Section 83 and the relationship between opposing A2 applications

BACKGROUND

 

1.     The tenant resided in a two-bedroom condominium with a roommate.

2.     On July 22, 2019, the tenant notified the landlords that she would be leaving the rental unit on August 1, 2019.  She asked the landlords to consent to an assignment of her tenancy to her roommate and another individual (email attached and as part of landlords’ disclosure).

3.     On August 1, 2019, the tenant vacated the rental unit and transferred occupancy to her roommate and another individual before the landlords had consented to the assignment.

4.     On August 28, 2019, the Tenant filed her A2 application seeking an order from the Board authorizing the assignment.

5.     On September 6, 2019, the landlords filed their A2 application seeking to evict the unauthorized occupants from the rental unit.

6.     On March 23, 2020, the Board dismissed the landlords’ application and granted the tenant’s application to authorize the assignment of the rental unit.

 

ISSUE

7.     the Member made a clear and fundamental error of law in her   interpretation of Sections 83 as it relates to the opposing A2 applications about an Assignment or Sublet.

 

FACT & LAW

The Member made a clear and fundamental error of law in her interpretation of Sections 83 as it relates to the landlords’ A2  Application about an Assignment or Sublet

8.     The Landlords submit that Section 83 cannot be applied by the Member to grant relief from eviction because the landlords’ A2 application sought to evict unauthorized occupants from the rental unit and not tenants.

9.     This purpose of Section 83 is clearly annunciated at Section 83(1) which states, “Upon an application for an eviction of a tenant, the Board may…..”.   In the case at bar, the landlords did not file an application to evict a tenant.  The A2 application filed by the landlords sought to evict the unauthorized occupants because the tenant had previously vacated the rental unit and assigned occupancy of the rental unit to the unauthorized occupants as contemplated under Section 100 of the RTA.  This fact is evidenced in the tenant’s email dated July 18, 2019 where the tenant provides the landlords with notice that she intended to “move out of Toronto” and in fact, at paragraph 4 of the order, Member Solomon found that the tenant had , “assigned occupancy of the rental unit to the occupants without the landlords consent”.  The Member drew this conclusion from a review of the undisputed facts listed in paragraph 2 of her order.

10.    The landlords submit that the purpose of the RTA as annunciated in Section 1 is to, “provide protection for residential tenants from unlawful rent increases and unlawful evictions, to establish a framework for the regulation of residential rents, to balance the rights and responsibilities of residential landlords and tenants and to provide for the adjudication of disputes and for other processes to informally resolve disputes.”  and therefore Section 83 must, at all times, be read in conjunction with the direction set out in Section 1 of the RTA.

11.    It is trite law that the primary purpose of RTA is to protect the interest and rights of tenants.  The landlords submit that this protection does not extend to the rights or interests of occupants especially in relation to Section 83.  Further to this, the landlords’ action in refusing the assignment has no adverse effect on the tenant and the tenant bears no liability or suffers no loss when she made the decision to move out of the rental unit on August 1, 2019 and transfer occupancy to the unauthorized occupants.

12.    In Toronto Community Housing Corporation v. Moallim, 2018 ONSC 1900, the Divisional Court found that Section 83 of the RTA relates to tenants and not occupants.  At paragraph 28, the Court states, “The Board did not find that the Appellant was a ‘tenant’ and s. 83 contains a discretion that is to be exercised with respect to ‘tenants’”

13.    It is respectfully submitted that in applying Section 83 at paragraph 7 of her order, Member Solomon acted outside of the authority granted to her under the RTA and that such actions are an unreasonable exercise of her discretion.

14.    It is further submitted that this indiscriminate application of Section 83 is contrary to the public’s interest and would extinguish the landlord’s right to approve anyone else who wishes to take over the rental unit and allow tenants to assign their tenancies into perpetuity.

15.    It is submitted that Section 83 cannot be applied to grant relief to occupants and therefore in the case at bar, Member Solomon erred in law by arbitrarily granting relief to the occupants under Section 83 without providing any juristic reason whatsoever for doing so.

16.    As a consequence of her error in apply Section 83, the landlords submit that their A2 application pursuant to Section 100 should be granted and the unauthorized occupants should be evicted from the rental unit.

17.    At paragraph 26 of Samuel Property Management Ltd. v. Nicolson, [2002] O.J. No. 3571, the Court of Appeal for Ontario states, “Under s. 81(1) of the TPA [now Section 100 of the RTA], an unauthorized transfer of the occupancy of a unit permits the landlord to evict the unauthorized occupant”.

18.    At paragraph 14 and 15 in TSL-57998-14 reported as 2014 CanLII 79358 (ONLTB), Member Ruth Carey interpreted the application of Section 100 as follows,

14.    As I explained at the hearing what the Board needs to know on applications such as this is: when did the Tenant move out; when did the Landlord know the Tenant moved out; was the application filed within 60 days of the Landlord discovering the Tenant had moved out; and did the Landlord enter into a new tenancy agreement with the Occupant?

15.   The reason the Board needs to know when the Tenant moved out is because this is the triggering event that turns a legal occupant (which is what a guest or roommate is) into an unauthorised occupant. In the language of the Act, by moving out the Tenant “transferred occupancy” to the Occupant which is why he suddenly became an unauthorised occupant even though the Landlord knew he was living there. In other words, what the provisions of the Act are intended to deal with is control of the rental unit. Once the Tenant moved out it was the Occupant who was in possession and control of the unit. It is this unauthorised transfer of control that the Act seeks to remedy.

19.    At paragraph 4 of the Member Solomon’s order, the Member found that, “the tenant assigned occupancy of the rental unit to the Occupants without the Landlords’ consent” and it was an undisputed fact at paragraph 2 of Member Solomon’s order that the tenant moved out of the rental unit on August 1, 2019.  The landlord filed their application on September 6, 2019, being within the 60-day limitation period as required under Section 100(2).

20.    The landlords submit that by failing to bring her Section 98 application before assigning her tenancy, the tenant contravened Section 95 of the RTA and therefore, the unlawful assignment cannot be saved by an application under Section 98 subsequent to the date of the unauthorized assignment or before the expiry of the 60-day limitation period as a former tenant.  The tenant filed her A2 application on August 28, 2019 being 27 days after Member Solomon found (at paragraph 4 and 5 of her order) that the tenant had transferred occupancy and vacated the rental unit.  As a consequence of this unlawfully assigned or “triggering event” as described by Member Carey, the occupants were no longer potential assignees and ineligible to benefit from an A2 application pursuant to Section 98.

21.    The language used in Section 98 and 100 clearly supports the proposition that a Section 98 application cannot be brought to assign a tenancy to unauthorized occupants.  The words used in Section 98 are “potential assignee” and “withheld consent” whereas in Section 100 the words used are, “Unauthorized occupation” and “evicting the tenant and the person to whom occupancy of the rental unit was transferred”.  If the legislators had intended that Section 98 and Section 100 have equal legal effect, then the legislators would have used the exact wording in both sections.

22.    This interpretation is supported by the Court of Appeal for Ontario in Samuel Property Management v. Nicholson (2002) CarswellOnt 3004, where the Court stated at paragraph 21 and paragraph 26,

21.    “…the purpose of this s. 81(1) of the TPA  [now Section 100(1)].  Its purpose is to protect the landlord’s expectation that the person with whom it contracted has a sufficient level of interest in the rental unit and the landlord’s right to approve of anyone else who wishes to take over the unit”.

26.    “Under s. 81(1) of the TPA, an unauthorized transfer of the occupancy of a unit permits the landlord to evict the unauthorized occupant”

23.    It is submitted that the legislation requires a tenant or former tenant to make their application under Section 98 prior to any unauthorized assignment.  The term “withheld consent to an assignment” used in Section 98 maintains the proposition that no assignment has yet occurred.  If it is found that a tenant or former tenant had assigned the rental unit in a manner other than by an assignment authorized under Section 95, the Board cannot grant relief under Section 98.   In effect, the Board would be ordering the reassignment of an unauthorized assignment to unauthorized occupants rather than potential assignees.

 

 

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