Fixed-term leases aren’t as iron-clad as they might appear to a landlord or tenant who wants to get out of their contract, says Ottawa paralegal Amri Murray. Murray, principal of AJ Murray Legal Services, tells AdvocateDaily.com that help with early termination of leases is one of her most popular services.
“People sign leases for a year or two, but your situation can change drastically during that time, so it’s a very common situation — for tenants more than landlords — to find themselves in,” she says. “Many think they’re stuck with the contract and don’t realize that there are several remedies possibly available to them under the Residential Tenancies Act (RTA). From a landlord’s perspective, the RTA allows for termination in the event of non-payment by renters. However, Murray warns that provincial law sets out a specific process for landlords to follow.
She explains that landlords must first fill out a form known as the N4, and present it to the tenant following the missed payment. This puts the tenant on notice to either pay what they owe or move out. If the renter remains, landlords may need to apply to the Landlord and Tenant Board (LTB) for an order of eviction. Other grounds for early termination of a lease by the landlord include a tenant’s misrepresentation of their income in certain circumstances, illegal acts performed on the property, or serious property damage, says Murray.
She says things are a little different on the tenant side, where the list of options for early termination is generally less extensive than for landlords. The RTA allows renters to break a lease early for a variety of reason, including if it's done to escape an abusive situation, such as sexual or domestic violence, says Murray. Certain breaches by landlords and their duty to maintain the property may also result in early termination if they render the unit uninhabitable. Recent amendments to the law also created a new mechanism for early termination initiated by tenants, she says.
I find it’s not well known by many people, even among legal practitioners who aren’t doing this kind of work regularly. There’s not much case law, because it’s so new. She says alleged misrepresentations by sellers, which could expose them to liability, fall into two camps: negligent misrepresentations, which could be put down to carelessness, and more serious fraudulent misrepresentations, which involve deliberate deception on the part of a vendor.
The method relates to the standard lease that applies to most residential tenancies in the province. Although some landlords can draw up their documents, neither party can contract out of the provisions of the RTA, says Murray, explaining that any clause purporting to breach it could provide grounds for a renter to terminate the tenancy early. Since April 30, 2018, certain tenants have been able to request that landlords provide the standard lease to them, she says. Failure to do so within 21 days gives renters the right to provide 60 days’ notice to terminate a fixed-term tenancy.
If the landlord meets the 21-day deadline, but the tenant has not entered into the new lease agreement, the tenant gets another 30 days from the date the new lease was provided, to give appropriate notice of termination to the landlord, says Murray. In some other cases, she has even helped tenants get out of a lease before occupancy. For example, a person moving a great distance to a new city may have signed a lease remotely, only to arrive and find the unit does not meet their needs.
They may have made the commitment based on pictures or descriptions online which don’t match up with what they see in person, Murray says. These cases tend to be negotiated between myself and the landlord. I’ve never had to take one to the LTB because we can look at the situation and find a resolution that’s fair and reasonable.