rent increase amount is, in my view, part of what maintains the security of tenure of the tenants. The annual guideline amount has a maximum and that amount is presumably affordable by most tenants. I accept the logic that developers and landlords needed rent flexibility to be encouraged to build new buildings. Being able to adjust the rents to reflect the market in the years after completion was needed to get the best returns possible for having invested the substantial sums required to build a new apartment building. Being able to raise rents to market levels in a rising rental market is likely a good incentive to build. If these rents were capped with a guideline amount the landlords of new buildings would not enjoy the upside of rising rents and hence make less on these new buildings--which is a disincentive to building apartment buildings.

      So, my point was to ask the question of how long should a landlord who has built a new building enjoy the unlimited upside of being able have rents follow the market? Should this really be an indefinite benefit? I do think that after a time, the new building becomes an "old" building and the costs of building have been recovered and the incentive of no rent increase caps should expire.

      My argument of what should change from the existing system is that the exemption should expire. Exempt buildings should only enjoy the exemption for a period of time that reflects the risk and capital invested by the landlord. I don't know what that time frame should be but I'm certain it should be less time than indefinitely which is how the RTA is written now. The security of tenure that comes with regulated rent increases is a good thing for Ontarians and when possible I think the RTA should ensure that as rental properties age they should become non-exempt from rent control.

      There will be an argument of course that as buildings age they will need significant capital repairs and that flexibility in rent will be needed to encourage the maintenance and improvement of aging buildings. For various reasons I don't buy that argument and I'd say the Above Guideline Rent Increase application process is a better method for dealing with and encouraging capital expenditures in rental properties than simply letting a landlord charge what they like.

      Michael K.E. Thiele
      www.ottawalawyers.com

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  2. Hi Michael,

    I have what I hope is a simple question to answer. I rent a room on the second floor of a three-storey house. There are two other bedrooms on my floor; both are vacant, and there is a shared full bath. On the third floor is a loft rented by another tenant; this loft has access to a private half-bath. The ground floor consists of a shared kitchen, living room, dining room, and half-bath. There is a basement in the process of being finished, with shared laundry machine and dryer.

    The owner of the house does not live here. Neither the other tenant nor myself share any relationship with them, such as spouse, child, etc as laid out in s.5(i) of the RTA. Given this circumstance, it was my understanding when I signed the rental agreement that 24 hours' notice would be required of the landlord before entering the entire house, despite the fact that the other tenant and I share the laundry, kitchen, etc. I would not have signed the agreement had I known otherwise. (On signing the agreement, information stipulated under s.11 of the RTA was not provided to me.)

    To make a long story short, after much back and forth on the matter things came to a head yesterday when I had law enforcement attend after my landlord showed up unannounced for the Nth time, acting like he not only owned the place but was legally permitted to enter it anytime as well. He did not see fit to wait for police to arrive but instead left after about half an hour. Eventually two officers appeared and I spoke with them at some length. They stated to me that the house is considered a "rooming house" because the rental agreement references me renting a room rather than the entire house, and that because of this the landlord can in fact enter without notice whenever he chooses.

    I have read the Act in some detail and I cannot reconcile this assertion with legal guarantees of reasonable enjoyment, privacy, etc - it seems implicitly false. Further, I cannot seem to locate any explicit confirmation of this assertion in the Act. I have looked for terms such as rooming house, kitchen, share(d), entry without notice, etc.

    I recognise that the rental agreement specifies I am renting one room and only one room, but I would think either I have the use of the rest of the house, or I do not. Why would myself and the other tenant(s) not have the same reasonable expectation of privacy in our kitchen, albeit shared, dining room, living room, etc. as we do in our bedrooms? What if I'm in the backyard, naked and suntanning, and the landlord decides to come in the back gate? Or what if he fancies showing a vacant room without notice and turns up unannounced while I'm watching TV in my underwear (because of the recent 30+ °C heat)? What if we're in the middle of holding a party, or mourning a dead friend or relative, or are terribly ill or injured and need rest? Surely the house either is my home or is not my home. It is the address I list in correspondence. I do not list which bedroom is mine in my return address, nor am I expected to tell police which bedroom is mine in giving my address at the scene of e.g. a motor vehicle incident.

    I may be wrong in my thinking, but if I am, I cannot for the life of me see in the Act where it says so. Perhaps you can shed some light on the subject. Thank you for your time.

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    Replies
    1. Hi: Unfortunately I will not have the time to see if there has been any definitive appellate authority on point. The RTA does not speak specifically to the living arrangements you describe (rooming house) in relation to entry into the common areas of the home. The RTA has its notice of entry provisions starting at section 25 (Privacy) and with Notice provisions at section 27.

      In my view, the way to look at this is to work with the language in section 25 & 27 and focus on the words "rental unit". Then go to section 2 of the RTA and start reading definitions---you then get to "rental unit". You will see that the definition of "rental unit" is not "your room in a rooming house"--the definition (in my view) is broader than that. The definition includes any "living accommodation" intended to be used as rented residential premises.

      It is in these definitions that a case law search--for something binding would be useful---feel free at www.canlii.org (a free legal database of cases).

      I can say that I had an issue just like what you are talking about before the Landlord and Tenant Board some years ago. The members analysis was, in my view, spot on. He (Member Greg Joy), held that a landlord did indeed have to give 24 hours notice in accordance with the entry provisions for a rooming house--that was essentially a house with individually rented rooms. The logic of his analysis was that the rental unit included not just the room but also the use of the common areas, the bathroom, the kitchen, the living room, all as living accommodation intended to be used as rented residential premises. What became clear in his analysis is that the nature of the residential complex matters and that the reasonable expectations of tenants matters with respect to the privacy provisions starting at section 25 RTA. Those considerations are exactly those types of things you said in your comment. You would expect to walk from your bedroom to the bathroom--perhaps in less than full dress--because your co-tenants (1, 2, 3 ,of them)--are known to be at work, perhaps are all female or male as the case may be, or you're comfortable around them, etc.. This is very different of course than if you're in the shower, come out in towel, and find the landlord in the hallway of the house with whoever he chooses to bring into the house.

      The expectation of privacy in relation to the nature of the house is how the Member I was in front interpreted the issue. He found, in that instance, that notice was required and that the failure to provide the notice was contrary to the RTA.

      The analysis, I think, makes sense if your consider a purpose built rooming house where the hallways are more "commercial" and residential living within the hallways is not reasonably expected---it is like the hallways of an apartment building--no one suggests that a landlord needs to give notice to walk and enter the hallways.

      There is nuance in the argument and perhaps there are cases, since the one I argued, that explore the issue more fully. The case I argued, at the Board level, is not binding authority so the best it does for you is to provide a basis for argument for your position.

      As the police and the landlord are not backing you up your only choice at this time to stop the behaviour is to file an application to the Landlord and Tenant Board in form T2 or perhaps to complain to the enforcement branch of the ministry of housing and see if they take up your cause. In bringing your case make sure to effectively communicate (with words, photos, video) what the house looks like and further communicate clearly your expectations of privacy and those of your co-tenants.

      Good luck

      Michael K. E. Thiele
      www.ottawalawyers.com

      P.S. If you bring the case I would love to have a copy of the decision if you don't mind.

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  3. Hello Michael,

    I enjoy reading your blog- really informative.
    I find myself in really needing some sort of advice.
    I am the owner of on apt that was flooded by the unit above (also rented).
    Neither one of us have any insurance- other than the one provided by my condo.
    The condo insurance paid for my wall, ceiling and electrical, but their standard definition of a unit excludes flooring. The owners of the unit above me feel they aren't financially responsible as they claim; i. flooring isn't part of a standard unit ii. I should have had (flooring?) insurance.
    They also referred to "Section 39- Insurance Maintained by Individual Unit Owners", and interpret is as i. insurance is mandatory ii. i am not legally allowed to sue anyone.
    They did pay to have the common elements fixed (hallway also got damaged), so I feel that in this case they are acting as an insurance.

    At this point I don't even know if I have a case.

    Clint

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    Replies
    1. Hi Clint: Your questions are more "condo" law than landlord and tenant law. Certainly, if you had insurance the flooring is likely to be covered by your own policy. It is also possible that your insurer would then sue the upstairs neighbours if the flood was caused by their negligence. How the flood happens matters of course as you need negligence by some "actor" as a basis for your claim. The upstairs neighbours argument about a "standard" unit is pure nonsense (in my view) and I'm not aware of any prohibition in suing a neighbour for causing damage to a neighbours property.

      All that being said, I have to reiterate that condo law is something I come across only peripherally. You might want to find a lawyer or law firm that specializes in condo law--perhaps even your own condo lawyer might be willing to speak with you. In the context of Landlord and Tenant law I will often do one hour consultations including a document review and provide general but guided advice. Often this is enough to show people the way and how to start and what to do. If you could find a knowledgeable condo law lawyer who would meet you for an hour and do a quick document review it may be worth the hourly rate to steer you in the right direction. My gut reaction to your situation is that you have a claim in the small claims court (presuming claim under $25,000--this is Ontario Small Claims Court maximum jurisdiction at time of this reply), and further assuming that the upstairs neighbours were somehow negligent which I'm going to presume is the case if they paid to fix common elements.

      Good luck to you--remember there are limitation periods so you should act quickly and inform yourself of the applicable timelines.

      Michael K. E. Thiele
      www.ottawalawyers.com

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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.