Sub-Tenant - Re: LTB (Eviction)

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

2 (1) In this Act,

“subtenant” means the person to whom a tenant gives the right under section 97 to occupy a rental unit; (“sous-locataire”)

97 (1) A tenant may sublet a rental unit to another person with the consent of the landlord. 2006, c. 17, s. 97 (1).

(2) A landlord shall not arbitrarily or unreasonably withhold consent to the sublet of a rental unit to a potential subtenant. 2006, c. 17, s. 97 (2).

(3) A landlord may charge a tenant only for the landlord’s reasonable out-of-pocket expenses incurred in giving consent to a subletting. 2006, c. 17, s. 97 (3).

(4) If a tenant has sublet a rental unit to another person,

(a) the tenant remains entitled to the benefits, and is liable to the landlord for the breaches, of the tenant’s obligations under the tenancy agreement or this Act during the subtenancy; and

(b) the subtenant is entitled to the benefits, and is liable to the tenant for the breaches, of the subtenant’s obligations under the subletting agreement or this Act during the subtenancy. 2006, c. 17, s. 97 (4).

(5) A subtenant has no right to occupy the rental unit after the end of the subtenancy. 2006, c. 17, s. 97 (5).

(6) This section applies with respect to all tenants, regardless of whether their tenancies are periodic, fixed, contractual or statutory, but does not apply with respect to a tenant of superintendent’s premises. 2006, c. 17, s. 97 (6).

99 The following provisions apply, with necessary modifications, with respect to a tenant who has sublet a rental unit, as if the tenant were the landlord and the subtenant were the tenant:

1. Sections 59 to 69, 87, 89 and 148.

2. The provisions of this Act that relate to applications to the Board under sections 69, 87, 89 and 148. 2006, c. 17, s. 99.

101 (1) If a subtenant continues to occupy a rental unit after the end of the subtenancy, the landlord or the tenant may apply to the Board for an order evicting the subtenant. 2006, c. 17, s. 101 (1).

(2) An application under this section must be made within 60 days after the end of the subtenancy. 2006, c. 17, s. 101 (2).

Tremblay v. Ogunfeibo, 2019 ONSC 7423 (CanLII)

[4] The parties both resided in a building that consists of eight rental units. The building is owned by a landlord who is not a party to this proceeding. Ms. Tremblay rented two units from the landlord. She lived in one of the units. The second unit consists of two bedrooms, a bathroom, a common area, and a kitchen.

[5] Since 2016, Mr. Ogunfeibo has rented from Ms. Tremblay one of the two bedrooms in the second unit with shared use of the kitchen, common area, and bathroom. Initially, Mr. Ogunfeibo had a roommate who rented the other bedroom in the unit. After the roommate left, Ms. Tremblay has rented the room on a short-term basis at times. She herself does not live in the unit.

[6] It is not disputed that since her daughter returned to Toronto in September, 2018, Ms. Tremblay has wished to evict Mr. Ogunfeibo to enable her daughter and granddaughter to take over the rental unit.

[7] Ms. Tremblay therefore started a proceeding at the board for a declaration that the Act did not apply to Mr. Ogunfeibo’s occupation of the unit. The board scheduled a hearing on Ms. Tremblay’s application for November 30, 2018.

[8] Not content to wait for a legal determination however, on October 1, 2018, Ms. Tremblay unilaterally locked Mr. Ogunfeibo out of his unit without an eviction order from the board.

[9] By order dated October 12, 2018, the Board found that Mr. Ogunfeibo was a subtenant under s. 97 of the Act and ordered Ms. Tremblay to put him back into possession of his rental unit. The Board also set a process for the parties to return a few weeks later to consider whether Ms. Tremblay complied with its order and to deal with any damages suffered by Mr. Ogunfeibo as a result of the unlawful eviction.

[10] The Board’s November 19, 2018 decision arose from the next hearing. It dealt with Ms. Tremblay’s non-compliance with the Act and her initial failure to comply with its order of October 12, 2018. The Board ordered Ms. Tremblay to refrain from any further harassment or obstruction of Mr. Ogunfeibo’s enjoyment of his rental unit. It also ordered her to pay $4,394.29 for damage to Mr. Ogunfeibo’s goods as a result of the illegal eviction, an abatement of rent for the period he was locked out, and general damages for pain and suffering, plus interest and costs.

[11] On reconsideration, the Vice-Chair found that the Board member had not applied the statutory test for a subtenancy in s. 2(2) of the Act. However, she found that this was not a “serious error” in the circumstances. She held that the Board was tasked to determine if the protections of the Act were available to Mr. Ogunfeibo. She held that the “[m]ember’s decision on this point was clear and within his discretion to make having heard all of the evidence and submi­ssions from the parties.”

[19] When s. 2(2) of the Act is read with s. 97, it is clear that there are four requirements to establish an authorized subtenancy. First, the tenant must vacate the rental unit. Second, s. 2(2)(b) of the Act, cited above, provides that a subtenancy involves a right to occupancy “for a term ending on a specified date before the end of the tenant’s term or period”. Third, s. 2(2)(c) provides that in a subtenancy, “the tenant has the right to resume occupancy of the rental unit after that specified date.” Fourth, in accordance with s. 97(1), the landlord must consent to the subletting.

[30] If Mr. Ogunfeibo was not a subtenant, then Ms. Tremblay submits that he is outside the protections conferred by the Act and she was within her rights to evict him at common law. In my view, that is not a tenable interpretation of the Act.

[36] The relationship between Ms. Tremblay and Mr. Ogunfeibo falls squarely within the words of the statute. She is a landlord because she is a “person who permits occupancy of a rental unit”. She is not permitting Mr. Ogunfeibo to occupy her unit with her, so the exemption in the definition of “landlord” in paragraph (a) of the definition does not apply.

[37] Similarly, Mr. Ogunfeibo is “a person who pays rent in return for the right to occupy a rental unit.” He pays that rent directly to Ms. Tremblay and he gave evidence that he believed she was the landlord. So, he fits the definition of “tenant”.

[38] The bedroom, kitchen, common area, and bathroom are “any living accommodation used or intended for use as rented residential premises” so they meet the definition of a “rental unit.” Although Mr. Ogunfeibo shares the bathroom, kitchen and common area with others, the premises are akin to a boarding house or a rooming house, both of which are expressly included in the definition of “rental unit” above. Finally, because the bathroom and kitchen are shared with other occupants and are not required to be shared with the “owner, the owner’s spouse, child or parent or the spouse’s child or parent” the exclusion from the Act in s.5(i) does not apply.

[41] In my view, finding that the Act applies to the relationship between Ms. Tremblay and Mr. Ogunfeibo as landlord and tenant is consistent with the wording of the Act and its remedial purpose. It follows that Ms. Tremblay had no right to evict Mr. Ogunfeibo by self-help on October 1, 2018 as she did. Moreover, her conduct was particularly egregious as she had previously submitted her issues to the board for resolution. Evicting Mr. Ogunfeibo while they were waiting for the board hearing in a proceeding that she herself had commenced was high-handed to say the least.

TST-70452-16 (Re), 2016 CanLII 40103 (ON LTB)

16. As a result of the evidence respecting the manner in which the Tenant came to use the rental unit and the Tenant’s use of the rental unit, a preliminary issue in this application is whether the Tenant became a tenant by virtue of ss.100 and 104 of the Act.

17. Subsection 100(1) of the Act provides that if a tenant transfers the occupancy of a rental unit to a person in a manner other than by an assignment authorized under the Act or a sublet authorized under the Act, the landlord may apply to the Board for an order terminating the tenancy and evicting the tenant and the person to whom occupancy of the rental unit was transferred.

18. Subsection 104(4) of the Act provides that a person’s occupation of a rental unit shall be deemed to be an assignment of the rental unit with the consent of the landlord as of the date the unauthorized occupancy began if,

(a) a tenancy agreement is not entered into under subsection (1) or (2) within the period set out in subsection (3);

(b) the landlord does not apply to the Board under section 100 for an order evicting the person within 60 days of the landlord discovering the unauthorized occupancy; and

(c) neither the landlord nor the tenant applies to the Board under section 101 within 60 days after the end of the subtenancy for an order evicting the subtenant.

19. It is uncontested that the parties have not entered into a tenancy agreement, the Landlord has not applied to the Board under s.100 to evict the Tenant (and the 60 day deadline to do so had passed before the first hearing date), and neither the Landlord nor Z have applied to the Board under s.101 of the Act to evict the Tenant.

26. Based on the evidence of the parties, I find, on a balance of probabilities, that the Tenant has not and does not live in the rental unit as his residence. The Landlords’ evidence through OH is stronger than the evidence given by the Tenant, especially considering the adverse inference drawn against the Tenant for failing to call key witnesses.

27. “Occupancy” is not defined in the Act. I agree with the reasoning in R. v. Bernard Machado Construction & Woodworking Ltd., [2001] O.J. No. 6276 (O.C.J.) (“Machado”), where the Court, considering the definition of residential occupancy, states “Having regard to its plain and ordinary meaning, there must be an element of residency or tenancy. Simple possession does not suffice.” In Machado, the Court found that although the personal defendant had occasionally slept in the home at issue, he did not occupy the home.

28. In this matter, the Tenant possesses the rental unit, in the sense that he keeps some of his possessions there and he has a key to enter the rental unit (or, at least, he had a key to the rental unit until the locks were changed in December 2015). However, the Tenant does not occupy the rental unit for residential occupation. The Tenant did not establish that he paid rent to the Landlords (at best the Tenant established that during his entire alleged tenancy L paid $600.00 to OH once, recently, and OH testified that this was for utilities). Although the Tenant could have called witnesses to establish that he had lived at the rental unit, he did not. OH testified that the Tenant has no clothes in the rental unit. The Tenant’s own testimony demonstrates that the rental unit is sparsely furnished, including with furniture owned by Z, and also including very temporary portable furniture (folding chairs).

29. Based on all of the foregoing, I am not satisfied that the Tenant had residential occupancy of the rental unit at any time. I am therefore not satisfied that occupancy of the rental unit was transferred to the Tenant and so I cannot find, based on ss. 100 and 104 of the Act, that the Tenant is a tenant. The only other way that the Tenant could be defined as a tenant under the Act would be if, as per the definition of “tenant” in s.2 of the Act, the Tenant had paid rent. I have found that he did not.

30. As the Tenant is not a tenant as defined in the Act, the Board has no jurisdiction over this matter and the Tenant’s application must be dismissed.

TSL-55139-14 (Re), 2014 CanLII 78350 (ON LTB)

44. The Head Tenant/Landlord’s head tenancy is for a fixed term ending April 30, 2016, and he obtained consent from the Head Landlord to sublet to anyone he wanted. However, the fixed term on the alleged subtenancy agreement between the Corporate Tenant and the Head Tenant/Landlord ends on June 19, 2016 which is a date after the expiry of the head lease. I believe that all of the parties rely on these facts in support the conclusion that the agreement is not a subtenancy because the requirements of s. 2(2)(b) have not been met; the agreement purports to give the Corporate Tenant a greater term than the Head Tenant has.

45. I pointed out to the parties that an argument can be made that at the end of the Head Tenant/Landlord’s lease he will become a statutory month to month tenant which is of indefinite duration. At least one legal author I am aware of has argued this means the Head Tenant could sublet the rental unit for an indefinite term as long as the subtenancy agreement includes the reversionary interest. (See: Fleming, Jack, Residential Tenancies in Ontario, 2nd Ed. (Toronto: LexisNexis, 2011) at 225 to 226.)

46. None of the parties before me argue this position is correct. For my own part, I do not believe it is as it would render s. 2(2)(b) meaningless for all intents and purposes. It would also give to statutory tenants a greater right to sublet than was ever the case at common law with respect to tenants with fixed term tenancies; to me this seems backwards as the balance of the Act recognises and maintains the historic advantages that flow from fixed term tenancies, namely they cannot be terminated except for cause prior to the end of the term.

47. In this instance I do not think it matters whether or not one agrees with Mr. Fleming’s analysis of this issue or not as the agreement here fails to meet the requirements of s. 2(2) for an additional reason: the Head Tenant/Landlord does not have a right to re-enter at the end of the term of the alleged subtenancy as required by paragraph 2(2)(c). The parties failed to indicate in the written agreement between them that the Head Tenant/Landlord was reserving the right to re-enter at the end of the subtenancy’s term. Instead the parties used a standard rental residential lease form to reflect their agreement and it is silent with respect to the necessary reversionary interest.

48. One could argue that pursuant to s. 202(1) the reversionary interest can be read into the agreement. That provisions says:

In making findings on an application, the Board shall ascertain the real substance of all transactions and activities relating to a residential complex or a rental unit and the good faith of the participants and in doing so,

(a) may disregard the outward form of a transaction or the separate corporate existence of participants; and

(b) may have regard to the pattern of activities relating to the residential complex or the rental unit.

49. As I explained at the hearing held on September 24, 2014, this provision is most often relied on by the Board to look behind a written lease agreement that purports to create a commercial tenancy. It is not unusual for some landlords to try to avoid the Board’s jurisdiction by requiring residential tenants to sign a lease that purports on its face to be about a commercial tenancy. In those circumstances the Board will hear evidence about the tenancy formation and the pattern of activities between the parties to determine if the original intent was to form a residential tenancy agreement or a commercial one.

50. In other words, s. 202(1) is an instruction to the Board to look at the real intentions between the parties to determine if there is a tenancy agreement covered by the Act and what the terms of that agreement are. It is about searching for intent.

51. Here the evidence establishes that the parties never put their mind to the issue of the reversionary interest. The Real Estate Agent indicated in his answers to my question that he was unaware of the elements of a subtenancy under the Act; sadly that is commonplace in my experience with respect to real estate agents. None of the parties who testified before me indicated in any way they had thought about or discussed what would happen at the end of the subtenancy’s fixed term. The scramble on the part of the parties and their representatives to address the jurisdictional issue I raised on September 24, 2014, also supports the proposition that they simply had not considered the issue at all.

52. As a result it cannot be said the parties here actually agreed to make it a term and condition of their arrangement that the Head Tenant/Landlord was reserving the right to re-enter at the end of the term of the alleged subtenancy. Although subsection 202(1) can be relied on by the Board to essentially override the parole evidence rule to ascertain the true terms of an agreement, it cannot be relied on to read into an agreement something that was never agreed to or contemplated by the parties at the time.

53. Given all of the above I am satisfied that when the Head Tenant/Landlord moved out of the rental unit and turned possession over to the Corporate Tenant it was not done pursuant to a valid subtenancy agreement under the Act.

54. For all intents and purposes Part VI of the Act is a complete code with respect to parties’ rights when something like this happens. The default result of those provisions is that every transfer of occupancy that does not involve a valid subtenancy is an assignment. What this means is that the Head Tenant/Landlord is not in a position to file applications with the Board as if he is a landlord. He is not; he has lost his rights to the rental unit including the right to possession. His status under the Act is limited now to that of a former tenant.

55. As a result of all of the above the Board has no jurisdiction to hear the applications as filed. They must all be dismissed. An order will issue accordingly.

TST-02765

3. Sections 95 through 104 of the Residential Tenancies Act, 2006 (the 'Act') set out detailed provisions dealing with subtenancies and assignments. A subtenant is someone who rents a rental unit from a tenant (sometimes referred to as a "head tenant"), where the agreement is for a fixed term and the tenant retains the right to move back into the rental unit at the end of the term. An assignment is where a tenant finds someone else to take his or her place under the lease and retains no rights to the rental unit after moving out. Under the Act, the landlord has the right to withhold consent to assignment, but cannot prevent a tenant from subletting a rental unit. However, in subletting situations, the landlord does have the right to withhold consent with respect to a particular proposed subtenant. If no consent is obtained from the landlord but the arrangement goes ahead anyway, then the subsequent occupant of the rental unit is considered to be an unauthorised occupant.

4. When an assignment is approved the new occupant steps into the legal shoes of the tenant and becomes the new tenant under the Act. Section 99 of the Act indicates that in sub-tenancy situations the original tenant, or head tenant, is given the right to evict his or her sub-tenant as if the tenant was a landlord.