When a Landlord Sells Property In Ontario Does the Tenant Have to Leave?
To Evict a Tenant to Enable a Buyer to Move In, a Landlord Must Provide Proper Notice of Termination.
In Ontario, the law surrounding whether a tenant can be evicted to allow for a purchaser to move in is very specific and procedural. When a landlord is selling a property, the landlord must be mindful of what the Agreement of Purchase and Sale states within, especially what is stated regarding the closing date and any terms related to extensions and penalty clauses. When a landlord promises vacant possession to a purchaser, the landlord needs to keep in mind that the landlord only has control over part of the process, being the process of issuing, and serving upon the tenant, an N12 – Notice of Termination for Purchaser's Own Use form. A landlord must also keep in mind that a Notice of Termination for Purchaser’s Own Use form may only be issued and served at the end of a lease term. Furthermore, such a termination is inapplicable, and thus invalid, where the premises contains more than three (3) rental units. Additionally, the rules of eviction when selling a property disallow eviction if the landlord is selling a property to a relative of the landlord.
Rules Regarding Notice
When a landlord is seeking to evict for the purpose of selling to a purchaser that intends 'own use' of the premises, the rules regarding the eviction notice period are very specific. Often a landlord fails to follow the rules due to failure to provide the proper notice document with the proper advance notice, among other things; accordingly, issuance of the absolutely necessary N12 form as required by the Residential Tenancies Act, 2006, S.O. 2006, Chapter 17 and the Landlord Tenant Board as well as the proper and timely service of the N12 form are important. Additionally, filing of the proper documents with the Landlord Tenant Board is necessary. Making an error on the notice form can be detrimental to the point of having to start again from the very beginning. Furthermore, a landlord should remain mindful that once a date for a hearing at the Landlord Tenant Board is scheduled, the landlord needs to involve the purchaser whereas the purchaser will need to provide an Affidavit as sworn, or affirmed, under Oath and attend at the hearing to testify, also under Oath, that the purchaser intends to move into the premises upon taking possession of the property promptly following closing of the purchase from the landlord.
A landlord is unable to force a tenant to leave; however, a landlord may negotiate a 'cash for keys' agreement with the tenants. A 'cash for keys' agreement occurs when a landlord, without use of undue pressure, enters into a deal to buy out a tenant. In such an effort, it is advisable that the landlord obtains the assistance of a legal professional to negotiate the agreement as the terms must be negotiated within the law. Trying to negotiate such a deal, or allowing a real estate agent to negotiate such a deal, is ill advised. Often when the landlord or a real estate agent takes on this task, failures to abide by the precise law lead to breach of the rights of the tenant with a possibility that such rights will be pursued by the tenant via applications seeking protections and remedies brought to the Landlord Tenant Board. Note also that a real estate agent is legally unable to provide legal services without holding a proper license from the Law Society of Ontario.