Monday, August 13, 2018

Ford's Cannabis Announcement Hopeful News for Landlords in Ontario

It looks like a big win for Ontario landlords with Premier Ford's announcement this afternoon re: Cannabis sales and use in Ontario. The announcement revealed a complete reversal of the former government's proposed government monopoly on sales, and will open up Cannabis sales to the private sector, starting first with online sales. The Ontario Cannabis Store will be launching an online retail store and begin to establish a wholesale distribution network to supply cannabis to legal private stores in Ontario once legislative requirements are put in place. It sounds to me like there will be no dedicated Ontario Cannabis brick and mortar stores.

But hidden near the bottom of the press release is some hopeful news for landlords. While no legislation or Regulations have been produced to date, the press release indicates, in the section about Places of Use, that tenants will only be able to smoke cannabis in rental buildings subject to the lease or building rules.

Based on that one sentence, it sounds like the government is considering changes to the Residential Tenancies Act, the legislation that governs all residential tenancies in Ontario. Currently evictions for smoking of ANY substance have been hit or miss at the Landlord and Tenant Board, and very dependent on the lease wording, the harm being done, and the whim of the individual adjudicator. However, the press release suggests that there will be regulatory changes allowing landlords to indicate no smoking of cannabis (and perhaps tobacco) in leases, and have the LTB grant evictions if that lease condition is breached.

This is all happening at the same time as many condo buildings are adding Bylaws, drafting Rules or amending Declarations to deal with the problems that cannabis will bring to residential condos. Most lawyers drafting the rules agree that having grandfathering for existing cannabis smokers must be permitted. Many condos, including my own, are taking the opportunity to draft Rules outlawing ALL smoking of anything anywhere, including in their own units. However, owners/occupants who currently use tobacco products have the right to register for grandfathering within 30 days of the passing of the Rule.

Most landlords are horrified at the thought of tenants being able to grow cannabis plants and smoke marijuana in their homes or apartment units. The issues are smell, damage to the unit, complaints from other tenants etc. Ford's announcement gives landlords hope that the government is listening to their concerns and recognizing that marijuana smoke is offensive to many, and has potential health impacts.  The press release did not mention growing of plants, which the current Federal law limits to 4 plants per household.

The government press release was issued moments ago. You can find it here.

This announcement means that Landlords need to be even more vigilant about having properly drafted leases. With the standard government lease which is required as of April 30th, 2018, there is very little specificity about ANYTHING.  Landlords have been flocking to my forms package of 27 difference forms including the best lease Appendix in the business. Fortunately the government allowed landlords to draft a lease Appendix to add clauses, conditions and specificity to the "bare skeletal" government lease, so long as the clauses are not contrary to the Residential Tenancies Act. You can find the forms package here.

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