Saturday, March 8, 2008

This Whole System is Out of Whack

Theoretically Ontario landlords and tenants are provided with a system that provides them both with an opportunity to effectively, quickly, cheaply and fairly have disputes adjudicated. Nothing could be farther from the truth. Landlords are terribly disadvantaged at the Board by a number of factors:
  • The Residential Tenancies Act is tenant-centred legislation
  • Decisions from the appeal courts have generally favoured tenants for a number of reasons
  • Legal Aid Ontario over-funds tenant-side programs, and provides little funding for landlords
I am going to deal with these issues in a number of posts over the next month, but for this post, I will deal with the imbalance between parties in their ability to get free legal help.

Legal Aid Ontario takes government money and doles it out, supposedly in the public interest. But Legal Aid Ontario considers that there is a huge power imbalance between landlords and tenants, and provides funding almost exclusively for tenants. There are 79 community legal clinics across the province, plus a number of specialty clinics, including ACTO, the Advocacy Centre For Tenants Ontario. In addition to its activities in the area of law reform, ACTO runs a program that provides tenant duty counsel for all hearings in all GTA area locations of the Landlord and Tenant Board. The community legal clinics handle duty-counsel services for the rest of the province. When a tenant walks into a Board office for a hearing, they are greeted by staff lawyers or community legal workers whose job it is to delay evictions, defeat landlord's applications, and have tenants win significant monetary judgments from landlords.

Landlords have no assistance at the Board through ACTO, nor do they have the ability to get assistance from the community legal clinics. There is one landlord-side legal clinic given minimal funding by Legal Aid Ontario. It is called the Landlord's Self-Help Centre, but it provides summary advice by phone or for walk-ins. There is no funding for legal representation at the Board or on appeal at the Courts for landlords. Landlord's Self-Help Centre has no staff lawyer, has no funding for test-case litigation, and while they do good work, small landlords are almost always the losers when they appear at the Board without representation when the tenant has a well-trained lawyer with the resources of Legal Aid Ontario behind them.

Landlords, particularly small-scale landlords should be up in arms at the heavy-handed measures taken by the legal clinics considering that there is an enormous imbalance in power and money. The solution is certainly political. Landlords should be complaining to Legal Aid Ontario, the Attorney General and the Ontario Ombudsman.


Anonymous said...

Interesting commentary.

However, one would think that it would be a conflict of interest for ACTO or community legal clinics to deal with landlords.

Also, it's important to note that the analogous group to landlords - that is, small employers, have no legal aid funding at all.

There is a reason for this - which is that there is a significant economic imbalance as between landlords (who own property) and tenants (who don't, presumably). And in this regard, it's interesting that landlords get a legal clinic to themselves at all.

It's also important to note in this analysis that landlords who accept rent-geared-to-income tenants end up getting rent supplements which well exceed the actual income of the tenants themselves in many cases.

As for the assertion that legal clinics exist only to delay evictions, most representatives who assist landlords realise that is not the case. However, where there is an actual legal argument to be advanced, it is the legal clinic's obligation to explain that to the tenant client. And let's not forget that it is the client who ultimately gives instructions - and who is not really interested typically in advancing and hypothetical agendae rather than interested in preserving their housing or their rights.

Anonymous said...

Harry, it's nice to know someone out there is actually paying attention to this bias Act. I've been a landlord for less than 2 years, (one house). I thought it would be a good investment.
I now know that pulling my toe nails out with pliers would be more enjoyable and perhaps I should try mutual funds.
I've lost more than $6000 to date and am in the middle of another mess with the Tribunal.
So yes, I agree, the law is stacked against landlords particularily small business types like myself.
The first tenants that ripped me off for $4000 I've since learned have a string of landlords across the country looking for them. (nice lady in PEI who'd love tho find them).
But there is no registry where "professional tenants" can be listed. Why is that?
None paying child support payors get listed? Criminal charges are available to the public. Why can landlords not list the names of tenants who owe them? Especially once they have an order?

I know there are good tenants. And unfortunately they are the ones who will pay the price when available decent units no longer exist.

I for one am out of the game as soon as I can!
If the tribunal will actually rule in my favour.

David Pylyp said...

I like your commentaries. They are always on topic contain vital information for landlords

David Pylyp RE.MAX Realty Specialists Inc. Humber Bay Shore Condos

Anonymous said...

I wish I had come across your blog and details earlier last year. I have been trying to evict a tenant for almost a year now. With the support of legal aid his strategy is clearly to drag out the process as long as possible at the province's and at my expense. He twice showed up drunk/incomprehensible in order to reschedule the hearing. On one occassion I sat in and watched the proceedings for 4 hours and not one landlord, despite strong evidence and testimonies in many cases received a decision in their favour. Every case that day was rescheduled.

Anonymous said...

It's nice to hear your comments Harry. I have been a landlord for just under 5 years and had no idea what I was getting into. The laws are ridiculously stacked in favour of the tenant and the decisions made by the tribunal even more so. I was reading through the judgments for cases on the LTBO website and was frightened by what was there. Is there a process for contesting the Landlord Tenant Act?

Anonymous said...

My comments are to the poster “Anonymous" from March 13, 2008 11:58 PM.

It is absurd to argue that property ownership in itself automatically proves that there is a significant economic imbalance and means that the tenant is at an economic disadvantage and the landlord is at an economic advantage. You are arguing that a landlord should be discriminated against because they chose to buy a rental property instead of spending money on perhaps frivolous items like cars, CDs, etc.

I once had a tenant who made $14,000,000 per annum and amongst other things, owned 2 Rolls Royces. At the time that I leased my unit to him I was making $45,000/year. How you would describe the economic imbalance in this situation? Do you think the tenant deserves legal aid because he doesn't own property?

One of my tenants doesn't own property but has instead chosen to amass a very large CD collection which has cost him approximately 50K - enough for a down payment on a property. He has CHOSEN to own CDs instead of property. I have under 30 CDs in my collection that I paid less than $300 for. That shows an economic imbalance in his favour. Should he therefore be denied legal aid for that reason?

I drive a 1998 Ford Explorer with a book value of under $5,000. One of my tenants drives an Audi with a book value of $65,000. He could sell the Audi and buy a 1998 Ford Explorer and have 60K left over to use as a down payment on a house but instead chooses his car. Is there not an economic imbalance there that would entitle me to legal aid because I don't own such a lavish car?

I am not alone. There are many, many landlords in Toronto that are not "richer" than their tenants. They bought houses through hard work and by denying themselves luxuries that in many cases their tenants have chosen to enyoy. Seeking to penalize an individual for spending their money wisely and rewarding another for spending frivolously is exactly what the credit card companies would like people to do. Perhaps you should be the poster boy for GE Credit or some other high interest lender.

Many landlords are elderly, disabled, poorly educated, culturally and linguistically disadvantaged and live below the poverty line. Their lifetime of savings that they have worked in menial jobs for until a very old age to amass is wrapped up entirely in a house that they have been forced to separate into apartments and rent out. They do not own cars or any items of even minor significant value. Many live in the smallest unit, often in the basement unit so they can maximize the rent they collect in order to put food on the table. Many of their tenants are young, able bodied, culturally and linguistically advantaged individuals who live well above the poverty line, enjoy good salaries and have very good financial prospects for the future.

Many tenants are evicted because they haven't paid rent. Legal clinics delay the process of eviction. Tenants are as opportunistic as anyone else and their agenda in delaying their eviction is to ride for free for as long as possible not the noble pursuit of preserving their rights. If they had to pay rent while they preserved their rights they would not be spending tax payers money to preserve their rights at all. This is not particular to tenants, this is the way opportunistic individuals reason.