Increasing Monetary Jurisdiction of Landlord and Tenant Board (and Small Claims Court)

FROM $25,000 to $35,000 as of JANUARY 1, 2020

The Ontario Landlord and Tenant Board has a monetary jurisdiction of $10,000 or the monetary jurisdiction of the Ontario Small Claims Court (which currently is $25,000).  This is set out in section 207 of the Residential Tenancies Act.   

There is a significant change coming on January 1, 2020, in that the monetary jurisdiction of the Ontario Small Claims Court is increasing to $35,000.00.  You can find the Regulation that makes this change HERE.   Because the Residential Tenancies Act creates a monetary jurisdiction that tracks the Ontario Small Claims Court (based on wording of section 207 RTA) one would presume that the monetary jurisdiction of the Ontario Landlord and Tenant Board will also be increasing to $35,000 starting on January 1, 2020.

An unanswered question that I have is whether the increased jurisdiction will apply only to new applications filed on or after January 1, 2020, or whether existing applications that have not yet been adjudicated can take advantage of the increased jurisdiction.   I've looked for any kind of transition Rule or Regulation but as yet no luck.  If anyone knows something I don't about this a comment below would be appreciated.   Absent any direct guidance my guess is that the increased jurisdiction will apply to existing but not yet adjudicated applications as well as new applications.  I have a very vague recollection of caselaw on point when the Small Claims Court has made the leaps in monetary jurisdiction and that being determined to be a procedural rather than a substantive issue meaning the jurisdiction at the time of hearing governs not the date of filing.  Of course, I stand to be corrected if anyone knows any different.

I'm wondering if delaying filing applications for claims in excess of $25,000 but less than $35,001, is necessary or worthwhile.  If there is no prejudice in a delayed filing this might be something to think about.  

Michael K. E. Thiele

www.ottawalawyers.com 

CANNABIS SMOKE BOTHERING OTHER TENANTS

What is a landlord to do about marijuana smoke?

With the legalization of medicinal and recreational cannabis in Ontario landlords are finding themselves confronted by problems that are bolder now than they once were.  Before legalization, tenants for the most part sought to consume their cannabis in a way that drew as little attention as possible.  As the practice was illegal, bothering other people and other tenants with cannabis smoke was easy grounds for serving a Notice of Termination and for eviction if the activity did not stop.  That isn't quite the case anymore, at least not in as straightforward a manner.

Tenants (and Ontarians generally), no longer need to be concerned about the legality of their behaviour in smoking cannabis.  Given that the government licences the sale of the product, in various forms, the stigma once associated with cannabis consumption is waning.  As the practice becomes more accepted people are less concerned about "where" and "when" they smoke.  People who never smoked cigarettes are indeed smoking cannabis.  These people don't have the experience of being a shunned tobacco smoker and don't have the experience of dirty looks and being sent outside 9 metres from the nearest opening to the building.   Many cannabis smokers simply think "It's legal", so they smoke without thinking that the cannabis smoke they create is as disturbing, bothersome, allergic reaction inducing and asthma exacerbating as tobacco smoke.

Landlords are getting calls from other tenants in their buildings.  The calls are complaints about cannabis smoke, the smell of smoke infiltrating other units, smoke drifting through open windows, and smoke coming through shared ventilation systems.  In the face of complaints landlords will approach the marijuana smoker (or suspected smoker).  Some respond politely, but others deny smoking, assert a right to smoke, assert a Human Right to smoke, or even further suggest that prohibiting smoking cannabis interferes with their use of their "medicine".

What does a landlord do?  What must a landlord do?  Forget about any moral imperative, personal view on the wisdom of cannabis consumption, the essence of the question is what is a landlord's obligation when other tenants are bothered by the presence of cannabis smoke in the residential complex? 

If landlords do not respond properly to a complaint about the presence of cannabis smoke the landlord can face an application to the Ontario Landlord and Tenant Board by the tenants who are complaining.   While the landlord isn't the one smoking, the landlord is made responsible for not adequately dealing with the presence of the cannabis smoke because it is the landlord's duty to ensure that her tenants in the residential complex have quiet and reasonable enjoyment of their home.   The duty arises under the Residential Tenancies Act and it is further an implied term in every residential lease in Ontario.  If a landlord breaches this duty, then the landlord can face a variety of remedies including a significant rent abatement, associated costs, claims for damages, moving expenses, rent differentials if the complaining tenant was forced to move, and a wide range of expenses limited in scope only by the imagination of the complaining tenant and the LTB's willingness to entertain the claim.

A REAL LIFE EXAMPLE and BOARD ORDER dealing with this issue. 

I have recently had a case at the Landlord and Tenant Board dealing with cannabis smoke, complaints about it, and a constellation of interesting if not bizarre additional complications and facts.  This case, reproduced below (with redactions of the address and last names of participants), demonstrates how my landlord client dealt properly with the complaints about cannabis smoke, the presence of marijuana plants, denials, medical cannabis, recreational cannabis, severe disabilities, and conflicting statements by a host of different tenants.  In this decision, Adjudicator Moniz makes a careful analysis of the various complaints, the impact of the presence of marijuana smoke on the complainants, the reason for the presence of the smoke, the presence of the marijuana plants in the yard, and the steps taken by the landlord to deal with the complaints.

It is significant to recognize that Adjudicator Moniz accepts that the complainers were indeed bothered and upset by what they alleged occurred.  The fact (found as a fact by the adjudicator), that the tenant's were bothered is not the test for entitlement to damages (expenses, rent abatement, moving expenses) at the expense of the landlord.   If the fact of being bothered was the test then the landlord would effectively become the insurer (guarantor) of a tenant's happiness in a rental unit and automatically be liable for any interference (by any other tenant) with that quiet enjoyment.

In this case, the tenant's claim against the landlord is dismissed because the landlord responded reasonably and in accordance with the established precedents on how a landlord is to deal with complaints (i.e. take reasonable steps to correct the intrusion of a neighbouring tenant on a tenant's right to quiet enjoyment of a rental unit).



   Michael Thiele
www.ottawalawyers.com

OPTIONS WHEN TENANTS CAUSE DAMAGE

 Evicting a tenant for damage: the law gives them options!

This article deals with the interpretation of section 62 of the Residential Tenancies Act and seeks to clarify what exactly a landlord must offer a tenant when dealing with damage caused by the tenant.  Where the damage to a rental unit is not wilful, the usual way to approach the problem is to serve the tenant a Notice of Termination in Form N5 (as opposed to just suing for damage and not evicting).  That Form (reproduced below--current as of June 2019), allows a landlord to terminate and evict a tenant if they have wilfully or negligently damaged the rental unit or the residential complex.  Note that wilful damage may be pursued under a different Notice of Termination as well (Form N7) but that is not the focus of this article.

When deciding to serve an N5 for damage, a landlord is deciding to terminate the tenancy subject to giving the tenant a chance to void the eviction and remain in the apartment and continue the lease.  The landlord's decision to give the tenants a chance to void the N5 for damage is not a real decision or choice.  It is the law that mandates that a tenant who receives an N5 for damage be given a chance to void the notice by dealing with the damage.

I use the phrase "dealing with the damage" because the Residential Tenancies Act sets out a number of ways that the damage can be dealt with and the N5 be voided.  The ways are reflected in section 62 and I will reproduce those sections here so that you can see the 5 distinct ways that damage can be dealt with that voids the eviction and allows a tenant to stay.

Section 62 provides as follows:

TERMINATION FOR CAUSE, DAMAGE---1) A landlord may give a tenant notice of termination of the tenancy if the tenant, another occupant of the rental unit or a person whom the tenant permits in the residential complex wilfully or negligently causes undue damage to the rental unit or the residential complex.  2) NOTICE--A notice of termination under this section shall, a) provide a termination date not earlier than the 20th day after the notice is given; b) set out the grounds for termination; and c) require the tenant, within seven days, i) to repair the damaged property or pay to the landlord the reasonable costs of repairing the damaged property, or ii) to replace the damaged property or pay to the landlord the reasonable costs of replacing the damaged proper, if it is not reasonable to repair the damaged property.  3) NOTICE VOID IF TENANT COMPLIES---The notice of termination under this section is void if the tenant, within seven days after receiving the notice, complies with the requirement referred to in clause 2 c) or makes arrangements satisfactory to the landlord to comply with that requirement.

Highlighted above in yellow are the 5 options that the legislation sets out.  Reproduced below is the Notice of Termination in Form N5.  Highlighted in yellow, on the form, are the 5 options that set out how damage can be dealt with.

WHAT IS THE PROBLEM??? IS THERE AN ISSUE?

If you are the landlord and you have a tenant who has caused extensive damage to a rental unit do you want the tenant to have the right to fix the damage themselves?  Or replace the damaged items themselves?  What if the work requires electrical work, or patching, sanding and painting?  What if it is quite clear that the tenant does not have the skills to perform the work in a workmanlike manner (i.e. professionally)?

As you read section 62 (above) you will see the word "OR" inserted between the various options.  The form must require the tenant to "repair" or "pay".  The form must require the tenant to "replace" or "pay" to the landlord the cost of replacement.

When reading the "or" is it the landlord's choice to limit the tenant's options to pay or repair.  Or to pay or replace?  Who controls the number of choices that the tenant has?

Is the correct reading of section 62 that the options provided to the tenant must include each of the 5 possibilities set out in section 62?  Reading section 62 in this way would mean that the tenant has the legal right to: repair, replace, pay, or make a deal.  And the landlord must offer the tenant each of these options in order for the Form N5 to be valid.  

What if a landlord only gives a tenant a repair cost but not a replacement cost?  Is the form invalid?  What if the landlord enters the unit, repairs or replaces the damaged things and then serves the N5 on the tenant and only sets out the "pay" options.  Is the N5 valid?

Take a look at the Form N5 reproduced above.  What if the dollar amount to repair the damaged item is different than the dollar amount to replace the damaged item.  Would the two different dollar amounts make the form confusing?  The law generally directs that a Notice of Termination that is confusing is void--meaning it is unenforceable and an application based on that notice would be dismissed.

LANDLORD: WHAT DO I DO?

It does appear that section 62 is being interpreted as giving the tenant as many of the 5 options as possible.  Where the circumstances of the damage permit, and it is reasonable to wait, the tenant should be given the option to repair, replace, pay for either repair or replace, or make a satisfactory arrangement.

With respect to different amounts to repair versus replace, inserting two different numbers in the form is also acceptable.  However, the reason for the different numbers should be explained in an attachment or in the reasons and details.  Satisfactory explanations include that a repair is not as perfect as a replacement (though acceptable) and cheaper than replacing.  A tenant might choose replacing where the condition of the damaged item is important enough to warrant the extra expense.  It is also possible that repairing is more expensive than replacing an item due to the work needed to do the repair.  Nevertheless, a repair might be chosen if there is less disruption to the tenant's household by repairing than replacing.  Whether this is the case depends on the circumstances.

CAN'T THE LANDLORD JUST say that "or" means landlord's choice?

Such an interpretation is not inconsistent with how many N5 cases for damage proceed.  Often enough, once landlords become aware of the damage they enter a unit and do the work and then fill out the N5.  Landlords often do the work because the work is necessary to protect the integrity of the building, the failure to do the work would impact other tenants, and the RTA imposes a duty on the landlord to repair and maintain the rental unit.  On this basis, landlords argue that there are certain kinds of damage that can't be ignored pending the serving of an N5 and waiting to see which way the tenant wants to go with repairing, replacing or paying.

This too seems reasonable.

RECENT DIVISIONAL COURT GUIDANCE

In Bombaci v. Gatien the Divisional Court held that the provisions of section 62(c) RTA do not require the landlord to choose between the two options of repair or pay and replace or pay.  The Court holds that the landlord can give the tenant more options and that the N5 Notice is not void as a result.  Hence, different amounts for repair versus replace are acceptable and this does not void the N5 even though the amounts are different.

The Court goes on to say that it is in the tenants' interest to be given all the options: do repairs themselves, or pay for the repairs, or pay for replacement.

The Court's direction that it is in the tenants' interest to be given all the options is not, I think, a direction that the tenants must be given all the options every time.  However, I do believe that it is clear indication from the Court that where it is reasonable and feasible that as many of the options as possible be granted to the tenant.

How might this direction become an issue?  Imagine a tenant with reasonable skills as a general contractor.  Imagine that a door is damaged by a tenant's pet dog who has scratched and gnawed on the door to the point where the only fix is to replace the door.  What if the landlord retains its usual "windows and doors company" and on 24 hours notice the company comes and replaces the door with a similar and standard typical door available at most building centres.  Let us assume that the invoice for replacing the door is in fact reasonable but that the majority of the cost of the invoice is for "labour".

Now the tenant whose door is replaced might be on a limited income or might otherwise have difficulty paying the amount of the invoice.  Or, the tenant might simply be frugal.  Regardless, the tenant is upset with having to pay the "labour" on the invoice because had he been given the option, he would have gone to a building centre, bought the same door, and replaced the door himself with his own labour (and hence pay nothing for it).  The cost difference to the tenant is meaningful.

Has the tenant been lawfully denied a "right" to replace the door?  Does the tenant have to pay the contractor's invoice even though he could have (and would have) done the work himself for much less?

At present, I do not think that there is an absolute answer to this question.  My inclination on the above example about the dog damaged door is that the tenant would indeed have a case to argue.  Especially with the Divisional Court's suggestion that it is in the tenants' interest to be given all the options (see paragraph 10 of the decision in Bombaci above).  Where a repair is not pressing, where a delay in the repair would not jeopardize the integrity of the building, and a delay would not impact other tenants, then perhaps the correct approach when serving an N5 for damage is to give the tenant as many options as possible.

CONCLUSION

In my view, the options set out in section 62(2)(c), exist for the benefit of the tenants.  The choices are not disjunctive in that the landlord can choose which of the options to grant the tenant.  As many of the choices as possible must be offered to the tenant in order for the N5 to be valid.  The number of available choices will be dependent on the circumstance of each case and the nature of the damage.  Sometimes it will be imperative for the landlord to act quickly and undertake the work immediately for the protection of the building and tenants.  In that case, the only reasonable option to give the tenant is the invoice to pay to void the N5.

To be clear, I do not think that the Court in Bombaci is saying that every option must be provided to tenants in every instance.  What I think the Court is saying is that tenants have an interest in being given all of the options.  And while giving all of the options is not mandatory, an N5 that does not provide as many options as reasonably possible risks being found void and incapable of sustaining an application to terminate a tenant for damage.

Michael K. E. Thiele

www.ottawalawyers.com

Can my landlord stop me from having guests, roommates or visitors?

THE LAW SAYS: NO!

As a tenant, is your residential landlord allowed to limit your guests, who lives with you, who stays over night?  Can your landlord charge a fee or extra rent or raise your rent if you have guests staying with you?  What if you specifically sign a lease, agreement, document, that very explicitly says you will be the only person living in the unit?  Can your landlord require that your guests, roommate,  or visitor never be left alone in your apartment or on the residential complex?

I get these questions all of the time.  It seems, from the questions that I get, that landlords have various strategies and tactics for trying to limit guests, occupants, roommates and visitors. Written agreements, lease clauses, rent increase provisions, and even limits as to the number of days that a guest can stay, are often provided in the agreements between tenants and landlords. Are these agreements, limitations, clauses, binding on tenants?  If your landlord is quite seriously telling you that the friend you have had staying with you for the last couple of months has to go—otherwise the rent needs to go up—is that something that you need to worry about?

I have written on this a number of times elsewhere in this blog.  The answer is always the same.  A landlord is not permitted to create these kinds of limitations. When you rent a home, the law presumes that you can do in that home the kinds of things that humans generally do. One of those things is to have relationships, have guests, have visitors, and even to have sleepovers on a regular basis. It is not any of the landlord’s business who visits, who stays over, who arrives and never leaves.  This includes boyfriends, girlfriends, children visiting, parents moving in (think aging, or sick parents), friends down on their luck, a roommate to help pay the rent, and whatever other potential class of persons you can think of.

While I have written about this, pointed out some human rights case-law on point, a recurring point that I get is that while the you (the tenant) believe what is being written on this point it is not so easy to convince the landlord that their position is illegal.

What does it matter what the law is if the landlord refuses to educate him or herself? If the landlord thinks the written lease clause or agreement is binding how do you convince him otherwise?

Recently, I have had a bit of luck convincing skeptical landlords of this fact by using the new Ontario Standard Form lease.  Specifically, the standard form lease at section 15 highlights the illegality of prohibiting roommates, guests, etc..  While everyone should now be using the Ontario Standard Form lease (because the law requires it), you should know that a failure to use this form does not make a tenancy automatically invalid.

So what does the lease say at section 15?  It says as follows:

Some examples of void and unenforceable terms include

those that:

•    Do not allow pets (however, the landlord can require

 the tenant to comply with condominium rules, which

 may prohibit certain pets),

•    Do not allow guests, roommates, any additional occupants,

• Require the tenant to pay deposits, fees or penalties

 that are not permitted under the Residential Tenancies 

Act 2006 (e.g.,damage or pet deposits, interest on rent

 arrears),and

•    Require the tenant to pay for all or part of the repairs

 that are the responsibility of the landlord.

As you can see from the highlighted portion above—there it is. Lease clauses that do not

allow guests, roommates or any additional occupants are void and unenforceable.

I have found that showing the landlord this provision, in the Standard Form Lease, is convincing and solves the issue for many tenants.  It’s an odd kind of way to prove the law, but this resource is easily accessible and rather straightforward.

Hopefully you can use this government mandates standard form lease to make clear the law on roommates, guests, visitors, and occupants.

Michael K. E. Thiele

www.ottawalawyers.com