Application of Rent Payment (RTA)

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Caselaw.Ninja, Riverview Group Publishing 2021 ©
Date Retrieved: 2022-05-18
CLNP Page ID: 970
Page Categories: [Payment of Rent (LTB)]
Citation: Application of Rent Payment (RTA), CLNP 970, <https://caselaw.ninja/r/6f>, retrieved on 2022-05-18
Editor: Sharvey
Last Updated: 2022/03/31


CEL-60319-16 (Re), 2016 CanLII 88113 (ON LTB)[1]

10. The Court of Appeal decision M E Inc. v. R H Ltd. 1993 CanLII 8675 (ON CA), [1993] O.J. No. 1724[2] recognized that the application of rental payments may be controlled by a direction from the tenant or the contract or custom of the parties. In this decision the Court stated:

“The application of rental payments may be controlled by a direction from the tenant or the contract or custom of the parties. However, in the absence of any direction from the tenant or agreement of the parties as to the application of a voluntary payment as between a number of claims for rent, the landlord may ordinarily apply the payment to whichever claim he pleases. Payments made by a tenant to his landlord on account of rent in the absence of any direction by the tenant or any agreement of the parties generally may and, according to some authorities, will be applied to the extinguishment of the rents first accrued.”

11. In this circumstance, the receipts submitted by the Tenant did not specifically state the payments were for a particular month. However the Tenant made the payments in the exact amount of his rent on a monthly basis, usually on the 27th or 28th day of the month which I find implies that his direction was the payments were rent for the current month. At the hearing, the Tenant testified that he intended the payments were to cover his monthly rent. There was no evidence before me to support that there was an agreement between the parties regarding the application of rent payments towards previous rent arrears. The Landlord had a remedy in the mediated agreement under section 78 of the Residential Tenancies Act 2006 where he could apply to terminate the tenancy and evict the Tenant if there was a breach of the agreement. Therefore I find that the $5,800.00 payments made by the Tenant apply against the current rent owed to the Landlord.

[2] [1]

TEL-14224-11 (Re), 2011 CanLII 34685 (ON LTB)[3]

4. The Tenant paid $776.47 for April’s rent in March 2011, which was not credited to her at the time the Landlord served the N4 Notice and filed the L1 application. As a result, I find that the N4 Notice is defective and the tenancy cannot be terminated at this time. The Landlord chose to proceed with the application, seeking rent arrears and costs only.

5. These parties had been before the Board in March 2010 at which time they entered into a Mediated Agreement for the payment of rent owing to March 31, 2010; however, the Landlord did not have a rent ledger with him for the rent owing and paid since the Mediated Agreement was entered into by the parties. His only record of payments was for the period January 2011 to May 2011. This record did not agree with the Tenant’s cancelled cheques. The Landlord’s record was seriously flawed and I could not rely upon it. The evidence submitted by the Tenant’s common law husband M.C. was more reliable, and I have relied upon his cancelled cheques to determine the amount of rent owing at this time, which I have calculated to be $776.47 for the month of May 2011. The Tenant and her representative agreed with this amount. The Landlord could not challenge it because of his inadequate records.

6. I am not allowing the Landlord’s application costs because his records were so inadequate and flawed. He did not come to the hearing, prepared to present the application. Also it was not possible for the Tenant to reconcile her records with the partial ledger presented by the Landlord.

[3]

Malva Enterprises Inc. v. Rosgate Holdings Ltd., 1993 CanLII 8675 (ON CA)[2]

...

The law bearing on this question appears, as one would expect, to be the same in the law of landlord and tenant as it is for the law of creditor and debtor generally. With respect to the latter, Dunlop, Creditor-Debtor Law in Canada (1981), at p. 24 quotes from Cory Brothers & Co. v. "The Mecca", [1897] A.C. 286 at p. 293, [1895-9] All E.R. Rep. 933 (H.L.), as follows:

When a debtor is making a payment to his creditor he may appropriate the money as he pleases, and the creditor must apply it accordingly. If the debtor does not make any appropriation at the time when he makes the payment the right of application devolves on the creditor.

With respect to the payment of rent in a landlord and tenant relationship 52 Corpus Juris Secundum states the basic rules as follows at p. 530:

The application of rental payments may be controlled by a direction from the tenant or the contract or custom of the parties. However, in the absence of any direction from the tenant or agreement of the parties as to the application of a voluntary payment as between a number of claims for rent, the landlord may ordinarily apply the payment to whichever claim he pleases. Payments made by a tenant to his landlord on account of rent in the absence of any direction by the tenant or any agreement of the parties generally may and, according to some authorities, will be applied to the extinguishment of the rents first accrued.

In the case before us Malva appropriated the $6,411.04 payment of January 6, 1993 to the rent payable in January. As I have indicated, the words on the cheque "For December's rent", in the context of the relationship between the parties, indicate that it was the percentage rent payable in January based on December sales and that the payment was to discharge Malva's liability for this rent. Further, because the rent payable in December (based on November sales) had been paid in December, Rosgate could not reasonably have thought that the $6,411.04 cheque was for rent payable in December.

...

SWL-03868-09 (Re), 2009 CanLII 79877 (ON LTB)[4]

3. The application reflects the Landlord’s position that a payment of $900.00 made by the Tenants on November 27, 2009 constituted a rent deposit. The Tenants wanted the payment applied to the December 2009 rent. Subsection 106(1) of the Residential Tenancies Act, 2006 (the 'Act') provides that a landlord may require a tenant to pay a rent deposit with respect to a tenancy if the landlord does so on or before entering the tenancy agreement [emphasis added]. In this case, the Landlord did not collect a rent deposit on or before entering the tenancy agreement, and no longer had ability to require the Tenants to pay a deposit, when the Tenants’ payment was made. Therefore, I find that the Tenants have paid the December 2009 rent in full, and that the Landlord is not holding a rent deposit.

4. The Tenants requested relief from eviction on the basis that the conduct was an isolated incident. The Landlord opposed any relief because he no longer feels safe or comfortable dealing with the Tenants in matters related to the tenancy. The Tenants were correct that their payment should have been applied to the December rent, but instead of using the legal process to resolve the dispute, the Tenant, R.C., chose to engage in violence and property damage, and put a person’s safety at risk. I have considered all of the disclosed circumstances in accordance with subsection 83(2) of the Residential Tenancies Act, 2006 (the 'Act'), and find that it would be unfair to the Landlord to grant relief from eviction or postpone the eviction pursuant to subsection 83(1) of the Act.

5. Since the Tenants have paid the rent up to December 31, 2009, the Landlord is entitled to daily compensation for the use of the unit commencing January 1, 2010, if the Tenants have not vacated the rental unit by that date.

[4]

SOL-74132-16 (Re), 2016 CanLII 79600 (ON LTB)[5]

2. Without a file number or a hearing, I am not satisfied that it is fair to delay the Landlord’s application to be heard together with the Tenant’s application. I also was not persuaded that the Tenant had retained counsel to speak to the L1 application. It is more probable than not that any retainer between the Tenant and the paralegal sitting beside him that morning was conditional upon the Board granting an adjournment.

3. The Landlord’s notice of termination based on non-payment of rent is defective having failed to give the Tenant 14 days in which to void the notice and pay the rent. The Landlord agreed to proceed on the basis of arrears only and termination on the L2 application for Landlords’ own use.

4. Although the Tenant made a rent payment to the Landlord at the end of August 2016 I am satisfied this payment was applied to the month of July 2016 as is set out in the form L1 application. The Tenant has not paid the total rent the Tenant was required to pay for the period from July 1, 2016 to September 30, 2016.

5. I am satisfied that the Landlords in good faith gave the Tenant a notice of termination because they intend to reside in the rental unit. The Landlords own another home which is in the midst of renovation and will later be listed for sale.

[5]

References

  1. 1.0 1.1 CEL-60319-16 (Re), 2016 CanLII 88113 (ON LTB), <https://canlii.ca/t/gw4mf>, retrieved on 2022-03-22
  2. 2.0 2.1 2.2 Malva Enterprises Inc. v. Rosgate Holdings Ltd., 1993 CanLII 8675 (ON CA), <https://canlii.ca/t/g12z3>, retrieved on 2022-03-22
  3. 3.0 3.1 TEL-14224-11 (Re), 2011 CanLII 34685 (ON LTB), <http://canlii.ca/t/flv9z>, retrieved on 2020-09-21
  4. 4.0 4.1 SWL-03868-09 (Re), 2009 CanLII 79877 (ON LTB), <http://canlii.ca/t/28gss>, retrieved on 2020-09-21
  5. 5.0 5.1 SOL-74132-16 (Re), 2016 CanLII 79600 (ON LTB), <http://canlii.ca/t/gvq8x>, retrieved on 2020-09-21