How to Apply Rental Restriction Bylaws
1. What is a Rental Restriction Bylaw
A rental restriction bylaw can:
- prohibit the rental of residential strata lots entirely;
- limit
the number of strata lots that may be rented; or
- limit the
length of time the strata lots may be rented.
A bylaw that limits the number of strata lots that can
be rented must also set out the procedure to be followed
in administering the limit. A strata corporation that has
a bylaw limiting the number of strata lots that may be
rented may wish to consider whether the following rentals
permitted under other sections of the Act should be counted
in the limit:
- rentals to family members under the family member
exception;
- rentals permitted on the basis of hardship;
- rentals permitted
under a Rental Disclosure Statement; and
- rentals established
prior to the filing of a rental restriction bylaw in
the Land
Title Office and permitted to continue under the provisions
which delay the
application of a rental restriction bylaw.
The strata corporation cannot:
- screen tenants;
- establish screening criteria;
- require that it approve of tenants;
and
- require the insertion of terms in tenancy agreements
or otherwise restrict the rental
of a strata lot except by a bylaw that prohibits or limits
the rental of residential strata lots.
2. Rentals Permitted Under other Sections
of the Act
If a strata corporation has a rental restriction bylaw,
an owner may be permitted to rent his or her strata lot despite
the bylaw under the following provisions:
- the family member exception;
- a determination of hardship by
the strata council;
- the provision which delays the application
of a rental restriction bylaw; and
- the owner is a party whose
right to rent is preserved by a Rental Disclosure Statement
filed by the Owner Developer.
3. Exception for Family Member
A rental restriction bylaw does not
apply to prevent the rental of a strata lot to a family member.
A family member is defined as:
- a spouse of the owner;
- a parent or child of the owner; or
- a parent or child of the
spouse of the owner.
A “spouse of the owner” includes
an individual who has lived and cohabited
with the owner for a period of at least two years at the
relevant time, in a marriage-like relationship including
a marriage-like relationship between persons of the same gender.
A rental to a family member creates an assignment
of the owner’s
powers and duties under the
Act, Regulations, bylaws, and rules.
[For more information on rentals to family members,
please refer to Instruction Guide 6, “The Role
and Responsibilities of Tenants and Landlords”.]
4. Exemption for Hardship
An owner may apply to the strata
corporation for an exemption from
a rental restriction bylaw on the grounds that the bylaw causes
hardship to the owner.
Neither the Act nor the Regulations define “hardship”.
An application for the exemption must:
- be made in writing;
- state the reason why the owner thinks an
exemption should be made; and
- indicate whether the owner wishes
a hearing.
The Regulations provide that a “hearing” means “an
opportunity to be
heard in person at a council meeting”.
When a hardship application
has been made, the strata council
must:
- hear the owner or owner’s agent
within three weeks of
the date of the application, if the owner
requests a hearing;
- give its decision in writing
to the owner within one week of the hearing;
- give its decision
in writing within two weeks after the owner applied
for the exemption if no hearing
is held or requested.
If the strata council fails to provide
its decision within the time specified,
the exemption is allowed, and the owner would be permitted
to rent the strata lot.
5. Provision Delaying the Application of Rental Restriction
Bylaws
The Act contains a provision that delays
the application of a rental restriction bylaw to a strata
lot to which the rental restriction bylaw would otherwise
apply.
Under the delayed application provision, a rental restriction
bylaw would not apply to a strata lot until the later of:
- one year after a tenant who is occupying the strata
lot
at the time the bylaw is
passed ceases to occupy it
as a tenant; and
- one year after the bylaw
is passed.
[See Appendix 3 for a flow-chart setting
out how rental restriction bylaws
are delayed.]
6. Rental Disclosure Statements
Under
the Act,
Owner
Developers
must provide prospective
purchasers with
a “Rental Disclosure Statement” (Form J) which has
been
filed with the Superintendent
of Real Estate,
if the Owner Developer
intends to rent or preserve the right to rent any of the residential
units.
The Form J:
- describes the strata lots which may be rented; and
- sets out
the date during which the rentals may occur.
The effect of the Form J is to preserve the right to rent
the strata
lot for the length of time set out in
the Form J regardless
whether a rental restriction
bylaw has been passed for:
- the Owner Developer;
- the first purchaser from the Owner Developer.
The right to continue to rent a strata lot despite a rental
restriction bylaw is not preserved for a subsequent
purchaser who buys the strata
lot from someone other than the Owner Developer even
though the time period in the Form J has not expired.
A purchaser
who buys the strata
lot from someone other
than the Owner Developer does not have a right to rent the strata lot.
In such circumstances, the strata
lot may only be rented by a subsequent purchaser if:
- there is no rental restriction bylaw;
- the owner is permitted
to rent despite a rental restriction
bylaw on the basis of:
- the family member exception;
- a determination of hardship by
a strata council;
- the provision which delays the application
of a rental
restriction bylaw.
[See Appendix
1 for a flow-chart
setting out how
to apply the Form
J.]
7. Rental Disclosure Statements (“RDS”)
Filed Under the Condominium Act
A purchaser may have a right to rent his or her strata
lot despite a rental restriction bylaw under the terms of
an RDS filed under the Condominium
Act.
The Act clarifies that only the first purchaser can continue
renting despite a rental restriction bylaw, if the period
of time provided in the RDS during which rentals could occur
has not expired. There was ambiguity under the Condominium
Act whether only the first purchaser could continue to rent
under the RDS despite a rental restriction bylaw. Therefore,
a transitional provision is provided to give owners that
did not purchase directly from the owner developer an extended
period of time before a rental restriction bylaw will apply.
8. Transition Provisions for Rental Disclosure Statements Filed
Under the Condominium Act
If an Owner Developer filed the RDS under the Condominium
Act:
- first purchasers are permitted to rent the strata
lot even though a rental
restriction bylaw
is passed until:
- the rental period in the RDS expires; or
- the first purchaser
sells the strata lot.
- subsequent purchasers who did not purchaser from the
Owner Developer will
be subject to a rental
restriction bylaw on
the earlier of:
- the expiry date; or
- January 1, 2006.
- once the strata lot is subject to a rental restriction
bylaw the owner may be
permitted to rent despite
a rental restriction
bylaw on the basis of:
- the family member exception;
- a determination of hardship by
a strata council;
- the provision which delays the application
of a rental
restriction bylaw.
[See Appendix
2 for a flow-chart setting out
how to apply the
Condominium Act
RDS.]
9. If the Rental Violates the Bylaw
If the strata
lot owner has
rented despite
a bylaw that
prohibits or restricts
rentals:
- the strata council can proceed to fine the strata
lot owner as long as the maximum amount of the
fine is set out in the bylaws;
- the maximum amount which can
be set out in a bylaw
for a breach of a rental restriction bylaw
is $500;
- the bylaws may provide that a fine will be re-assessed
for a continuing breach to a maximum frequency
of every seven days;
- the Act specifically provides that the tenant
is not
in contravention of the bylaw; and
- the Act provides the tenant with the
right to end
the tenancy agreement within ninety days of learning
of the breach of the bylaw by the strata lot
owner and the
landlord
must pay the
tenant’s
reasonable moving expenses to a maximum of one month’s
rent if the tenant
ends the tenancy
agreement within
ninety days of learning of the breach.
Click here
to view Appendix 1,2,3 (Adobe Acrobat document
download)
References:
Sections of the Act: 130, 132, 139 – 144
Sections of the Regulations: 7.1, 8.1, 8.2 17.15 |
