Changes to Ontario housing law that renters need to know

August 24, 2021

Two Ontario provincial Bills were passed in the last year that impact the legal rights of renters across the province: Bill 184, passed in July 2020, and; Bill 204, passed in October 2020. Here we take a closer look at what renters need to know about these two Bills and their legal rights.

Changes to the law: Bill 184

What is Bill 184?

Bill 184, the “Protecting Tenants and Strengthening Community Housing Act,” was passed by the Ontario government on July 21, 2020. This law made some important changes to the Residential Tenancies Act and the Housing Services Act, two of the most comprehensive laws that govern housing in Ontario.

Many advocates, including CERA, are concerned about the negative impacts that these changes will have on tenants’ rights and housing security.

How does Bill 184 help tenants?

Bill 184 increased the fines for landlords who evict tenants “in bad faith.” These fines can apply to evictions in two scenarios.

In the first scenario, a landlord evicts a tenant by claiming that the landlord, a family member, or someone purchasing the unit needs to move in. This is commonly known as an eviction for a “landlord’s own use”. However, it would be considered “in bad faith” if once the tenant has moved out, the landlord, family member, or new purchaser does not move in and instead puts the building up for sale or re-rents it, sometimes at a higher price.

In the second scenario, a landlord evicts a tenant claiming that they want to demolish the rental unit or renovate it. Once the tenant has moved out, the landlord re-rents the unit at a higher price or puts the building up for sale. This type of eviction is commonly called a “renoviction.”

In both of these scenarios, landlords can be fined up to $50,000 (and $250,000 in case of a corporation) if a tenant can prove that an eviction has been done “in bad faith”.

Starting on September 1, 2021, tenants who have been evicted in bad faith may request additional compensation equaling an amount of up to 1 year’s rent. If they were evicted so that the landlord could renovate the unit but they weren’t provided with an option to move back after the renovations, tenants may now bring an application for a bad faith eviction. Such an application can be made up to two years after the tenant had to leave their apartment and if they requested “the right of first refusal”, meaning that they asked their landlord to provide them with the opportunity to move back into the unit before it is offered to anyone else.

How does Bill 184 hurt tenants?

Bill 184 has stripped away many protections from tenants that were formerly afforded to them under the Residential Tenancies Act. Here are five key concerns under Bill 184 that could negatively impact tenants, identified by housing rights advocates:

If a tenant has been unable to pay their rent, their landlord can file an application at the Landlord and Tenant Board (LTB) to evict the tenant. This process may involve the landlord and tenant developing a written document that outlines the dates and amounts the tenant will pay to the landlord until the total amount owed has been paid in full. This document is known as a ‘payment agreement.’ Under Bill 184, landlords and tenants are now allowed to develop a payment agreement on their own and file the agreement with the LTB. If the tenant misses a payment or makes a payment later than the dates they agreed to, the landlord may be able to apply for an eviction without notifying the tenant. This means that a tenant could receive an eviction order from the LTB without ever attending a hearing. Moving outside of the hearing process has the potential to negatively impact tenants, as it removes the involvement of a Board member, who is required to consider a tenant’s circumstances when setting out the terms of a payment agreement. Without the involvement of a third-party like an LTB member or a mediator, tenants could be more vulnerable to pressure or intimidation by their landlord to sign an agreement with terms that they do not understand or cannot afford.

Disputes between landlords and tenants can now be resolved through alternative dispute resolution processes, in addition to mediation and hearings. However, it remains unclear what these “alternative” dispute resolutions will involve. Without clarity on what the alternative processes are, housing advocates are concerned that such processes could potentially weaken tenants’ access to justice, and that tenants may not have the same protection as those available through the hearing and mediation process.

During dispute processes, tenants are now required to notify the LTB in writing in advance of their hearing of any concerns and complaints they would like to raise against their landlord at their hearing. The problem with this change is that tenants often do not raise problems with their landlord until they arrive at their hearing out of fear of retaliation from their landlord in the form of eviction threats, harassment, or loss of a landlord referral. This requires tenants to be legally-savvy and develop their legal arguments well in advance of their hearing. Most tenants find the legal process complex and overwhelming as upwards of 97% of tenants do not have representation to help them navigate the LTB process.

  • Pursuing financial compensation from current and former tenants at the LTB

Starting on September 1, 2021, landlords may seek financial compensation from tenants at the LTB for various issues, including for unpaid rent, unpaid utilities, damages to the rental building, and costs associated with if the tenant interfered with the landlord’s reasonable enjoyment of, or legal interest in, the rental property. Landlords can claim compensation from current tenants, as well as from former tenants, for up to one year after the tenant moves out. The landlord can apply for this money as long as the tenant is still in possession of the unit on September 1, 2021, even if the money is owed for things that happened before that date.

In the past, these issues would have been resolved at Small Claim Court, where rules and processes exist to inform tenants about any legal proceedings against them and serve them with legal documents. For proceedings at the LTB, landlords are responsible to notify their former tenant of any applications or hearings where they are involved. If a landlord fails to notify a former tenant for instance because they do not have the new address of that tenant, the tenant may not know about the hearing and fail to attend their hearing, and a landlord may obtain an Order that they can enforce, without the tenant knowing anything about the issue.

Tenants who receive notice of any of these applications should get legal advice about their options. Reach out to a Legal Clinic or contact CERA.

There are very specific laws that regulate rent increases in Ontario. However, tenants sometimes unknowingly pay illegal rent increases when they are unaware of these regulations or have been pressured by their landlord.

Before Bill 184, tenants could challenge an illegal rent increase at the LTB at any time, and an illegal increase could never become legal. Under Bill 184, if a tenant pays the illegal rent increases for 12 consecutive months, this becomes the new legal rent amount and the tenant is no longer able to challenge the illegal rent increase afterwards.

Frequently Asked Questions about Bill 184

  • Now that Bill 184 is law, can I be evicted without any notice?

    Tenants who are protected under the Residential Tenancies Act cannot be evicted without a formal process. This process involves the landlord making an application to the Landlord and Tenant Board (LTB) requesting an eviction. If the eviction is granted by an LTB member, only the Sheriff can enforce the eviction.

    However, if a landlord and a tenant enter into a payment agreement and the tenant fails to stick to what was agreed upon, such as making a payment a day late or missing a payment altogether, the landlord no longer has to go through a formal LTB hearing. Instead, they can obtain an ‘ex-parte’ eviction order, which is an eviction order that can proceed without a hearing at the LTB.

    Find out if you are a tenant under the Residential Tenancies Act

    A new standardized payment agreement form is now available, in which landlords and tenants can define the terms of an agreement. Question #4 on that form includes two options that will determine what will happen if a tenant fails to make any of the payments as defined in the agreement. If the first option is selected, a landlord may proceed with an eviction order – without seeking a hearing at the Landlord and Tenant Board – if a tenant fails to make a payment. This is a new provision under Bill 184 which tenants must be especially aware of if they are signing a payment agreement with their landlord.

    Find out more about Bill 184 and tenants rights

  • Now that Bill 184 is law, can my landlord force me to sign a payment agreement?

    When a tenant has fallen behind on their rent, they can develop an agreement with their landlord to repay the amount they owe over a period of time. After the landlord has filed a notice of eviction and application for a hearing for unpaid rent, landlords and tenants can develop a payment agreement on their own without attending a hearing at the Landlord and Tenant Board (LTB). A landlord could potentially show up at a tenant’s door, with no warning, and demand that the agreement be signed on the spot. If a tenant feels pressured or intimidated by their landlord, they may feel that they are obliged to sign the first agreement their landlord presents them with even if that agreement is unrealistic. It is important that tenants are not pressured and have the time to think of more realistic terms that they can meet and obtain legal advice.

    Tenants are not required to sign any payment agreement. If they do not sign a payment agreement, the matter must go before a hearing at the LTB as it normally would.

    If your landlord is pressuring you to sign a payment agreement that you do not understand or cannot afford, seek advice immediately from a Legal Clinic or Tenant Duty Counsel.

    Find out more about changes to payment agreements

  • Now that Bill 184 is the law, can my landlord raise my rent without notice?

    No. There are very specific laws that regulate rent increases in Ontario. Rent can only be raised once per year based on that year’s rent increase guideline which is identified by the provincial government based on the Consumer Price Index (CPI). Landlords are still required to provide 90 days’ notice in advance of increasing the rent. Bill 184 did not change these rules.

    Find out more about Bill 184 and tenants rights

Changes to the law: Bill 204

In the fall of 2020, Ontario passed Bill 204 which froze rent increases for most renters at 2020 levels, even if the notice of a rent increase was given to the tenant in 2020. This means that if the rent increase was going to take effect in 2021, it is no longer valid. The rent freeze applies to all residential units, including those that are not regulated by Ontario’s rent increase guideline (ie. units first occupied as residential unit after November 15, 2018 which are exempt from Ontario’s rent increase guideline) as well as rent-geared-to-income units.

Landlords are still able to raise the rent in some circumstances. For example, the landlord may increase the rent if the tenant agrees to receive additional services. Or, the landlord may apply to the Landlord and Tenant Board for an above-guideline rent increase to cover extraordinary expenses related to municipal taxes, major repairs, or additional security.

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