Difference between revisions of "Tenancy Agreements (19:IV)"

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{{REVIEWED LSLAP | date= August 15, 2024}}
{{LSLAP Manual TOC|expanded = landlord}}
{{LSLAP Manual TOC|expanded = landlord}}
=A. Protecting the Tenant=


A third party should accompany a potential tenant during a rental unit showing, so there is a witness as to the landlord’s representations made during the showing. '''Important: Get the landlord’s promises in writing if possible''', but note that landlords are not obligated to provide them in writing.  
== A. General ==


After establishing the tenancy and before the tenant moves their personal possessions into the rental unit, the RTA requires the landlord and tenant to jointly conduct a condition inspection and fill out and sign the RTB’s Condition Inspection Report. This report notes the condition of various elements of the rental unit. The tenant may want to take photographs at the initial move-in inspection, as well as the move-out inspection. The landlord must provide the tenant with a copy of the Condition Inspection Report within 15 days.  
A “tenancy agreement” is defined as “an agreement, whether written or oral, express or implied, between a landlord and a tenant respecting possession of a rental unit, use of common areas and services and facilities, and includes a licence to occupy a rental unit” (''RTA'', s 1). Like any valid contract, there must be an offer, acceptance, and consideration.


Fees for cable and internet should be negotiated before the tenancy commences, and included in the Tenancy Agreement.
A tenancy agreement gives the tenant the right to use, enjoy, and dispose of the property for some duration. The landlord has a freehold in reversion, allowing them to sell their property to someone else. A tenancy continues under the same terms when a rental property is sold in BC. Accordingly, the landlord cannot terminate a lease simply because they want to sell the property; instead, the new owner will take over as the landlord. No new lease is required to be drafted and signed, though this may happen if both parties agree.  


The Residential Tenancy Branch provides a fillable and printable Tenancy Agreement at www.rto.gov.bc.ca/documents/RTB-1.pdf. TRAC’s website has more information as well as translations of the Tenancy Agreement forms into Punjabi, and Simplified and Traditional Chinese at www.tenants.bc.ca/other-languages.
=== 1. Two Methods of Creating a Tenancy Relationship ===


=B. General=
==== a) By Written Contract ====


The “leasehold” or tenancy interest is an estate (a bundle of property rights) of limited duration, which is created and acquired by the “tenant” when a person capable of granting that interest does so. Such a person (usually called the owner or landlord) conveys to the tenant the right of “exclusive possession”. The interest that the landlord retains is called the “reversion”, and full possession reverts back to the landlord on the termination of the tenancy.
Although section 1 of the ''RTA'' contemplates tenancy agreements that are written, oral, or implied, a landlord must prepare in writing any tenancy agreement entered into on or after January 1, 2004 (''RTA'', s 13(1)).


The landlord can sell his or her reversion to someone else, who becomes the new landlord and property owner. The tenancy follows the property, not the initial owner, so a tenancy agreement is still binding on a new owner, who is responsible for repaying the initial security and/or pet damage deposit when the tenancy ends (RTA, s 93).
Vague terms of the tenancy agreement may be framed in the tenant's favour using the principle of contra proferentem, meaning that the agreement will be strictly construed against the party who provided the agreement's wording.
==1. Two Methods of Creating a Tenancy Relationship==
===a) By Formal Contract===


A tenancy interest is granted by a contract known as a tenancy agreement or lease. Often the parties will enter into an express agreement (see Section III.C: Contractual Nature of the Tenancy Agreement). The executed tenancy agreement governing the tenant’s possession may be written, or oral, or both (see the s 1 definition of “tenancy agreement”). To be enforceable, the elements of a complete contract (offer, acceptance, and consideration) must be present (see Chapter 9: Consumer Protection).
==== b) By Implied Contract ====
===b) By Implied Contract===


Every tenancy agreement entered into on or after January 1, 2004 must be prepared in writing by the landlord (RTA, s 12(1)).  
Notwithstanding the obligation to prepare a written agreement, where there has been offer, acceptance, and some kind of meaningful consideration, the law may imply the existence of a valid tenancy agreement. The law seeks to recognize and validate the relationship where possible, even where the requirement for a written tenancy agreement has not been met.


Notwithstanding this obligation to prepare the agreement in writing, where a tenant is already in possession of the unit, or where rent has been paid, the law may imply the existence of a valid tenancy agreement (see Section III.C.2: Terms, Covenants, and Conditions). This type of rental agreement is quite common because many tenancies are entered into on the basis of an application form, or verbal consensus, without the existence of any written contract. A “tenancy agreement” may be found to exist, notwithstanding the fact that:
Oral contracts are hard to prove. If something is important, it should be recorded in writing.


# there is no written tenancy agreement;
In a fixed term tenancy that does not require the tenant to vacate on the last day, if the landlord and tenant have not entered into a new tenancy agreement, they are deemed to have entered into a month to month tenancy on the same terms (''RTA'', s 44(3)).


# a previously existing agreement has expired or terminated; or
=== 2. Freedom of Contract and the Agreement ===


# there was no previous agreement of any kind.
Parties may use a standard form tenancy agreement with or without an addendum for additional terms, or they may write their own. Parties are free to add and alter the terms, covenants, and conditions, subject to common law and statute restrictions, which include standard terms that the ''RTA'' and ''RTR'' require to be in every tenancy agreement.


If the person in possession pays rent or a deposit and the landlord accepts the payment with the intention of creating a tenancy, an agreement is created.
==== a) What Tenancy Agreements Must Contain ====
==2. Where Something Other than a Tenancy is Created==


An agreement or circumstances may create something other than a tenancy. A person may be a tenant at will, a tenant on sufferance, a licensee, or a mere occupant.
The standard terms are the clauses that every tenancy agreement must contain (''RTR'', s 13(1)), and are found in the schedule of the ''RTR''. The standard terms cover key rights and responsibilities of both parties, including repairs, payment of rent, rent increases, security deposits, assignment or sublet, occupants and invited guests, entry of the residential premises by the landlord, locks, ending the tenancy, and the application of the ''RTA''. A tenancy agreement cannot be amended to change or remove a standard term (''RTA'', s 14(1)), making them a minimum standard that all tenancy agreements must achieve.  


An occupant or person in possession who is not a tenant has no agreement with the landlord concerning that possession or occupation. In the case of a licensee or occupant living in a home by permission of a main tenant (when the landlord/owner lives off-site), the main tenant is responsible for all obligations, including paying rent (and utilities if required). If the licensee or occupant is sharing a kitchen or bathroom with the landlord, the parties can seek remedies in Small Claims Court.
All tenancy agreements must comply with the requirements laid out in section 13(2) of the ''RTA''. In addition to mandating that the tenancy agreement include the standard terms, a tenancy agreement must also contain the landlord and tenant’s agreement over certain key terms, such as the parties’ contact information, the duration of the tenancy, the amount and due date of the rent, and the amount and due date of any security or pet damage deposits to be paid.
==3. Formal Requirements==
===a) Essential Elements of the Agreement===


A landlord must prepare in writing every tenancy agreement entered into on or after January 1, 2004 (RTA, s 13(1)). A tenancy agreement must comply with any requirements prescribed in the regulations and must set out all the requirements in RTA s 13(2).  
Form RTB-1 is a standard tenancy agreement form that only contains the standard terms along with fillable boxes to complete the remaining mandatory terms; additional terms can be added as an addendum, or alternatively, the parties could use any other written document that conforms with the requirements from the ''RTA'' and ''RTR''. More information about tenancy agreement requirements and Form RTB-1 can be found [https://www2.gov.bc.ca/gov/content/housing-tenancy/residential-tenancies/starting-a-tenancy/tenancy-agreements here].


Where these elements are absent, vague, or unclear, the agreement may be void (as a result, no interest would be created). However, if the tenant is in possession and has paid money (i.e. rent) then there is a tenancy agreement. If a tenancy has been created (i.e. the tenant has possession and is paying rent), any vague terms of the tenancy agreement can be framed in the tenant’s favour using the principle of contra proferentem (i.e. the agreement will be strictly construed against the party seeking to rely on the contract), and perhaps even principles of statutory interpretation. The law seeks to recognize and validate the relationship where possible, even where the requirement to have a written tenancy agreement has not been met.
==== b) No Contracting Out of Tenancy Legislation ====
==4. Agreements for Lease (Also Known as Agreements to Lease, or Agreements for Tenancy)==


Landlords may occasionally attempt to have potential tenants enter into “agreements to lease”, whereby they agree, by paying some amount now, to enter into a lease at a later date. In accordance with the provisions of the RTA, particularly section 15, application, holding, consideration, administration or other fees are not permitted. If a tenant gives a landlord a sum of money, after negotiating in relation to a rental unit, the most likely legal outcome is that the parties have created a tenancy, and the amount paid is either a security deposit and/or rent.  
As it is not possible to contract out of the ''RTA'' or ''RTR'' (''RTA'', s 5), a tenancy agreement cannot have terms that contradict the ''RTA'' or ''RTR''. A tenancy agreement cannot be subsequently amended to change or remove a standard term (''RTA'', s 14(1)).


=C. Contractual Nature of the Tenancy Agreement=
A tenancy agreement might purport to contain terms contrary to tenancy legislation, and this may not be identified in some cases until dispute resolution. A tenant is free to argue that a term violates the ''RTA'' or ''RTR'' and should, therefore, be void.
==1. Freedom of Contract and the Agreement==


Throughout the establishment and duration of the agreement, the parties are generally free to add and alter the terms, covenants and conditions as they see fit – subject to restrictions imposed by common law and statute (e.g. prohibition of contracts for an illegal purpose, unconscionable terms, or contracts in restraint of trade). The RTA and MHPTA both restrict parties from contracting out of requirements of those Acts and from adopting terms that are contrary to the Acts. The changes in the tenancy agreement must be in writing, and be signed and dated by both parties. Some requirements, such as locks on doors, are automatically included in every tenancy agreement even if the tenancy agreement does not specifically mention them. A unilaterally altered or newly included term may be unenforceable where there is no consideration for it.
==== c) Amendments and Subsequent Contracts ====
===a) Collateral Contract===


The parties may enter into additional or subsequent oral or written contracts, separate from the tenancy agreement, that involve a change in the way the terms of the tenancy agreement are carried out (e.g. agreement by the tenant to do repairs in return for paying a reduced amount of rent). The terms of the tenancy agreement still exist; they must be performed as stipulated when the collateral contract is fully performed or is otherwise terminated (e.g. one party dies or goes away). If an Arbitrator determines the terms are reasonable and not unconscionable, as defined within s 3 of the RTR, any purchaser of the reversion will be bound by the former owner’s collateral contract. A remedy for the new landlord would be found in an action against the seller. Generally speaking, oral collateral contracts are hard to prove. If something is important, it should be recorded in writing.
The parties may enter additional or subsequent oral or written contracts on top of the tenancy agreement. If an RTB Arbitrator determines the terms are reasonable and not unconscionable, as defined within section 3 of the ''RTR'', new landlords or tenants that take over or enter into the same tenancy agreement would be bound by the subsequent contract.
==2. Terms, Covenants, and Conditions==
===a) Covenants and Conditions===


A covenant in a tenancy agreement consists of a promise by a person that a certain thing must or must not be done (the RTA eliminates the word “covenant” and uses the more modern word “term”). A “Material Term”, as used in the RTA, is a term going to the root of the relationship and the tenancy agreement. Landlords and tenants may agree to any term they wish, as long as it is not unconscionable or contrary to the RTA. Terms contrary to the RTA may not be identified in some cases until dispute resolution, and a tenant is free to argue that a term violates the RTA and should therefore be void. The Arbitrator will take this into consideration when determining reasonableness. For more information, see RTB Policy Guidelines 8: Unconscionable and Material Terms.
Changes in the tenancy agreement must be agreed upon by both the landlord and tenant (''RTA'', s 14(2)), in writing, and signed and dated by both parties. Generally, changes are only enforceable if both parties offer something in return for the other; however, a change without fresh consideration may be enforceable in the absence of duress, unconscionability, or other public policy concerns ([https://canlii.ca/t/hs3c5#par183 ''Rosas v Toca'', 2018 BCCA 191] at para 183).


===b) Express, Implied and Statutory Terms===
==== d) Pets ====


Valid express terms or conditions override any implied terms or “usual terms” that might otherwise apply at common law. For residential tenancies, the RTA deems some express terms to be unenforceable (see Section III.C.d: Reasonable Terms below). The RTA also establishes statutory terms, deemed to be terms in every agreement, that override any express or implied term to the contrary. For tenancies not governed by the RTA, a court will find implied obligations and insert the usual terms, if the parties have failed to expressly agree to certain matters.
If the tenancy agreement is silent about pets, then the tenant can obtain one. Tenancy agreements are allowed to include terms that prohibit pets or restrict the size, kind, or number of pets a tenant may keep on the residential property, or otherwise govern the tenant’s obligations regarding keeping a pet on the rental property (''RTA'', s 18(1)). This is subject to the ''Guide Dog and Service Dog Act'', SBC 2015, c 17 (''RTA'', s 18(3)), which in section 3 prohibits a person from denying tenancy or from discriminating with respect to a term of the tenancy against a person who intends to keep a guide dog or service dog in the rental unit.
===c) Express Terms and Obligations===


Parties may write their own tenancy agreement with their own terms, or may use a standard form tenancy agreement to which they can add their own extra terms. Parties may also adopt a lease in conformity with the Land Transfer Form Act, RSBC 1996, c 252, p 2.
==== e) Cannabis ====


The RTA requires that all tenancy agreements include standard terms outlining key statutory rights and responsibilities of the tenant and landlord (see RTA s 12, and the Schedule to the Regulation). The standard terms cover repairs, payment of rent, rent increases, security deposits, assignment or sub-let, occupants and invited guests, entry of the residential premises by the landlord, locks, ending the tenancy, and the application of the RTA. To assist landlords and tenants, the Ministry created a standard Residential Tenancy Agreement, available online (http://bit.ly/1eiaQNL). This Agreement incorporates suggestions put forward by landlord and tenant stakeholders, and includes the prescribed terms found in the Schedule of the Regulation.
As of October 17, 2018, personal possession of cannabis is legal in Canada. Accordingly, changes to the ''RTA'' were implemented around growing and smoking cannabis.


For residential tenancies, the following express terms are void and unenforceable:
If a tenancy agreement entered into prior to legalization includes a clause prohibiting or limiting smoking and did not explicitly allow for smoking cannabis, then that clause is deemed to apply to smoking cannabis in the same way (''RTA'', s 21.1(2)). Vaporizing a substance containing cannabis is not “smoking cannabis” (''RTA'', s 21.1(3)).


*a term purporting to hold that the RTA does not apply to the agreement (s 5(1));
Most tenancy agreements entered into prior to legalization are deemed to contain a term prohibiting growing cannabis plants in or on the residential property. There is an exemption for existing operations in or on the residential property that met the following conditions on the day before legalization:
*the tenant is growing one or more medical cannabis plants (''RTA'', s 21.1(4)(a));
*growing the plants is not otherwise a violation of the tenancy agreement (''RTA'', s 21.1(4)(b));
*the tenant is authorized under federal law to grow the cannabis plants in or on the residential tenancy (''RTA'', s 21.1(4)(c)); and
*the tenant is in compliance with federal law with respect to the medical cannabis (''RTA'', s 21.1(4)(c)).


*that the rent remaining for the term of the agreement becomes due and payable if a tenant fails to comply with a term of the tenancy agreement (s 22) (i.e. “accelerated rent terms” are not permitted); or
=== 3. Operation of Tenancy Agreement Terms ===


*that the landlord can seize the tenant’s personal property for rent owing (s 26(3)(a)).
A term in a tenancy agreement consists of a promise by a person that a certain thing must or must not be done.


Some included requirements of the RTA state that the tenant:
==== a) Material Terms ====


*must maintain reasonable health, cleanliness, and sanitary standards throughout the rental unit and other areas of the property to which the tenant has access;
From RTB PG 8, a material term is defined as a term of the tenancy agreement that, at the time of entering into the tenancy agreement, both parties agree is so important that the most trivial breach of the term entitles the other party to terminate the agreement.


*shall not assign or sublet without the landlord’s written consent, where the agreement is for a period of six months or more; and
Not all terms of a tenancy agreement are material terms. The circumstances surrounding the creation of the tenancy agreement and the importance of the term in the tenancy agreement as a whole are more relevant to whether the term is material; meanwhile, the consequences of a breach are less relevant. Although RTB PG 8 states that whether the tenancy agreement declares the term to be material is less relevant, Arbitrators are likely to consider a term material if the agreement flags it as such. The same clause can be a material term in one tenancy but not material in another.


*shall not pay more than one-half of one month’s rent for each of the security deposit and/or pet damage deposit.
==== b) Express, Implied and Statutory Terms ====


Similarly, terms in a short form lease that are inconsistent with the RTA are unenforceable. The parties may however enter into a separate collateral agreement, under which a clause requiring the tenant to perform repairs is binding on the tenant, so long as there is separate consideration.
Valid express terms override any implied terms or “usual terms” that might otherwise apply at common law. For residential tenancies, the ''RTA'' deems some express terms to be unenforceable. Furthermore, the terms that the ''RTA'' deems to be terms in every agreement override any express or implied term to the contrary.


===d) Reasonable Terms===
For tenancies not governed by the ''RTA'', a court will find implied obligations and insert the usual terms if the parties have failed to expressly agree to certain matters.


Changes in the RTA allow more ability to agree to any term landlords and tenants wish, than the repealed Act did.
==== c) Unenforceable Terms ====


However, a term of tenancy is unenforceable if (RTA, s 6):
A term of the tenancy is unenforceable if:
*the term is inconsistent with this ''RTA'' or the ''RTR'' (''RTA'', s 6(3)(a));
*the term is unconscionable (''RTA'', s 6(3)(b)); or
*the term is not expressed in a manner that clearly communicates the rights and obligations under it (''RTA'', s 6(3)(c)).


* the term is inconsistent with this RTA or the regulations;
The definition of “unconscionable” for the purposes of determining whether a term of a tenancy agreement is enforceable is “if the term is oppressive or grossly unfair to one party” (''RTR'', s 3). Some of the factors determining whether a term meets this standard can include (RTB PG 8):
*whether it grossly impacts the health and living quality of one party;
*whether there is a rational basis for the term to exist in the agreement; or
*whether the term is so one-sided that it oppresses or exploits the party with weaker bargaining power.


* the term is unconscionable; or
The following are examples of express terms that are void and unenforceable:
*a term purporting to hold that the ''RTA'' does not apply to the agreement or attempts to avoid the ''RTA'' (''RTA'', s 5);
*that the next payable rent becomes immediately due if a tenant fails to comply with a term of the tenancy agreement (''RTA'', s 22);
*that the landlord can seize the tenant’s personal property for rent owing (''RTA'', s 26(3)(a));
*terms that impose unreasonable restrictions on guests or impose a fee for having guests stay overnight (RTB PG 8); or
*for a fixed term tenancy, any vacate clauses that require the tenant to move out at the end of the tenancy unless:
**The tenancy agreement is a sublease agreement; or  
**The fixed term tenancy was created in circumstances where the landlord or landlord’s close family plans in good faith to occupy the unit after the tenancy ends (''RTR'' s 13.1).


* the term is not expressed in a manner that clearly communicates the rights and obligations under it.
== B. Protecting the Tenant During Agreement Formation ==


See Policy Guideline 8: Unconscionable and Material Terms.
A third party may accompany a potential tenant during a rental unit showing, so there is a witness as to the landlord’s representations made during the showing. Tenants should get the landlord’s promises in writing if possible, but note that landlords are not obligated to provide them in writing.  


NOTE: The RTR defines “unconscionable” for the purposes of s 6(3)(b) of the RTA as follows: a term of a tenancy agreement is “unconscionable if the term is oppressive or grossly unfair to one party”.
After establishing the tenancy and before the tenant moves their personal possessions into the rental unit, the landlord and tenant must jointly conduct a condition inspection and fill out and sign the RTB’s Condition Inspection Report (''RTA'', s 23). This report notes the condition of various elements of the rental unit, such as what needs to be repaired. It is a good idea to take photographs at the initial move-in inspection as well as the move-out inspection. The landlord must provide the tenant with a copy of the Condition Inspection Report within fifteen days (''RTA'', s 23(5)).  


===e) Pets===
=== 1. Illegal Application Fees ===


In B.C., there is '''no''' law that allows tenants to have a pet. RTA, s 18 allows a tenancy agreement to include terms that prohibit pets, or restrict the size, kind or number of pets a tenant may keep on the residential property. In order to keep a pet one needs to have a term in one’s tenancy agreement that allows pets. If a tenancy agreement doesn’t allow pets and a tenant gets one anyway, the landlord can tell the tenant to remove it. If the tenant refuses, the landlord may be able to give an effective eviction notice. RTA, s 18 is subject to the rights and restrictions under the Guide Animal Act RSBC 1996, c 177, s 4, which states that landlords must not deny tenancy or impose discriminatory terms on a person with a disability who intends to keep a guide animal in the rental unit.
A potential landlord cannot ask a renter or potential renter for application or processing fees relating to the following:
====(1) New Pet: Where Permitted====
*accepting a tenancy application (''RTA'', s 15(a));
*processing the application (''RTA'', s 15(b));
*investigating the applicant’s suitability as a tenant (''RTA'', s 15(c)); or
*accepting the person as a tenant (''RTA'', s 15(a)).


The landlord and tenant together must inspect the condition of the rental unit on or before the day the tenant starts keeping a pet or on another mutually agreed day where the landlord permits the tenant to keep a pet after the start of a tenancy (RTA, s 23(2)). Failure of the tenant or landlord to participate in the inspection may extinguish the right of the failing party to the rights relating to the pet deposit (s 24(1)). The landlord can request a pet damage deposit not greater than ½ of a month’s rent, regardless of the number of pets.
If someone has paid an application fee and the landlord will not give it back, they can apply for dispute resolution to have it returned. Applicants will need to know the landlord’s proper name and address and have proof that the fee was paid. If a landlord does this as a business practice, the tenant should report this to the director of the RTB, or to the RTB’s Compliance and Enforcement Unit (CEU), who can launch an investigation. For more information about the CEU, see [https://www2.gov.bc.ca/gov/content/housing-tenancy/residential-tenancies/solving-problems/tenancy-compliance-enforcement here].
===f) Prescribing Terms===


Terms and conditions that must or must not be included in every written tenancy agreement, or an application for an agreement, may be prescribed by an order-in-council and may prescribe different terms for different classes of tenancy agreements.  As discussed above, the RTR sets out in its schedule those terms that must be included in every tenancy agreement.
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===g) Implied Obligations and Usual Terms===
====(1) Landlord’s Obligations====
 
A landlord must ensure that:
 
*the tenant is given vacant possession on the starting date of the tenancy;
 
*the tenant has quiet enjoyment;
 
*the rental units are reasonably fit for occupation; and
 
*the rental units are maintained in a state of decoration and repair that complies with housing health and safety standards required by law.
====(2) Tenant’s Obligations====
 
A tenant must ensure that:
 
*he or she pays the rent or other fees on time and conducts him or herself in a manner consistent with protecting the landlord’s rights and interests;
 
*he or she delivers up the rental unit in a reasonably clean condition and in a reasonable state of repair, reasonable wear and tear excepted; and
 
*he or she gives one full month’s notice in writing when terminating the agreement. (see Section IX.B.1: Form and Basic Requirements).
====(3) Court-Implied Terms====
 
The usual terms that a court may insert in a tenancy agreement, where express provision is lacking and statutory terms do not apply, include a tenant’s undertaking:
 
*to pay rent;
 
*to pay taxes and utilities not payable by the landlord assigned to them in the tenancy agreement; and
 
 
*to keep and deliver up the rental unit in good repair.
 
===h) Statutory Terms in the RTA: Duties and Prohibitions===
 
For residential tenancies subject to the RTA, the common law implied obligations apply, unless their subject matter is superseded by one of the RTA’s obligations.
====i) Rent Increases for Additional Occupants====
 
A rental increase for a new occupant can only be imposed if the contract specifically allows for it. Disputes most often arise upon the birth of a baby, so renters should consider whether they might have children before signing a contract with a new occupant increase clause.
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Latest revision as of 07:54, 30 August 2024

This information applies to British Columbia, Canada. Last reviewed for legal accuracy by the Law Students' Legal Advice Program on August 15, 2024.
LSLAP Manual
LSLAP Manual
This page is from the
Law Students' Legal
Advice Program Manual.
See the full contents.
LSLAP Manual
Introduction
Chapters
19. Landlord and Tenant Law
 · I. Introduction

 · II. Governing Legislation
 · III. Residential Tenancy Act & Laws
 · IV. Tenancy Agreements
 · V. Moving In & Moving Out
 · VI. Security Deposits
 · VII. Repair & Service
 · VIII. Rent Increase
 · IX. Tenant's Rights
 · X. Subletting & Assignment
 · XI. Termination & Eviction
 · XII. Dispute Resolution
 · XIII. Common Law
 · XIV. Strata & Condos
 · XV. Assisted Living
 · XVI. Manufactured Homes

 · XVII. Guidelines & Resources
v • d • e



A. General

A “tenancy agreement” is defined as “an agreement, whether written or oral, express or implied, between a landlord and a tenant respecting possession of a rental unit, use of common areas and services and facilities, and includes a licence to occupy a rental unit” (RTA, s 1). Like any valid contract, there must be an offer, acceptance, and consideration.

A tenancy agreement gives the tenant the right to use, enjoy, and dispose of the property for some duration. The landlord has a freehold in reversion, allowing them to sell their property to someone else. A tenancy continues under the same terms when a rental property is sold in BC. Accordingly, the landlord cannot terminate a lease simply because they want to sell the property; instead, the new owner will take over as the landlord. No new lease is required to be drafted and signed, though this may happen if both parties agree.

1. Two Methods of Creating a Tenancy Relationship

a) By Written Contract

Although section 1 of the RTA contemplates tenancy agreements that are written, oral, or implied, a landlord must prepare in writing any tenancy agreement entered into on or after January 1, 2004 (RTA, s 13(1)).

Vague terms of the tenancy agreement may be framed in the tenant's favour using the principle of contra proferentem, meaning that the agreement will be strictly construed against the party who provided the agreement's wording.

b) By Implied Contract

Notwithstanding the obligation to prepare a written agreement, where there has been offer, acceptance, and some kind of meaningful consideration, the law may imply the existence of a valid tenancy agreement. The law seeks to recognize and validate the relationship where possible, even where the requirement for a written tenancy agreement has not been met.

Oral contracts are hard to prove. If something is important, it should be recorded in writing.

In a fixed term tenancy that does not require the tenant to vacate on the last day, if the landlord and tenant have not entered into a new tenancy agreement, they are deemed to have entered into a month to month tenancy on the same terms (RTA, s 44(3)).

2. Freedom of Contract and the Agreement

Parties may use a standard form tenancy agreement with or without an addendum for additional terms, or they may write their own. Parties are free to add and alter the terms, covenants, and conditions, subject to common law and statute restrictions, which include standard terms that the RTA and RTR require to be in every tenancy agreement.

a) What Tenancy Agreements Must Contain

The standard terms are the clauses that every tenancy agreement must contain (RTR, s 13(1)), and are found in the schedule of the RTR. The standard terms cover key rights and responsibilities of both parties, including repairs, payment of rent, rent increases, security deposits, assignment or sublet, occupants and invited guests, entry of the residential premises by the landlord, locks, ending the tenancy, and the application of the RTA. A tenancy agreement cannot be amended to change or remove a standard term (RTA, s 14(1)), making them a minimum standard that all tenancy agreements must achieve.

All tenancy agreements must comply with the requirements laid out in section 13(2) of the RTA. In addition to mandating that the tenancy agreement include the standard terms, a tenancy agreement must also contain the landlord and tenant’s agreement over certain key terms, such as the parties’ contact information, the duration of the tenancy, the amount and due date of the rent, and the amount and due date of any security or pet damage deposits to be paid.

Form RTB-1 is a standard tenancy agreement form that only contains the standard terms along with fillable boxes to complete the remaining mandatory terms; additional terms can be added as an addendum, or alternatively, the parties could use any other written document that conforms with the requirements from the RTA and RTR. More information about tenancy agreement requirements and Form RTB-1 can be found here.

b) No Contracting Out of Tenancy Legislation

As it is not possible to contract out of the RTA or RTR (RTA, s 5), a tenancy agreement cannot have terms that contradict the RTA or RTR. A tenancy agreement cannot be subsequently amended to change or remove a standard term (RTA, s 14(1)).

A tenancy agreement might purport to contain terms contrary to tenancy legislation, and this may not be identified in some cases until dispute resolution. A tenant is free to argue that a term violates the RTA or RTR and should, therefore, be void.

c) Amendments and Subsequent Contracts

The parties may enter additional or subsequent oral or written contracts on top of the tenancy agreement. If an RTB Arbitrator determines the terms are reasonable and not unconscionable, as defined within section 3 of the RTR, new landlords or tenants that take over or enter into the same tenancy agreement would be bound by the subsequent contract.

Changes in the tenancy agreement must be agreed upon by both the landlord and tenant (RTA, s 14(2)), in writing, and signed and dated by both parties. Generally, changes are only enforceable if both parties offer something in return for the other; however, a change without fresh consideration may be enforceable in the absence of duress, unconscionability, or other public policy concerns (Rosas v Toca, 2018 BCCA 191 at para 183).

d) Pets

If the tenancy agreement is silent about pets, then the tenant can obtain one. Tenancy agreements are allowed to include terms that prohibit pets or restrict the size, kind, or number of pets a tenant may keep on the residential property, or otherwise govern the tenant’s obligations regarding keeping a pet on the rental property (RTA, s 18(1)). This is subject to the Guide Dog and Service Dog Act, SBC 2015, c 17 (RTA, s 18(3)), which in section 3 prohibits a person from denying tenancy or from discriminating with respect to a term of the tenancy against a person who intends to keep a guide dog or service dog in the rental unit.

e) Cannabis

As of October 17, 2018, personal possession of cannabis is legal in Canada. Accordingly, changes to the RTA were implemented around growing and smoking cannabis.

If a tenancy agreement entered into prior to legalization includes a clause prohibiting or limiting smoking and did not explicitly allow for smoking cannabis, then that clause is deemed to apply to smoking cannabis in the same way (RTA, s 21.1(2)). Vaporizing a substance containing cannabis is not “smoking cannabis” (RTA, s 21.1(3)).

Most tenancy agreements entered into prior to legalization are deemed to contain a term prohibiting growing cannabis plants in or on the residential property. There is an exemption for existing operations in or on the residential property that met the following conditions on the day before legalization:

  • the tenant is growing one or more medical cannabis plants (RTA, s 21.1(4)(a));
  • growing the plants is not otherwise a violation of the tenancy agreement (RTA, s 21.1(4)(b));
  • the tenant is authorized under federal law to grow the cannabis plants in or on the residential tenancy (RTA, s 21.1(4)(c)); and
  • the tenant is in compliance with federal law with respect to the medical cannabis (RTA, s 21.1(4)(c)).

3. Operation of Tenancy Agreement Terms

A term in a tenancy agreement consists of a promise by a person that a certain thing must or must not be done.

a) Material Terms

From RTB PG 8, a material term is defined as a term of the tenancy agreement that, at the time of entering into the tenancy agreement, both parties agree is so important that the most trivial breach of the term entitles the other party to terminate the agreement.

Not all terms of a tenancy agreement are material terms. The circumstances surrounding the creation of the tenancy agreement and the importance of the term in the tenancy agreement as a whole are more relevant to whether the term is material; meanwhile, the consequences of a breach are less relevant. Although RTB PG 8 states that whether the tenancy agreement declares the term to be material is less relevant, Arbitrators are likely to consider a term material if the agreement flags it as such. The same clause can be a material term in one tenancy but not material in another.

b) Express, Implied and Statutory Terms

Valid express terms override any implied terms or “usual terms” that might otherwise apply at common law. For residential tenancies, the RTA deems some express terms to be unenforceable. Furthermore, the terms that the RTA deems to be terms in every agreement override any express or implied term to the contrary.

For tenancies not governed by the RTA, a court will find implied obligations and insert the usual terms if the parties have failed to expressly agree to certain matters.

c) Unenforceable Terms

A term of the tenancy is unenforceable if:

  • the term is inconsistent with this RTA or the RTR (RTA, s 6(3)(a));
  • the term is unconscionable (RTA, s 6(3)(b)); or
  • the term is not expressed in a manner that clearly communicates the rights and obligations under it (RTA, s 6(3)(c)).

The definition of “unconscionable” for the purposes of determining whether a term of a tenancy agreement is enforceable is “if the term is oppressive or grossly unfair to one party” (RTR, s 3). Some of the factors determining whether a term meets this standard can include (RTB PG 8):

  • whether it grossly impacts the health and living quality of one party;
  • whether there is a rational basis for the term to exist in the agreement; or
  • whether the term is so one-sided that it oppresses or exploits the party with weaker bargaining power.

The following are examples of express terms that are void and unenforceable:

  • a term purporting to hold that the RTA does not apply to the agreement or attempts to avoid the RTA (RTA, s 5);
  • that the next payable rent becomes immediately due if a tenant fails to comply with a term of the tenancy agreement (RTA, s 22);
  • that the landlord can seize the tenant’s personal property for rent owing (RTA, s 26(3)(a));
  • terms that impose unreasonable restrictions on guests or impose a fee for having guests stay overnight (RTB PG 8); or
  • for a fixed term tenancy, any vacate clauses that require the tenant to move out at the end of the tenancy unless:
    • The tenancy agreement is a sublease agreement; or
    • The fixed term tenancy was created in circumstances where the landlord or landlord’s close family plans in good faith to occupy the unit after the tenancy ends (RTR s 13.1).

B. Protecting the Tenant During Agreement Formation

A third party may accompany a potential tenant during a rental unit showing, so there is a witness as to the landlord’s representations made during the showing. Tenants should get the landlord’s promises in writing if possible, but note that landlords are not obligated to provide them in writing.

After establishing the tenancy and before the tenant moves their personal possessions into the rental unit, the landlord and tenant must jointly conduct a condition inspection and fill out and sign the RTB’s Condition Inspection Report (RTA, s 23). This report notes the condition of various elements of the rental unit, such as what needs to be repaired. It is a good idea to take photographs at the initial move-in inspection as well as the move-out inspection. The landlord must provide the tenant with a copy of the Condition Inspection Report within fifteen days (RTA, s 23(5)).

1. Illegal Application Fees

A potential landlord cannot ask a renter or potential renter for application or processing fees relating to the following:

  • accepting a tenancy application (RTA, s 15(a));
  • processing the application (RTA, s 15(b));
  • investigating the applicant’s suitability as a tenant (RTA, s 15(c)); or
  • accepting the person as a tenant (RTA, s 15(a)).

If someone has paid an application fee and the landlord will not give it back, they can apply for dispute resolution to have it returned. Applicants will need to know the landlord’s proper name and address and have proof that the fee was paid. If a landlord does this as a business practice, the tenant should report this to the director of the RTB, or to the RTB’s Compliance and Enforcement Unit (CEU), who can launch an investigation. For more information about the CEU, see here.

v • d • e
 
Introduction
 
Chapters 1-7
Criminal Law  · Youth Justice  · Family Law  · Victims  · Public Complaints · Human Rights  · Workers Compensation
Chapter One:
Criminal Law
Chapter Two:
Youth Justice
Chapter Three:
Family Law
Chapter Four:
Victims
Chapter Five:
Public Complaints
Chapter Six:
Human Rights
Chapter Seven:
Workers' Compensation
I. Introduction · II. Governing Legislation, Policy & Guidelines · III. Introduction to Compensation Claims for Injured Workers · IV. LSLAP's Role at the Initial Decision Level · V. Limitation Periods and Timing of Decisions · VI. Making a Claim · VII. The Claim Acceptance Process · VIII. Worker Status · IX. Disability and Causation · X. Time Limits and Procedures · XI. Claim Benefits · XII. Appeals · XIII. Health and Safety Regulations · XIV. Assessments of Employers · XV. The WCB Fair Practices Office · Appendix A: Abbreviations · Appendix B: List of Cases · Appendix C: Referrals · Appendix D: Resources · Appendix E: Small Claims Flow Chart · Appendix F: Checklist for Interviews · Appendix G: Checklist for Appeals · Appendix H: Sample Authorization Form
 
Chapters 8-14
Employment Insurance  · Employment Law  · Creditors and Debtors  · Consumer Protection  · Auto Insurance (ICBC)  · Motor Vehicle Law  · Mental Health Law
Chapter Eight:
Employment Insurance
Chapter Nine:
Employment Law
Chapter Ten:
Creditors' Remedies and Debtors' Assistance
Chapter Eleven:
Consumer Protection
Chapter Twelve:
Auto Insurance (ICBC)
Chapter Thirteen:
Motor Vehicle Law
Chapter Fourteen:
Mental Health Law
 
Chapters 15-23
Adult Guardianship and Substitute Decision-Making · Wills and Estates  · Citizenship  · Immigration  · Landlord and Tenant Rights  · Small Claims  · Welfare Law  · Strata Law  · Referrals
Chapter Fifteen:
Adult Guardianship and Substitute Decision-Making
Chapter Sixteen:
Wills and Estate Administration
Chapter Seventeen:
Citizenship
Chapter Eighteen:
Immigration Law
Chapter Nineteen:
Landlord and Tenant Law
Chapter Twenty:
Small Claims and the CRT
I. Introduction · II. Governing Legislation and Resources · III. Do You Have a Claim? · IV. Choosing the Proper Forum · V. Starting a Claim · VI. Responding to a Claim · VII. Default Order · VIII. How a Claim Proceeds · IX. Pre-Trial Applications · X. Mediation · XI. Settlement Conferences · XII. Trial/Pre-Trial Conferences · XIII. Trial Preparation · XIV. Trials · XV. Costs and Penalties · XVI. Appeals · XVII. Enforcement of a Judgement · XVIII. LSLAP Program Information · Appendix A: Registries · Appendix B: Demand Letter · Appendix C: Notice of Claim · Appendix D: Reply to Claim · Appendix E: Glossary · Appendix F: Limitation Periods · Appendix G: Causes of Action · Appendix H: Court Fees · Appendix I: Tribunal Fees · Appendix J: Settlement Conference · Appendix K: Payment Hearing · Appendix L: Appeal
Chapter Twenty One:
Welfare Law
Chapter Twenty Two:
Strata Law
Chapter Twenty Three:
Referrals
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