Readiness for Occupancy:

Question: If my rental unit in Ontario was not ready for occupancy on move-in day, can I claim rent abatement or reimbursement even if I was told about the delay in advance?

Answer: In Ontario, a landlord has an absolute duty under Residential Tenancies Act, 2006, S.O. 2006, c. 17 at section 20 to provide and maintain a residential complex and rental unit in good repair and fit for habitation from the start of the tenancy, and that duty applies even if you knew about the deficiencies before move-in or agreed to delayed readiness.   If the unit is not habitable, the Residential Tenancies Act, 2006 at section 29 sets out remedies that can include rent abatement, and reimbursement for reasonably necessary out-of-pocket expenses like temporary accommodations or storage due to the lack of readiness.   Anderson Aylwin Begg & Co. can review your lease and move-in communications, document the habitability issues, and help you pursue appropriate remedies through the Landlord and Tenant Board, including collecting evidence to support a rent abatement claim.   For help in Oshawa, Whitby, Pickering, Scarborough, and across Ontario, call (905) 686-8080 to speak with the paralegal team at Anderson Aylwin Begg & Co. about your options.

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Understanding the Duty to Provide a Habitable Rental Unit That Is Ready for Occupancy

There are times when a landlord and tenant enter into a lease agreement prior to completion of construction, or renovation, repair, or other readiness, of the rental unit.  Frustratingly for the landlord, per section 20 of the Residential Tenancies Act, 2006, S.O. 2006, Chapter 17, the landlord is prescribed the absolute duty to provide a ready for habitat rental unit.  Specifically, the Residential Tenancies Act, 2006 states:

Note: Please contact Anderson Aylwin Begg & Co. by phone at: (905) 686-8080 to discuss any specific questions that you may have.

As per section 20 (2) shown above, the mandate within section 20 (1) remains applicable even in in circumstances where the tenant was informed and aware of the uninhabitable state of repair and expected inability for the landlord to provide a habitable unit by the scheduled occupancy date. Accordingly, the duty to do so as prescribed upon the landlord remains along with the potential for liabilities upon a failure to deliver a habitable unit in accordance to the agreement. Additionally, a landlord and tenant are unable to circumvent, via a waiver or other secondary agreement, the prescribed mandate within the Residential Tenancies Act, 2006 whereas section 4 of the the Residential Tenancies Act, 2006 voids any agreements conflicting with the Residential Tenancies Act, 2006 mandates.

The above concerns were reviewed and decided upon by the Divisional Court in Swan v. Liang, 2019 ONSC 1573, as an Appeal decision subsequent to a Landlord Tenant Board determination. Specifically, the Divisional Court said:

As such, when a landlord enters into a lease with a tenant, even where the tenant may come to know, or even agree, that the rental unit will lack readiness on the move-in date, the obligation upon the landlord to provide a ready and fit unit remains regardless.

Available Remedies

Upon a finding that the landlord failed to meet the obligations to provide a unit fit for habitation as required by section 20 of the Residential Tenancies Act, 2006, the statutorily available remedies are prescribed in section 29 of the Residential Tenancies Act, 2006.  The available remedies include an abatement of rent, potentially up to one hundred (100%) percent, as well as reimbursement to the tenant for reasonably necessary expenses incurred by the tenant as a consequence of the lack of readiness of the rental unit such as the cost of temporary accommodations, temporary storage, among other things.  Indeed, these were the remedies awarded by the Divisional Court within the Swan case where it was said:

Interestingly, per paragraph 30 in the Swan case, the Divisional Court declined to award compensation for the increased cost of a substitute rental unit obtained by Swan.

Summary Comment

A landlord and tenant may enter into a lease and thereby establish a tenancy relationship in advance of actual readiness of the intended rental unit; however, when doing so, the landlord must accept the absolute duty to provide a fit and habitable unit by the scheduled occupancy (move-in) date.  The absolute duty to provide a fit and habitable unit is imposed by statute law, being the Residential Tenancies Act, 2006, S.O. 2006, Chapter 17. Furthermore, the statute contains provisions restricting agreements that may attempt to alter the statute law. Accordingly, even if the tenant were to agree to provide leeway, such an agreement would be unenforceable.  Of course, if a tenant does agree to provide leeway, and does so despite such agreement being unenforceable, if the tenant fails to raise the issue of delay by the landlord in providing a habitable unit, the issue becomes moot; however, if the tenant chooses to raise the issue, even if raising the issue goes back on the word of the agreement to provide leeway, such a leeway agreement should fail and liability upon the landlord remains. As such, if the tenant should choose to pursue remedy for the failure of the landlord to provide a habitable unit as scheduled, liability in various forms of compensation may be imposed upon the landlord. The compensation may involve abatement of rent, release of the tenant from the lease, reimbursement for expenses incurred by the tenant, among various other things.