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Tenants can challenge some extra fees as long as it's been less than a year since the charge
A: For some long-term renters or those looking for a lifestyle change, COVID-19 might have been the time to capitalize on rent deals and move to another apartment or condo. But a new place also means a new landlord with (potentially) new rules. While there is a standard lease landlords are supposed to give tenants, many will create their own, sometimes for the purpose of sneaking in extra frills and charges that might look legitimate on paper.
But tenant law expert Karen Andrews says that, most of the time, these extra fees are illegal.
Andrews, a staff lawyer at the Advocacy Centre for Tenants Ontario (ACTO), says the Residential Tenancies Act (RTA) is the contract and legislation that landlords and tenants are supposed to abide by. The RTA clearly lays out in Section 134 that a landlord cannot charge a tenant a “fee, premium, commission, bonus, penalty, key deposit or other like amount of money” in addition to the lawful amount of rent already determined.
This can include anything from a lease change fee, a cleaning deposit, an additional charge because you’re bringing in a pet, an occupants fee and more.
However, Andrews acknowledges that contesting these fees is not as easy as just refusing to pay. “The landlord says, ‘Pay this and pay that,’ and you’re not going to say no, because you know you don’t have any bargaining power and you know that the landlord will find somebody else who will pay,” she explains.
For prospective tenants about to sign a new lease agreement with a new landlord who has listed additional charges, Andrews advises tenants to first ask the landlord to point out where these fees are allowed within the RTA.
It becomes a bit more complicated for tenants who already started paying the fees, but there’s still a good chance you can fight it – if you paid those fees within the limitation period of a year. Andrews notes that in civil justice within Ontario, the limitation period is generally two years, but that has been cut down to one year for tenants.
“The act is very clear that if you have been overcharged, or you want to dispute a charge, or you’ve been charged an illegal charge, you only have a year from that charge and from the retention of that money to bring it to the attention of the Landlord and Tenant Board (LTB), and try and get your money back,” she says.
There is a T1 form, which covers applications for a rebate, that a tenant could file with the LTB to get that money back. But Andrews offers similar advice to what she advises prospective tenants to do – ask your landlord about where the charge is covered in the RTA and wait for a response first.
“Sometimes that’s the end of the matter; the landlord does not respond and then the tenant can follow up,” she says. “They can say their research says the landlord is not entitled to that damage deposit, for example, and they will deduct that amount from next month’s rent.”
But Andrews cautions that your landlord may then bring an arrears application against you for refusing to pay part of your rent, and she says that especially within this past year, tenants should try to stay out of the LTB, because it’s a bit of an “administrative nightmare.”
To avoid this trouble, she says tenants should phrase the follow-up email to leave an opening for the landlord. “Write, ‘I shouldn’t have paid that damage deposit, I’m going to deduct it from my next month’s rent, if you have a problem with this, let me know,'” she says. If the landlord then threatens with a notice for arrears, she recommends tenants pay the full amount, and then file your own T1 application with the LTB.
If it’s been over a year since you’ve paid the illegal fee, Andrews says that you don’t have any legal argument to stand on, but it’s worth trying to reach out to your landlord anyway.
“Regardless, it’s an organizing opportunity as a tenant,” she says. “I might call investigations and enforcement and say that this landlord charges damaged deposits and to please put him on your radar. Or it’s also an opportunity for tenant organizing; you should talk to your neighbours about it and warn new tenants.”
Extra fees may come in a different form than a one-time fee – utility charges. Condo lawyer Brian Horlick at HLD Lawyers says buildings can charge utility fees a few different ways. A condo could either take the entire utility bill that comes from an energy company and add it as a monthly common element charge for unit owners to pay. The payment could be based on a percentage breakdown depending on the size of a unit, or they could be working with a metering energy company, which has meters attached to each unit and reads the exact amount of water or electricity consumption per month.
Horlick says that these meters sometimes come with additional charges from the energy company that you might not be expecting as a tenant, including a service charge. “Meters are still going to cost everybody so much a month just for having that company there,” he says.
He’s sometimes seen charges as high as $10 a month, per meter – and units sometimes have three meters measuring separate energy uses, such as cold water and hot water.
Horlick advises prospective tenants to ask landlords for a copy of previous utility bills from previous tenants before deciding on a place. “If you want to rent a place, you want to know how much it’s going to cost you. If they tell you it’s $1,500 a month plus utilities, ask to see some bills to see how much those utilities are going to be.”
Andrews says that overall, she understands that tenants sometimes feel like they don’t have much of a choice when it comes to these illegal fees, considering the lack of supply out there for renters.
“Your other option is to pay it and then pursue it within the year,” she says. “I don’t like telling people to agree with illegal things and I don’t like advising people to put up with things that they should not, but I also understand what the market looks like and I understand how desperate people are for a place to rent.”
Resident Expert is a column about renting, buying and owning in the city. Send your queries to realestate (at) nowtoronto.com. NOW writers will talk to relevant experts to get the answers. Letter writers will remain anonymous. Read previous columns here.
This column is not legal advice. You should not act or rely on the information provided. To ensure your interests are protected, retain or formally seek advice from a lawyer.