Mitigating Losses - Rent (LTB)

Boardwalk General Partnership v Fraser, 2013 CanLII 95665 (ON SCSM)

1. This is a damage assessment sought by Boardwalk General Partnership, the owner of an apartment building at 812 King St. W., Kitchener against Paul Fraser, a tenant in Apartment 408 in that building beginning in December, 2008.

2. According to the Affidavit of Service filed Mr. Fraser was served personally on July 4, 2012. He was noted in default on August 13, 2012.

13. I was not referred to, but have considered Yonge Pleasant Holdings Ltd. v. Dragonov (1995), 1995 CarswellOnt 2946 (O.C.G.D.). Mr. Justice Gibson in that case distinguished Lees and held that where the landlord gives notice to terminate a month to month tenancy the landlord cannot claim damages for loss of rent after the date of termination.

14. The present case falls to be decided under a different statutory regime, the Residential Tenancies Act, 2006, S.O. 2006, c. 17. The crucial provisions of that Act are as follows:

15. A provision in a tenancy agreement providing that all or part of the remaining rent for a term or period of a tenancy or a specific sum becomes due upon a default of the tenant in paying rent due or in carrying out an obligation is void. 2006, c. 17, s. 15.

16. When a landlord or a tenant becomes liable to pay any amount as a result of a breach of a tenancy agreement, the person entitled to claim the amount has a duty to take reasonable steps to minimize the person’s losses. 2006, c. 17, s. 16.

17. Except as otherwise provided in this Act, the common law rules respecting the effect of a serious, substantial or fundamental breach of a material covenant by one party to a contract on the obligation to perform of the other party apply with respect to tenancy agreements. 2006, c. 17, s. 17.

86. A landlord is entitled to compensation for the use and occupation of a rental unit by a tenant who does not vacate the unit after his or her tenancy is terminated by order, notice or agreement. 2006, c. 17, s. 86.

18. Section 15 of the Residential Tenancies Act, supra, on the other hand, abolishes acceleration clauses altogether. The right of a landlord to both terminate the tenancy for fundamental breach by the tenant and claim loss of future rent otherwise due under the contract is, in effect, an acceleration of the rent due over the life of the contract, since the landlord may give notice and bring the claim before the period of the tenancy has expired. Accelerated rent clauses are void under the new Act. This alone is a reason to find against the plaintiff on this issue.