Corporate Owners - Re: Personal Use (RTA)

From Riverview Legal Group


Caselaw.Ninja, Riverview Group Publishing 2021 ©
Date Retrieved: 2022-08-11
CLNP Page ID: 1661
Page Categories: [Personal Use Application (LTB)]
Citation: Corporate Owners - Re: Personal Use (RTA), CLNP 1661, retrieved on 2022-08-11
Editor: Sharvey
Last Updated: 2022/05/16


Residential Tenancies Act, 2006, S.O. 2006, c. 17

48 (1) A landlord may, by notice, terminate a tenancy if the landlord in good faith requires possession of the rental unit for the purpose of residential occupation for a period of at least one year by,

(a) the landlord;
(b) the landlord’s spouse;
(c) a child or parent of the landlord or the landlord’s spouse; or
(d) a person who provides or will provide care services to the landlord, the landlord’s spouse, or a child or parent of the landlord or the landlord’s spouse, if the person receiving the care services resides or will reside in the building, related group of buildings, mobile home park or land lease community in which the rental unit is located. 2006, c. 17, s. 48 (1); 2017, c. 13, s. 7 (1); 2021, c. 4, Sched. 11, s. 31 (1).
...
(5) This section does not authorize a landlord to give a notice of termination of a tenancy with respect to a rental unit unless,
(a) the rental unit is owned in whole or in part by an individual; and
(b) the landlord is an individual. 2017, c. 13, s. 7 (2).
...

202 (1) 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. 2006, c. 17, s. 202.

[1]

Slapsys (1406393 Ontario Inc.) v. Abrams, 2010 ONCA 676 (CanLII)[2]

[13] Furthermore, by its language, s. 202 obligates the Board to ascertain the true substance of transactions, activities and the good faith of the parties when making findings on an application. It allows the Board to disregard the separate corporate existence of the parties to the transaction in doing so. These are matters that are relevant to an enquiry under s.48. As a result, we are satisfied that s. 202 is relevant to the determination of an application under s. 48 of the Act.

[14] For these reasons, we are satisfied that s. 48 is available to permit a tenancy to be terminated for the personal use of the sole shareholder of the corporate owner of rental premises. Accordingly, we do not give effect to this ground of appeal.

[15] The appellant further submits that, in any event, the landlord was precluded by issue estoppel from seeking the tenant’s eviction. The landlord had a previous unsuccessful application by the landlord under s. 48. However, the Divisional Court was correct in holding that the change in circumstances that the landlord’s family was expecting an additional child was evidence upon which the Board could conclude that issue estoppel did not apply.

[16] Finally, we see no reason to disturb the Divisional Court’s conclusion that there was evidence upon which the Board could conclude as it did on the issue of good faith.


[2]

SWL-52948-21, RVGP 301 (ONLTB)[3]

9. In this instance, I find that while the Landlord was an individual at the time the Notice was served, pursuant to section 202 of the Act, the true Landlord is a corporation. The real substance of the transfer was to evade the Act’s prohibition on corporate Landlord’s serving N12s under section 48(5). It was undisputed that Never Rest Farms Ltd. was the Landlord at the start of the tenancy. It was the Landlord’s own evidence that he transferred title to his name to meet the requirements of section 48 of the Act. I recognize that the definition of “landlord” in section 2(1) of the Act includes an owner of a rental unit. However, John Sauve acquired his ownership in the rental unit from a corporation that he alone controls for the sole purpose of being able to evict the Tenants. This interpretation is consistent with the intent of section 48(5) of the Act, which is to deny corporate Landlord’s the right to evict Tenant’s for Landlord’s own use applications.

10. As I have found that Never Rest Farms Ltd., a corporation, is the true Landlord, the N12 Notice of Termination served on July 13, 2021 does not comply with section 48 of the Act.


[3]

References

  1. Residential Tenancies Act, 2006, S.O. 2006, c. 17, <https://www.ontario.ca/laws/statute/06r17#BK299>, retrieved on 2021-09-24
  2. 2.0 2.1 Slapsys (1406393 Ontario Inc.) v. Abrams, 2010 ONCA 676 (CanLII), <https://canlii.ca/t/2d05l>, retrieved on 2021-09-24
  3. 3.0 3.1 SWL-52948-21, RVGP 301 (ONLTB), <https://caselaw.ninja/d/42>, retrieved on 2022-05-16