PEIFAH Submission to Government on 2nd draft Residential Tenancy Act. January 2022

INTRODUCTION

Thank you for the opportunity to submit comments on the Government of PEI’s second draft of a new Residential Tenancy Act (RTA).

The PEI Fight for Affordable Housing is a grassroots organization which grew out of tenant concern with widespread eviction, rising rents and loss of place in the community which reached a boiling point in 2018. Between October 2018 and the summer of 2019 tenants organized a series of tenant meetings at which hundreds of tenants told their stories and discussed ideas about what needed to change at the municipal, provincial and federal level with regard to housing policy, landlord tenant law and tenant political engagement. We also conducted surveys and entertained discussion on social media. After careful consideration of everything we had learned and shared we published some initial platforms at a press conference in Charlottetown in June 2019.

Since January 2021 we have worked closely with many individual tenants and groups of tenants who have reached out for information and support when they are facing evictions or insupportable rent increases. Much of our submission is based on what we have learned over the course of helping tenants to prepare for and navigate hearing processes.

While we appreciate that efforts that have been made to improve on some sections of the Rental of Residential Property Act, we are deeply concerned that this new draft embodies some fundamental changes which will overall increase the power imbalance between landlords and tenants and weaken rent regulation. The private sector is already failing to provide housing which is affordable to a high percentage of tenants, and we know through speaking to tenants on a daily basis that many are not asserting their rights to repair and maintenance because of their very deep and valid fear that, if they do, the landlord will find a way to evict them or ease them out of the unit. The new draft, if implemented, will do nothing to change this and will in many cases serve to worsen tenants’ insecurity.

OVERVIEW OF THIS SUBMISSION

COMMENTS AND RECOMMENDATIONS

1. Evictions, Rent Increases and Lack of Affordability
2. First steps in the dismantling of vacancy control
3. The reasons to end the termination of tenancies for repairs and renovations.

Repairs and renovations which are unnecessary or cosmetic.

Temporary relocation.

The role of a Provincial Housing Planner.

The Right to Maintain Occupancy.

The interaction of Section 50 (3) (a) and renovictions; gentrification.

• Reinstating the cap on the rent increase guideline
• Returning the right to challenge a guideline increase to tenants
• Rent Increases above the guideline – factors involved
• Information on incomes and wages a factor in calculating a rent increase above the guideline
• Prohibition of evictions for change of use to a short-term rental
• A public Rent Registry
• Evictions for non-payment of rent

• Maintenance and Repair; Increase in power imbalance between tenants and landlords
• Reduction in landlords’ obligation to maintain the premises in a good sate of repair.
• Provincial maintenance standards regulation.
• The interdependence of the obligations to pay rent and the obligations to maintain the premises in a good state of repair.
• Overall shift of power to landlords.
• Recycling – obligations of landlord
• Landlords letting buildings run down – the need to reverse upside-down justice.
• Double standard for quality of repairs

• Miscellaneous Concerns
• Emergency measures
• The right to organize and protection for tenants
• Breaking rules or “material” terms of a tenancy added by the landlord should not be a ground for eviction.

APPENDICES

1. Key proposals put forward by PEIFAH which have not been incorporated in new draft Act.

2. Submission to the Department of Education and Lifelong Learning. March 2020

1. EVICTIONS, RENT INCREASES AND LACK OF AFFORDABILITY

1. A new factor for consideration in calculating an allowable increase above the guideline – Section 50(3)(a) – “Whether the affected rental unit is currently vacant or occupied”

Vacancy control on PEI has been in place with the existing Rental of Residential Property Act (RRPA) for 30 years. A crucial aspect of our vacancy control is that the rental rate of a unit stays with the unit and not the tenant. This provision – whether exercised in good faith by landlords or is needing to be challenged by a tenant – is a viable mechanism for ensuring rental rates remain consistent and prevents rents from increasing so quickly that tenant incomes are unable to keep pace.

Despite maintaining that rent increases run with the rental unit and not the tenant (Section 47(2)), the second draft RTA begins to erode this longstanding provision by allowing the Director to consider whether a unit is vacant as a deciding factor for an above the guideline rent increase. As the PEI Fight for Affordable Housing (PEIFAH) has learned over the years, landlords pushing tenants out of their homes has for many years been used as a means to render a unit vacant so rent can be increased – with or without IRAC approval. This new section will play a role in codifying and legalising this behaviour.

There is no rational reason that an empty unit should have a higher rent than an occupied unit. This change simply provides another way for landlords to push up rents. It is true that when an increase takes place in between tenants no individual tenant is directly confronted with a large increase, but when a unit is increased above the guideline because it is empty, all tenants are affected. The erosion of the affordable housing supply affects us all.

We recommend that Section50(3)(a) be removed entirely from the draft as a factor for determining above the guideline rent increases.

• Section 64(1)(c) – Landlord’s notice for demolition, conversion, repairs, renovations

The forced displacement of tenants who have been served an eviction notice for major repairs and renovations has been and remains a persistent issue across PEI. In some areas, we have also seen an increase in evictions for demolition.

While the second draft RTA in 64(2) has introduced longer eviction notice requirements and requires that a landlord seek Director approval before they could serve a notice of termination on a tenant, all the machinery of renovictions remains in place. The longer notice requirements might deter some efforts to use renovictions to empty the building and raise the rents illegally, but the proposed regime still allows renovictions to take place and, as we will explain, has added features which will promote the allowance of large (legal) rent increases as a result.

• Terminating tenancies is not necessary and not fair.

We are extremely disappointed that PEI government has clung to the notion that tenancies need to be terminated for repairs and renovations. There is no rational reason for terminating a tenancy rather than temporarily rehousing the tenant.

While we recognize that extensive renovations may on rare occasions be necessary and that they will require vacant possession of a unit, terminating a tenancy is not the solution. A tenant can be rehoused elsewhere while the work is done and return to the unit once the work is completed. There is no logic to a new tenant being better than an old tenant. The only objection that a landlord might have is that it’s too much bother to help provide and cover the cost of the tenant’s temporary housing while the work is done.  But “too much bother” fades in comparison with the tenant losing their home and being cast into a market where there is close to no affordable housing available. In addition, the landlord has undertaken, through a tenancy agreement, to provide the tenant with accommodation in return for rent and our laws need to ensure that landlords continue to do this even when major repairs are necessary. The Quebec law is a good model in this regard. In the end it is the landlord who gains the most from the repairs and renovations, as it is their property which is enhanced and will be appraised at a higher market value. The tenants are doing the landlord a favour by agreeing to be rehoused while the work is done.

• Requirements that landlords rehouse tenants while work is done will not be a disincentive to landlords doing necessary repairs.

The Residential Rental Association of PEI argued in its presentation during the January 11^th engagement session that if landlords can’t evict tenants easily to do repair work it will be a disincentive to landlords to keep their buildings well-maintained. It is unfortunate that this kind of fearmongering is going on. Almost all repairs and maintenance which must be done to maintain a building well can be done while the tenant lives in the unit. And if a short period of vacancy is required the tenant can be easily rehoused. There is no disincentive here.

It should be a rare occurrence that renovations or repairs are so extensive that a tenant is required to leave an apartment for more than a few days. The government of British Columbia has produced a chart which indicates how unlikely it is that vacancy of a unit is required to perform this kind of work. The Government of BC is not implying that an eviction is the solution when vacancy is needed.

Common Renovations or Repairs
Type of Renovation or Repair	Disruption to tenants	Requires Vacancy?
Electrical
Electrical service replacement	Usually minimal	Unlikely
Replacing receptacles and switches	Usually minimal	Unlikely
Rewiring a circuit	Usually minimal	Unlikely
Rental unit re-wire	May be significant	May require vacancy
Heating
Boiler/furnace replacement	Usually minimal	Unlikely
Hydronic heating system upgrades	Usually minimal	Unlikely
Electric baseboard heater replacement	Usually minimal	Unlikely
Other Mechanical
Elevator modernization	Usually minimal	Unlikely
Fire sprinkler installation/replacement	May be significant	May require vacancy
Plumbing
Re-pipe	Usually minimal	Unlikely
Replacing faucets and fixtures	Usually minimal	Unlikely
Replacing bathtubs/toilets	Usually minimal	Unlikely
Structural/Exterior
Exterior window/glass door replacement	Usually minimal	Unlikely
Roof replacement	Usually minimal	Unlikely
Building envelope repair/remediation/	Usually minimal	Unlikely
Exterior painting	Usually minimal	Unlikely
Balcony repair/remediation	Usually minimal	Unlikely
Seismic upgrades	May be significant	May require vacancy
Interior
Replacing cabinets/vanities/countertops	Usually minimal	Unlikely
Replacing backsplashes	Usually minimal	Unlikely
Interior painting	Usually minimal	Unlikely
Replacing interior doors	Usually minimal	Unlikely
Replacing flooring/baseboards	Usually minimal	Unlikely
Replacing appliances	Usually minimal	Unlikely
Adding appliances	Usually minimal	Unlikely
Interior wall/ceiling demolition	Likely Significant	Likely Requires vacancy

Examples it gives where vacancy could be required include extensive asbestos remediation and the stripping down to the studs to replace insulation or electrical wiring.

• Renovations and repairs should only be considered as a reason to require a tenant to temporarily relocate where they are necessary to maintain the integrity of the building and the safety of the tenant.

We are disappointed that the requirement that renovations and repairs be deemed necessary to maintain the integrity of the building and the safety of the tenants is not in the draft Act. The Rental of Residential Property Act (RRPA) amendment passed on November 17, 2021 specifies that renovations can only be used as a ground for eviction when they are deemed necessary to protect or preserve the property, or to protect the health and safety of tenants. We believe that this RRPA amendment should be included in the RTA. With the current draft landlords will be free to evict tenants and increase the rent based on cosmetic changes to the building.

• The need for a Provincial Housing Planner – rehousing tenants temporarily

This is detailed in our 2020 brief (see Appendix – 2) and is based on best practices in other Canadian jurisdictions.

Since 2019 the PEI Fight for Affordable Housing has proposed the creation of a Provincial Housing Planner who will provide resources to landlords in the development of a detailed relocation plan for each tenant. This would ensure that tenants are not forcefully displaced into homelessness or other precarious housing situations.

Plans will be required to:

• temporarily rehouse tenants during the period which renovations/repairs take place; and
• to relocate tenants who are evicted due to demolition or change of use of the property.

As submitted in our first round of feedback, we submit that the new Act should align with the “the right to maintain occupancy”. This principle recognizes that tenants who comply with the law can stay in their dwelling if they wish and plays a role in stabilizing communities and people’s lives.

• The interaction of the new right to argue for a larger rent increase when the unit is vacant and the right to terminate a tenancy for renovations promotes gentrification and loss of affordable housing.

The new amendment in section 50 (3) (a) which allows the Director to approve a larger rent increase when the unit is empty will play out in a dreadful way for tenants when it is combined with the continuing right of a landlord to end a tenancy in order to carry out renovations or repairs. Let’s look at the way the proposed scheme will work for tenants. First, where the Director has decided that the landlord cannot do the work while the tenant occupies the premises, a tenant will lose their home before the work is started. This can happen whether the renovations are necessary to keep the building up to standard or not. So, if a landlord wants to build an unneeded balcony or turn a perfectly good kitchen into an upscale dining area the tenant has no defence. The work will be done, and the unit left empty while the landlord applies to the Director for a rent increase above the guideline based on the cost of the work done. The landlord will also argue that as the unit is empty, they should be able to get a larger increase as no individual tenant will be directly affected. There will be no tenant at the hearing, no tenant voice heard at all – even though the loss of an affordable unit may be on the line – and no party present which can appeal the decision. In addition, section 50 (3) (m) which states that the Director can “take into account the expectation of a tenant that rent increases will remain within the guideline” will not be a factor because there is no tenant. The tenant was previously evicted.

This regime and the amendments to section 50 (3) will work to promote gentrification and the loss of affordable housing throughout the province.

We must stress that tenants are affected whenever a large increase is approved for a unit, whether it is vacant or not. Every large rent increase approved takes an affordable unit out of the market and affects us all.

While it is true that the right of first refusal has been added to the draft, it is not likely that many tenants will be able to afford the new rent on their old apartment particularly with the new provision under section 50 (3) (a).

This speaks to the need for a cap on the percentage increase which can be awarded to a landlord who applies for an increase above the guideline. PEIFAH proposed a cap of 5-6% in our March 2020 submission.  When large expenditures are required to bring the building up to standard the cost must be borne fairly between tenants and landlords. And where the large expenditure is the result of landlord neglect, or cutting costs in the past, tenants should not bear any hardship.

• Reinstating the Legislated Cap on Yearly Guideline Rent Increases

In the first RTA draft, Section 50(2)(b) stated that “the guideline for a calendar year shall be not more than 2.5 per cent”. We recommend that this provision for calculating guideline rent increases be put back into the RTA.

The change of calculating yearly guideline rent increases using the All-Items Consumer Price Index is concerning and could result in rent increases more than double that of a legislated cap set at 2.5%. Tenants cannot afford sweeping rent increases each year as their source(s) of income do not increase at comparable rates.

• Loss of Ability to Challenge a Guideline Increase

Tenants currently have the right to challenge a yearly guideline increase under Section 23(4) of the RRPA. This provision has been taken away in both the first and second draft of the RTA. We recommend that this clause be reinstated in the RTAto give tenants the choice on whether they would like to dispute a yearly guideline rent increase.

If the 2.5% cap is removed this right will become even more important as guidelines could increase significantly and, as we all know, the guideline becomes the automatic rent increase charged by most landlords.

• An increase in the factors which enable landlords to increase the rent above the guideline

The PEIFAH is opposed to introducing new ways for a landlord to argue for greater increases above the guideline. Already, under the current list of four factors in the RRPA, the director is allowing landlords large rent increases in the 10-30% range.

Section50(3) (a) – “whether the affected rental unit is currently vacant or occupied”

See comments in section 1.

Section 50 (3) (b) – “the rent payable for similar rental units in the residential property immediately before the proposed increase is intended to come into effect”

We can safely say that when a building has a difference in the rents for similar size units it is in very many cases due to illegal increases which have taken place in the past. Sometimes it is not. It may be due to proximity to the boiler or the fact that some units are basement apartments. But to expect that rents can be increased to upwardly harmonize with the highest rents is to accept and condone illegal rent increases charged in the past and institutionalise them.

There is no reason why rents in a building must be the same for all units of the same size. This is, again, just another pretext to push up rents.

Section 50(3) (d) – “a change in service or facility that the landlord has provided”

We discussed this section in our March 2020 submission. At that time the provision that the change must have the support of most of the tenants had not been inserted. While we welcome the attempt to ensure that unwanted and unnecessary services are not added against the tenants’ will and simply to increase the rent, there must be great care given to how the support of tenants is gathered to ensure that the vote is truly democratic, and the decision is not wrested from the tenants in a coercive manner. Consultation with tenants must take place before a process is approved and this needs to be inserted into the legislation or regulations.

In addition, the legislation must be clear that wherever the tenant does not agree with the new service being added to their tenancy, they should not be affected by any rent increase based on the cost of introducing the service. As we said in our 2020 submission “Section 10 (3) (also section 10(3) in the new draft) a tenancy agreement cannot be changed unilaterally. Therefore, a landlord cannot change the term of a tenancy without the tenant’s consent. We want to stress the importance of this section.” This means that no individual tenant can have the introduction of a new service imposed on them against their will. If the majority of the tenants want the new service and are prepared to pay any additional cost, it does not follow that a landlord can impose the change on tenants who do not want it. Where a tenant does not agree to the change, the landlord may have to wait until a new tenant moves into the unit to change the terms of the tenancy and apply the rent increase.

Section 50 (3) (e) – “a change in the operating expenses and capital expenditures in the three years preceding the date of the application that the Director considers relevant and reasonable”

This is an attempt to subvert regulation of rents. If a landlord does renovations each year for three years, there may be no loss incurred and no significant dent in return on investment in each of those years. However, if the costs of all the renovations are funnelled into one year the landlord’s costs might, on paper, reach a level that affects the return on investment. This is cheating and way of claiming “hardship” when there is none. If expenses from the past three years are allowed, revenue and profit margin of the past three years should also be part of the calculation. This clause must be deleted and replaced with a clause which specifies that only capital expenditures carried out in the year under consideration should be allowed.

Section 50 (3) (l) – “the expectation of a landlord to have a reasonable return on investment”

This is, by far, the most controversial and problematic clause in this section and has been in the legislation since 1989. The experience of the PEI Fight for Affordable Housing is that this clause has caused the most hardship and dislocation for tenants. It is profoundly counter productive from the point of view of any public policy which aims to achieve balance and affordability in the provision of housing.

The PEI FAH has made proposals that local data on wages and incomes also be a factor in rent increase calculation. While this proposal has been ignored, very specific attention is given to protecting the perceived “right” of the landlord to get a return on their investment. The right to make a profit on an investment is seen as more important than housing security for tenants.

If this clause stays in the legislation, specific attention must be played to the definition of “capital investment”. Under the RRPA the definition of capital investment was fatefully corrupted by the drafting of a Form 15 which entertained the notion that capital investment was the same as equity. It is our position that capital investment is a sum of cash acquired by a company to grow its operations. In the area of real estate, it refers to cash acquired or raised to purchase permanent fixed assets such as an apartment building.

Equity is different. Equity is the cost of acquisition plus any increase in the market value of the property since the purchase. This increase has nothing to do with expenditures on the building which benefit tenants. It has to do with the workings of a hot market and the pressures of speculation by a property-owning class.

The legislation is clear that the factor to be considered is return on “capital investment” not return on “equity”. The corruption of the interpretation of this section under the RRPA has had a very negative impact on tenants, allowing the Director to approve large increases based on a requirement that tenants cover the cost, through their rents, of a return on their landlord’s “equity” – an amount which can be considerably greater than the return on “capital investment”.

Section 50 (3) (m) “the expectation of the tenant that a rent increase will remain within the annual guideline”.

How this clause will interact, if at all, with all the above more precise provisions which benefit landlords will remain to be seen. But if the government was really concerned about tenants’ expectation that the province protects them from large rent increases it would have incorporated the 5-6% cap on increases above the guideline, proposed in the PEIFAH March 2020 brief, into the new draft.

We recommend that sections 50 (3) (a), (b) and (c) be removed from the draft and that a 5-6% cap be applied to all increases above the guideline. We also recommend that careful thought is given to creating appropriate regulations, as we have suggested, for sections 50 (3) (d) and (l).

As previously mentioned in section 5 both the RRPA and the draft RTA ignore the question of the tenants’ ability to afford the rent in setting out factors to be considered in calculating an increase above the guideline, while very specific attention is given to guaranteeing a return on investment for the landlord. We have observed through the many hearings we have attended that the factor concerning the landlord’s “right” to a reasonable return on their investment tends to overshadow all other considerations. As a result, it invariably results in rent increases being awarded which the current tenants cannot afford, and which take the units out of the reach of most renters. This regime could take hundreds of affordable units off the market over time and make the housing crisis for renters exceedingly worse.

The 2016 Census showed that the median total income for working PEI residents was $31,744. An affordable rent for someone earning $31,744 according to federal government measures (30% of pre-tax income) is $793.60.  An affordable rent by PEI Government measures (25% or pre-tax income) would be $661.33.

The same census showed that 46% of working residents of PEI have pre-tax income under $30,000. An affordable rent for these people would be under $750 by federal measures and under $625 by PEI government measures.

According to Statistics Canada, Labour Force Survey, the average hourly wage rate increased by $1.50 between 2015 and 2019. This increase would have had little impact on the amount of income available for rent, especially given the increased cost of other essential items.

These statistics are the reason that so many tenants are talking about their inability to afford rents. Tenants are often forced to go without other necessities to manage the higher rent. Or, they move in with a family member or friend in very cramped conditions in order to make ends meet. Or, they try to find cheaper accommodation, likely much further from their places of work due to the scarcity of affordable accommodation in the Greater Charlottetown region. In some cases, homelessness is not out of the question. In fact, the latest Point in Time survey done by the John Howard Society shows a marked increase in the incidence of homelessness on PEI since 2018.

We recommend that the new RTA include information and statistics on tenants’ incomes on PEI as a factor in determining a rent increase above the guideline. In addition, tenants’ submissions about their individual situations must be admissible and taken into consideration.

• An end to evictions on the basis of the unit being converted to a short-term rental

As recent community consultations in Charlottetown have indicated there is a deep awareness among tenants of the damage done when there is no regulation stopping the conversion of long-term rentals to short-term rentals. We support a prohibition of this type of change of use. We recommend that this be included in the new Act by adding an exemption to section 64 (1) (b)

• The creation of a Public Rent Registry

The creation of a publicly run rent registry, similar in character to a Land Registry, has been a long-standing proposal of the PEI Fight for Affordable Housing. More details can be found about our proposal in our March 2020 submission (see Appendix2).

• Eviction of a tenant for non-payment of Rent

Section 63 of the new draft reduces the amount of notice a tenant must receive of eviction for non-payment of rent from 20 days to 14 days and the time a tenant has to file a dispute the eviction has been reduced from 10 days to 7 days. We are opposed to this change. Our position on this issue can be found in our March 2020 submission (Appendix 2).

• MAINTENANCE AND REPAIR AND POWER IMBALANCE
•  Reduction of landlord’s responsibility to do repairs and a shift in law to invest more power with landlords.

• Landlord’s responsibility to repair reduced

For over thirty years the obligation of a landlord to provide tenants with well-maintained homes has been set out as a statutory condition of a tenancy in the RRPA section 6. 1. This section states that a landlord must “keep the premises in a good state of repair and fit for habitation during the tenancy and shall comply with any enactment regarding standards of health, safety or housing…” As there are no maintenance standards by-laws implemented by PEI municipalities and no Provincial standards for the maintenance of rental units, the obligation to “keep the premises in a good state of repair” has always been of key importance. Tenants could always assume that repairs such as broken or non-functioning refrigerators, stove elements which don’t work, leaking windows and ceilings, flooring which has risen and become hazardous, unsafe hallways and stairways and broken fans were included in the landlord’s obligation to “keep the premises in a good state of repair”.

The obligation to “keep the premises in a good state of repair” has been removed from the new draft Act. Here the only obligation of the landlord with respect to repairs is to “comply with health, safety and housing standards required by law”. Since there are no municipal or provincial maintenance standards which cover the maintenance of the inside of a unit and common areas,  the new section 28(1) has little substance and doesn’t really oblige a landlord to maintain much of anything.

The only standards at a provincial level of any relevance to tenants are the standards enforced by Environmental Health officers. These are primarily concerned with very basic cleanliness and sanitary considerations rather than maintenance and repair. They certainly do not cover the wide range of maintenance issues experienced by tenants. While these inspectors can respond to problems regarding mould, faulty plumbing, pest infestations and issues which might affect the resident’s health, they have no enforcement mechanism or ability to impose penalties.

If we take Charlottetown as a municipality and look at by-laws which address the maintenance of rental units we find nothing much. There is the Dangerous, Hazardous and Unsightly Premises Bylaw which is preoccupied with issues of unsightliness and possible danger to community members such as grass growing too high or abandoned vehicles on the property. And there is the Fire Prevention Bylaw – a very important by-law which requires adequate fire exits and maintenance of sprinkler systems but has limited relevance to the day-to-day maintenance issues experienced by tenants.

This raises the question of how a tenant can apply to the Director for an Order requiring the landlord to fix a broken stove, provide adequate snow removal or clean the hallways and stairs when according to the much-reduced obligation in 28(1) the landlord may not have violated the Act. [1]

The PEIFAH has for many years advocated for provincial maintenance standards for rental units.This would benefit the entire community as well as tenants by preventing the loss of affordable housing through neglect and lack of repair. More information on this proposal can be found in our 2020 submission on the first draft RTA in Appendix-2.

We recommend that section 28 (1) be amended to include a meaningful obligation on the landlord to keep the premises, both inside units and the in common areas, in a good state of repair.

We also recommend that the PEI Government begin work immediately on the development of a provincial rental housing maintenance standards regulation.

• The targeted removal of the interdependence of the obligation to pay rent and the landlord’s obligation to do repairs.

We wrote about this in our submission in response to the first draft in March 2020 and have been ignored. Here is what we wrote:

“b) The interdependence of the obligations to pay rent and the obligations to maintain the premises in a good state of repair.

The interdependence of material covenants – most significantly the obligation to provide premises in a good state of repair and the obligation to pay rent – is a crucial common-law principle in landlord tenant law. It holds that neither party can expect the other to perform their obligations if they themselves are not performing theirs. It is entrenched in the Rental of Residential Property Act in section 5 (2):

“Subject to this Part, the common law rules respecting the effect of the breach of a material covenant by one party to a contract on the obligation to perform by the other party apply to rental agreements.”

 This is a very important principle for tenants as it provides the legal basis for tenants to pay rent into a court- or tribunal-approved trust fund if their landlord is seriously neglecting maintenance and repair[2]. But, more generally it brings an element of equality into a legal relationship in which there is, by its very nature, an enormous power imbalance. This common-law principle is not asserted in the draft Residential Tenancy Law. We submit that it should be. Moreover, section 20. (1) states:

“A tenant shall pay rent when it is due under the tenancy agreement, whether or not the landlord complies with this Act, the regulations or the tenancy agreement, unless the tenant has an express right under this Act to deduct or withhold all or a portion of the rent.’

Is this clause suggesting that the Act fly in the face of the common law principle of the interdependency of material covenants?

In addition, Section 105 in the draft new Act states:

“Except as modified or varied under this Act, the common law respecting landlords and tenants applies in Prince Edward Island.”

The words “Except as modified or varied under the Act, …” give us further cause for concern.”

This may seem a legalistic point. But it goes to the very heart of fairness for PEI tenants. We are simply pointing out that the new draft Act introduces a new legislative framework which transfers increased level of power and leverage to landlords.

We recommend that Section 5(2) of the RRPA  be inserted into the new legislation and clauses which attempt to do away with repercussions for a landlord who fails to do repair or violate their obligations must be taken out.

• Overall shift in power

Overall, the legislation appears to be carefully drafted to ensure that while landlords can fail to live up to their obligation to do repair over long periods of time and experience no repercussion or hardship, tenants can be pounced on and evicted as soon as they have a challenge paying the rent.

This is a one-sided regime which has distorted the historic interdependency of the landlord’s obligation to maintain the premises in a good state of repair and the tenant’s obligation to pay rent. We recommend that it be reversed before this Act becomes law. This should also involve reversing the changes presented in section 63.

1.  Landlord responsibility to provide tenants with adequate recycling facilities which are well maintained and safe and provide tenants with all relevant information.

28. (3) (b) On responsibility for proper sorting and disposing of waste, compostable and recyclable materials: This is indeed something that most Island residents have become accustomed to. Island Waste Management (IWMC) provides good information in various formats. We agree that the responsibility to manage waste, according to IWMC guidelines, rests with tenants.

We believe that landlords should be required to do their part in supporting tenants to carry out this responsibility, by ensuring that everyone has access to adequate information (including but not limited to the IWMC seasonal pamphlet, posted in a prominent spot) and equipment, and that common areas are maintained in such a way that storing and disposing of compost, waste and recyclables does not interfere with tenants’ safety or wellbeing.

These responsibilities should be included in a new section, perhaps inserted between 28 (3) and 28 (4).

1.  The upside-down justice of sections 61 (1) (k) and 70 (1) and (2) The more a landlord lets a building run down the more the landlord is rewarded while the tenant absorbs the hardship.

Section 61 (1) (k) makes an order from any level of government that the premises be vacated a ground for eviction. This means that where a landlord lets a premise run down to the point that it breaches fire safety, public health standards or poses a risk to public safety landlords are not penalised while the tenants lose their home. We have experienced this scenario firsthand. The negligent landlord was not jeopardized in any way, while all the tenants lost their homes and one of the tenants was ordered to appear in Provincial Court where they were ordered to move out immediately. This caused incredible hardship, loss of a pet and the exacerbation of a medical condition. There was no fine imposed on the landlord, no order to take responsibility to rehouse the tenants and no order that damages be paid out to the tenants who experienced enormous stress and displacement.

This section needs to be rethought and redrafted, so that where a premises becomes unhabitable due to lack of repair and maintenance, the landlord bears the responsibility for rectifying the situation, rehousing the tenants and paying them damages.

In addition, in the section on compensation (s.70 (1) and (2), (c)) landlords whose tenants are forced to move because a level of government requires that repairs be made is exempted from having to pay one month compensation. Although there may be some cases where the renovations ordered are for some other reason than the landlord’s failure to maintain the building, in most cases this is upside down justice. Landlords who, through negligence, cause their tenants to lose their homes should have an increased obligation to pay them compensation

1. Double standard for quality of repairs made pursuant to section 28(4)

We have written at some length about the reduction in the obligation of the landlord to do repairs. 28 (4) of the draft RTA requires that when tenants perform repairs which they are responsible for they have to do them “in a good and professional manner”. This is a higher standard than landlords are held to. The Act simply requires landlords to comply with health, safety and housing standards. There is no mention of a standard for the quality of landlord repairs in the draft Act or in any safety or housing standard or municipal bylaw of which we are aware.  We recommend that this section be deleted from the legislation.

•  MISCELLANEOUS CONCERNS
•  Emergency Measures

A new section dealing specifically with emergency measures should be added to the legislation.

Landlord responsibility to implement safety measures in common areas: To say the COVID pandemic has changed the way we work and live and interact with one another would be an understatement. One of the things we have learned over the past two years is the importance of regular sanitization and provisions for social distancing in buildings, homes and public places. We feel strongly that landlords must be held accountable through appropriate provisions in the new Residential Tenancy Act to ensure that during public health or other emergencies, safety measures, at minimum as required by government are followed (for example, regular sanitizing of common areas, wearing of masks and social distancing, including in laundry rooms).

Ensuring regular maintenance during emergencies: This section should also make it clear that in emergency situations, necessary safety measures must not be used as an excuse to delay or ignore other safety and maintenance issues that typically arise in apartments.

Stopping evictions during pandemics or other emergencies: The new Act must contain provisions which invoke a moratorium on evictions and the service of notices for termination during a health or any other kind of emergency. In 2020 the need for this became crystal clear, as essential workers, many in low-paid positions, experienced lost income.Finding new rental housing in the middle of a public health emergency is challenging and adds to the anxiety and hardship already experienced by low and moderate-income tenants.

1.  Protection from reprisals for tenants who enforce their rights, organize a tenants’ association or are a member of a tenant association

Over the past year, the FAH has had the opportunity to work with numerous groups of tenants, providing practical and moral support as they navigate a system that seems to be weighted against them, and to favour landlords. When tenants feel their rights have been violated, whether it’s because of an illegal rent increase or eviction, or because their landlord is not fulfilling their responsibilities as defined in legislation, they may feel fearful or lack the confidence to act on their own. The stakes are high as they face a very real possibility of losing their home, with extremely limited prospects for finding a new one.

There is security in numbers, and tenants are more likely to use existing mechanisms for defending their rights when they are acting collectively. Tenant organizations provide safety as well as opportunities for sharing information and knowledge. They contribute to more inclusive and stable homes, neighbourhoods and communities.

The proposed Residential Tenancy Act presents an opportunity to ensure that tenants do not face retaliatory action by a landlord because they have taken part in a tenant organization or have advocated for or defended their rights in any way. We recommend adding a new section to the Act, it could be included in the Act as a new section (71) at the end of the section of termination of tenancies by landlords. We propose the following:

71. The Director shall refuse to grant any application for termination of a tenancy where they are satisfied that:

a) a reason for the application being brought is that the tenant has complained to any governmental authority of the landlord’s violation of any statute or municipal by-law dealing with health or safety standards including any housing standard or by law;

(b) a reason for the application being brought is that the tenant has attempted to secure or enforce their legal rights; or

(c) a reason for the application being brought is that the tenant is a member of an association, the primary purpose of which is to secure or enforce legal rights of tenants, or that the tenant is attempting to organize such an association.

And, to strengthen new provisions and the right of tenants to organize the following changes (highlighted) could be made to strengthen the “offences” section:

110. Offences

(2) A landlord or landlord’s agent who harasses, hinders, obstructs or interferes with a tenant in the exercise of,

(a)   securing a right or seeking relief under this Act or in another court or tribunal,

(b)   participating in a proceeding under this Act, or

(c)   participating in a tenants’ association or attempting to organize a tenants’ association;

commits an offence and is liable on summary conviction to a fine of not more than $25,000.

(3) A person who coerces, threatens, intimidates or harasses a landlord

(a) in order to deter the landlord from making an application under this Act; or

(b) in retaliation for seeking or obtaining a remedy under this Act,

commits an offence and is liable on summary conviction to a fine of not more than $25,000.

1.  Breaking rules or “material” terms of a tenancy added by the landlord should not be a ground for eviction.

Grounds for eviction for cause already include (i) interference with the quiet enjoyment of the premises by other tenants (ii) causing damage to the property and (iii) seriously interfering with the safety or lawful right of another tenant.

The RRPA section 14 (1) adds to this “breach of any other term of the rental agreement”. This is very dangerous in that it opens the possibility for a landlord to insert all manner of odd and nitpicky rules in tenancy agreements and use a violation of them to evict a tenant.

The concept that tenants have exclusive possession of their apartment must be taken very seriously. Thousands of tenants on PEI consider an apartment their home. Many will be renters for their entire life. Exclusive possession and full use of the premises with all the freedoms which homeowners enjoy should be their right. For example, no homeowner is restricted by rules which say when they can and when they can’t have visitors or when they can take showers.

With the three grounds for eviction listed above, any behaviour of the tenant that truly interferes with neighbours’ lives in an unreasonable way can become a ground for eviction. For example, hosting noisy gatherings in the premises at unreasonable hours could be a reason for eviction – not for breaking a rule, however. It would be for interfering with the quiet enjoyment of the premises by other tenants.

Section 61.1 (h)(i) of the second draft RTA changed this provision to a degree. It states that a tenant can be evicted if they fail to comply with a material term of a tenancy. Traditionally a material term has been defined as one which the parties both agree is so important that the most trivial breach of the term justifies a termination of the tenancy. But over the years landlords and elected officials have tried to change its definition so that any rule which a landlord thinks is important can be considered a material term of the tenancy and hence its violation can be grounds for eviction. We submit that there should be no provision in the new legislation which provides landlords with “rule breaking” as a ground for eviction. We recommend that Section 61(1) (h) of the latest draft of the RTA be removed.

This position aligns with the position of PEI’s Tenant Support Network that any “no pet” clause in a tenancy agreement should be deemed void. It should only be possible to evict a tenant for having a pet if the pets behaviour provides one of the three, already existing, grounds for eviction noted above.

We do agree, however, that restrictions on smoking inside the premises and the expectation that smoking takes place outside could be an exception. This is in line with accepted public health measures in a variety of public and private places in the community. However, being a smoker should never be a ground for someone being denied the right to rent an apartment.

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[1] The obligation to rent premises which are “suitable for occupancy” in the latter part of section 28 is so vague and subjective to be of little value.

[2] Quann and Pajelle Investments Ltd.

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