Jan

4

Residential Lease Agreements Ontario: Terminating a Fixed Term Lease

Ontario residential lease lawyer

Home Lease Agreement: Terms and Conditions

If you’re a Landlord in Ontario and you want to lease out your house, apartment, condo, etc., then you can use our Lease-O-Matic Wizard to create a custom-tailored residential lease agreement. This Residential Lease Agreement also includes a 2 page tenant application which takes into consideration the types of questions you can LEGALLY ask a prospective tenant (under the Ontario Human Rights Code and the Residential Tenancies Act, 2006). Finally, the Residential Lease Agreement includes an eBook about residential leases in Ontario:

Rental Agreement Ontario

Please note that the information provided herein is not legal advice and is provided for informational and educational purposes only. It may not be up to date. Laws change often and without notice. If you need legal advice with respect to a residential lease agreement or sublease contract, you should seek professional assistance (e.g. make a post on Dynamic Legal Forms). We have Toronto, Ottawa, Hamilton, Brampton, Mississauga and other Ontario lawyers registered to help you. You can also contact me directly.

In this blog, I’ll be talking about an important, but often confused, issue: how can a residential lease agreement by terminated at the end of the fixed term?

Now, lets assume that you want to have a 2 year lease. This means that it will start on day 1 and the term shall run until 2 years from day 1. The question comes up: how can the lease be terminated? Well, the first thing to keep in mind is that a residential lease for a rental unit is governed by the Residential Tenancies Act, 2006. That Act says that a lease can only be terminated in accordance with the Act (section 37) and that any provision in the residential lease agreement which is inconsistent with the lease agreement is void (section 4). Ouch! So you’d better pay attention here…

Some people think that a residential lease agreement can automatically be terminated when it expires. This may be valid only in certain cases. Basically, if during the lease the Landlord and Tenant agree to terminate the lease (e.g. by using the Landlord and Tenant Board’s Form N11), then the lease can be terminated at any time – including at the expiration of the term: section 37(3). One thing to keep in mind, however, is that this agreement CANNOT be entered into at the time when the lease is being entered into or as a condition of entering into the tenancy agreement (section 37(5)). There are exceptions to this rule (e.g. related to post-secondary housing), but you get the basic idea. You, as a Landlord, cannot at the time of entering into the lease require the Tenant to move out at the expiration of the term. This has to be a separate agreement that is entered into after the lease is entered into (and it must not be a condition of entering into the lease).

So how can the Tenant terminate a fixed term lease? Well, under section 47, a Tenant may terminate the tenancy at the end of the term by giving notice to the Landlord. Section 44(4) of the Act specifies that, in the case of a fixed term tenancy, the Tenant must provide the Landlord with notice at least sixty (60) days before the expiration of the date specified in the tenancy agreement. You may want to consider providing the Tenant with a draft notice of termination document. The notice should comply with the requirements set out in section 43 of the Act (e.g. identify the rental unit, state the date on which the tenancy is to terminate, be signed by the party, etc.).

So how bout the Landlord? Well, there are lots of ways the Landlord can terminate the tenancy – for cause or not for cause, either during or at the end of the fixed term. But one thing to keep in mind is that the Landlord can only terminate in accordance with the Act.

The Landlord can only end the tenancy AT THE END OF the fixed term for reasons like (but not limited to): the Landlord needs the rental unit to live in for themselves, their spouse, their parent, or child; the Landlord has entered into a purchase and sale agreement with a purchaser who requires the unit for residential occupation for themselves, their spouse, their parent or child; the Landlord needs to demolish the unit, convert it for a purpose other than residential premises or do major repairs (they have to be so extensive that they require a building permit and vacant possession of the unit); or the Tenant has persistently failed to pay rent on the day it becomes due and payable.

The Landlord can only end the tenancy DURING the fixed term for reasons like (but not limited to): the Tenant has failed to pay rent; the Tenant materially misrepresented their income; the Tenant or an occupant whom the Tenant permits to be there has committed an illegal act in the rental unit; the Tenant or an occupant whom the Tenant permits to be there has wilfully or negligently caused undue damage to the rental unit; the Tenant or an occupant whom the Tenant permits to be there has substantially interfered with the reasonable enjoyment of the residential complex for all usual purposes by the Landlord or another tenant; if the Tenant’s act or omission seriously impairs the safety of another person; or if the number of persons occupying the rental unit on a continuing basis contravenes health, safety or housing standards required by law.

If neither the Tenant or the Landlord terminate at the expiration of the term (in accordance with the Act), and the lease has not been renewed by either party, then the lease is DEEMED to have been renewed as a MONTHLY TENANCY agreement containing the same terms and conditions that are in the expired tenancy agreement: section 38.

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