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.