For those that attended the recent SOLO MPP Townhall, you might have heard board member Varun mention that Ontario landlords are picking up and moving to more landlord-friendly provinces. One of the provinces he mentioned was Alberta. The province, situated east of British Columbia, is known for its cowboys, WEXIT campaigns, right-wing thinking and, crucially, support for fairness in renting. I wanted to take a closer look to see what makes Alberta so different than our own province of Ontario if you’re a landlord. Just like Ontario, Alberta has its own tribunal. It’s called the Residential Tenancy Dispute Resolution Service (RTDRS). Alberta also has a Residential Tenancies Act (RTA), which lays out obligations for tenants and landlords.
Given how difficult things are for landlords in Ontario, Alberta seems to have a more reasonable approach to dispute resolution. Currently also, the RTDRS is not in a state of perpetual backlog. By freeing up the tribunal by removing the need for cases such as non-payment of rent, the process can run much smoother. When I called them and asked for more information, they said:
Leases in Alberta have a beginning and an end. If the tenant and landlord don’t renew the lease then it is assumed, the tenancy will end at the end of the term. Done. Both parties have to agree for the lease to continue or the tenant must leave. Interestingly, section 15 of the Alberta RTA states that notice is not even necessary:
(15) Notwithstanding any agreement to the contrary, notice to terminate is not required in order to terminate a fixed term tenancy.
A lease break fee is possible. Tenants need to give 30 days when ending a fixed lease early. If the tenant breaks the lease with less than one month notice, they can be subject to a fee of up to one month’s rent. This can amount to the entire last month’s deposit given circumstances. This gives the ease term more weight and breaking this can lead to consequences. Conversely, in Ontario a lease is only that in name. Ontario has little or no consequence for leaving a lease early. Additionally, when a lease ends in Ontario, it just moves from month to month, almost completely negating the reason for negotiating a lease in the first lace (I.E. That it ends).
Landlords can charge a fee for late rent. Yes, it’s true. Be late on your rent and you could be hit with a fee. The landlord can’t claim this later in a hearing but a late rent fee can be stipulated in the lease. In addition, the standard termination form for arrears can stipulate a late fee. In Ontario, nothing like this exists or can be attached to the terms of a lease.
The process of terminating a tenancy due to arrears is entirely different in Alberta. Section 29(1) of The Alberta Residential Tenancies Act (RTA) lays out the process:
29(1) If a tenant commits a substantial breach of a residential tenancy agreement, the landlord may apply to a court to terminate the tenancy or may terminate the tenancy by serving the tenant with
a notice at least 14 days before the day that the tenancy is to terminate.
And this process is stopped by way of:
(4) A notice to terminate under this section is ineffective if, before the termination date given in the notice, the tenant (a) pays all rent due as of the date of payment, if the alleged breach is a failure to pay rent, or (b) serves the landlord with a notice in writing objecting to the termination that sets out the tenant’s reasons for objecting, if the alleged breach is other than a failure to pay rent.
So, essentially, if your tenant has not paid rent even for one day, you serve them with this 14-day notice and, if they don’t mount a defence “objecting” to the termination – the tenant must leave. If the tenant will not vacate the landlord can take this to a hearing which would take place in “one to two weeks by phone” says a representative spoke to at Service Alberta. Further, she said, “The order will contain a date the tenant must leave, if the tenant does not leave by that date, the landlord can consult a bailiff or a private contractor to remove the tenant.”
I asked her “Is it reasonable to see this entire process play out over the course of two months?” and her reply , “Oh, yes, absolutely.” This far shorter time duration (up to a year in Ontario due to backlogs) means a landlord can see their home return with less in arrears.
In Ontario we regularly see in excess of $50,000 in arrears and damages for landlords. Alberta is clearly a jurisdiction that places enforcement of non-payment of rent at a higher priority than Ontario. The disparity is stark. The best way to fix the problem of serial non-payment of rent like what occurs in Ontario is to keep the losses to a minimum. This removes the incentive for a tenant.
In cases where tenant property is left behind, if it’s worth less than $2,000, the landlord can dispose of it immediately. If it is worth more, then the landlord must store the property for 30 days at their cost. After 30 days, it can be sold or disposed of.
Landlords can enter properties in much the same way they can in Ontario. If they have ‘reasonable’ suspicion that an emergency is occurring or that the property is abandoned, they can enter. Other cases require 24 hours’ notice and entry between 8a.m. and 8p.m. In the Alberta RTA, it is as codified that showing the home to realtors is a valid non-emergency reason for entry. All of this somehow seems saner than the less detailed and more confusing terms found in the Ontario RTA.
The bigger question is, what can Ontario learn from all this? It would be fair that tenant groups probably hate what landlords can prescribe fees like this, but they have to admit that a faster process of eviction for non-payment of rent serves to deter those looking to scoff at contracts they’ve signed. And let’s face it, if it’s a lease and parties sign it, the document should hold some weight, or what’s the point? In Ontario the rental lease agreement is a toothless albatross for landlords. To require both parties to renew the lease or have the tenancy end only makes sense.
We now know why small landlords are leaving the Ontario rental market and investing in Alberta. The hope is that the Ontario Government can take note and make some substantive changes here. As usual Ontario small landlords are encouraged to consult legal professionals before engaging any action with respect to renting.
