Area of Law: Landlord and Tenant
Answer Number: 425
Residential leasesRegion: Ontario Answer Number: 425
Advantages of having a lease
Contrary to what many people think, a written lease is not necessary to establish a tenancy agreement. However, many landlords require new tenants to sign a lease to ensure that they will be responsible for certain obligations. The main difference between a tenant with a lease and a tenant without one, is when and how the tenancy agreement can end. Many landlords use a standard lease that requires the tenant to live in the rental unit for at least one year, to pay a set amount of rent on time each month, and to follow other rules about how the tenant may use the premises. Whether a lease gives the landlord or tenant rights or obligations will depend on the terms of the lease and what the law allows.
Advantage of having a lease
Tenants who live in a small apartment building, rented house, or part of a house owned by an individual and not a management company, are at risk of being evicted if the landlord or the landlord’s family wants to move in. Tenants without a lease can be evicted if the landlord gives them 60 days’ notice that the landlord or their family requires the premises.
When the tenant has a lease, however, a landlord who may want to take over the premises for their own use cannot do so before the lease has expired, or if the lease gives the tenant an option to renew, unless the Landlord and Tenant Board has issued an eviction notice.
On May 18, 2017, the Rental Fairness Act, 2017 was passed making a number of amendments to the Residential Tenancies Act. The new Act has tightened the provisions under which a landlord can evict a tenant because the landlord, their family member, or a caregiver wants the unit for their own use. Landlords must prove that they or someone in their family, intend to move into the unit for their own use and that they require possession for the purpose of residential occupation for at least one year. Proof of “landlord’s own use” could include:
- Notice to end the tenancy given to the family member’s current landlord
- Booking with a moving company
- Notice of address change given to Canada Post
The legislation also states that landlords will have to compensate the tenant for one month’s rent or offer another acceptable rental unit. If the tenant feels the notice to vacate is invalid, the landlord must file an application with the Landlord and Tenant Board to enforce it.
Disadvantage of having a lease
If a tenant wants the flexibility of moving without having to give much notice, a lease will usually be a disadvantage since the tenant may be legally responsible for paying the entire amount of the lease if they leave before the lease expires. Although landlords are required to make all efforts to find a replacement tenant for the premises, if the landlord is unsuccessful in finding a new tenant, they may be able to sue the previous tenant who broke the lease.
Once the lease has expired, the tenant does not have to sign another lease, and the landlord cannot require the tenant to move out without a good legal reason. However, a tenant who does not have a lease, or whose lease has expired, can usually end the tenancy by giving proper notice to the landlord.
Terms of a lease are not necessarily valid
Residential landlords and tenants have rights and obligations set out by the Residential Tenancies Act and previous court cases. Although terms of a lease may attempt to limit a tenant’s rights, they may not necessarily be enforceable by law. For example, even if a lease states that a landlord can evict a tenant without a reason by giving the tenant notice, the tenant will still have the right to stay unless there is a good legal reason for the eviction. However, the Residential Tenancies Act may allow landlords and tenants to waive some of their rights. For legal advice on the validity of a lease, you can consult a lawyer or contact a legal clinic in your area.
For more information about residential leases in Ontario, visit the Landlord and Tenant Board.
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