What Can You Do If You Are a Landlord Facing a Bad Faith LTB Proceeding (T5)?
- Tira Muise
- Oct 20, 2024
- 3 min read
Have you ever needed to reclaim your property for personal use as a landlord? If so, you've likely encountered the "N12 Notice to Terminate your Tenancy for Personal Use" and its associated requirements. One crucial stipulation demands that you reside in the unit for a full year after gaining possession. Failing to do so could lead your former tenant to file a T5 application.
What is a T5 Application?
A T5 application is filed by tenants who believe their landlord issued an N12 or N13 notice in bad faith—meaning the landlord had other plans for the unit, such as selling it or renting it out at a higher price.
Life, however, can be unpredictable. What if you need to relocate to care for a sick loved one or have an opportunity for a dream job out of province? Such circumstances might necessitate putting the unit back on the market before the mandated one-year occupancy period is over.
Potential Outcomes of a Successful T5 Application
If a former tenant's T5 application proves successful, according to section 57(3) of the Residential Tenancies Act, you could face one or more of the following consequences:
An order that the landlord pays a specified sum to the former tenant for all or any portion of increased rent that the former tenant has incurred or will incur for a one-year period after vacating the rental unit.
An order that the landlord pay a specified sum to the former tenant as general compensation in an amount not exceeding the equivalent of 12 months of the last rent charged to the former tenant. An order under this paragraph may be made regardless of whether the former tenant has incurred any actual expenses.
An order that the landlord pay a specified sum to the former tenant for reasonable out-of-pocket moving, storage, and other similar expenses that the former tenant has incurred or will incur.
An order for an abatement of rent.
An order that the landlord pay to the Board an administrative fine not exceeding the greater of $10,000 and the monetary jurisdiction of the Small Claims Court.
Any other order that the Board considers appropriate.
Defending Against a T5 Application
If faced with a T5 application, your first step is to understand the burden of proof. Typically, the applicant must prove their case, but in T5 cases, the burden shifts to the landlord to prove they did not act in bad faith. The law presumes bad faith if, within the year after the tenant vacates, the landlord:
advertises the rental unit for rent;
enters into a tenancy agreement in respect of the rental unit with someone other than the former tenant;
advertises the rental unit, or the building that contains the rental unit, for sale;
demolishes the rental unit or the building containing the rental unit; or
takes any step to convert the rental unit, or the building containing the rental unit, to use for a purpose other than residential premises.
More often than not, tenants refer to this list and conclude that once they gather evidence of any of the items listed above, they believe they have an “open-and-shut” case against their former landlord. However, this assumption isn't accurate. It's now the landlord's responsibility to prove that their circumstances do not align with the legal criteria used to determine the success of a T5 application. The legal test to determine the success of a T5 application is as follows.
The Landlord gave the Tenant an N12 notice of termination under section 48 of the Act;
The Tenant vacated the rental unit as a result of the N12 notice of termination;
No person referred to in subsection 48(1) of the Act occupied the rental unit within a reasonable time after the Tenant vacated; and
The Landlord served the N12 notice of termination in bad faith.
If you're a landlord facing a T5 application and need guidance, schedule a free consultation with us to discuss your case and how we can assist you!
About the Author
Tira Muise
Licensed Paralegal
AJ Murray Legal Services