March 29, 2018
Real estate salespeople are expected to work hard for their clients. But when a registrant is selling a property that has tenants, dedication to duty should never involve disrespecting the rights of the tenants, or assisting the landlord to violate the Residential Tenancies Act, 2006 (RTA).
The Real Estate Council of Ontario sometimes receives complaints from irate tenants about the behaviour of registrants when they show rental properties to interested buyers. One complaint involved a registrant who invaded their privacy by taking unauthorized photos of their apartment; other cases involve registrants who failed to provide adequate written notice for viewings, showed up late for scheduled appointments, or attended outside of the formal visitation times. We have even heard allegations of registrants assisting landlords in evicting tenants under false pretenses.
A landlord has the right to put their property up for sale at any time, but there are rules both a seller and their representative must follow. Registrants are well-advised to urge their clients to approach tenants ahead of time in order to work out an amicable arrangement for visits and other issues. Registrants should also understand the following about visits and leases.
A tenant can’t prevent registrants and potential buyers from viewing their home, but they must be given at least 24 hours of advance written notice, and a showing can only take place between 8 a.m. and 8 p.m. A tenant may choose whether they would like to be present during the showing. If a tenant would prefer to have showings only occur when they are home, the registrant should attempt to accommodate them.
Landlords and registrants are not allowed to take pictures of a property while it is occupied by a tenant unless the tenant provides their express consent.
The sale of a property can’t be used as grounds to terminate a tenancy until and unless their lease has expired. If the lease has expired and the tenant is paying month-to-month, the tenant must be given 60 days’ notice to vacate the property, provided that a buyer has unconditionally agreed to buy the home. A notice is invalid if the termination date is inaccurate, so it’s a good idea for a registrant to obtain a copy of the tenant’s lease, and use the latest forms available on the Landlord and Tenant Board’s website.
Registrants should know that it is illegal for a buyer to evict a tenant under the false pretenses that they need the home either for themselves or for their families. The buyer – and potentially also their real estate salesperson – could be sued by the former tenant for moving costs and the higher rent paid at their new home. Moreover, the Ontario Rental Housing Enforcement Unit takes these allegations very seriously and may investigate the matter. The Ontario Landlord and Tenant Board has the power to impose fines up to $25,000 for individuals and $100,000 for corporations.
Under Section 3 of the Code of Ethics, under the Real Estate and Business Brokers Act, 2002 (REBBA), registrants have a responsibility to treat everyone involved in a real estate transaction with fairness, honesty and integrity. A registrant who repeatedly disrespects the rights and privacy of tenants, or is found to have assisted a landlord in violating RTA could face disciplinary action from RECO.
RECO strongly recommends that registrants seek their own independent legal advice when they are representing the buyer or seller of a property that has tenants. By seeking guidance about the rights of the tenants, registrants can avoid the risk inadvertently breaching RTA or REBBA.