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Return to First Part of Chapter
3. Remedy Comparison: Courts Versus the RTA
(a) Overview
These jurisdictional battles are most likely to occur in the applicant/plaintiff's initial choice of remedies. Most litigants will not want to advance two separate proceedings, one each before the LTB and the courts, but that's what the current state of the law may motivate them to do - especially when they lose at first try.
To avoid that, an initial consideration of court remedies in light of RTA statutory remedies is useful.
Setting aside for time being the specific remedial limitations of the Small Claims Court - where most L&T cases would (but for the RTA) logically be filed - the civil courts have evolved a number of traditional remedies, including:- declarations (simple statements of what is lawful or not);
- mandatory injunctions (ordering a party to do a positive act or acts);
- prohibitory injunctions (ordering a party not to do a particular act or acts);
- monetary compensation (by far the most common remedy);
- monetary penalties (ie. "punitive damages").
The Board on the other hand, has numerous specific remedial powers, all of which are roughly analogous in form to the above court categories. "Monetary compensation" for loss is widespread in the power to award compensation for arrears of rent, overhold compensation, miscellaneous related expenses such as NSF fees, and physical damage to rental units. "Termination" is a form of legal declaration, and "eviction" is a form of legal mandatory injunction. "Administrative fines" are analogous to punitive damages.
The main distinction between the court's remedial powers and those of the Board is that the court's powers are broad ("plenary") while the latter are much more narrowly defined in scope by the specific circumstances in which they arise, and in which they are claimed.
In the following sub-sections I explore the case for specific civil court remedies in the residential landlord and tenant context.
(b) Declarations and Injunctions
As noted above, the Board's authority to order "termination" of a tenancy is the primary "declaration"-type remedy that either landlord or tenant would want, just as "eviction" is the primary injunctive-type remedy sought.
Numerous other injunctive and declaratory instances can be found - such as converting an "unauthorized occupancy" to an "assignment" tenancy [see Ch.1, s.5(f)], or the various "determinations" of tenant rights violations which set the ground for further remedial orders such as Orders "to desist" from illegal behaviours and even to put tenants back into possession where they have been illegally induced to leave [see Ch.3, s.5].
That said, the range of potential declarations and injunctions is as broad as human activity can be pernicious. While it is safe to say that the RTA has anticipated most situations that can arise in the residential landlord and tenant context, where others arise that are not anticipated an argument exists that the courts retain common law declaratory and injunctive jurisdiction.
It is worth noting again at this point that the Small Claims Court in Ontario has no general declaratory or injunctive jurisdiction. Aside from it's $35,000 monetary order limit (the court's monetary limit as of 01 September 2020), the only residual authority it has is to order the recovery of personal property of a value not exceeding $35,000 . The jurisdiction of the Small Claims Court is explained in this linked chapter of the Isthatlegal.ca Small Claims Court (Ontario) Legal Guide:
Ch.3: Jurisdiction
(c) Monetary Compensation by Quantum
To repeat, regardless of the circumstances in which the monetary claim arises, the Board's monetary compensation jurisdiction is limited to the greater of $10,000 or the Small Claims Court monetary jurisdiction limit [$35,000 on 01 September 2020] [Act s.207(1)].
Where monetary compensation above that amount is sought, the RTA makes express provision for the party to proceed through the 'regular' courts (ie. the 'regular' Superior court which has an unlimited monetary jurisdiction) [Act s.207(2)].
However the party cannot "split" a claim over between the LTB and the court - so if a party wants a monetary compensation of over $35,000 but wishes to remain in Small Claims Court, it must 'waive' (give up) the claim to any amount above that - and further recourse to the court for additional amounts is barred for that same cause of action [Act s.207(3)].
As a practical matter it should be noted that while the Board's jurisdiction for under $35,000 RTA claims created under the RTA is exclusive - and thus excludes the Small Claims Court's jurisdiction in those cases - the enforcement of Board monetary awards is still conducted through the Small Claims Court enforcement mechanisms [see Ch.14, s.7: "Hearings, Orders and Enforcement: Enforcement and Stays of Enforcement"].
In the civil courts the three main grounds of monetary claims are contract, tort and restitution - each considered below.Case Note: Trindade v. Jantzi
In Trindade v. Jantzi (Div Ct, 2021) the Divisional Court held that it was an abuse of process for the LTB to decide it had jurisdiction over a tenant's rent abatement application (which was within the LTB's monetary limit) where the landlord had already applied to the Superior Court for $45,000 rent arrears (over the RTA S.207(2) monetary limit). The case was confused by the fact that the court had not acknowledged that the RTA applied to it (the tenancy had been terminated by a consent order), but the Divisional Court decided that the rent abatement issue could be advanced as a set-off in the first court application, and thus the LTB's decision was in error as an abuse of process:[22] The Board’s first error was in stating, in paragraph 50, that the respondents [SS: the tenants] could not be compelled to advance their claim in the Superior Court. The Board provided no authority or rationale for this statement. It is simply a bald statement suggesting that, once the Board has found that the respondents’ claim for rent abatement falls within its monetary jurisdiction, no further inquiry is required. Section 23(1) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, provides that a “tribunal may make such orders or give such directions in proceedings before it as it considers proper to prevent abuse of its processes”. During the argument of the appeal, counsel for the Board agreed that the Board has the power to stay or dismiss an application on the basis that it is an abuse of process, and that the jurisdiction hearing would have been the appropriate context in which to consider this issue. I agree and, on that basis, I find that it was an error of law for the Board to find that it had no power to compel the respondents to raise the issue of rent abatement in the Superior Court. Whether the Board should have made a finding of abuse of process in this case is a different issue which is addressed below. But what is clear is that the Board made a legal error in finding that its inquiry was limited to the issue of whether the respondents’ claim fell within the Board’s monetary jurisdiction. The Board should have gone on to address the issue of whether the respondents’ application for rent abatement brought to the Board was an abuse of process.
[23] The Board’s second error was its finding at paragraph 51 that, even if the Board had the power to decline jurisdiction, the respondents would have no recourse in the Superior Court proceedings. The Board’s finding that the respondents would have no recourse in the Superior Court was based on a narrow reading of the December 11, 2018 order, without regard to the broader legal and factual context. As conceded by the appellant, the respondents would be allowed to make a claim for setoff in the Superior Court for any rent reduction to which they would be entitled due the appellant’s alleged failure to provide heat. The wording of the December 11, 2018 order, which refers to determining “entitlement, if any, to judgement as against the Respondents and each of them for unpaid occupancy fees or rents, and the quantum of same” [emphasis added] does not preclude the respondents from asserting their claim for setoff. In addition, the Board’s finding that the respondents would have no recourse in the Superior Court completely ignores the evidence that the respondents have already asserted a right to setoff in relation to the heat issue in the Superior Court proceedings. In an affidavit sworn by the respondent Ryan Jantzi in the Superior Court proceedings, he reviews the circumstances of the tenancy from the respondents’ perspective, including their position that the landlord provided inadequate heat, and goes on to request that “the Court consider offsets” [emphasis added] to the appellant’s claim, including for “failure to provide vital services to children and adults: $39,000 deducted from base rent”. Accordingly, it was an error of law for the Board to read the December 11, 2018 order as precluding the respondents from asserting a claim for setoff and to ignore the evidence that the respondents had already asserted such a claim.
[24] To be clear, had the Board considered the issue of abuse of process and found that there was no abuse of process in this case, this Court would have limited power to intervene on appeal. A finding of abuse of process engages a decision maker’s discretion and the Court could only intervene if the Board had made an error in principle. However, in this case, the Board’s error was to not embark on the abuse of process inquiry at all by first finding that it did not have the power to compel the respondents to raise their issues in the Superior Court and by then finding that, even if it had the power to so, they were precluded from doing so by the December 11, 2018 order. Case Note: Lopera v. Margosutjahjo
In Lopera v. Margosutjahjo (Div Ct, 2020) the Divisional Court considered an unusual RTA appeal case where the LTB ordered termination and eviction for non-payment of rent, the rent arrears covering a period of over five years. The case is interesting in that while the rent arrears were over $92,000, the LTB could only order $25,000 - the Small Claims limit at the time of the LTB order. (d) Monetary Compensation in Contract
. Overview
As noted earlier [Ch.1, s.1(c): "Fundamentals: Overview: Sources and Conflict of Laws"] there is a modern legal tendency to move the landlord and tenant relationship away from its feudal origins and to bring it into the larger family of contract law.
For reference, the Isthatlegal.ca section on contract is linked here: Contracts.
Indeed, the RTA expressly adopts a primary contractual principle which releases an aggrieved party from further performance if the other party has engaged in 'material breach' of their duties [RTA s.17]:RTA s.17
Except as otherwise provided in this Act, the common law rules respecting the effect of a serious, substantial or fundamental breach of a material covenant by one party to a contract on the obligation to perform of the other party apply with respect to tenancy agreements. That said, the doctrine of fundamental breach has fallen into disfavour recently in contract law [Fundamental Breach], so it is best not to rely on it if you can avoid it.
For present purposes the topic can be narrowed to that of remedies upon such "breach" of contract. The standard measure of damages for breach of contract is to give the aggrieved party what they would have gotten had the contract not been breached (or in other words, had the contract been fully 'performed'). This is sometimes called the "performance" or "expectation" value.
. Monetary Damages for "Breaking a (Term) Lease"
In the L&T situation this principle applies most frequently in practice in landlord's claims for the balance of rent "owing" when a tenant is alleged to have "broken a (term) lease".
Something like this contractual remedy is integrated into the RTA in the form of compensation for arrears and overhold compensation (compensation for occupancy after termination is declared). However the RTA limits such claims to the point that the tenancy is terminated, and provides no general landlord right to claim for lost "performance value" past that point.
The first distinction to be made here is that between "periodic" and "term" tenancies [see Ch.1, s.2(e)]. Briefly, a term tenancy (on it's face) obliges a tenant to continue to make rent payments for a fixed term (typically a year), while a periodic tenancy takes advantage of the "automatic renewal" provisions established by common law and the RTA [Act s.38(1)(2)].
Clearly, the potential for loss of "performance value" is greater in the term lease situation, and it is those situations which give rise to the greater legal concern. The Supreme Court of Canada, in the case of Highway Properties Ltd v Kelly [1971] SCR 562 established that in some circumstances a landlord's claim for loss of "performance value" (ie. future rent) in a term lease was allowable. However whether this liability survives the formal "termination" brought about a tenant complying with a Notice of Termination [Act s.37(2)] or by Board declaration of "termination" is an open question. On this issue, Donald Lamont [Residential Tenancies, 5th ed. (Carswell, 1993) states at p.145-6: It is arguable that the Highway Properties case may have developed the law so that a landlord can obtain an order terminating a lease early for breach of covenant for any of the specific causes in [then] s.107 and as well claim for damages in a separate action. However in Sifton Properties Ltd v Sloan [(1981) 12 ACWS (2d)(Ont Small Claims Court)], the landlord lost the right to prospective common law damages when the tenant complied with notice of early termination and moved out.
...
However in 190 Lees Avenue Ltd v Dew [(1991) 2 OR (3d) 686 (Div Ct)], which was an ordinary action, the judgment allowed the claim for damages and pointed out that the remedies provided for in [then] s.113 were not an exhaustive list. . Monetary Damages for Improper/Short/No Tenant Notice of Termination
In contrast to breach of a "term" lease, the lost dollar value in periodic lease situations where tenants either: allegedly abandon the premises, "cause" the termination or give inadequate or short notice - is typically small enough that the Board arrears and overhold compensation provisions cover it.
That said, the RTA has expressly set out how damages are to be determined in these circumstances [Act s.88]:- Improper Notice
Where the tenant gives a form of Notice of Termination that does not meet the legal requirements for such a Notice [see Ch.4, s.2: "Termination Fundamentals: Notices of Termination"], the landlord's claim for arrears ends on the earliest date of termination that would have applied had the tenant's Notice of Termination been properly given at the same date that faulty Notice was.
- No Tenant Notice
Where the tenant fails to give any form of Notice of Termination, the landlord's claim for arrears ends on the earliest date of termination that would have applied had the tenant properly given Notice of Termination "on the date that the landlord knew or ought to have known that the tenant had abandoned or vacated the rental unit".
- "Abandonment" after "Early Termination Option" Landlord Notice of Termination
There are several landlord Notice of Termination procedures which give the tenant an 'early termination' option which, if exercised, allows them to "counter"-terminate the tenancy (by proper Notice of Termination) earlier. These are terminations for "personal possession" and "purchaser possession" [see Ch.5, s.2], and for "demolition/conversion/repair/renovation" [see Ch.5, s.3].
The RTA views a tenant who simply leaves the premises after such a landlord notice - but while neglecting to give the proper "counter"-Notice for early termination (or after giving a faulty form of such Notice) - to be abandoning the premises.
In such cases arrears of rent shall be calculated to the earlier date of A and B below [Act s.88(2)]:A. in the case of a faulty tenant's Notice of Termination, ten days after it was given to the landlord;
or
in the case of no tenant Notice of Termination, ten days after "the landlord knew or ought to have known that the tenant had vacated the rental unit",
and
B. the "date of termination" in the 'initial' landlord Notice of Termination.
As these damage calculation provisions all tie themselves to dates of termination which could 'otherwise' have been given, they do not significantly impact on the term lease situation discussed above.
. Duty to Mitigate Loss
All lease-breaking claims are subject to the general contractual responsibility of the landlord to deduct from their losses any amounts recovered by re-renting the rental unit ["mitigation"], or that they could have recovered had they taken "reasonable steps to minimize losses" [Act s.16, 88(3)(4)].
It is likely that any court will impose this duty to mitigate in other non-contractual damage situations: see the Isthatlegal.ca section on Mitigation.
. Monetary Damages for Damage to Rental Unit
As noted above, a landlord may "if ... the tenant is in possession of the rental unit" [Act s.89(1)] apply to the Board for compensation for "reasonable costs that the landlord has incurred or will incur for the repair of or, where repairing is not reasonable, the replacement of damaged property, if the tenant, another occupant of the rental unit or a person whom the tenant permits in the residential complex wilfully or negligently causes undue damage".
Such damage claims - made either in contract or tort - are at the heart of conventional civil court jurisdiction and it seems quite likely that court claims for such damage - made after the tenant has left the premises will be heard by the courts (in such actions the party can advance claims against guarantors as well, see below).
. Monetary Claims Against Guarantors
While s.87(1) is generally available for landlords to claim arrears, note that the Board views this jurisdiction as not extending to Board-Ordered arrears recovery against rent "guarantors" (ie. those required, as a condition of the tenancy being granted to the tenant, the guarantee the payment of the tenant's rent) [Interpretation Guideline 11: "Eviction for Failure to Pay Rent"].
The Board's reasoning on this issue appears to apply to any other situation of guarantor liability. Given this Board position, which is defensible, claims against guarantors must then apparently proceed through the courts.
(e) Monetary Damages in Tort
The Board has some tort-like remedial jurisdiction in relation to tenant's rights applications [see Ch.3, s.5]. These include protections against inadequate repair, harassment, substantial interference with reasonable enjoyment violations, illegal entry and withholding vital services - amongst other things.
For comparison, the Isthatlegal.ca section on tort is linked here: Torts.
All such applications first must seek a "determination" (akin to a declaration) that the alleged behaviour has in fact occured, and then move on to a consideration of the requested remedies. Monetary remedies available to both tenants and former tenants within one year of the breach include [Act s.29(2)]:- compensation for repair and/or replacement costs;
- abatement of rent; and
- where the tenant has moved as a result of the landlord behaviour, increased rent in their new premises for one-year subsequent, and out-of-pocket expenses for moving and such.
Also available are "administrative fines", payable by the landlord to the Board ("Board fines"). But for the payment of these to the Board they can be viewed as analogous to "punitive damages" in the civil courts.
Earlier case law has been favourably disposed to the civil courts exercising their traditional damages role in tort situations. Thus in Beyer v Absamco Developments Ltd (1976) 12 OR (2d) 768 (County Court), a tenant's claim for general damages for alleged tortious acts committed within a residential L&T relationship, was properly taken before the civil court in a regular lawsuit. Similarly, this route was successfully followed in the civil case of Robitaille v Moore [Court File #97-CU-119459, Ontario Superior Court, 27 April 2004] (argued by the author), where a residential landlord who intentionally killed a tenant's dog in the course of a landlord and tenant dispute was found liable for $15,000 compensatory and $15,000 punitive damages.
(f) Monetary Compensation in Restitution
. Overview
"Restitution" is a form of compensation for "unjust enrichment". It is available in civil courts as a remedy where there is: enrichment, corresponding loss, and "no juridical reason" for the enrichment and the loss (ie. no legitimate legal reason, such as contract). A simple example calling for restitutionary relief would be the inadvertent overpayment of an invoice. Restitution remedies are distinct in that they are neither contractual-based nor tort-based, and their availability is ideally conditioned by 'equitable' concerns. The primary equitable precondition is that the claimant have "clean hands", which means that their prior behaviour not be significantly impugned by such things as bad faith or intentional wrong-doing.
The application of restitution as a tenant remedy in residential landlord and tenant situations will almost always (as a practical necessity) involves rent (or prohibited charge) payment and recovery. Setting aside RTA remedial intervention, it is ideally suited for recovery of illegal rents and charges.
. Board Applications to Recover Illegal Rent and Charges
As such, the consideration of the extent of "restitution" availability in the civil courts requires an examination of the RTA's remedies for illegal rent and charges [see Ch.12, s.7: "Other Rent Proceedings: General Application to Recover Illegally-Paid Monies"].
A general Board application process is available to tenants (as well as former and prospective tenants) to obtain "an order that the landlord, superintendent or agent of the landlord pay to the tenant any money the person collected or retained in contravention of this Act or the Tenant Protection Act" [Act s.135(1)]. Similar, though more specific, such recovery is available under s.115.
Perhaps redundantly [at least for purposes of illegal rent recovery - in light of s.136(1) discussed below], the RTA continues to bar recovery applications unless brought within one year "after the person collected or retained money in contravention of this Act or the Tenant Protection Act" [Act s.135(4)]. This (and related, below) is a political provision that sullies the otherwise sophisticated attempted balanced of the RTA by essentially 'legalizing an illegality', if it 'goes on long enough'.
. Retroactive Legalization of Illegal Rent After One Year
That said, the outlook for any form of illegal rent recovery is drastically curtailed - either through the Board or the civil courts - by the following RTA provisions: RTA s.136(1)
Rent charged one or more years earlier shall be deemed to be lawful rent unless an application has been made within one year after the date that amount was first charged and the lawfulness of the rent charged is in issue in the application. While this provision is superficially similar in form to the common "one-year limitation" periods noted above, it is unlike those other provisions in that it does not only bar the procedural availability of a remedy (eg. the right to sue) - but it actually retroactively legitimizes past illegal rents both for recovery and for future legal rent purposes [Act s.136(2)]. This is another sad provision that essentially rewards illegality, and actively brings L&T law into disrepute.
. Illegal Charges
As to what "non-rent" charges are "illegal", the reader should review Ch.10, s.5: "Rent Fundamentals: Non-Rent Charges and Security Deposits".
While there is no RTA provision "legalizing" unchallenged illegal charges after a year [such as s.136(1) does for illegal rents, see above], recovery of illegal charges under the general s.135 recovery application procedure is still subject to the s.135(4) one year limitation period. That is, the RTA bars such recovery applications unless brought within one year "after the person collected or retained money in contravention of this Act or the Tenant Protection Act" [Act s.135(4)].
Unlike retroactively "legalized" rents however, illegal charges are typically one-time, and as such cannot have the ongoing impact on future legal rent that s.136(1) creates.
Where this limitation period is missed, a good argument exists for restitutionary recovery in the civil courts (if within the two-year Limitation Act, 2002 period), though the quantum involved in most such cases would not likely make this worthwhile.
. Restitution for Income Misrepresentation in Social Housing
Where a tenant in public housing receiving a "rent geared to income" (RGI) subsidy is alleged to have "knowingly and materially" [Act s.60(1)] misrepresented their or their family's income for eligibility purposes, then they are subject to early termination and eviction for cause [see Ch.6, s.7]. Note that a landlord applying to the Board for termination and eviction on these grounds may also request "an order for the payment of money the tenant would have been required to pay if the tenant had not misrepresented his or her income or that of other members of his or her family" [Act s.90]. Such a "restitution" order may only be initiated in conjunction with related termination and eviction Board proceedings, and therefore only while the tenant is still in possession of the premises.
Several key points need to be made as to the limited availability of this Board "restitution" remedy in terms of the residual jurisdiction it may leave the courts.
Firstly, the previous Rental Housing Tribunal and courts before it were regularly faced with applications to terminate and evict for non-payment of rent in situations where "rent-geared-to-income" (RGI) amounts were determined outside of normal rent controls (ie. administratively). This brought them into complex and often policy-driven areas (often discretionary to the public-housing provider) that they were uncomfortable with. As a result, the RTA now has the following provision - which has an unhappy co-existence with the the s.90 restitution provision:RTA s.203
The Board shall not make determinations or review decisions concerning,
(a) eligibility for rent-geared-to-income assistance as defined in the Social Housing Reform Act, 2000 or the amount of geared-to-income rent payable under that Act; or
(b) eligibility for, or the amount of, any prescribed form of housing assistance. How - given this s.203 restriction - the Board may [under s.90] determine the quantum of (or even complete) RGI ineligibility is difficult to see.
Secondly, the Board social housing restitution provisions only operate where the misrepresentation is intentional ("knowingly"), and as such is not available for restitution in cases of negligent or innocent misrepresentation.
Thirdly, Board social housing restitution is only available where "a landlord has a right to give a notice of termination under section 60". This is an odd provision in that it does not tie the restitution remedy to the social housing misrepresentation termination and eviction application (though they can be coincident), but appears to tolerate a Board restitution application during (and even separate from) the ongoing misrepresentation. That said, to the extent that such restitution applications will be brought in conjunction with the termination and eviction application (as seems natural), they will be themselves conditioned by the general limitation on the bringing of such applications within 30 days after the date of termination specified in the notice [Act s.69(2)], and the requirement that the "tenant is in possession of the rental unit" [Act s.90].
Given these three major restrictions on the availability of the Board s.90 social housing restitution remedy, broad jurisdictional room remains for civil court restitution in relation to social housing "over-subsidization".
4. L&T Board and Staff Civil Immunity
The LTB as a legal body is immune from civil liability, just as courts and judges are: Raba v Landlord and Tenant Board (Ont Sup Ct, 2014).
Additionally, "against an investigator or inspector appointed by the Minister, against a member of the Board or against a public servant" by the Board are also immune from civil liability (ie. damage claims) for "any act done in good faith in the performance or intended performance of any duty or in the exercise or intended exercise of any power under this Act or for any neglect or default in the performance or exercise in good faith of such a duty or power" [Act s.232(1,2)].
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