Service NL
May 17, 2018

Residential Tenancies Act Changes Aim to Improve Province's Rental Environment

Legislation to modernize the Residential Tenancies Act, 2000 to benefit both landlords and tenants will begin second reading today in the House of Assembly. Newfoundland and Labrador has a large rental market, and the act affects many residents with a wide variety of backgrounds.

Several significant proposed changes in the legislation allow for early termination of rental agreements as a result of domestic violence situations, and the inclusion of boarding houses under the act. The act also includes significant increases in penalties, and covers extended timelines regarding notices for rent increases, privacy enhancements, shorter timelines to deal with situations such as unpaid rent, abandonment of personal property, and the return of damage deposits.

A complete list of the proposed amendments can be found in the backgrounder below.

For a number of years, landlords, tenants and other interested parties had been asking for substantive changes to residential tenancies legislation. There were also a number of sections of the act that were not easily understood and required clarity and modernization.

The proposed amendments are the result of information gathered from consultations with the public, as well as submissions received directly from stakeholders and the general public.

Quote
“A modern and robust regulatory framework is necessary to deliver consumer protection to tenants, while also ensuring the needs of landlords are taken into account. We feel that these proposed amendments strike a fair balance for landlords and tenants.”
Honourable Sherry Gambin-Walsh
Minister of Service NL

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Learn more
Bill 15, An Act to Amend the Residential Tenancies Act, 2000

The Way Forward

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Media contact
Krista Dalton
Service NL
729-4748, 685-6492
kristadalton@gov.nl.ca

BACKGROUNDER

Amendments to the Residential Tenancies Act, 2000 

Issue

Current Legislation

New Legislation

Tenant Who Sub-Lets

Not clear on whether or not a tenant who sub-lets is a landlord under the Act.

Definition of landlord will be amended to make it clear that sub-lettors are landlords.

Residential Premises

Definition does not give examples for clarity.

Definition will be expanded to include a house, apartment, room or similar place.

Applicability

Boarding houses are excluded from the Act, as are living accommodations provided by a religious, charitable or non-profit organization.

Applicability of the Act will be expanded to boarding houses, as well as living accommodations provided by religious, charitable and non-profit organizations by removing references to exceptions under section 3. Transient accommodations provided by religious, charitable and non-profit organizations will remain excluded.

Appointing the Director of Residential Tenancies

Appointed by the Lieutenant-Governor in Council.

Will be appointed by the Minister.

Provision of Terms of Agreement

No requirement for landlords to give tenants terms of and conditions of the agreement in writing.

Requirement that landlords give tenants information as contained in regulations. These regulations will contain details of an agreement where the agreement is oral or implied.

Provision of Rental Agreement and Information

Unclear that the tenant must pay rent owing that is withheld because the landlord does not supply a copy of the lease.

Will clarify that the tenant must pay the rent owing because of a landlord’s failure to provide a copy of the rental agreement on receipt of a copy of the rental agreement.

Sub-Letting

Not clear that approval to sublet must be in writing. 

Will clarify that a landlord’s consent to a sublet is to be made in writing.

Peaceful Enjoyment and Reasonable Privacy

The tenant shall not unreasonably interfere with the rights of a landlord or other tenants in the premises; the landlord shall not unreasonably interfere with the tenant’s peaceful enjoyment of the premises.

Will include reference to “reasonable privacy” to address concerns related to property surveillance and to address situations where landlord and tenant reside in same premises.

Post-dated payment methods

Post-dated cheques are permitted.

Will be expanded to include other forms of post-dated payment.

Accounts for Security Deposits

All landlords required to have separate accounts for security deposits.

Landlords will only be required to establish a separate account for holding security deposits if they rent three or more residential premises. 

Length of Time a Landlord Can Keep a Security Deposit

Landlord can hold a deposit for 15 days after a tenant leaves.

Time a landlord can keep a security deposit will be decreased from 15 days to 10 days.

Security Deposit Return

The onus is on the tenant to make the application and there is no power for the Director to issue an order to have the deposit returned. A hearing is required. 

Will be easier to have security deposit returned by allowing an immediate order for its return without holding a hearing if the landlord does not file an application within the ten days.

Fees for Non-Sufficient Funds

The fees charged for failure to pay rent and fees charged for cheques returned for the “reason of not sufficient funds” are set by the Minister of Service NL. The fees for failure to pay rent are set at $5.00 for the first day and $2.00 for each day thereafter to a maximum of $75.00 per late period. The fees for cheques returned for the “reason of not sufficient funds” are set at a maximum of $25.00.

When cheques are returned to the landlord for non-sufficient funds, the landlord will be able to charge the tenant a fee in the same amount the landlord is charged by the financial institution.

Notice of Rental Increase

The notice period for rental increases is three months.

The notice period will be increased from three months to six months.

Housekeeping / Clarifications

Rent, money and security deposit records are to be kept by the landlord. 

Records required to be kept by the landlord will also have to identify the tenant and the residential premises to which the records relate.

Receipts

No requirement for landlords to provide a receipt of rent paid.

Will require receipts (electronic permitted) for rent or other money, at the tenants’ request.

Agreement to Terminate a Rental Agreement

A termination notice is required to be provided even when a landlord and tenant agree in writing to terminate on a specific date.

Termination notices will not be required if a landlord and tenant agree in writing to terminate the rental agreement on a specific date (reduces red tape).

Notice Where Failure to Pay Rent

If the rent payable by a tenant is in arrears for 15 days, the landlord can give the tenant notice that the rental agreement is terminated and the tenant is required to vacate the residential premises on a specified date not less than 10 days after the notice is served on the tenant.

There will be reduction in the time it takes to evict a tenant in arrears in a month-to-month tenancy by decreasing the time the tenant must be in arrears before a ten-day notice to evict can be given to five days from fifteen days.

Notice of Termination – Family Violence

No provisions to provide for early termination of a rental agreement in situations of family violence.

Will provide for early termination of fixed-term rental agreements without penalty by providing 30 days’ notice in situations of family violence.

Grounds for Group Evictions

Subsection 24(5) of Act states that, for the purpose of a group eviction, a landlord may give a tenant a notice to terminate where the landlord requires possession of the residential premises for the purpose of demolition; changing use to a use other than rented residential premises; and repairs or renovations so extensive they require vacant possession.

Will clarify that group termination notices are limited to the grounds outlined in the Act (demolition; changing use to a use other than rented residential premises; and repairs or renovations so extensive they require vacant possession).

Group Eviction Notice Period

No specific notice period for group evictions of a residential complex.

In situations of a group eviction, requirement that all tenants (including tenants of residential complexes, in addition to tenants of mobile home parks) be given six months’ notice.

Group Evictions - Undue Hardship

Landlord can apply to the Director for further consideration in situations where the six-month notice period for mobile homes would place undue hardship on the landlord. There is no similar provision to allow a tenant to apply for further consideration, or a landlord to apply for further consideration in relation to residential complexes.

Director will be able to hear an application and determine that a six-month notice period for a group eviction notice would result in undue hardship for the landlord or tenant and make an order reducing or extending that time period.

Housekeeping / Clarifications

Not clear when abandonment has or has not taken place. 

Will clarify when a tenant is considered to have abandoned the residential premises.

Storage of Abandoned Personal Property – Where It Can Be Stored

Legislation indicates the landlord can remove personal property left on the premises by the tenant and immediately place it in safe storage.

Will allow landlords to securely store the personal property in/on the rental property, without requiring an agreement in writing.

Storage of Abandoned Property - Timelines

Landlord is required to store abandoned personal property for 60 days.

Will be a reduction in the time landlords have to store abandoned personal property from 60 to 30 days.

Consistent Notice Requirements

Group termination notices and notices of application to the Director have requirements inconsistent with other notices.

Prescribed requirements for group termination notices and notices of application to the Director will be consistent with requirements for other types of notices.

Grounds for Notice Required

No requirement that explicitly requires that notice include the section of the Act under which it is given.

Will clarify that any notice indicates the section of the Act that gives grounds for the notice.

Substituted Service

There is currently no provision made for substituted service.

Changes will be made to allow a landlord or tenant who cannot serve a notice to apply to the Director who may issue an order authorizing an alternate method of service.

Electronic Documentation

Electronic documentation is not dealt with under legislation.

Will provide that documents can be delivered and served through electronic means.

Housekeeping / Clarifications

Act places onus on the Director to notify the other party of an application or hearing.

Notification of application and hearing requirements will be shifted from the Director to the applicant (Director would still notify of any change in hearing date, time or place).

Housekeeping / Clarifications

No provisions for a telewarrant.

Where a request for a warrant is filed, it will be filed as a telewarrant.

Timeframes for Applications Under the Act

An application to the Director can be made from two years from the termination of a rental agreement. 

Will be a reduction in the period of time a landlord or tenant can make an application to the Director to one year from the termination of the rental agreement.

Housekeeping / Clarifications

Not specified that the request to withdraw an application to the Director be made in writing.

Will be clarified that withdrawal of applications must be made in writing (including electronic).

Reconsideration to the Director

A landlord or tenant can make an application to the Director of Residential Tenancies for a reconsideration of an order made under section 41 by the staff of the division.

Will be an elimination of the reconsideration of orders to the Director and allow parties to go straight through the court process, reducing the timeline by 17 days.

Ex-Parte Orders

The Director has authority to make an ex-parte order (make an order without attempting to mediate or holding a hearing) where the matter is urgent and involves the safety or security of a landlord or tenant.

Director’s authority will be expanded to make an ex parte order to include situations where the landlord’s property is at significant risk.

Copies of Orders

Not noted in the Act that the Director is required to give copies of orders to the landlord or tenant.

Will be a requirement for the Director to provide landlords and tenants with a copy of an order.

Penalties

Maximum fines for contravening the Act are $400.

Penalties for contravening the Act will increase from maximum of $400 to maximum of $10,000 for corporations and $3,000 for individuals.

Housekeeping / Clarifications

Act has not been updated in some time and there is a great deal of unclear language.

There will be a general clarification of the language.

Definition of Material Breach

The definition of material breach is narrowly defined and the language is confusing for landlords and tenants.

The limiting, unclear, definition of material breach will be removed and placed in policy.

2018 05 17                                                    10:20 a.m.