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RTA - Special and Exempt - Land Lease

. White v. Upper Thames River Conservation Authority

In White v. Upper Thames River Conservation Authority (Ont CA, 2022) the Court of Appeal considered a land lease case, appealed from the LBT and through the Divisional Court. The original issue was the application of the RTA to the lots given that the lease called for seasonal periods of non-occupancy, a provision that had been waived extensively in practice. At the CA it was agreed that the RTA applied, and the only issue was the legality of the non-occupancy period provisions (the court held against their legality):
[13] The parties have a longstanding rental relationship that has always included occupancy limitations. It is unclear why the limitations were established. The respondent can suggest no purpose for them, nor does anything in the record indicate the practice at other conservation authorities in the province. The respondent is attempting to establish the legality of occupancy limitations it has chosen not to enforce for decades.

[14] Regardless of the provenance or utility of the occupancy limitations, the operation of the Act is clear: if the limitations are inconsistent with the Act they are rendered void by operation of s. 4.

[15] Plainly, occupancy limitations are not specifically permitted by the Act, but nor are they specifically prohibited. The Divisional Court considered that the absence of a specific prohibition was determinative, given the parties’ agreement to the limitations. In an apparent application of the expressio unius est exclusio alterius maxim, the court reasoned that because the Act includes some specific prohibitions – for example, the Act prohibits “no pet” provisions – the absence of a specific prohibition of occupancy limitations means that they must be permitted. The court reasoned that “[i]f there was a limitation regarding limiting access or occupation of a residential unit, the court would expect there to be a specific section of the Act dealing with this issue.” The court added: “It can hardly be said that when a party voluntarily agrees to a provision of the residential agreement that is not specifically provided for by the Act, this leads to a determination that the provision is inconsistent with the Act.”

[16] This reasoning is untenable. It does not necessarily follow from the specific prohibition of some things in an act that other things not specifically prohibited must be permitted. Whether this sort of negative implication can be drawn depends on context and common sense – as Scalia and Garner note, whether the thing specified “can reasonably be thought to be an expression of all that shares in the grant or prohibition involved: see Reading Law: The Interpretation of Legal Texts (St. Paul, MN: Thompson/West, 2012), at pp. 107-111. In this case, there is no reason to suppose that the Legislature’s decision to prohibit “no pet” provisions has anything to do with tenants’ right to occupy the units they rent.

[17] The Divisional Court’s reasoning begs the question at issue. Voluntary agreement to a provision is irrelevant if that provision is not otherwise permitted. In the absence of specific authorization or prohibition, the legality of occupancy limitations must be determined by consideration of the provisions of the Act as a whole.

[18] This is simply an application of the modern approach to statutory interpretation. The purpose of statutory interpretation is uncontroversial: it is to determine the intention of the legislature. The Supreme Court summarized the modern approach recently in Vavilov, at para. 117:
A court interpreting a statutory provision does so by applying the “modern principle” of statutory interpretation, that is, that the words of a statute must be read “in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament”: Rizzo & Rizzo Shoes Ltd. (Re), 1998 CanLII 837 (SCC), [1998] 1 S.C.R. 27, at para. 21, and Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559, at para. 26, both quoting E. Driedger, Construction of Statutes (2nd ed. 1983), at p. 87. Parliament and the provincial legislatures have also provided guidance by way of statutory rules that explicitly govern the interpretation of statutes and regulations: see, e.g., Interpretation Act, R.S.C. 1985, c. I-21.
[19] The modern approach to statutory interpretation is now referred to as “text, context, and purpose”: see the helpful discussion by Miller J.A. (dissenting) in R. v. Walsh, 2021 ONCA 43, 154 O.R. (3d) 263, at paras. 133-150. In my view, the text, context, and purpose of the Act confirm that it contemplates only non-temporary, non-conditional, unlimited occupancy arrangements. In short, occupancy limitations in residential leases are not permitted.

The security of tenure

[20] The intervener Advocacy Centre for Tenants Ontario and the Board made helpful submissions highlighting the security of tenure provisions of the Act – provisions that the Divisional Court failed to consider. These provisions are premised on the notion that the Act establishes ongoing tenancies that may be renewed following completion of the initial fixed term. The circumstances in which a landlord may take possession of a rental unit from a tenant are strictly limited to lawful termination, abandonment, death, assignment, eviction, or a Board order – in other words, the end of a tenancy in accordance with the Act. Nothing in the Act authorizes a landlord to take possession of a residential unit during an ongoing tenancy or assists the landlord in doing so.

[21] None of this is surprising in the context of an Act that is designed to redress the imbalance in bargaining power between landlords and tenants. Occupancy limitations are at odds with the very scheme of the Act. This is confirmed by the core concepts in the Act – tenant and tenancy agreement – both of which are defined in s. 2(1) in terms of tenants’ right to occupy the units they rent.

[22] The respondent sought to defend occupancy limitations by drawing a distinction between tenants’ right to occupy their rental units, on one hand, and the right of the landlord to take possession of those units on the other, asserting that the landlord does not take possession of the rental units or occupy them itself during the term in which occupation by the tenant is not permitted. This purported distinction is illusory. The denial of a tenant’s right to occupy the unit he or she has leased is the problem, and it is irrelevant whether the landlord has in some sense taken possession of the unit or simply denied the tenant access to it; in either case, the continuity of the tenancy has been broken in a manner inconsistent with the Act.

[23] The Act specifically enumerates the forms of living accommodation that are exempt from the Act on the basis of seasonal or temporary occupation, and it is common ground that the land lease situation in this case is not included. Section 5(1) provides:
5 This Act does not apply with respect to,

(a) living accommodation intended to be provided to the travelling or vacationing public or occupied for a seasonal or temporary period in a hotel, motel or motor hotel, resort, lodge, tourist camp, cottage or cabin establishment, inn, campground, trailer park, tourist home, bed and breakfast vacation establishment or vacation home;
[24] In other words, rather than address seasonal or temporary accommodation arrangements in the context of leases covered by the Act, the Legislature exempted them all together.

[25] Thus, the Divisional Court’s concern that the Board’s order would preclude the owner of a cottage and a tenant from including a term in a lease permitting the owner to occupy the cottage during certain limited times of the year, such as at Christmas, is misplaced. Cottage rentals are exempt from the Act by virtue of s. 5. Put another way, there is no need to interpret the Act to protect seasonal or temporary arrangements for living accommodations. The Legislature has adverted to the matter and determined the sorts of seasonal and temporary arrangements that are not covered by the Act.

[26] In summary, the Act establishes security of tenure. Occupancy limitations are inconsistent with the Act and are rendered void by s. 4. The parties’ agreement to such limitations is simply irrelevant: freedom of contract values cannot be invoked to limit the protection the Act provides.
. Sutton v. Patterson and Morrow

In Sutton v. Patterson and Morrow (Div Ct, 2021) the Divisional Court held that the RTA constitutes a 'complete code', even to the extent of excluding the common law regarding such things as the law of fixtures:
[39] Validly enacted legislation is paramount over the common law. The Legislature can offer an exhaustive account of the law in an area (a code) which occupies the field in that area, displacing the common law rules and cutting off further common law evolution: see Ruth Sullivan, Sullivan on the Construction of Statutes, 6th ed. (Markham: LexisNexis, 2014), at 17.4; see also Bank of Montreal v. Innovation Credit Union, 2010 SCC 47, [2010] 3 S.C.R. 3, at paras. 53-54.

[40] Mobile home and land lease home tenancies were not originally protected by residential tenancies legislation. The RTA now deals extensively and in detail with land lease homes. For example, s. 3(1) of the RTA codifies the Legislature’s intent that the RTA take precedence over conflicting legislation, and s. 3(3) shows a particular concern for protecting the ownership interests of tenants who are land lease owners, where it says:
3(1) This Act, except Part V.1, applies with respect to rental units in residential complexes, despite any other Act and despite any agreement or waiver to the contrary. [...]

(3) In interpreting a provision of this Act with regard to a mobile home park or a land lease community, if a provision in Part X conflicts with a provision in another Part of this Act, the provision in Part X applies.
[41] By including the concept of permanency in the definition of a land lease home, the Legislature expressly addressed characteristics that would otherwise be relevant in determining whether a structure is land or chattel, and thus who it belongs to. For example, in the cases of Haggert v. Brampton (Town) (1897), 1897 CanLII 14 (SCC), 28 S.C.R. 174, and Stack v. T. Eaton Co. (1902), 4 O.L.R. 335 (Ont. Div. Ct.), as cited by the Appellant, the intention that a structure be permanent was a determinative factor in finding whether the structure is a chattel or part of the land.

[42] As the Respondents contend, the compounded effect of the history of reform and the comprehensive nature of the RTA itself shows the Legislature codified the law in the residential tenancies context, so the common law in respect of fixtures does not apply. I agree.

[43] Further, to adopt the Appellant’s argument on the matter would make a land lease home the property of the land lease community as soon as it was affixed to its location or connected to services, thus defeating the purpose of this new regime and these new rights. Moreover, the Legislature’s intent to preserve the right to sell “permanent” land lease homes would be frustrated, as would its scheme establishing the circumstances in which the landlord can sell, retain for the landlord’s own use, or dispose of the land lease home.


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Last modified: 26-04-23
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