The termination of tenancy by a landlord for personal or family use

 In Real Estate Law

Has your landlord terminated your tenancy agreement because he/she or one their children wants to move into the property?  Or have you evicted a tenant because you or a family member needs a place to live?

This past fall, the Rental Fairness Act, 2017 (RFA) came into force, which amended the Residential Tenancies Act, 2006 (RTA) and one of the biggest changes was regarding the termination of tenancy by a landlord for personal or family use.

By way of background, the RTA permits termination for “landlord’s own use,” as long as it is a bona fide request, made in good faith. Unfortunately, prior to the RFA coming into force, a strategy used by some owners of small rental properties had been to seek termination of tenancy on the grounds that the landlord (or member of a landlord’s family) intended to reside in the rental unit, but the occupancy did not actually happen.  In so doing, this would free the unit from its current rent so that it can be re-rented at a higher market rent. This strategy has also been used to simply get rid of an unwanted tenant.

The new Section 48 RTA amendment states that a minimum of one year’s residential occupancy is required for a landlord (or the member of a landlord’s family) who seeks to terminate a tenancy based on use by the landlord or member of the landlord’s family. Furthermore, the landlord “shall compensate a tenant in an amount equal to one month’s rent or offer the tenant another rental unit acceptable to the tenant if the landlord gives the tenant a notice of termination of the tenancy under section 48”.

If at any time between delivering the notice of termination and one year after the tenant vacates the unit, the landlord:

  • advertises the unit for rent;
  • advertises the rental unit or the building it is in for sale;
  • enters into a lease with someone other than the former tenant;
  • demolishes the rental unit or the building it is in; or
  • take any steps to convert the use of the rental building or unit it is in;

the RFA creates an inference that the notice of termination was giving in bad faith, which in turn exposes the landlord to fines of up to $50,000 and a payment of compensation (ie. moving costs, abatements in rent) to the tenant who vacated. Unfortunately, this applies to situations which may be outside the landlord’s or their family member’s control, such as job transfers, spousal separations, unforeseeable life decisions, including death.

It is important to know your rights as a tenant and your obligations as a landlord.  If you require assistance, please don’t hesitate to contact one of our Real Estate team at Mann Lawyers.

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