What Happens If a Landlord Fails to Offer a Tenant the Right to Return Following Renovations?
A Landlord Can Be Fined For Failing to Offer the Right to Return to a Tenant Following a Renovation.
When a landlord wishes to, or needs to, ask a tenant to leave so to enable the landlord to perform renovations to the rental unit, the landlord is required to offer the tenant an opportunity to return once the renovation is complete. The offer must provide that the rent will remain the same, or with only a rent increase as may be allowed by the Residential Tenancies Act, 2006, S.O. 2006, Chapter 17 (the "RTA") which states:
Tenant’s Right of First Refusal, repair or renovation
53 (1) A tenant who receives notice of termination of a tenancy for the purpose of repairs or renovations may, in accordance with this section, have a right of first refusal to occupy the rental unit as a tenant when the repairs or renovations are completed.
(2) A tenant who wishes to have a right of first refusal shall give the landlord notice in writing before vacating the rental unit.
Rent to be Charged
(3) A tenant who exercises a right of first refusal may reoccupy the rental unit at a rent that is no more than what the landlord could have lawfully charged if there had been no interruption in the tenant’s tenancy.
Change of Address
(4) It is a condition of the tenant’s right of first refusal that the tenant inform the landlord in writing of any change of address.
What Is the Maximum Fine for Failing to Offer a Tenant With a Right to Return After Renovations?
Per section 57(3)3 of the RTA, the Landlord Tenant Board may issue an Order that a landlord pay a fine up to the limit of the Small Claims Court (which is $35,000.00 effective January 1 2020). Furthermore, where a landlord engages in a multiplicity of violations of the RTA, the fine may be applied for each violation. In the case of A.B., et al (Tenants) v. 795 College Inc. (Landlord), TST-90503-17 (Re), 2019 CanLII 87012 (ON LTB) three such violations were found and an Order of a $25,000 fine for each occurrence was issued whereas it was said:
77. In light of the above, I find that the appropriate fines in this case would be $45,000.00 per rental unit. Since those amounts exceed the maximum, fines of $25,000.00 will be awarded in respect of each unit, for a total of $75,000.00 in fines.
A landlord should avoid conduct that may be determined as a 'renoviction' by providing a clear and concise notice to a tenant, or tenants, consisting of an offer to return to the rental unit when renovation work is complete. If a landlord fails to provide such an offer, and found as done so with a bad faith illicit motive contrary to the RTA, significant fines may be imposed by the Landlord Tenant Board.