Recently I interviewed Harry Fine, president of Landlord Solutions in Toronto, to get an idea of what questions Realtors have when it comes to Ontario’s landlord and tenant laws. Although he speaks specifically about Ontario’s forms, the issues presented are common across the country.

Stan Albert: Harry, you recently gave a three-CEU course on the Residential Tenancies Act. Yipes, what a revelation it was for the agents attending. What is your background and how many years have you been helping landlords in Ontario?

Harry Fine: I was an adjudicator at the Landlord and Tenant Board from 2001 to 2004. After leaving the board, I switched sides and now I represent “landlords only” at the landlord and tenant board and at various other courts. In addition to doing legal advocacy for landlords, I teach extensively in residential landlord and tenant law, including at the Ontario Real Estate Association. In fact I’m just making my application to RECO to become a certified trainer so that I can spread the message more efficiently. I have been president of the Landlord’s Self-Help Centre, am on the Board of Directors of the Paralegal Society of Ontario and am a member of and involved with legislative efforts through the Federation of Rental Property Owners of Ontario.

Albert: What is wrong with the present OREA form for Offers To Lease, in your opinion?

Fine: During my teaching at various boards over the last seven years, I’ve been complaining to Realtors about the shortcomings in the forms, hoping that the message would get back to the powers that be. I find that many Realtors and their clients get into trouble as the forms are not current with the law as it currently sits. I have a number of concerns, but to list just a few:

– It is not clear anywhere in the offer to lease that the landlord’s name and address for the purpose of service of documents must be included on the lease, otherwise the tenant’s obligation to pay rent is suspended. I’ve seen many a poor Realtor and their clients have cases dismissed at the Landlord and Tenant Board for rent arrears since the information wasn’t on the lease.

– The lease is devoid of clauses that are required in order to properly protect a landlord, tracking the wording and protecting against traps that lie in wait in the fine print of the Residential Tenancies Act.

– The agreement doesn’t deal properly with utilities. What happens if the tenant does not contract directly with the utility company, and what rights does the landlord have under the Residential Tenancies Act if they fail to do so?

– The agreement does not, in my opinion, adequately deal with the intricacies of rentals in condos, and of course condos are the new rentals. I’m always shocked that so many condo owners do not provide the tenant with a copy of the Rules, Declaration and Bylaws as is required by law. Try to evict a tenant at the Landlord and Tenant Board for breaching the condo rules, when the tenant has never been provided with them, and it hasn’t been sufficiently clear in the lease that a breach of the rules equates to a breach of a landlord’s lawful right, interest and privilege under the Residential Tenancies Act.

– I’ve seen a terrible case caused by a clause that a Realtor told me (don’t know if it’s true) was a standard OREA clause, that offered the tenant the right to renew the lease term at the end of the term. Problem was, it didn’t say that it could be renewed only once or that the tenant had to be in good standing or that there would be no further rights of renewal. In this sad case, an adjudicator at the LTB found that the tenant had a right of perpetual renewal, provided that they picked up their option each year in writing. This meant that the landlord couldn’t ever get the house back for herself or for prospective purchasers, since the tenant was always in lease term.

– The wording in the agreement related to last month’s rent deposits is in clear violation of the Residential Tenancies Act and a recent court decision about rent deposits. All Realtors and their clients using OREA leases risk not being able to keep a rent deposit if a tenant, who has signed a lease, backs out just a few days prior to occupancy. They would have to give the money back.

– When a vendor landlord comes to me for advice about guaranteeing vacant possession on closing when the house is tenanted, I almost always tell them they are taking a huge risk. I advise them against simply using the normal clause. Instead I tell them that if they wish to warrant vacant possession on closing, that 60 days is the absolute minimum to evict at the Landlord and Tenant Board if the purchaser wants to move in, and to never sign an agreement with a clause guaranteeing vacant possession unless the agreement also obligates the purchaser to take part in the legal process. They should agree to attend court, testify and sign the affidavit that is required. If you go to a hearing to evict a tenant so that a purchaser can move in, and the tenant disputes the good-faith intentions of the purchaser, and the purchaser is not present to give evidence, it is as likely as not that the application will be dismissed. Also you can’t evict, even for the landlord’s or purchaser’s own use, while the tenant is still in lease term.

For more information about Harry Fine and Landlord Solutions, visit www.landlordsolutions.ca.

Stan Albert, broker/manager, ABR, ASA at Re/Max Premier in Vaughan, Ont. can be reached for consultation at [email protected] Stan is now celebrating 40 years as an active real estate professional.

8 COMMENTS

  1. Agreeing with John M. on his points. Why it is a better idea to have an intermediary firm who manages the property and all that goes along with it. No need to be a landlord if you just want to benefit from property ownership with a truly passive investment. http://www.viproperties.com

  2. The basic intent of this theme of the article as in other Q&As is to point out the pluses & minuses we are guided under. The Offert to Leavse in my own opinion needs addressing. There are too many issues surrounding the present form. MoSt Agents I talk to who are property owners, neglect the basic formalities required. Mystifying!

  3. Great article!
    On the flip side, those who are investing in real estate and are not interested in being a landlord, and look to hire a property management company… it is just as important to do your research on appropriate company's to take care of your properties. The objective in hiring a property manager is to be headache free, but sometimes, in hiring the wrong company, it certainly turns out to be quite the opposite…
    Best thing is to really do your research, or hire someone that has been referred to you.
    Here was a guest post on a similar topic on a blog I found.. http://www.viproperties.com/blog/property-manager

  4. It sounds like the adjudicators on the Lanflord and Tenant Board are a chosen bunch of socialist leaning types who use every in-house provided escape loophole to side with tenants in general against those evil profit-seeking landlords.

    Apparently Harry saw the light (from the inside) and became an advocate for the bureaucratically oppressed offerors of placees to live, as business ventures no less. What scumbags!

    'You' apply the term to whichever side 'you' emotionally side against.

    Then reexamine the reality of the situation, rationally, without pre set, learned beliefs about who does what for the betterment of society, whether it be profit driven individuals or of the levelling nature bureaucrats, and see if you can decipher the other side of the coin's benefits.

    If there are no privately supplied rentals in this province/country, then the state must provide same, and we know what a boondoggle that results in.

    "Professional Renters' learn their 'abuse-of-the-system' craft therein by the learned skillful manipulation of the bureaucracy that runs the boondoggle.

    They then apply the same techniques to private rentals knowing that the adjudicators will likely find in their favours upon claiming whatever they can scour up out of the regs. in support of their abusive ulterior motives (living for free!). That's why they are called "Professional Renters".

    Way to go Harry!

    Regards,

    Brian

  5. Great article!

    Mr. Fine should put together a course outline and submit it to TREB if he hasn’t already. There are far too many REALTORS even landlords and tenants who don’t know the RTA and unfortunately this is one area where incorrect statements are repeated so often they're literally taken as fact.

    Listings are rife with RTA violations – requirements for post dated cheques, no pets, key deposits and even specific types of tenants such as single, female only. None of which should even be allowed on MLS < TREB are you reading?

    Many REALTORS seem to have an aversion to clauses, they liken their inclusion to newbies trying to impress their clients, yet they’re the ones quite willing to submit an offer deferring lease terms and conditions to the landlord’s lease which they don’t even ask for or conversely take offense when the offer states the terms, or is subject to review of their client's lease agreement. Throw in a rent increase limitation clause if the property was built post June ‘98 and they’ll ask if you had nothing better to do than waste paper and their time because ‘everyone knows rents can’t be increased above the posted rate.’

    Then there are those who argue vehemently that a seller need only give 60 days notice to the tenants even when they know the lease’s expiration is well beyond that, usually trying to bolster their case with, ‘well that’s how I’ve always done it.’

  6. Every written argreement, no matter how well it is written is subject to some form of peril once lawyers come into the picture.

  7. The OREA form is just an "Offer to Lease", not a Lease. It should always be followed up with a formal lease that addresses the landlord and tenant's rights and obligations.

    • As I stated in my previous post, no matter how well the lanlords and tenants rights and obligations are addressed, there will always be some lawyer out there who will find some fault with it.

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