Air BnB (LTB)

Caselaw.Ninja, Riverview Group Publishing 2021 ©
Date Retrieved:	2024-07-08
CLNP Page ID:	381
Page Categories:	[Interference of Reasonable Enjoyment (LTB)‎], [Illegal Act & Impairment of Safety (LTB)]
Citation:	Air BnB (LTB), CLNP 381, <https://rvt.link/c8>, retrieved on 2024-07-08
Editor:	Sharvey
Last Updated:	2024/07/05

Resources

• City of Toronto Short-Term Rental By-Law

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

234 A person is guilty of an offence if the person,

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(x) charges rent in an amount greater than permitted under this Act; or

HOL-03799-18 (Re), 2019 CanLII 134446 (ON LTB)

Short-term rentals

7. The parties do not dispute that throughout the tenancy the Tenant has rented out the rental unit on a short-term basis using websites like Airbnb.

8. The tenancy agreement appears to prohibit short-term rentals. The first page of the agreement states that the premises are to be used only for a single family and that “unless otherwise agreed to herein, only the Tenant…will occupy the premises”. Page five of the agreement states, “Tenant agrees to use the premises strictly for residential purposes. Tenant also agrees that no other person will be occupying the premises other than those listed in the rental application and/or lease agreement.”

9. The Divisional Court has found that breach of a consensual provision in a tenancy agreement can be considered a “substantial interference” within the meaning of section 64 of the Act (see Stanbar Properties Ltd. v. Rooke, [2005] O.J. No. 6363 and Morguard Residential v. Asboth 2017 ONSC 387). However, in the present case, I find that even though short-term rentals may be contrary to the terms of the lease, they do not constitute a substantial interference. I say this for two reasons.

10. First, the Tenant gave uncontested testimony that the Landlord’s real estate agent, who acted as the Landlord’s agent for the purpose of negotiating the lease with the Tenant, agreed to let the Tenant use short-terms rentals to help him pay the rent. The Tenant also gave uncontested testimony that flowing from this agreement, he and the agent also agreed to include a clause in the lease, which states, “Tenant may sub-lease the premises without written consent from the Landlord and such consent shall not be unreasonably withheld or denied.” The Landlord did not provide an alternative explanation for this clause. Ultimately, I find that the Landlord, through his real estate agent led the Tenant to believe that short-term rentals were acceptable.

11. Second, short-term rentals are not contrary to the rules and regulations of the condominium corporation (note: the rental unit is a unit in a condominium building). In fact, the condo corp. appears to authorize these rentals through its short-term rental committee and a short-term rental sign-in sheet, which is kept at the front desk. Therefore, it is unclear why the condo corp. was bothered by the Tenant engaging in these rentals and why the management sent the Tenant a warning letter about this behaviour.

12. I find that the only significant and justified disruption the Landlord experienced as a result of the Tenant’s short-term rentals is the damage the Tenant’s guests caused to the rental unit. Therefore, I find it more appropriate to deal with this issue as part of the Landlord’s claim for wilful or negligent damage. The Landlord’s claim for substantial interference arising out of the short-term rentals is dismissed.

Metroview Developments (Winlock) Inc. v Dai, 2021 CanLII 87205 (ON LTB)

7. The allegations that the property has been converted to a short-term rental and that the property was sublet are not appropriate grounds for a N7 Notice, as these allegations are more appropriately dealt with by other sections of the Act. In addition, the existing jurisprudence does not support the assertion that such conduct is sufficiently serious to warrant a N7 Notice.

Kolta v Akhbari, 2021 CanLII 150804 (ON LTB)

11. The Tenant, RK, testified that he lived in the rental unit for two weeks at a time on several occasions. This testimony seemed to be an attempt to demonstrate that the Tenant also used the unit for his own residential occupation and not only to run his short-term rental business. However, I do not find the Tenant’s testimony credible in this regard. When the Tenant was specifically asked when he stayed in the rental unit, he was not able to provide any particular dates. The Tenant also testified that he owned a house throughout the tenancy, where he lives with his wife and children. The Tenant further testified that he runs his short-term rental business in seven units. The parties entered into agreements for two different units for the same term. Based on the evidence before me, I find it difficult to believe that the Tenant lived in the rental unit at any time. I find it more likely than not that he used the rental unit to run his short-term rental business only, that the Landlord was aware of this use and that it is more indicative of the relationship between the parties.

12. Importantly, the Tenant also treated the tenancy as frustrated when the condo corporation changed its Declaration to make short-term rentals illegal. In other words, the Tenant viewed this change and his inability to run his business in the rental unit to be fundamental to the agreement between the parties. The letter from the Tenant’s legal representative from April 2020 acknowledges that the change to the Declaration made “performance of the lease agreement illegal and impossible to execute”. If the Tenant was also using the rental unit for his own residential purposes, I find it unlikely that he would have taken this position with respect to the change to the Declaration.

13. For this reason, I also find that the caselaw the Tenants submitted (OnTheGoShipping Inc., and Kwok-Wai Leung, aka Harry Leung v. G. Khan Medicine Professional Corporation, 2020 ONSC 2789) was not relevant to the case at bar. In OnTheGoShipping Inc., the Court considered a situation in which the tenant was living in the rental unit and conducting business in the unit. The Court considered whether the Act applied to the tenancy or whether the rental unit was exempt from the Act by virtue of section 5(j). That section applies to premises occupied for business or agricultural purposes with living accommodation attached if the occupancy for both purposes is under a single lease. However, in the present case, the Tenants only occupied and used the rental unit for business purposes. They never occupied the unit for residential purposes.

14. In conclusion, I find that the parties’ relationship did not involve a residential tenancy. Accordingly, the LTB does not have jurisdiction to hear this application and it must be dismissed.

TSL-01536-18 (Re), 2019 CanLII 87095 (ON LTB)

11. With respect to the First N6 Notice, it alleges the Tenants or another occupant of the rental unit have committed an illegal act or have carried out, or permitted someone to carry out an illegal trade, business or occupation in the rental unit or the residential complex, details of which are:

September 18, 2018 – Tenant has been renting out a room and a bed on Airbnb, which is not currently permitted under the City of Toronto’s Zoning Bylaws. On September 18, 2018 an Airbnb guest was intentionally locked out without her luggage. The guest complained to the second floor tenant who contacted the property manager. The police were called as a result of the incident. The property manager advised the tenant she was not permitted to sublet on Airbnb or other short-term rental websites.

September 21- October 3, 2018 – The tenant continued to rent out the property on Airbnb. On September 21, 2018, the landlord’s lawyer, Tannis Waugh, wrote to the tenant enclosing a N5 Notice to End Tenancy Early along with a letter advising that short-term rentals were not permitted. On October 3, 2018, Ms. Waugh sent a further N5 to the tenant as the unit was still listed as available for short-term rentals on the Airbnb website.

November 5, 2018 – The Airbnb website continues to show that the premises are available for short-term rentals on Airbnb contrary to the landlord’s request as relayed by the property manager, the landlord’s lawyer and in contravention of the City of Toronto’s current Zoning Bylaws.

12. The Landlord also indicated that because of these illegal activities by the Tenants, her insurance carrier would not respond to any third party claims arising out of the operations of the Airbnb, including any property damage as a result of that operation and, indeed, as of November 14, 2018 no longer remain on the risk.

13. The Landlord presented a statement posted on the City of Toronto website that was accessed on December 14, 2018 in which the heading states: “Currently, short-term rentals are not permitted in Toronto”. In the body of the notice it is explained that the City’s amendments to the zoning bylaw to permit short-term rentals under regulated conditions are not in effect because they have been appealed to the Local Planning Appeal Tribunal which is scheduled to hear the appeal in August 2019. Without the relevant zoning bylaw excluding short-term rentals, I am not satisfied the Tenants’ activity as complained about in the First N6 Notice is illegal as contravening the City of Toronto zoning bylaw applicable to the rental unit.

It is ordered that:

1. The application is dismissed.

Thadani v Roozbahani, 2021 CanLII 106394 (ON LTB)

18. It was uncontested that the Tenant listed the unit on Airbnb in 2019. I am satisfied that by advertising and renting out the rental unit through Airbnb, the Tenant has substantially interfered with the reasonable enjoyment or a lawful right, privilege or interest of the Landlords by contravening the terms of the tenancy agreement that state that the Tenant agrees not to have any business operation from the leased premises. As it was uncontested that the Tenant continued to have the unit on the website until early 2021, I am also satisfied the Tenant continued this conduct within seven days after receiving the notice.

Shum v Nambakhsh, 2022 CanLII 138725 (ON LTB)

3. On December 13, 2021, the Landlord gave the Tenant an N6 notice of termination deemed served on December 18, 2021. The notice of termination alleges that the Tenant was renting the rental unit out for short-term rentals and that this constituted an illegal act under the City of Toronto By-Laws, the Residential Tenancies Act, and the condominium corporation’s rules, by-laws, and declarations.

4. The Landlord and ES testified that they found a person using the rental unit as a short term rental on November 28, 2021. They brought this person to the security desk and obtained details with respect to her short-term rental. While there is a discrepancy between the information in the Landlord’s application and the testimony regarding whether it was the Landlord or ES who first went to the rental unit that day and with respect to the length of the short-term rental, I did not find this to be material or to detract from the credibility of the Landlord or ES.

5. SS’s testimony corroborated the testimony of the Landlord and ES. SS also testified to the several other incidences outlined in the notice of termination when he engaged with individuals using the rental unit as a short-term rental.

6. The Tenant denied using the rental unit for short-term rentals. The Tenant alleged that the Landlord staged the incident on November 28, 2021. The Tenant claimed that the Landlord was conspiring with other individuals to evict him from the rental unit so that the unit could be used for short-term rentals. He said that he was paying a low rent and the Landlord was trying to evict him so she could make more money.

7. I find the Tenant’s assertion that the November 28, 2021 incident was staged to be fantastical and highly unlikely.

8. I find the evidence of the Landlord, ES, and SS to be straightforward and credible and I prefer it to the Tenant’s testimony.

9. I also find use of the rental unit as a short-term rental to be an illegal act as it is contrary to Toronto Municipal Code Chapter 547.

10. As a result, I am satisfied, based on the evidence before me on a balance of probabilities, that the Tenant has committed an illegal act in the rental unit by renting the rental unit out as a short-term rental. Not every illegal act automatically gives rise to termination of the tenancy and eviction. The illegal act must have the potential to affect the character of the premises or disturb the reasonable enjoyment of the Landlord or other tenants in the residential complex. In this case, use of the rental unit for short-term rentals has the potential to affect the character of the residential complex by giving a transient or travelling population access to both the rental unit and the complex. As a result, I find that termination of the tenancy is warranted in the circumstances of this case.

Zandona v Seaforth, 2021 CanLII 141436 (ON LTB)

5. The Tenant testified that the Residential Tenancies Act (‘the Act’) applies to this house because she moved in with the intention of living there on a long-term basis. The Landlord says the Act does not apply because she only intended to rent the unit to the Tenant for 6 months as a temporary seasonal residence. In support of the Landlord’s position, the Landlord entered in evidence a copy of the short-term rental agreement signed by both parties. The agreement is titled “Sunport Beach Resort and Motel Rental Agreement (Inn Keepers Act) & Application”. The agreement refers to the Tenant as a “Guest” and the Landlord is referred to as the “Inn Keeper”. The agreement started October 15, 2019 and has a set termination date of April 15, 2020. The agreement also indicates a daily rate of $60.00 for a total of $1,800.00 a month. Further, the agreement states that by signing, the guests agree to the termination of the rental on the specified date. The Tenant denied that it was her signature on the rental agreement but offered no comparison or supporting evidence that the signature was not in fact hers.

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10. The exemption the Landlord seeks to rely upon is s. 5(a) of the Act which reads as follows:

This Act does not apply with respect to,

(a) living accommodation intended to be provided to the travelling or vacationing public or occupied for a seasonal or temporary period in a hotel, motel or motor hotel, resort, lodge, tourist camp, cottage or cabin establishment, inn, campground, trailer park, tourist home, bed and breakfast vacation establishment or vacation home; [Emphasis added.]

11. There are two observations I would make about this section of the Act. First, the wording of the exemption has been interpreted to include two different situations: where the accommodation is intended for the travelling or vacationing public or where it is in fact only occupied for a seasonal or temporary period. (See: Rogers v. Fisherman’s Cove Tent & Trailer Park Ltd., [2002] O.J. No 5942 (Ont. Div. Ct.). In either situation the property itself must be one of the listed types. The second thing I would say about the exemption is that the burden of proof rests on the party claiming the exemption. This means that it was up to the Landlord to lead evidence in support of the proposition that when each tenancy agreement was entered into the parties intended the units to be used as vacation properties or short term seasonal rentals, and not as permanent residences.

12. In other words, I must determine the intention of the parties at the time the tenancy agreement was entered into and, in this case, the Landlord has the burden of proving that this tenancy is exempt from the Act. Moreover, in undertaking this exercise, section 202 of the Act requires that I determine the real substance of the relationship between the Landlord and Tenant.

13. I am satisfied on a balance of probabilities that that the rental unit is exempt from the Act pursuant to s.5(a) of the Act. In making this finding, I was persuaded by the Landlord’s compelling evidence that at the time the parties signed the rental agreement, it was known and accepted by Landlord and the Tenant that the unit was a seasonal, short-term vacation property with a fixed termination date. The Landlord’s oral testimony was well supported by documentary evidence, namely the rental agreement, text messages and two letters sent to the Tenant. The rental agreement clearly sets out that this unit is part of a beach resort, being short term rentals for the vacationing public. The rental agreement and the two letters clearly set out the expectations that the tenancy would terminate in accordance to the short-term rental agreement. Further, the Landlord’s evidence clearly establishes that the termination date set out in the short-term agreement was not negotiable. There is no evidence on the part of the Tenant that at any point in time, the parties agreed to alter the rental agreement and change it to a long-term rental situation. Rather, the evidence is clear that it was the Tenant who tried to unilaterally change the terms of the agreement without the consent of the Landlord. Although the Tenant denies it was her signature on the rental agreement and that it was her telephone number on the text messages, she offered no evidence in support of her position.

14. As I have found that the Landlord has established that the Act does not apply to this tenancy, the Tenant’s application must be dismissed.

Gardens v Markovic, 2021 CanLII 122258 (ON LTB)

1. On June 15, 2020, the Landlord filed this application with the Board. The details of the application indicate that on June 2, 2020, the Landlord discovered that the Tenant was using the rental unit as an Air B and B short term rental.

2. At the hearing, JD testified that the application was filed because she received complaints from other tenants in the residential complex that they were seeing people coming and going from the Tenant’s rental unit with suitcases. JD investigated online and found that the Tenant had the rental unit posted on Air B and B as a short-term rental. The contact person listed for bookings of the rental unit was the Tenant. A copy of the Air B and B listing was entered in evidence.

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9. The Landlord’s application is based on the Tenant having transferred the occupancy of the rental unit to an unauthorized occupant in a manner that was not authorized by the Residential Tenancies Act, 2006 (the 'Act'). On a balance of probabilities, I find the Landlord did not file the correct application to support their position to have the tenancy terminated. In making this finding, I considered the evidence in the Landlord’s application, as well as the evidence presented at the hearing. This evidence is consistent with the Tenant using the rental unit in a manner that is inconsistent with the tenancy agreement. The evidence clearly demonstrates that the Tenant pays the monthly rent and that he still has a presence in the residential complex. This finding is supported by the Landlord’s Witness’ evidence that the Tenant was last seen approximately one month ago and that he has been paying the monthly rent. The Landlord did not provide sufficient evidence for me to determine that the Tenant transferred the occupancy of the rental unit to another person without the consent of the Landlord. Rather, I find that it is more likely than not, that the Tenant is using the rental unit as an Air B and B.

10. As the Landlord did not establish that the Tenant transferred the occupancy of the rental unit to an authorized occupant in a manner that is not authorized by the Act, the application must be dismissed.