Canada: A Landlord's Duty To Maintain A Residential Property

Introduction

In an economic climate where younger generations cannot afford to purchase real estate, it is of fundamental importance that landlords know and thoroughly understand their duties and obligations. According to the Canadian Rental Housing Index of 2018, rental properties account for approximately 4.4 million households across Canada, which equates to 32% of all households.1 In Ontario specifically, approximately 30% of all households are renter households.2

As a result of the prominence of renter households in our province, the potential for liability on the part of the landlord is exponential. This paper focuses specifically on the duty of care that a landlord has for maintaining a rental complex or residential unit a good state of repair. The governing legislation includes the Occupiers Liability Act, and the Residential Tenancies Act.

These Acts set out the responsibilities in question and assist in determining whether the landlord, as an occupier of residential properties, fell below the standard of care.

To whom is a duty of care owed?

Landlords owe a duty of care to tenants and their guests to maintain the premises in reasonably safe conditions. This duty of care is created under both the Occupiers Liability Act, and the Residential Tenancies Act. A landlord cannot contract out of this duty of care, per the Residential Tenancies Act. Liability can be limited on the part of landlords for predictable maintenance standards, through municipal bylaws. Liability may also be limited in cases involving the retention of independent contractors or where a party entering the premises voluntarily assumes risks..

The Occupiers Liability Act (1990) (OLA) governs accidents in both residential premises, commercial premises, such as, shopping centres, grocery stores, warehouses.3 An "occupier" under the OLA includes a person who is in physical possession of premises, or a person who is responsible for or who has control over the conditions of the premises, the activities carried out on the premises, or control over the persons allowed to enter the premises.4 Section 3(1) of the OLA requires that an occupier must take reasonable care to see that people are reasonably safe while on the premises. This section creates the duty of care. However, the OLA creates situations where this duty of care is limited and, therefore, may not always apply.

The landlord's duty of care does not extend to ensuring that the property is free of any possible danger.

The landlord's duty of care does not extend to ensuring that the property is free of any possible danger. Meaning, the occupier is not constantly required to monitor the area. Determining what is a reasonable step to ensure the premises are safe, is fact-specific. Furthermore, section 3(1) is limited by section 4(1) OLA. Section 4(1) OLA states the duty of care owed under section 3(1) does not apply if a person who enters the premises willingly assumes risks. Finally, section 3(3) OLA allows an occupier to restrict, modify, or exclude the occupier's duty.

The duty of care for an occupier extends to landlords under section 8 of the OLA, which states:

Where premises are occupied or used by virtue of a tenancy under which the landlord is responsible for the maintenance or repair of the premises, it is the duty of the landlord to show towards any person or the property brought on the premises by those persons, the same duty of care in respect of dangers arising from any failure on the landlord's part in carrying out the landlord's responsibility as is required by this Act to be shown by an occupier of the premises.

In essence, this section requires a landlord to maintain and repair the premises in the exact same as the duty owed by an occupier of the premise. The tenant and landlord owe a duty to all people who enter the property, even if the landlord does not reside at the property. However, where the OLA seems, on its face, to allow landlords to limit their liability, the Residential Tenancies Act, which deals strictly with landlord and tenant relations, does not allow landlords to waive any such liability.

The Residential Tenancies Act, (2006) (RTA) governs the duties and responsibilities of both landlords and their tenants.5 It imposes a stricter duty of care on landlord's than the OLA, by disallowing landords to contract out of their duty to maintain a residential complex or rental unit in a good state of repair.6 This duty of care is set out by section 20 of the RTA.

Section 20(1) of the RTA stipulates that "a landlord is responsible for providing and maintaining a residential complex, including the rental units in it, in a good state of repair, and fit for habitation and for complying with health, safety, housing, and maintenance standards."7

The Duty to Repair and maintain - A Seminal Case Study: Taylor v Allard

In the seminal case of Taylor v Allard (2010), the plaintiff was a visitor to a rental property for a house party. The landlord of the property did not live there and was not present during the party, but the tenants were present. The plaintiff arrived at the party in an intoxicated state and later tripped over a cinder block ringing a fire pit. The plaintiff fell into the bonfire and was badly burned. At trial, the cinder blocks ringing the fire constituted a tripping danger under the OLA.

The court was asked to determine whether the landlord could escape liability for the plaintiff's personal injuries based on a provision in the lease agreement whereby the landlord attempted to relinquish his responsibility for maintenance and repairs by way of a waiver in the tenancy agreement. At trial, the court dismissed the plaintiff's claims against the landlord on the basis that the landlord was not an occupier of the property, in that he did not have any control over the premises, was not in physical possession of the premises, and had no maintenance obligations pursuant to the contractual waiver. The trial judge held that the tenants were the proper occupiers under the OLA. The trial judge decision held that the tenants were liable for 50% of the damages, and the plaintiff was liable for the remaining 50% of the damages. The tenants appealed.

The Court of Appeal found that the landlord was an occupier of the premises pursuant to the section 3(1) of the OLA, and therefore owed a duty of care to the tenants and their guests.

Of importance, the court relied upon sections 94(1) and 80(1) of the Landlord Tenant Act, which now equates to sections 20(1) and 3(1) of the RTA. Section 20(1) RTA sets out the duty of care owed by landlords to tenants and their guests, to maintain the rental unit in a good state of repair. Section 3(1) RTA stipulates that this duty cannot be subject to a contractual waiver. This, therefore, supersedes section 3(3) of the OLA which appears to allow an occupier to contract out of this duty of care.

In conclusion, the case law stipulates that the statutory duty set out in the RTA prevails, despite any agreement or waiver to the contrary; as such, any attempts of a landlord to exempt itself from liability via contract are unenforceable.

Now that the duty of care has been established, we must consider what the standard of care is for maintenance.

...most municipalities have their own property-standard by-laws.

What Does it Mean to Maintain a Property?

The above legislation can leave landlords feeling overwhelmed, questioning what level of maintenance standards are required of them. Fortunately, most municipalities have their own property-standard by-laws which provides direction for landlords about what specifically they are required to maintain, and to what degree.

However, this is of limited use when hazards may be present that do not appear in disrepair. Take, for example, the case study mentioned above: the cinder blocks ringing the fire pit were not neccessarily in a state of disrepair, however, continued to expose landlords to liability. This begs the question: what is reasonable action on the part of the landlord? First, we will explore the predictable maintenance standards, and then we will move to unpredictable maintenance dangers, and what landlords may have to do to protect themselves.

(a) Predictable Maintenance Standards - Tenants have two avenues of recourse when a landlord does not adequately maintain their property. If a tenant believes that their landlord is neglecting maintenance on their property, they can request for the municipal Property Standards division to inspect their rental unit. If the inspector identifies a maintenance problem, they will issue an order directly to the landlord specifying what exactly must be corrected and the timeframe for completion. This order makes the landlord responsible to Property Standards, not the tenants themselves. The tenants may also file an application with the LTB to have further orders made against the landlord, to require both that the maintenance be completed and, potentially, an order compensating them as well for this breach of the duty of care.

(b) Unpredictable Maintenance Standards - We will now consider the best ways for landlords to protect themselves when there are allegations that they have breached this standard of care without a danger ever previously being identified.

The test for finding a breach is well established in the recent case, Onyskiw v CJM Property Management, where the Ontario Court of Appeal determined that when a landlord's potential breach is being considered, we must use a contextual approach to section 20(1) of the RTA.8 This means that no breach will be found against the landlord's response to a maintenance issue if their action was reasonable in the circumstances. The court stated, "the entirety of the factual situation should be considered before determining whether or not a landlord committed a breach." Two factors considered in this process are the use of an independent contractor or whether the injured party willingly accepted the risk.

Acts Reasonable in the Circumstances

In a matter before the Landlord Tenant Board, CET-71571-17, the residential property sustained emergency plumbing issues at approximately 8:46 pm on November 3, 2018. The tenants claimed that the delay was unreasonable in the circumstances.

The tribunal disagreed and held that the landlord responded "quite quickly, responsibly, and effectively in respect of repairs and remediation of the rental unit."9 In this matter, the tribunal held that the landlord did not breach his duty of care owed to the tenants as his action was reasonable in the circumstances.

(i) Independent Contractors

To effectively consider the best ways for landlords to protect themselves, we have to consider section 6 of the OLA, which specifically addresses how independent contractors may limit a landlord's liability. Section 6 OLA states:

  1. Where damage to any person or his property is caused by the negligence of an independent contractor employed by the occupier, the occupier is not on that account liable if in all the circumstances the occupier had acted reasonably in entrusting the work to the independent contractor, if the occupier had taken such steps, if any, as the occupier reasonably ought in order to be satisfied that the contractor was competent and that the work had been properly done, and if it was reasonable that the work performed by the independent contractor should have been undertaken.

  2. Where there is more than one occupier of premises, any benefit accruing by reason of subsection (1) to the occupier who employed the independent contractor shall accrue to all occupiers of the premises.

...if a landlord takes the reasonable steps necessary...

In concise terms, section 6 of the OLA states that if a landlord takes the reasonable steps necessary to be satisfied that an independent contractor was competent and that the work would be, or had been, properly completed, then they are not liable for negligence on the part of the contractor. If there is more than one occupier, both will accrue the benefit of discharging their duty of care if one acts reasonably in retaining an independent contractor.

In a matter before the Landlord and Tenant Board, CET-43865-14 (Re), the tenants filed an application claiming that the landlord breached his duty under section 20(1) of the RTA with respect to six issues. For one such issue, the landlord tendered evidence which included an invoice for the repairs and the testimony of an independent contract who was retained to complete the repair work.10 Upon receipt of this evidence, the Board found that the landlord had met his duty of care under section 20(1).11 However, the Board was not satisfied that the landlord met his duty with respect to another issue as the landlord only produced a quote for the work to be completed by an independent contractor.12

From this example, we can see that in order for landlords to properly discharge their duty under section 20(1) of the RTA, they must provide an invoice for proof of work, and should obtain testimony of the independent contractor indicating that such work was completed.

(ii) Voluntary Assumption of Risk

Landlords may also limit their liability if the individual entering the premises voluntarily assumes the risk, per section 4(1) of the OLA:

The duty of care provided for in subsection 3(1) does not apply in respect of risks willingly assumed by the person who enters on the premises, but in that case the occupier owes a duty to the person to not create a danger with the deliberate intent of doing harm or damage to the person or his or her property and to not act with reckless disregard of the presence of the person or his property.

In short, section 4(1) of the OLA states that the duty of care is not breached by an occupier when an individual voluntarily assumes the risks, but the occupier cannot create danger deliberately to harm the person or their property.

Conclusion

The OLA and RTA create a duty of care on the part of the occupier or landlord, to maintain their premises in a reasonably safe order. This duty of care cannot be contracted out of, per section 3 of the RTA. Safeguards are available to landlords to protect their risks of liability through the use of independent contractors, retained to maintain the premises in a state of good repair. In addition, if a party entering the premises willingly assumes the risk, then the landlord may also be discharged of their duty of care.

Footnotes

1 Canadian Rental Housing Index, 2018.

2 Ibid.

3 Occupiers Liability Act, R.S.O. 1990, c O.2.

4 Ibid, s. 1.

5 Residential Tenancies Act, 2006, S.O. 2006, c. 17.

6 Ibid, s. 3(1).

7 Ibid, s. 20(1).

8 Onyskiw v CJM Property Management, 2016 ONCA 477, para 84.

9 CET-71571-17, 2018 CanLII 88560 (ON LTB), para 34.

10 CET-43865-14 (Re), 2015 CanLII 59718 (ON LTB)

11 Ibid.

12 Ibid.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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