CITATION: Drewlo Holdings Inc. v. Weber, 2011 ONSC 6407
DIVISIONAL COURT FILE NO.: DC 11-281
DATE: 2011-10-27
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Jennings, McCartney and Swinton JJ.
B E T W E E N:
DREWLO HOLDINGS INC.
Joseph Hoffer and Kristin Ley, for the Appellant Drewlo Holdings Inc.
Appellant
- and -
JACLYNN WEBER
Joseph Fera, for the Respondent Jaclynn Weber
Respondent
HEARD: at Hamilton October 21, 2011
ENDORSEMENT
[1] Drewlo appeals an order of the Landlord and Tenant Board dated February 3, 2011 and a Review Order of February 8, 2011 holding that a rent increase of 9 percent levied against pet owning tenants was an impermissible premium or penalty proscribed by Section 134(1)(a) of the Residential Tenancies Act, 2006, S.O. 2006, c. 17 (the RTA), and as such interfered with Weber’s reasonable enjoyment of her apartment. The Board awarded an abatement of the increased rent charged pursuant to Section 31(1)(c) of the RTA. The appellant submits that the abatement remedy is available only if an application is brought under Section 29 of the RTA. It is not an available remedy, the appellant submits, under Section 135(1) of the RTA for a breach of Section 134.
[2] For the reasons that follow we disagree.
[3] It will be appropriate to set out here the sections of the RTA to which we will refer.
29.(1) A tenant or former tenant of a rental unit may apply to the Board for any of the following orders:
- An order determining that the landlord, superintendent or agent of the landlord has substantially interfered with the reasonable enjoyment of the rental unit or residential complex for all usual purposes by the tenant or a member of his or her household.
31.(1) If the Board determines that a landlord, a superintendent or an agent of a landlord has done one or more of the activities set out in paragraphs 2 to 6 of subsection 29(1), the Board may,
(c) order an abatement of rent.
134.(1) Unless otherwise prescribed, no landlord shall, directly or indirectly, with respect to any rental unit,
(a) collect or require or attempt to collect or require from a tenant or prospective tenant of the rental unit a fee, premium, commission, bonus, penalty, key deposit or other like amount of money whether or not the money is refundable.
135.(1) A tenant or former tenant of a rental unit may apply to the Board for 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, 1997.
- In making findings on an application, the Board shall ascertain the real substance of all transactions and activities relating to a residential complex or a rental unit and the good faith of the participants and in doing so,
(a) may disregard the outward form of a transaction or the separate corporate existence of participants; and
(b) may have regard to the pattern of activities relating to the residential complex or the rental unit.
[4] In this case, the Board was required to interpret its “home” statute in determining whether there was a substantial interference with the tenant’s reasonable enjoyment of her unit. We are satisfied that such a determination falls squarely within the Board’s area of expertise. The standard of review was accordingly one of reasonableness, with the deference due to the Board.
See First Ontario Realty Corporation v. Deng, 2011 ONCA 54.
[5] It is conceded that the building owned by Drewlo was partially exempt from rent control pursuant to the provisions of Section 6(2)(c) of the RTA. It is further conceded that Drewlo did not need to give reasons for the rental increase it sought to impose. However, in a letter to Weber, Drewlo advised her that the increase was to be applied to all pet owning tenants because it typically incurred higher than usual turnovers costs when pet owning tenants vacated, because of damage caused by their pets.
[6] Weber thereupon launched a T2 Application About Tenants Rights, claiming only that Drewlo seriously interfered with her reasonable enjoyment of her unit. That application was brought pursuant to Section 29 of the RTA.
[7] It was further conceded that at the hearing it was the position of the Tenant and of the Member hearing the application, that the issue before the Board was whether the increase for pet ownership was contrary to principles expressed in the Act and amounted to a penalty for pet owners only.
[8] No evidence was led by Drewlo to justify its position that a 9 percent rent increase was related to habitual pet-caused damage. The position of Drewlo was then, and is now, that its reasons for levying the increase were and are irrelevant. Drewlo submits it has the unfettered right to raise rent under the RTA as it sees fit.
[9] In our opinion, it was appropriate for the Board to have recourse to Section 202 of the RTA to ascertain the real substance of the rent increase. Section 14 of the RTA voids prohibitions in leases against pet ownership. The Act also provides a mechanism for a landlord to recover compensation for damage caused by pets and in certain circumstances, to obtain an order terminating a tenancy because of a pet. The Board found that the real substance of the rent increase was to extract a premium or penalty from pet owning tenants. Although taking the position on the hearing before us that the real substance was irrelevant, Drewlo conceded that the finding was reasonable on the evidence before the Board. The Board then found that “…a tenant’s reasonable enjoyment of the property…includes the expectation that they [sic] will not be made subject to premiums, penalties or other charges for otherwise lawful conduct.” We find that was a reasonable finding that was open to the Board.
[10] At that point, the provisions of Section 31(1)(c) of the RTA came into play and the Board had the power to award an abatement for the breaching of Weber’s right to reasonable enjoyment. We reject the submission that Section 135 and Section 29 cannot operate harmoniously together. It cannot be the case that a breach of Section 134 is not to be considered in determining whether there has been a breach of the right to reasonable enjoyment.
[11] The decision of the Board was reasonable. The appeal must be dismissed. Failing agreement as to the disposition of costs, the parties may make written submissions not to exceed three pages within 14 days of the release of these reasons.
Jennings J.
McCartney J.
Swinton J.
Released: October 27, 2011
CITATION: Drewlo Holdings Inc. v. Weber, 2011 ONSC 6407
DIVISIONAL COURT FILE NO.: DC 11-281
DATE: 2011-10-27
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Jennings, McCartney and Swinton JJ.
B E T W E E N:
DREWLO HOLDINGS INC.
Appellant
- and –
JACLYNN WEBER
Respondent
ENDORSEMENT
Released: October 27, 2011