PLEASE LET ME MOVE OUT!
Life's realities sometimes make it necessary for a tenant to move and leave their current apartment. Sometimes, the reality is a job loss, a relationship breakup, or sometimes the reality is an opportunity for a better job in a different city. Family responsibilities or financial set backs can also contribute to the need to terminate a tenancy early. Many of these "realities" are unexpected and take people by surprise. The year long term of a lease, or the multi-year term that seemed like a good idea to sign up for is, all of sudden, a tremendous burden.
For tenants who never signed a lease and are on a month to month tenancy, or for tenants whose lease terms have expired and therefore the lease has automatically renewed on a month to month basis, the extent of liability to the landlord for ongoing rent is 60 days notice to the end of the term. In theory this could amount to a maximum of three months rent.
A tenant who is on a month to month tenancy needs to give a landlord 60 days of notice to the end of term. The exact rules for this and the timing of that notice is set out in a handy form that the Ontario Landlord and Tenant Board provides. That form is the Form N9 and is called a Tenant's Notice to Terminate.
FIXED TERMS
What is meant by "Fixed Terms" is a lease that was entered into for a term other than a month to month term. The typical or normal term is one year. After the one year term expires, a lease in Ontario does not end. Without doing anything at all, the lease automatically renews periodically on a month to month basis.
During the original lease term, a tenant is presumed to be committed to staying in the rental unit and paying the rent for the entire term of the lease. After the expiry of the original lease term, the lease goes month to month, and a tenant is only presumed to be bound to pay the future rent for up to 60 days as the tenant may terminate the month to month tenancy on a minimum of 60 days written notice to the end of the monthly term.
What if a tenant needs to terminate a lease during the original fixed term of the tenancy? For this discussion, lets presume a scenario where the tenant has signed a one year leasing starting January 1, 2017, in Ottawa, Ontario. The tenant moves in and is obligated to pay $1500 per month on the first of every month. The term is indicated in the lease as ending on December 31, 2017. On February 4, 2017, the tenant's local job is terminated but she is offered a transfer to another location in Toronto. If she wants the job, she has to start, on March 1, 2017. She basically has three weeks to find a new apartment in Toronto, pack, move, and wrap up her life in Ottawa. In that time she has to figure out what to do with her Ottawa apartment. She has only paid for January and February and now after these two months has 10 months of rent left which totals $15,000.
What can this tenant do? A telephone call to the Landlord and Tenant Board will result in the tenant being told that she can "Assign" the lease to another person. The Residential Tenancies Act provides that a tenant may assign a lease with the consent of the landlord. If a landlord chooses not to allow the tenant to assign the lease a tenant may terminate the lease--even if in a fixed term--on 30 days notice to the landlord regardless of the length of the term of the lease.
The applicable sections of the RTA are found in Part VI, specifically in section 95 and 96.
The first thing that a tenant should do, in relation to "assigning" a lease is to ask the Landlord, in writing, whether the landlord agrees to allow the tenant to assign the lease. This is a general request for permission to transfer the lease to another person. The reason to ask this question is that a landlord has the right to say "no". The landlord does not have to have a good reason to refuse an assignment on a general basis. Given that the point of an assignment is to transfer responsibility for the lease to another person, a tenant whose landlord refuses consent to assign should be just as happy to terminate the tenancy agreement using a Form N9. A landlord's refusal to consent to assign is grounds for terminating a tenancy under section 95(4) RTA.
WHAT IF THE LANDLORD AGREES TO ASSIGNMENT GENERALLY
After asking your landlord for consent to assign the lease (without proposing any specific person to take over the lease) in writing, your landlord has seven days to respond to your request. If the landlord responds within the seven days stating that they agree to you assigning the lease you are then left with the task of trying to find a new tenant to take over your lease. You can advertise, find friends, friends of friends, hold open houses, and do whatever you can to find a new tenant. Your success will likely turn on the state of the rental market, how desirable your rental unit is, and the amount of your monthly rent.
Presuming some success in finding a person who wants to take over your lease you will need to work with the landlord to have the landlord assess the tenant to see if the person you have found is suitable. The landlord needs to assess the prospective assignee reasonably and objectively--meaning the landlord can't just say no for arbitrary reasons. The landlord may run a credit check or background check on the tenant to make sure that the assignee is acceptable. You may be charged a fee for the out of pocket expense of doing so--but only if the cost of the background check results in the assignment of the rental unit. A landlord is only entitled to charge for the background check when the background check results in a "yes".
If you have been lucky enough to find a new tenant to take over the lease on an assignment the landlord will prepare some kind of document (sometimes just a written acknowledgement), that the assignee has taken over the lease from a certain date. For the tenant doing the assigning (i.e. the tenant who is leaving), getting a firm and fixed date in writing about when the assignment takes effect is critical. This date is important because it is from the date of the assignment that the tenant who is leaving is no longer liable for rent, damage, or any behaviours of any guests in the rental unit. The liability of the tenant who is leaving is limited to rents owing, damage caused, upon to the date of the assignment.
The assignee (tenant taking over the lease), is likewise only responsible for rent, damage, and tenant responsibilities from the date of the assignment. Anything that existed before the assignment is not the responsibility of the assignee. Hence, as you can imagine, it is very important for the "leaving tenant" and the "new tenant" to clearly document and record the condition of the rental unit on the date of transfer. The old tenant doesn't want to beheld liable for new damage caused by the new tenant and the new tenant does not want to be liable for damage that existed on the date of the assignment. Without a clear inspection and acknowledgement of the landlord about the condition of the premises on the date of assignment there is a risk that the landlord chases both the old tenant and the new tenant for damage when the tenancy ends.
IS THERE ANOTHER WAY to end the tenancy?
The assignment process that was just discussed is the "way" that the LTB will advise tenants who need to leave early to deal with the tenancy. That being said, nothing stops a landlord and tenant from agreeing to terminate a tenancy on terms that work for both. When an agreement to terminate is reached the parties can use a Form N11 to terminate a tenancy (regardless of term). The obligations to each other under the lease will be effective on the termination date set out in the N11 Form. Note that there is no minimum notice period for an N11. Where the parties agree, they can legally choose any termination date that they wish.
Michael K. E. Thiele
www.ottawalawyers.com
Hi Michael, Thanks for writing this blog to help those need help with tenant issues. I just came across your blog whiling looking for information about N11. I have a tenant, who subtenants my house without permission. After negotiation, we signed a N11 to end the tenancy after 60 days. He is doing a short term rental business and it seems to be profitable for him. So I am concerned that he won't move out after the termination day. Can I file to the board before the termination day to make the N11 enforceable once after the termination day? With the current speed of the Toronto board, it will take months if I file after the termination day. Thanks.
ReplyDeleteHi Derek:
DeleteAbsolutely you should apply immediately. Use the L3 Form. You will get an ex part Order--meaning no hearing is necessary and it will be enforceable as of the date. Filing the application immediately is always worthwhile because it will put your tenant to the test of either accepting the Order or filing a motion to set it aside within 10 days of the date of the Order.
Check out online filing---I think you can file this one on-line but you will need to find a lawyer or other commissioner who can commission your affidavit.
Best of luck
Michael K. E. Thiele
www.ottawalawyers.com
Hi Michael,
ReplyDeleteReading your article is a better experience and more efficient than going through boring clauses on TLB. I have a question that whether the fixed-term or monthly tenancy affects the right of the tenants to make a request to sublet or assign the premises. Here is a case that the tenant have a candidate tenant (say a friend) to recommend to the landlord, and the tenant has also sent a written request to sublet or assign his lease to this friend. However, the landlord rejects the request without a fair reason. In such a case, can the tenant files the N9 form (not sure sent to the landlord or the LTB?) to request the termination of his lease without a notice of 60 days in advance? Then the tenant vacates and moves out right away. But how can the tenant get back his last month deposit becomes a problem.
Looking forward to your answers.
Thank you,
Jason
Jason:
DeleteAn "assignment" and a "sublet" are very very different things. Unfortunately, people use these words interchangeably and the difference between the two concepts is lost.
The place to start, in answering your question, is to figure out what your goal is. Is your goal to get your friend into the rental unit? Or is your goal to permanently get out of your lease? Or is your goal to get out of your lease for a little while and then come back?
The last part of your question, including you referring to the N9, makes me think that you're just trying to get out of a lease. From that perspective, the key legal concept is "assignment". Whether you are on a fixed term or on a month to month you can ask the landlord to assign the lease. You can ask that question "generally" without proposing a potential assignee (new tenant). If the landlord says "no" then you can terminate the tenancy and serve the N9 (on the landlord). Refer back to the article about the timelines for terminating when a landlord says "no".
Once you terminate by serving the N9 you then ask the landlord to refund any prepaid rent plus the interest on the Last Month's Rent deposit. Usually, the only prepaid rent is the last month's rent deposit. The landlord should cut that cheque to you--often though only after your return possession of the apartment to the landlord. Some landlords will argue that they get to keep the deposit, or can use it for damage, or some other nonsense. There is no legal option but to return the prepaid rent. If the landlord refuses to return the money you can use a T1 application to get an Order for the return.
Michael K. E. Thiele
www.ottawalawyers.com
Hello Michael,
ReplyDeleteThanks for your detailed reply. Now I understand such a way to resolve this issue. Actually I am in a situation living in a two-bedroom apt with in total two persons as tenants on the list. My cotenant planed to move out on Dec 1st, and we agreed to assign only his bedroom to someone else, I will still remain staying in my bedroom. However, after we submitted the leaseholder change request form (we received from the superintendent, whose boss is the landlord) to the landlord, we got the rejected letter for the reason that our month-to-month tenancy is not permitted for any assignments or sublets. Even we also submitted an application form from the assignee, this was not approved. The landlord suggested a solution that the assignee and I submit a new tenancy application at the current market price. This happened last week. In such a case, can we (my cotenant and I) submit an N9 form to the landlord to apply for the termination of the lease right away, does it work?
Another questions is that, if we submit the N9, vacate and return the keys to the landlord before Dec 1st, then we can avoid paying the rent of Dec and at the same time get back our rent deposit of the last month. Is this right? Else, but if we submit the N9 after Dec 1st, say Dec 2nd, in case we have no enough time to vacate, shall we have to pay the rent for the Dec even though we only stay for two days in Dec? As a result, we may not get back the last month deposit in this case.
Hope to hear from your follow-up response.
Thanks,
Jason
Hi Jason:
DeleteThe premise of your latest comment does not actually work. If there is a single tenancy (you and your roommate leasing one rental unit on a single lease) then you are not able to assign rights to occupy one of the bedrooms. An assignment is for the entire rental unit and a sublet requires you to move out while another person occupies the premises for a fixed length of time.
With the N9 you are clearly trying to access the termination provisions arising from a refusal to assign. Perhaps the landlord's statement to you is broad enough (categorical that the rental unit may not be assigned in any respect) that you can now serve the N9. The notice period you are required to provide is set out in section 96(2) RTA--likely 30 days and you are required to give that notice (if you intend to terminate) within 30 days of the refusal (s. 95(4)).
Take at look at the RTA--assignment provisions starting at Part VI of the RTA. It reads like a flow chart and you can figure out the implications of certain steps. Note, the notice period that you provide is not indicated as having to be to the end of a term/rental period.
Michael K. E. Thiele
www.ottawalawyers.com
Hi Michael,
ReplyDeleteI'm a student living in a house with 5 other students and one post-doc. I'm monthly, the other students have leases with end dates of April or later, and the post-doc is just here for December. Myself and four other students want to move out by the end of December (the other student is undecided).
There are heating issues, electrical issues, and a possible mold issue that I think may make the place unfit for habitation and the landlord is renting the property without a licence in violation of municipal by-laws. The landlord is also renting two basement rooms, one of which contains the fuse box. I have reported the landlord to by-law enforcement and they have assigned an officer to investigate (no timeline has been given as of yet).
We would like to break our tenancies without involving the Landlord and Tenant Board if possible. We are restricting our communication with the landlord to emails for the moment so we have everything in writing but the landlord is refusing to communicate with us at all about this matter. We have asked the landlord to sign N11 forms but, as I said, he is not responding. Is the landlord required to respond and, if so, is he required to respond within a certain time frame? What can we do if the landlord doesn't respond? We don't want to assign our tenancies to someone else as regardless of whether that would be legal we think it would be immoral to try to persuade anyone to live in this house in its current state.
If we do file a complaint with the Landlord and Tenant Board, we are planning to file a T1 (the landlord required illegal security deposits), a T2 (interfering with a vital service, namely heating), an a T6 (not adequately fixing leaks in the basement that may cause, or have already caused, a mold issue under the tiling).
Thanks,
Nathan
HI Nathan:
DeleteThe landlord is not required to respond to a request to terminate early. Of course, it isn't a good business practice to ignore your tenants but failing to do so in the situation you describe has no immediate legal consequence. You might be thinking of the requirement to respond in an assignment request and the implications for failure to respond to the "general" request. Whether that might be useful--you could look at the requirements of "Assignment". I do have a blog article on the topic but there is lots of information on the LTB website as well. A failure to respond in that context gives you a legal right to terminate though probably not on the timeline you are seeking.
It sounds to me that you have already made the ultimate decision about your tenancy and that it is ending December 31 because you are moving out regardless. On that basis, you need to simply make yourself ready for possible legal action by the landlord (so that you have the strongest possible defence). For the move out day you need to make it very clear that possession of your rental unit has been returned to the landlord. A key turnover and acknowledgement of that is the strongest evidence. Repeated emails advising that you are leaving Dec 31 is also good evidence. You want it to be crystal clear that possession has been returned and that the landlord can't feign ignorance.
Beyond that, you want lots of pictures of the premises, video perhaps, and you want to highlight the problems in the place. You also want to keep all of your evidence proving complaints to the landlord about these issues. Your strongest defence to any claim by the landlord will be that the premises were not fit for habitation, breached laws, and that because of that you were legally justified in terminating the tenancy. It is a fundamental breach argument allowing you to terminate the tenancy agreement. Note that such an argument is not the first stop in a landlord and tenant relationship. Once you move out, the landlords only legal recourse is the Small Claims Court (or higher level if above $25K). You will need to be able to put forward a compelling case to the Judge that you were justified in terminating the lease and walking away from it. In this context, the landlord's failure to respond to numerous maintenance requests, there being serious maintenance issues, no vital service of heat, etc. etc., is very strong. That being said, make sure you have the evidence to prove these allegations with more than just your say so. By-law inspecting is great as that should generate a third party report from someone who will not be considered to have a bias. Having similar such reports from others--would also be helpful. For instance, if there is no heat--why? Perhaps an inspection from an HVAC person with a written report would be great to get. If, for example, you get the HVAC person in and they say---in a report all the things that are wrong then that is great evidence. If the report indicates that the furnace is unsafe, or heaven forbid gets red-tagged, it is good evidence to establish that the premises are not fit for habitation.
DeleteNote, in deciding how to do this, when you are on a month to month you have an obligation to provide 60 days written notice to the end of term. Where notice is short, the RTA does extend that notice to the first lawful date. Makes you wonder if the landlord is really going to take legal action to chase you for what is a maximum of 2 to 3 months rent.
Lastly, collect evidence of the condition of the premises as a whole when you move out. Photos, etc., and think of this from a perspective of defending yourself against fictional claims from the landlord. Often enough tenants get ambushed after vacating with allegations of having caused damage to the house. Inviting the landlord to do a move out inspection--before you vacate--is a good idea. State that you want to go through he house to identify anything he thinks you might be responsible for. If the landlord does that with you--great---sign off a sheet of paper when that is done. If he just ignores you--that too is favourable for you should he later make allegations when you are gone.
Good luck. You view on the tenant applications you could bring are all fine--you just need to decide if you want the hassle. Keep in mind the 1 year limit on asserting claims under the RTA (1 year from the breach--not from the end of the tenancy).
Michael K. E. Thiele
www.ottawalawyers.com
Hi Michael,
ReplyDeleteAs tenants, we were given a N12 notice with the purchaser indicating they are reclaiming our rental unit. If we end our tenancy early with the N9, are we entitled to the rent we've already paid on our last month's rent?
Thanks!
HI: The simple answer is "yes". Once you lawfully terminate your tenancy you are required to pay rent up to the date of the lawfully terminated date. Any rent that is prepaid (i.e. rent you paid for the current month) or the last month's rent deposit (plus interest), must be returned to you without deduction. The landlord does not get to keep any of this money as a "bonus" or "penalty" etc..
DeleteMichael K.E. Thiele
www.ottawalawyers.com
Hi Michael,
ReplyDeleteThanks for all of your informative posts. I have a question regarding a couple (unmarried and not together long enough to be considered common law) who now want to separate.
My partner and I signed a lease together and unfortunately we are now choosing to go our separate ways. We've been living together in a rental unit for about 6 months (the original term is for a year) and both of our names are on the lease. She would like to move out and I would like to stay in the unit by myself. I am willing to take on the entire financial responsibility alone. My question is this- if I notify the landlord that my partner is moving out, could the landlord evict me on the basis that we were originally approved for the unit based on our combined incomes and both of our credit scores?
Thanks!
Hi:
DeleteThe separation from your partner and your partner moving out is not grounds for termination of the tenancy even if, as you explain, the unit was rented to you both on your combined incomes and credit scores. The landlord can not evict you for this.
Please be aware, however, that your partner's moving out does not mean that her liability comes to an end. She is still on the lease. If you default on the rent that landlord could serve you with a Notice of Termination for Non-Payment of Rent and proceed to get an order for the money and eviction against you. Then, if you are difficult to collect from the landlord could sue your former partner and still co-tenant on the lease for the money. A quirk in the law does not allow the landlord to get an order against your former partner after she vacates the unit at the Landlord and Tenant Board (must proceed to Small Claims).
If the end of your relationship is friendly enough your former partner may be fine to leave and simply trust you to meet the obligations under the lease (rent, no damage, etc.). If she is not so understanding then there is a bit of a problem. She does not have the right to remove her name from the lease--the landlord can simply say no. The tenancy is still ongoing and there is no right to terminate the lease before the expiry of the term. If you were both leaving you might look to assign the lease or the landlord might make a deal to break the lease and re-rent or you would simply breach and trigger the landlord's duty to mitigate losses. I suppose in your situation you could (presuming your partner wants her name off the lease) ask the landlord to assign the lease from you and your partner to just you. You would have to "qualify" on your own for the apartment and if approved then your former partners liability would end with the assignment of the lease to you.
Good luck
Michael K. E. Thiele
www.ottawalawyers.com
Can a landlord demand additional payments once they have signed an N11, with no financial penalties or conditions listed or discussed prior to signing the N11 form? I provided sufficient notice (>60 days) and we signed the N11 with a date fixed to end the lease. A new tenant has been secured, and will move in immediately after the unit is vacated, there is no unoccupied periods in which the landlord is not collecting rent. I am now being told I am to pay a penalty for breaking the lease and being threatened legally. Is there any validity to this matter?
ReplyDeleteHi: A signed N11 is an agreement to terminate. It is signed by the landlord and the tenant. Once signed, the tenancy ends on the agreed upon date. No penalty or demands for more. On the facts you provide, even without an N11 there is no liability for ongoing rent beyond the date you are moving out because the landlord has mitigated losses by re-renting the unit for immediately after you have vacated.
DeleteOn the facts you've provided the landlord's demand is nonsense. It is so silly in fact--I wonder if you've omitted anything pertinent?
Michael K. E. Thiele
www.ottawalawyers.com
That's it that all. Scare tactics!
DeleteHi Michael. I signed the lease agreement together with another tenant. My life has become miserable in the sense that I am no more free. I stay out of the apartment and only gets in to sleep just to avoid her screams and taunts. I requested the landlord for me to assign the lease either to the other tenant or to allow me to find someone else. and he refused of letting me go. What would you suggest in my situation?
ReplyDeleteRegards.
Hi Ayana:
DeleteI am sorry to hear this. If your situation is "miserable" due to anything approaching illegality consider contacting the police and making a report. Is this potentially a matter of domestic violence? I ask simply because there are special rules for domestic violence and rules related to terminate of such tenancies. If you wish to research this, you can read the "law" at this link which you will need to cut and paste into your browser:
https://www.canlii.org/en/on/laws/stat/so-2006-c-17/latest/so-2006-c-17.html?autocompleteStr=reside&autocompletePos=1#sec47.1subsec1
The section is 47.1 of the Residential Tenancies Act.
If this is not a domestic violence situation then the termination provisions set out in this section do not apply to you. If inapplicable, put a comment back up and I can write something about the problem from the perspective of two roommates who simply don't get along.
Michael K. E. Thiele
www.ottawalawyers.com
I have started a tenancy and signed lease (has start date but no end date, no landlord information or landlord signature) on May 1st 2019. Now I want to move out, can I simply give 6. days notice and leave? or I am on 1 year lease even if my lease doesn't have end date on it. Thank you for you response.
ReplyDeleteHi: For a definitive answer it is necessary to see the lease document. However, assuming you are describing it accurately and you're not missing anything then it is entirely possible that you are on a month to month tenancy. It is not uncommon for written leases to be month to month and there isn't anything illegal about starting a tenancy on the basis of it being month to month. Residential Landlord and Tenant leases can be written, oral, or implied. Each have equal weight and it is possible that a lease is a mixture of all three. While Ontario has a new standard form lease that is required to be used, the failure to use the standard form lease does not void a tenancy agreement---meaning, written, oral, implied leases are still legally binding.
DeleteYour description makes one wonder if the lease is just poorly filled out. Missing information and no signatures--it makes one wonder if the written lease was properly completed. Also possible, there were likely multiple copies (you kept one, the landlord kept another)--is the landlord's copy the same as yours? If you asked the landlord right now, would the landlord say you are month to month or on a fixed term of one year? What was your expectation when you got the lease document? Did you think you had a one year lease but now that you are wanting to leave you are finding the absence of dates convenient? In my view, if this got before the LTB the adjudicator would want to know the answers to these questions. The lease, all by itself, would not settle the question.
So, all that being said. If you are month to month then you may indeed terminate the lease on 60 days notice to the end of term. Your 60 days needs to end on the last day of a rental period (usually the day before rent is due). Hence, if you gave notice today (November 5), the earliest legal termination date would be January 31. It is a minimum 60 days to the end of term. You should also use the N9 Notice Form to give proper legal notice. That form is available on the LTB website.
Michael K. E. Thiele
www.ottawalawyers.com
Well it was our general understanding that it is one year lease but never really discussed this. We asked about subletting and he said I have to find him someone suitable to sign a new 1 year lease and I will not get refund for my last month. He is kind of legally harassing us. I sent him the lease via email which has start date but no end date or landlord information at all. Please provide your knowledge in this situation.
DeleteHi: Your first sentence "Well it was our general understanding that it is a one year lease but never really discussed this.", is problematic. If your general understanding that it is a one year lease matches the landlord's evidence that this is a one year lease then I think it is open to the Board to determine that this is a one year lease. As previously indicated, the document you have seems incomplete and I think it is questionable (from what you've said) whether the written document reflects the actual agreement. That being said, if by saying "never really discussed this" means you didn't really think about the length of the lease at all and in retrospect you are recalling what you think you must have thought--then arguably the length of the lease is unspecified. If unspecified and not a part of the negotiations then the paper is the best evidence of intentions and from what you describe a month to month tenancy is what you have. To terminate a month to month tenancy you use a form N9 and follow the instructions on that form.
DeleteWith respect to assignment (not sublet--as your landlord instructs), you would only be assigning the lease as it exists at the time of the assignment. You don't have to get a new tenant to sign a one year lease. This is not how it works. If you have a one year lease and there are 4 months left on the term then the assignee takes the lease with 4 months left plus the right to go month to month at the expiry of the term.
Lastly, if terminating is your goal and it seems that the landlord is going to give you a hard time then you should become familiar with section 12.1 and section 47.0.1. These are the provisions dealing with the new standard form lease. You have the right to demand that lease and following through on whether the landlord delivers a copy and/or whether you refuse to sign that lease, you can be in a position to terminate the tenancy on notice (60 days).
Good luck
Michael Thiele
www.ottawalawyers.com
Michael K. E. Thiele
www.ottawalawyers.com
Hi Michael thanks for sharing this wealth of knowledge.
ReplyDeleteI needed some clarity in a specific assignment matter.
Our landlord has provided general consent to assign the lease. However now that we have found tenants to take over the lease, he is not providing his specific consent (we drafted an Agreement to Assign Lease for all parties to sign)
He is making this execution/agreement conditional on the new tenants providing him with all posted dated cheques for the remainder of the lease.
My question is, is this condition tantamount to unreasonably withholding consent and second, is it illegal ?
What is our recourse here ?
Sincerely appreciate your insight in this regard.
Pramp
Hi: As you are likely aware, it is not lawful for a landlord or a tenancy agreement to require the provision of post-dated cheques. This is set out in section 108 of the Residential Tenancies Act. The landlord's requirement as you describe it is unlawful. The landlord can not impose a condition in assignment that is not otherwise lawful.
DeleteYou may want to consider writing to the landlord (writing so that you have evidence) asking the landlord to remove the post dated cheque condition. You could explain that the condition is contrary to section 108 of the Residential Tenancies Act. Whether you should write to the landlord about this issue depends, in my view, on how clear the landlord has been with respect to this requirement. If the landlord has already confirmed this condition in writing or in some other way that you can prove the imposition of this condition then perhaps, depending on other circumstances, you might not want to give the landlord a chance to remove the condition. If your prospective assignees are still willing to take over your lease and are anxious to do so then pushing the landlord on the point may be worthwhile. However, if your prospective assignees are getting cold feet and realizing that the landlord may not be the "best" you may not want to push for the removal of the condition if your assignees are no longer willing to take over your lease.
There are a lot of "moving parts" when you are trying to do a lease assignment (as you've likely discovered) and getting the landlord and the assignee to a point of agreement and keeping them there can be a challenge. If the landlord's demands reflect a reluctance to allow you to assign or are intended to be a roadblock to make it more difficult then you might want to consider simply terminating the lease.
How to go about terminating the lease? You will have to become familiar with Part VI of the Residential Tenancies Act. There are certain circumstances described in section 95(4) RTA that permit a tenant to serve a Notice of Termination under section 96. Query whether the circumstances you describe constitute the refusal described in section 95(4). Is imposing an illegal condition tantamount to a refusal? That question is a good one and not one I can offer an immediate (i.e. conclusive) answer to. That being said, if you've decided to go down the terminating the tenancy road I would consider exercising the right to terminate under section 96--whether or not it ultimately turns out to apply or not. I would do this simply because there is a time limit to give the Notice of Termination--30 days from the date of the request.
The other way that you terminate the tenancy is through an application to the Landlord and Tenant Board. Take a look at FORM A2. This is the process contemplated by section 98 RTA. In this application you would assert that the landlord unreasonably withheld consent--the argument being that the imposition of a condition that is ultimately illegal amounts to unreasonably withholding consent. If successful, then the LTB has the jurisdiction to terminate the tenancy.
DeleteIt will take some time for the LTB to schedule and hear your case. That timing is likely longer than it should be and you will be wanting to take steps (presumably) prior to the hearing date. I presume you need to move out, move somewhere, or are unwilling or unable to continue to pay your current rent. If you move out prior to the hearing of your application the importance of winning that application will be rather important. It is for this reason that I first suggested writing to the landlord and asking for a removal of the post dated cheque condition and perhaps even pointing out the section that makes it illegal. If you are very clear in your position to the landlord and the landlord refuses to remove the condition or simply ignores you then your argument on the facts is stronger.
In my experience, the content of emails, text messages, are rarely as clear and unequivocal as we would like them to be. I am often shown emails/texts by clients who say "here is the proof" and on review those emails "sort of" confirm what the client says they say. The reason for the confusion--usually--is that people read, send, and receive emails within a context. External facts inform the meaning of the text/email in the mind of the recipient. This "meaning" is not necessarily the same meaning that a "stranger" reading the email/text chain would understand.
Given the foregoing, does the landlord's condition for post dated cheques truly read as a condition for assignment? Is the landlord expressing a preference as opposed to a requirement? Would the landlord be able to say something along the lines of having had post dated cheques from you that he thought the new tenant would also want to provide post dated cheques and that this is all that he meant by whatever he wrote? Is your interpretation of the email/text the only interpretation? This is an important question if you intend to take a step to terminate your tenancy--perhaps even move out?--and file the A2 application with the expectation that the LTB will terminate your tenancy. If the condition imposed by the landlord is not absolutely clear or there isn't corroborating evidence of the meaning of the condition then you might want to write to the landlord to clarify the illegality and seek an unequivocal response permitting the assignee to take over the lease without providing post dated cheques.
Good luck with this.
Michael K. E. Thiele
www.ottawalawyers.com
Hi Michael, can a tenant break a fixed term lease by not paying rent? If tenant doesn’t pay rent and landlord issues N4, does it terminate tenancy on termination date listed on N4? Is tenant able to break fixed term lease this way? If yes, then how else can landlord collect rent if tenant doesn’t pay during a fixed term lease? In case the tenant is given N4 and tenant leaves the property, can landlord sue the tenant in small claims to recover unpaid rent until the end of lease term or until the property is re-rented (during lease term, after tenant moves out) plus cost of renting the property?
ReplyDeleteCan landlord claim late rent payment fees / penalties (and consequential damages such as bank interest) listed on lease through LTB while tenant is in the unit or through small claims, after the tenant has vacated? The N4 doesn’t have an option to add late fees or other consequential damages incurred by landlord due to tenant’s late payment or non-payment of rent.
Hi Tom:
DeleteWow, a lot of questions here. I'll give an over-view response but each of these issues could be a chapter on their own.
While it is not the intended purpose of the RTA, a tenant could break a fixed term lease by causing the landlord to serve a Notice of Termination. If a tenant is in a fixed term (or month to month), and the tenant wants to move with minimal notice the tenant could not pay rent and cause an N4 to be served. That N4 will terminate the tenancy early and a tenant could indeed vacate the unit in accordance with the N4 (or allow themselves to be evicted through LTB proceedings).
What seems "unfair" about the above is that the tenant can apparently benefit from his/her own breach of contract. How is it proper that a party to a contract can intentionally breach a contractual obligation, benefit from it, and cause harm (financial loss) to the other party? You will find caselaw that highlights this very point and holds tenants liable for losses arising in this way. However, you will also find caselaw that determines a tenant's liability ends in accordance with the termination date in the N4 or in accordance with the termination in the LTB Order. This second view is the more current view and I think reflects the current state of the law. The RTA has a number of sections that support the interpretation that a tenant's liability ends (for rent, rent losses, unit turnover costs) if a landlord chooses to terminate a tenancy via an N4 (or other Notice of Termination).
The alternative to serving an N4 is to NOT terminate the tenancy but only to "sue" for the rent arrears. You can do that at the LTB by filing an L9 application. This will give you an Order for rent arrears but it does not terminate the tenancy. The tenant remains entitled to remain in possession because the tenancy continues. Any rent arrears that are ordered paid in an L9 application can NEVER be used again to support an eviction. Hence, it is very important to determine whether an Order for arrears can be enforced without eviction. Otherwise, you end up with a pretty piece of paper (i.e. Order for Rent Arrears) that is uncollectible and a tenant still in possession.
Ontario does not allow the collection for late rent payment fees, interest, or any other kind of penalty. These are strictly prohibited under the RTA and there are no exceptions. Any lease clause to the contrary is void as per section 4 RTA.
The N4 does not have an option for late fees or other damages because these are prohibited charges. There is an exception for NSF charges for bounced cheques (these costs, capped by regulation, can be charged back). An order for rent arrears does bear interest at the Courts of Justice rate but this amount is typically much lower than the actual interest expenses being carried by a landlord.
I appreciate that the above answers may be disheartening to you. I'll remind you that I am just the messenger!
Michael K. E. Thiele
www.ottawalawyers.com
Hi Michael,
ReplyDeleteI am a landlord and rented my student house to 5 students earlier this year February) with a move in date of September. They paid a months rent and a security deposit of $200 each. Due to the global pandemic I have just heard that classes will now be held online for the fall semester and therefore the students do not want to move in and wish to break their lease. It was a 12 month lease. As the landlord where do I stand, do I have to refund their deposits and first months rent or am I entitled to hold onto to all or part of it, we held the property for many months as we were unable to rent due to covid 19 this summer. Are they required to look try and reassign which is very difficult in this current global situation or does all responsibility fall on me. Thank you so much. Would appreciate some clarification.
Hi: The answer I think is rather straightforward. If you have a signed standard form lease for a term of presumably a year then the tenant's are bound. They don't get to "cancel" just because they don't want to rent anymore. That being said, I find their position "odd" as most students in this position are continuing with their leases as the Universities are presently intending to bring everyone back to campus by second term and/or around December.
DeleteAnyway, the students having signed a lease are bound. The Residential Tenancies Act allows them to sublet or assign with your consent. Absent that, they are responsible for the rent--subject to any other lawful termination. If you don't allow them to assign or sublet you might trigger a termination right for them hence it is important that you become familiar with the assignment and sublet provisions of the RTA (and follow them diligently if they are triggered---this blog has articles on the assignment/sublet provisions and there is information on the LTB website and of course look at the RTA starting at section 95).
Aside from that, you need to think about whether you serve an N4 (termination for non-payment of rent) if they don't pay the rent. If you do that you end up terminating their lease early for them. Consider instead filing an L9 and effectively sue them for the rent as opposed to terminating their tenancy and suing for the rent. If the tenant's make it clear that they are NOT taking possession and are returning possession of the rental unit to you (you can in fact ask them if this is what they're doing if they don't seek to sublet or assign). If they answer yes, then you will have a duty to mitigate your losses and it makes sense to then market the property (aggressively) and try to find new tenants. You can advise the existing tenants that until you find new tenants that they are liable for the ongoing rent as it becomes due. When you find "new" tenants you would return any prepaid rent and LMR deposit as you are not entitled to double dip. Arguably, you can charge back to the tenants your mitigation costs (i.e. the advertising expenses and reasonable costs of finding replacement tenants).
If the current tenants do not pay what is owed as of the date that you mitigate and find new tenants to take the unit then your likely recourse is a small claims court action against them. The foregoing course of action (as I've described it) is something I would write to the tenants quite explicitly so that they understand your position and act accordingly. The foregoing is perfectly legal and proper.
I should mention/ask about your $200 security deposit. If this is a "damage" deposit then it is illegal and should be returned. The only lawful deposit under the RTA is a Last Month's Rent deposit equal or less than one month's rent.
You are not obliged to return rent or an LMR. Make sure that rent payments and deposits are used towards rent obligations as they become due. At no point should you use the words "penalty, service charge, forfeit" or anything that invokes that sentiment when it comes to money and deposits. As a landlord you are entitled to charge the tenants for rent due, a LMR deposit, and some small refundable deposits for keys, fobs, etc..
Hope that helps
Michael K. E. Thiele
www.ottawalawyers.com
Hi Michael,
ReplyDeleteThis is an amazing and helpful article you have posted. Thank you so much for the information. Just one quick clarification:
If I email my landlord with a request to "assign" my tenancy to another person and they fail to respond within 7 days do I have grounds to terminate my lease?
All the best,
Justin
Hi Justin: With caution, that is a fair summary of what section 95(4)(b) RTA allows. Be sure to read the entirety of Part VI of the RTA to have a fulsome sense of what the rules are for subletting and assigning.
DeleteMichael Thiele
www.ottawalawyers.com
Hi Michael,
ReplyDeleteMy landlord and I recently came to an agreement to end my fixed term tenancy using the N11 form. Originally I offered to give 60 days notice, paying rent until the end of the 60 days and they agreed. I sent the N11 for their signature and they returned asking me to change the termination date to 1 month earlier (it was always known that I would be leaving earlier but paying rent until the end of the 60 days). My landlord has my last months rent as a deposit. Since my landlord technically has technically been paid up until the date on the N11, can I withhold the July rent? The RTA states that the landlord is not entitled to any rent after that date, my only concern is that the payment until the end of the 60 days could be interpreted as a condition of the agreement to terminate.
Thanks in advance for you advice
Hi: It seems to me that you had a deal and then your landlord proposed to change it by asking you to shorten the notice period by bringing the termination date closer by one month. Your original deal had you paying to the end of the notice period (as reflected in the N11). It seems to me, to hold to the same premise, you would pay one month less with the shorter termination date because that is consistent with the original intent of paying rent until the termination date. Presumably your landlord wants lawful possession "sooner" in order to be able to rent to someone new or to take control of the unit to effect repairs/renovations. Until your tenancy is terminated you have a lawful right to enter the space--whether for yourself, to let a friend stay overnight, sublet, etc. (and this is true regardless of your original plan to leave "early").
DeleteMichael K. E. Thiele
www.ottawalawyers.com
Hi I'm a Property Manager, one of my tenants has filed a complaint with LTB because we installed a security camera in the hallway where her unit is located. She is insisting it be taken down. She says it was put there to harrass and intimidate her. Can she make Landlord take it down? One of her arguments was that there were no other cameras in the building, that has now changed and all halls and landings have one and signage is visible throughout.
ReplyDeleteHi: As far as I am aware there is no definitive answer to this question. Certain things are "true"--that being the cameras can't have sound and the cameras should most certainly be "aimed" in such a way not to see into rental units when tenants come and go (i.e. no incidental capturing of the interior of the unit when the door opens). When I've looked at this issue there is very little guidance when it comes to security cameras. The Federal Privacy commissioner has some articles speaking to the issue: https://www.priv.gc.ca/en/privacy-topics/landlords-and-tenants/02_05_d_66_tips/ (cut and paste this link and look at #6 for comments on surveillance).
DeleteInside a building security cameras are a bit different than outdoor cameras--but those too create a lot of controversy between fighting neighbours. There is a notion of the cameras as a "security camera" and then the camera as a tool of a "peeping tom". Obviously no one likes to be "peeped upon" or have their privacy violated for the titillation of some invisible camera watcher. Some tenants too will be interested in the privacy of having persons come and go from their unit and they don't want to be monitored in this way. For example, a steady monitoring of who comes and goes from a unit can reveal a lot about a person's life (health, relationships, business, etc.) and also their routines about when they go to work, come home, go out, etc. etc.. You might think that this kind of information could be obtained simply by sitting there and watching and that there is no privacy right in this kind of information. On that point I disagree because the camera's allow you to monitor the doors remotely by recording and then simply by fast-forwarding through recorded footage (or motion activate footage) you can summarize a tenant's activity for a week/month in 30 minutes or less. That seems wrong to me.
Accordingly, I am a big fan of what the privacy commissioner talks about as a "surveillance policy". It seems to me that a proper policy would control access to the recordings and provide comfort to the tenants who might be recorded about when the data would be viewed. For instance, I'd be pleased with a policy that confirms that the recordings would never be viewed unless an incident required the recording to be watched. I'd also be pleased for the policy to require notification to every tenant viewed in a video (that is watched) to be informed that they were captured in a video and that it was reviewed with a "right" for the tenant to see the video too. Perhaps this should include guests of the tenant who are seen entering the tenant's unit too. As for the policy, I think a camera in the main lobby is different than a camera monitoring a hallway.
Privacy rights under the Residential Tenancies Act are hardly discussed or addressed. The likelihood that the LTB will order security cameras to be removed, I think, is low. However, if the landlord does not have a reasonable policy, and explanation for the need for the cameras (I presume there is crime or other problems?) and fails to comply with the Privacy Commissioner guidance (which seems reasonable to me), then I do think the LTB might conclude that the cameras are an interference with the tenant's reasonable enjoyment and as a result "orders" could be made including taking the cameras down.
Michael K. E. Thiele
www.ottawalawyers.com
Hi Micheal,
ReplyDeleteMy friends and I (a total of 5 people) signed a one year lease starting September. However since most universities are moving to online, we don't need the apartment anymore. We wanted to leave the lease entirely and were told to find other tenants either subletting or lease takeover. It has been extremely difficult finding anyone willing to do a lease takeover. I was wondering if there was anything I could do to end the lease before it begins? Thanks so much!
Hi: The Residential Tenancies Act provides you with the option of "assigning" or "subletting" as the option when you do not want to continue in the tenancy and giving "notice" is not a reasonable option because of the length of time to the end of term. As you've discovered, doing the work of finding a tenant to take over is not the easiest of tasks. Perhaps it is more difficult now that students aren't flocking to the usual areas until there is a little more clarity around COVID rules and universities requiring in person attendance to classes.
DeleteIf finding an assignee turns out to be impossible the question is whether there is anything else that can be done to void or terminate the lease. Approaching the landlord has not yielded a useful answer. What else?
You could begin to look at the Residential Tenancies Act to see if certain events will, or might, result in or give grounds to terminate the tenancy early. Ultimately, you could also consider what would happen if you returned the keys to the landlord and advised in writing that you do not intend to occupy the premises and that the landlord should re-rent and mitigate his/her/its losses.
What might these grounds for early termination be? Well, they arise when there is non-compliance with the RTA--either by the landlord or the tenants--and either the landlord or the tenants exercise their right to terminate the tenancy (due to the particular non-compliance with the RTA). An immediate example that I've been seeing a lot lately (being used by students), relates to the landlord's failure to use the Ontario Standard Form Lease agreement. Some landlords haven't kept up with the law and are using their own form of leases or are using a Real Estate Board Form of lease that they have been using for years and years. These forms are not "valid" any longer and the failure to use the proper lease can result in the tenants having the right to terminate the lease early. If this fits your situation this can be an out with a limited exposure to a rent obligation (i.e. it doesn't mean zero rent payable but does cut the lease short). If this might apply to you take a look at section 12.1 and follow it through.
Other things that might happen include termination by the landlord for things like non-payment of rent. If the landlord served a Notice of Termination (Form N4) for Non-payment of rent, then that act would indeed result in an early termination of the tenancy if the tenants chose not to "void" the Notice. The same can be said for the other notices of termination. Of course, getting such a notice is not a right and whether the RTA provisions apply depends on the choices made by both landlord and tenants in dealing with breaches of the RTA.
DeleteLastly, there is what I mentioned at the beginning. Tenants could always announce that they will not take possession and they can return possession to the landlord. Rent would come due but the landlord's entitlement to the rent would depend on the landlord's mitigation of damages. The landlord would have to actively market the property and his efforts in doing that would be judged when determining his entitlement to rent from the tenants. My experience has been that landlords typically can expect to collect rent for about 60 days. After that a presumption of a failure to mitigate arises and they are not entitled to further damages. There are exceptions of course for difficult to rent or unique premises and perhaps COVID will be a reason to extend the entitlement beyond 60 days if proper mitigation is employed. Note that simply returning the property to the landlord does come with a risk as you are putting it on the landlord to take the necessary actions to re-rent. You do hear people say that the landlord could simply sit on his hands for the 12 months of the lease and simply sue for the 12 months of rent arrears and leave the property empty. That couldn't happen because of the mandatory requirement (under the RTA) to mitigate losses (meaning--taking reasonable steps to re-rent, market, reduce losses). Of course, it is theoretically possible that the landlord pulls out all of the stops to market and re-rent and simply has no success at all---arguably, then, you could owe up to 12 months of rent (the lease term). I've never seen that happen--but it is theoretically possible and therefore it represents your maximum financial exposure. That being said, I typically see the maximum award at 60 days (2 months).
Good luck
Michael K. E. Thiele
www.ottawalawyers.com
Given new changes in Bill 184 landlords can pursue former tenants who have vacated at the LTB now instead of the courts.
ReplyDeleteIs there a way for a tenant to even know that they've been actioned at the board (eg because of some discrepancy in arrears or similar), given that unlike with the courts where there are strict rules about serving notices, the LTB leaves the onus on the landlord?
How could a tenant keep themselves aware of such developments should a case like this arise?
Hi Jamie:
DeleteAwesome question. In my view what you're hitting on is the real disaster that Bill 184 (contrary to the focus in the media). The post tenancy/occupancy right of action creates a real procedural issue. The Small Claims Court deals with this issue regularly and even there you find motions courts regularly filled with motions to set aside judgments/orders based on service or lack thereof, orders validating service, and other service related issues. The Small Claims Court process is far more sophisticated than anything at the LTB---the mere fact that the Small Claims Court has a "motions" whereas the Landlord and Tenant Board does not is already a major strike agains this legislation and what is going to be allowed. Combine that with a mentality of "no costs" for legal steps taken (which is the norm at the LTB), I can imagine (and predict) a major procedural problem developing on a grand scale. I wonder how many "false" or "ineffective" serves will result in Orders without actual notice of claims being served.
To be fair--what is proposed is still new and parts of the Bill have not been proclaimed. Perhaps that LTB will adopt more stringent rules to reflect this expanded jurisdiction--perhaps they will become more like the Small Claims Court and have motion days to deal with procedural issues. Perhaps they will adopt more stringent service rules and highlight the need for actual personal service of an originating process (versus dropping it in a mailbox, sliding it under a door, or mailing it). These things will be published in due course and we'll see. Sadly, I'm skeptical given the LTB's challenges (and inability) to conduct the simpler version of its pre-Bill 184 mandate. The LTB has been under-resourced, under-staffed, for a very long time and recent attempts to bolster the LTB will be insufficient to actually getting it to perform. The halcyon days of the LTB are long gone and it's hard to imagine the place ever being as efficient again as in its first incarnation as the Ontario Rental Housing Tribunal.
So, to your question. Is there a way to monitor whether you are "sued" post tenancy and post moving out? As far as I know---"no". Current file "look up" services require you to know the file number and postal code. Query whether the new system will still use the unit address and postal code as a key piece of information in post tenancy applications. A lot is unknown.
Michael K. E. Thiele
www.ottawalawyers.com
Hi Michael,
ReplyDeleteI was wondering what you thought with respect to a landlord's duty to mitigate and an unit being listed for a price higher than what the tenant which has vacated the unit was paying. Is it possible that the LTB would find that rent owed (by the vacated tenant) is less than the 2 months that is typically awarded at most, if the market is such that rates have increased making it that the amount that was being paid by the vacated tenant are now below the market rate (and therefore arguably the unit could be rented out even faster than it originally was)?
Are landlords expected to rent the unit out at the amount that the tenant who broke the lease early (i.e. vacated the unit) was paying?
Thanks!
I think you make a great point. I suspect that there must be a precedent out there addressing this issue as what you describe is, I think, common. Market rents have been increasing in dramatic amounts far above what one would expect for inflation adjustments. Hence, the monthly rent from one tenant to the next tenant can be several hundreds of dollars higher. Does the landlord get the benefit of the increased rent without any of that benefit flowing to the former tenant? I wonder too if the reverse also applies (in a falling market rent environment) does the landlord suffer the loss of a lower future rent alone?
DeleteI'll comment based on my impression as I haven't seen any caselaw that addresses this circumstance. I think it is easier to proceed on the premise that the mitigation happens upon the re-renting regardless of the amount of the rent. It seems to me that digging into the amount of the higher rent (to give the tenant credit against the amount otherwise owed) then also begs to investigate the cost of the mitigation and associated expenses. To that end, what if the landlord incurred re-painting, cleaning, and perhaps upgraded the unit a bit (newer stove, new fridge, as an example). Do you deduct those expenses from the higher rent achieved on re-renting from any credit that the former tenant might get for the higher rent?
How does one think about this in a falling rent environment. Should the landlord immediate re-rent for a lower market rent than what the former tenant paid thereby locking in a specific and discernible amount over the term of the new lease versus what would have been paid by the former tenant? For example, old tenant pays $1500 per month, new tenant pays $1000 per month, loss per month equals $500 over 1 year term of the new lease $6000. Does the old tenant pay that amount in damages? Or perhaps pay that equivalent monthly loss to the first lawful date of termination?
I wonder too if you could argue on the higher subsequent rent that the landlord failed to mitigate at all. Because the landlord seeks a higher rent the landlord precluded finding the first available tenant that would put the landlord in the same position as he was in with the former tenant. By seeking a better deal (higher rent) the landlord was refusing to mitigate and thereby deprived the tenant of a likely immediate replacement if the unit went on the market at a well below market rent. I like this argument until I apply the logic to the decreasing market rent scenario which then would have the landlord offering the unit at an above market rent which likely results in the unit remaining vacant and the former tenant taking the full loss until the day that the tenancy could have been lawfully terminated.
I'm stuck on this without being able to come up with a formulaic answer as you can see unfairness arising if a formula was applied consistently across every circumstance. It's what makes the model of mitigation to the date of re-renting (regardless of the rent amount) the most attractive method and then just ensuring that the landlord in mitigating did actively seek to do so (i.e. the amount of the rent being irrelevant). Alternatively, I think the point you raise is rather compelling in certain circumstances and I think if you can show a ledger in a specific case that a landlord is far ahead on the termination such that the landlord is earning more than otherwise under the old lease--well, then I think fairness dictates a credit to the former tenant as the tenant's action actually enriched the landlord.