Strata 101: Ending a Tenancy Following the Denial of a Hardship Exemption Application

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strata property act hardship exemption

Many strata corporations have rental restriction provisions in their bylaws. Along with a rental restriction bylaw, the strata will also have a provision that allows owners to rent out their units on the basis of hardship. The owner must apply for a hardship exemption and must prove to the strata council’s that the rental bylaw will cause hardship to them if they are not allowed to rent out their unit.  Usually hardship exemptions are granted for a year and an owner must re-apply each year.

If a strata owner’s application to renew the hardship exemption is denied, the owner (who is also the landlord) has little choice but to tell the tenant to move out. If the tenant refuses to move voluntarily, the owner has to take appropriate steps to end the tenancy or face the real risk that the strata corporation will impose fines of as much as $500 per week for so long as the tenant remains in place.

A tenant who has a lease can end that lease without penalty if the rental violates a strata’s rental restriction bylaw, within 90 days of learning of the violation. They also have the right to receive reasonable moving expenses of up to one month’s rent from a landlord, by giving notice to the landlord.

However, in cases where the tenant does not agree to move out, an owner can only end the tenancy by following the process set down by the Residential Tenancy Act (the “RTA”). A landlord can end the tenancy if the tenant’s conduct is wrongful (disturbing neighbours, causing damage, etc.) or the tenant has repeatedly been late paying rent. But tenants, for the most part, behave themselves.

Where the owner/landlord has to end the tenancy so as not to fall afoul of a bylaw rental restriction, and the tenant has done nothing wrong to justify expulsion, the owner has to rely on the limited grounds provided by the RTA to end the tenancy. The owner will have to be able to show a good faith decision to take one of the following steps as the basis for requiring the tenant to move out:

  1. the owner/landlord plans to occupy the unit or to rent it to a close family member (e.g. the owner’s spouse, their parents, their children, or their spouse’s parents or children):

Most strata bylaws permit an owner to rent out their property to a close family member or to allow that close family member to otherwise occupy the unit. The RTA allows a landlord to give notice to end the tenancy if they intend in good faith for a close family member to occupy the unit.

  1. the owner/landlord plans to sell the unit:

A landlord can end the tenancy once they have entered into an agreement in good faith to sell their unit. All the conditions of the sale must be satisfied along with a note from the purchaser asking the landlord to end the tenancy. These requirements are intended to avoid the possible situation of a “fake” property sale being made just to get the tenant out.

  1. The owner/landlord plans to do major construction on the unit:

If a landlord decides to do major construction, including renovations, which requires the unit to be empty, a landlord can end the tenancy.

If landlords are challenged on the “good faith” intent (e.g. a tenant questions whether or not the landlord is actually going to do what he says he is going to do), it is up to the landlords to prove their intentions are honest and that they are in fact going to carry out one of the three options.

As should be clear by now, there is nothing in the RTA that would allow an owner/landlord to end the tenancy simply because the owner no longer has a hardship exemption and is liable to significant fines for non-compliance with the rental restriction bylaw for so long as the tenant remains.

This may seem unfair to owners in this situation but, until the Legislature sees fit to change the RTA to add this as a valid reason for ending a tenancy, owners will have to comply with the requirements set out in both pieces of legislation.

To summarize: owners must comply with the rental restriction bylaws if they cannot obtain or renew a hardship exemption. If a tenant does not agree to end the tenancy voluntarily, the owner can only get the tenant out by carrying out one of the options allowed by the RTA.  The owner does not really have a choice in such a situation unless he or she is willing to risk having to pay the significant fines that the strata is empowered to impose for violations of rental restriction bylaws. Without the tenant’s cooperation, there is no way to avoid following the RTA and, possibly, an encounter with the Residential Tenancy Branch should the tenant challenge the notice on the basis of a lack of good faith.

If you have any questions about your obligations as a strata owner/landlord or your rights as the tenant of a strata unit, contact us.


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