Ontario landlords, here’s what to do if your tenant won’t pay rent: Reasonable Doubt

Rent is at the core of the standard residential landlord-tenant relationship. In exchange for an agreed-upon sum of money, usually paid monthly, the tenant is permitted to live in property owned by the landlord. As most know, if a tenant does not pay rent, then the landlord can seek an order from the Landlord and Tenant Board (LTB) terminating the tenant’s tenancy and permitting the landlord to evict the tenant. If the LTB makes an eviction order, the eviction can then be carried out by the Court Enforcement Office (Sheriff).

What some people may not know is that an eviction order by the LTB doesn’t necessarily mean that a tenant will be evicted anytime soon. Under the Residential Tenancies Act, 2006 (RTA), there is an automatic right of appeal of any order of the LTB to the Divisional Court on a question of law. (There is also a separate right to ask the LTB to review an eviction order and set same aside, which is outside the scope of this article.) Once an appeal has been filed with the Divisional Court, the LTB order is automatically stayed while the appeal is pending.

This automatic right of appeal is sometimes used by unscrupulous tenants to live rent-free, and in some cases, live rent-free for a year or more. This places significant burden on a small landlord with carrying costs for the rental property (e.g., mortgage, property tax, condominium fees) that still have to be paid, with or without rent.

There are steps that a landlord can take to minimize the impact of an appeal that is brought by a tenant in order to obtain rent-free housing. For one, the Rules of Civil Procedure require an appellant to move the appeal forward on a specified timetable. Some of the required steps, like ordering transcripts of the LTB hearing at which the eviction order was made, can cost an appellant several hundred dollars (or more) to complete. If a tenant files an appeal but does not take timely steps to move it forward, the landlord can bring a motion to the Registrar of the Divisional Court to have the appeal dismissed for delay.

In some cases, it will be clear that an appeal does not have any reasonable chance of being successful. In the case of an appeal of an LTB order, the RTA only permits appeals on questions of law, meaning that an appellant cannot challenge findings of fact that were made by the LTB (e.g., if the LTB found that there were rent arrears owed to a landlord by a tenant).

If a tenant’s appeal appears to be frivolous and without merit, a landlord can bring a motion before a Divisional Court judge to quash the appeal without a full hearing. As an alternative, the landlord can ask the court to order the tenant to pay arrears of rent and/or monthly rent pending the hearing of the appeal. This can weaken the impact on the landlord by resolving the appeal (and lifting the stay of the eviction order) sooner, or reducing the amount the landlord is paying out-of-pocket while the appeal is pending.

It’s tough to say how frequently tenants abuse the system in this way. That said, there is anecdotal evidence (including several reported court decisions) to support the view that this is a problem that should be addressed. One suggestion is to require any tenant appealing an LTB eviction order for rent arrears to either obtain leave (permission) from the Divisional Court, or pay the rent arrears that were found to be owing by the LTB into court, before being permitted to proceed with the appeal. This would, at a minimum, serve to filter out some of the tenants who try to live rent-free.

Timothy Duggan is a condominium lawyer and civil litigator with Horlick Levitt Di Lella LLP. Reasonable Doubt appears on Mondays. You can contact him on Twitter at @timmyd_  and tell him what you would like to read about in future columns.

A word of caution: You should not act or rely on the information provided in this column.  It is not legal advice.  To ensure your interests are protected, retain or formally seek advice from a lawyer.  The views expressed in this article do not necessarily reflect those of Horlick Levitt Di Lella LLP or the lawyers of Horlick Levitt Di Lella LLP.

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