What to Do When a Tenant Refuses to Leave After the House is Sold in Ontario: A Guide for Landlords
Selling a house in Ontario that is currently occupied by bad tenants can be a challenging process, especially if the tenant refuses to vacate the property after it has been sold. Understanding the legal rights and obligations of both landlords and tenants is crucial in such situations. This guide will provide landlords with a comprehensive overview of what to do when a tenant refuses to leave after the sale of a property, focusing on the legalities in Ontario.
Understanding Tenant Rights Under Ontario Law
In Ontario, tenants are protected under the Residential Tenancies Act (RTA), which outlines their rights and responsibilities. One of the key aspects of the RTA is that a tenant’s lease does not automatically terminate just because the property has been sold. The new owner effectively “inherits” the tenant along with the property, and the tenant’s rights remain intact unless specific legal steps are taken.
Key Points to Understand:
- Lease Continuation: If the tenant has a fixed-term lease (e.g., a one-year lease), they have the right to stay in the property until the lease term ends, even if the property is sold during this time.
- Month-to-Month Tenancies: If the tenant is on a month-to-month tenancy, the situation is slightly different. The landlord or the new owner may be able to terminate the tenancy under certain conditions, such as personal use by the new owner or an immediate family member.
- Proper Notice: To legally require a tenant to move out after a sale, the landlord or new owner must provide proper notice as mandated by the RTA.
Step 1: Determine the Type of Tenancy
The first step in addressing a situation where a tenant refuses to leave after the sale of a property is to determine the type of tenancy agreement in place.
Fixed-Term Lease:
- If the tenant has a fixed-term lease, they are entitled to remain in the property until the lease expires. The new owner must honor the lease terms unless the tenant agrees to leave earlier.
Month-to-Month Tenancy:
- If the tenant is renting on a month-to-month basis, the landlord or new owner has more flexibility in terminating the tenancy, but they must follow the correct legal procedures.
Step 2: Serve the Tenant with Proper Notice (N12 Notice)
If the new owner intends to move into the property or if an immediate family member will be moving in, the landlord or new owner can serve the tenant with an N12 Notice. This notice informs the tenant that the tenancy is being terminated because the property is needed for personal use.
Key Requirements for an N12 Notice:
- Notice Period: The N12 Notice must give the tenant at least 60 days’ notice. The termination date must be the last day of the rental period, which usually aligns with the end of the month.
- Personal Use: The new owner, their immediate family members (such as parents or children), or a caregiver for the new owner or their family must intend to live in the property for at least one year.
- Compensation: The landlord or new owner is required to offer the tenant one month’s rent as compensation or provide the tenant with another rental unit acceptable to the tenant.
Serving the Notice:
- The notice should be served in person, by mail, or by posting it on the tenant’s door. Ensure that the notice is properly completed and provides the required details, such as the reason for termination and the termination date.
Step 3: Handling Tenant Refusal to Leave
If the tenant refuses to leave after being served with the N12 Notice, the landlord or new owner cannot forcibly remove the tenant. Instead, they must take legal action through the Landlord and Tenant Board (LTB).
File an Application with the LTB:
- If the tenant does not move out by the date specified in the N12 Notice, the landlord or new owner must file an L2 Application with the LTB to obtain an eviction order. The L2 Application is used to request an eviction for reasons other than non-payment of rent, such as the need for personal use.
Attend the LTB Hearing:
- Once the L2 Application is filed, the LTB will schedule a hearing where both the landlord/new owner and the tenant can present their cases. The landlord/new owner should be prepared to provide evidence that supports the need for the property, such as a sworn affidavit stating the intention to use the property for personal use.
LTB Decision:
- The LTB will review the evidence and make a decision. If the LTB rules in favor of the landlord/new owner, they will issue an eviction order with a specified date by which the tenant must vacate the property.
Step 4: Enforce the Eviction Order
If the LTB grants an eviction order and the tenant still refuses to leave, the landlord or new owner must take further steps to enforce the order legally.
Contact the Sheriff:
- Only a sheriff can legally enforce an eviction order in Ontario. The landlord or new owner must contact the local sheriff’s office to schedule the eviction. The sheriff will then remove the tenant from the property if they have not vacated by the specified date.
Important Considerations:
- Do Not Attempt Self-Help Evictions: It is illegal for the landlord or new owner to change the locks, remove the tenant’s belongings, or take any other action to force the tenant out without the sheriff’s involvement. Such actions can lead to significant legal consequences, including fines and penalties.
- Document the Process: Keep detailed records of all interactions with the tenant, the notices served, and any legal actions taken. This documentation is essential in case of disputes or legal challenges.
Step 5: Consider Negotiating with the Tenant
In some cases, it may be beneficial to negotiate with the tenant directly to reach a mutually agreeable solution. This can help avoid lengthy legal processes and potential conflicts.
Offer Incentives:
- Consider offering the tenant additional compensation beyond the required one month’s rent to encourage them to vacate the property voluntarily. This could include paying for moving expenses or offering a financial incentive for early departure.
Create a Written Agreement:
- If an agreement is reached, ensure that it is documented in writing and signed by both parties. This agreement should outline the terms, including the move-out date and any compensation provided.
Navigating Tenant Refusals After a Property Sale in Ontario
When selling a property in Ontario that is occupied by tenants, it’s important for landlords to understand the legal rights of tenants and the proper procedures for evicting them if necessary. Tenants are protected under the Residential Tenancies Act, and their lease agreements do not automatically end when the property is sold. If a tenant refuses to leave after the sale, landlords or new owners must follow the legal process, including serving the proper notices, filing applications with the Landlord and Tenant Board, and potentially enforcing eviction orders through the sheriff’s office.
By understanding the legalities and following the correct procedures, landlords can navigate these challenges effectively and avoid legal pitfalls. If you are unsure about any part of the process or face complications, consulting with a lawyer who specializes in landlord-tenant law in Ontario is highly recommended. They can provide the guidance and representation needed to ensure a smooth transition after the sale of the property.