Rent Decrease (RTA)

Caselaw.Ninja, Riverview Group Publishing 2021 ©
Date Retrieved:	2024-04-28
CLNP Page ID:	2045
Page Categories:	[Payment of Rent (LTB)]
Citation:	Rent Decrease (RTA), CLNP 2045, <https://rvt.link/2r>, retrieved on 2024-04-28
Editor:	Sharvey
Last Updated:	2023/01/17

O. Reg. 516/06: GENERAL under Residential Tenancies Act, 2006, S.O. 2006, c. 17

11 (2) In this section,

“the 12-month period” means,

(a) the 12-month period following the commencement of the tenancy,

(b) the 12-month period following any rent increase taken after the 12-month period described in clause (a), other than a rent increase taken under section 123 of the Act, or

(c) where clauses (a) and (b) do not apply, the 12-month period following the most recent anniversary of a rent increase taken in accordance with section 116 of the Act or, where no rent increase has been taken in accordance with section 116 of the Act, the commencement of the tenancy. O. Reg. 516/06, s. 11 (2).

...

12. (1) The rules set out in this section apply in calculating lawful rent under subsection 111 (3) of the Act. O. Reg. 516/06, s. 12 (1).

(2) The lawful rent for any rental period in the 12-month period shall be calculated in the following manner:

1. Add the sum of the rents that are actually charged or to be charged in each of the rental periods in the 12-month period to the largest eligible discount determined under subsection (6).

2. Divide the amount determined under paragraph 1 by the number of rental periods in the 12-month period.

3. Add to the amount determined under paragraph 2 any rent increases under section 123 of the Act and subtract from that amount any rent decreases under section 125 of the Act. O. Reg. 516/06, s. 12 (2).

...

(6) For the purpose of this section, the largest eligible discount shall be determined in accordance with the following rules:

1. In the case of a discount that is provided for in a written agreement, the largest eligible discount is the largest of the following amounts:

i. The lesser of the following amounts:

A. The sum of the discounts in rent during the first eight months of the 12-month period.

B. The rent for one month.

ii. The largest discount in rent during any month in the last five months of the 12-month period, plus the lesser of the following amounts:

A. The sum of the discounts in rent during the first seven months of the 12-month period.

B. The rent for one month.

iii. The largest discount in rent during any month in the 12-month period, if,

A. the rent is paid monthly, and

B. the largest discount in rent during any month in the 12-month period is equal to the rent for less than one month.

iv. The sum of the largest discount in rent during any month in the 12-month period and the second-largest discount in rent during any month in the 12-month period, if,

A. the rent is paid monthly,

B. the largest discount in rent during any month in the 12-month period is equal to the rent for one month, and

C. the second-largest discount in rent during any month in the 12-month period is equal to the rent for less than one month.

v. The sum of the largest discount in rent during any month in the 12-month period, the second-largest discount in rent during any month in the 12-month period, and the third-largest discount in rent during any month in the 12-month period, if,

A. the rent is paid monthly,

B. the largest discount in rent during any month in the 12-month period and the second-largest discount in rent during any month in the 12-month period are both equal to the rent for one month, and

C. the third-largest discount in rent during any month in the 12-month period is equal to the rent for less than one month.

vi. The rent for three months, if,

A. the rent is paid monthly, and

B. the largest discount in rent during any month in the 12-month period, the second-largest discount in rent during any month in the 12-month period, and the third-largest discount in rent during any month in the 12-month period are all equal to the rent for one month.

vii. The lesser of the following amounts, if the rent is paid daily or weekly:

A. The sum of the discounts in rent provided in the form of rent-free weeks during the 12-month period.

B. The rent for 13 weeks.

2. In the case of a discount that is not provided for in a written agreement, the largest eligible discount is the largest discount in rent in one rental period in the 12-month period. O. Reg. 516/06, s. 12 (6); O. Reg. 377/11, s. 3 (2).

...

(8) In this section,

“the 12-month period” has the same meaning as in section 11. O. Reg. 516/06, s. 12 (8).

Residential Tenancies Act, 2006, S.O. 2006, c. 17

111 (1) No landlord shall charge rent for a rental unit in an amount that is greater than the lawful rent permitted under this Part. 2006, c. 17, s. 111 (1).

(2) The lawful rent is not affected by a discount in rent at the beginning of, or during, a tenancy of up to 2 per cent of the rent that could otherwise be lawfully charged for a rental period if the discount is provided for paying rent on or before the date it is due and the discount meets the prescribed conditions. 2009, c. 33, Sched. 21, s. 11 (5).

(2.1) The lawful rent is not affected if one of the following discounts is provided:

1. A discount in rent at the beginning of, or during, a tenancy that consists of up to three months rent in any 12-month period if the discount is provided in the form of rent-free periods and meets the prescribed conditions.

2. A prescribed discount. 2009, c. 33, Sched. 21, s. 11 (5).

(2.2) For greater certainty, the lawful rent is not affected if discounts described in subsections (2) and (2.1) are both provided. 2009, c. 33, Sched. 21, s. 11 (5).

(3) Subject to subsections (2) and (2.1), where a landlord offers a discount in rent at the beginning of, or during, a tenancy, the lawful rent shall be calculated in accordance with the prescribed rules. 2006, c. 17, s. 111 (3); 2009, c. 33, Sched. 21, s. 11 (6).

SWL-94855-16 (Re), 2016 CanLII 88168 (ON LTB)

[5] The Landlord argued that the lawful rent should not be affected, and should remain the same, whether or not the discounts comply with the Regulation. That is not the law, but perhaps one may argue that if the Tenants have pets, and no longer qualify for the “no pet” rent discount, then the discount does not apply so it does not matter if it meets the prescribed rules.

[6] The contrary argument would be that it is not good public policy to permit a landlord to give a non-compliant discount so long as the landlord makes the discount conditional and the tenant does not meet the condition. Similarly, if a landlord gives a prompt payment discount that exceeds 2% of the monthly rent, this will decrease the lawful rent whether or not the tenant pays the rent on time to meet the condition for the discount.

[7] Any offer of a rent discount before or during the tenancy will result in a calculation of the lawful rent unless the discount meets the prescribed rules. This is set out in subsection 111(3) of the Residential Tenancies Act, 2006 (the ‘Act’).

TEL-86897-17-SA (Re), 2018 CanLII 42542 (ON LTB)

7. Pursuant to s. 110 no landlord can increase the rent charged to a tenant for a rental unit, except in accordance with the Act. Pursuant to s. 111(1) no landlord shall charge rent for a rental unit in an amount that is greater than the lawful rent permitted. The lawful rent is equal to the rent charged at the beginning of a tenancy plus or minus any increases or decreases permitted by the Act.

8. In other words, the amount of rent a landlord can charge and collect is strictly regulated under the Act.