Order under Section 69

Residential Tenancies Act, 2006

File Number: SWL-52948-21

John Sauve (the 'Landlord') applied for an order to terminate the tenancy and evict Nicole Chauvin and Justin Chauvin (the 'Tenants') because the Landlord requires possession of the rental unit for the purpose of residential occupation.

This application was heard via videoconference on January 10, 2022. The Landlord, the Landlord’s legal representative, R. Lammers, the Tenant, N. Chauvin, and the Tenants’ legal representative,

C. Hall, attended the hearing.

Determinations:

2.     It was undisputed that Landlord purchased the unit under the title, Never Rest Farms Ltd. Further, the Landlord at the beginning of the tenancy was Never Rest Farms Ltd. On July 13, 2021, title of the unit transferred from Never Rest Farms Ltd. to John Sauve.

3.     The Tenants submitted that the unit was fraudulently conveyed from Never Rest Farms Ltd. to John Sauve. Specifically, the Landlord transferred title to this unit from Never Rest Farms Ltd. for an amount less than full consideration. As the unit was fraudulently conveyed, the tenancy is being terminated in bad faith.

4.     The Landlord’s evidence was that he initially served the Notice under Never Rest Farms Ltd. on or about March 17, 2021. However, when he received counsel and was made aware that to serve this Notice pursuant to section 48 of the Act, the Landlord needed to be an individual, he transferred title of the unit into his name.

Law and Analysis

5.     While I will not engage in an analysis as to whether the unit was fraudulently conveyed, I find that the true Landlord is Never Rest Farms Ltd., and therefore, does not have standing to terminate the tenancy. The Notice was served pursuant to section 48 of the Residential Tenancies Act, 2006 (the ‘Act’) which states, in part:

48 (1) A landlord may, by notice, terminate a tenancy if the landlord in good faith requires possession of the rental unit for the purpose of residential occupation for a period of at least one year by,

(a)               the landlord;

(b)               the landlord’s spouse;

(c)                  a child or parent of the landlord or the landlord’s spouse; or

(d)                  a person who provides or will provide care services to the landlord, the landlord’s spouse, or a child or parent of the landlord or the landlord’s spouse, if the person receiving the care services resides or will reside in the building, related group of buildings, mobile home park or land lease community in which the rental unit is located.

(2) The date for termination specified in the notice shall be at least 60 days after the notice is given and shall be the day a period of the tenancy ends or, where the tenancy is for a fixed term, the end of the term

6.     Subsection 48 (5) of the Act states:

(a)     This section does not authorize a landlord to give a notice of termination of a tenancy with respect to a rental unit unless,

(a)               the rental unit is owned in whole or in part by an individual; and

(b)               the landlord is an individual [emphasis added]

7.     Therefore, pursuant to subsection 48(5)(b), only a landlord which is an individual is authorized to serve a tenant with an N12 Notice of Termination on the ground that the landlord in good faith requires possession of the rental unit for the purpose of residential occupation.

8.     Section 202 of the Act states:

202 (1) In making findings on an application, the Board shall ascertain the real substance of all transactions and activities relating to a residential complex or a rental unit and the good faith of the participants and in doing so,

(a)      may disregard the outward form of a transaction or the separate corporate existence of participants; and

(b)      may have regard to the pattern of activities relating to the residential complex or the rental unit

9.     In this instance, I find that while the Landlord was an individual at the time the Notice was served, pursuant to section 202 of the Act, the true Landlord is a corporation. The real substance of the transfer was to evade the Act’s prohibition on corporate Landlord’s serving N12s under section 48(5). It was undisputed that Never Rest Farms Ltd. was the Landlord

at the start of the tenancy. It was the Landlord’s own evidence that he transferred title to his name to meet the requirements of section 48 of the Act. I recognize that the definition of “landlord” in section 2(1) of the Act includes an owner of a rental unit. However, John Sauve acquired his ownership in the rental unit from a corporation that he alone controls for the sole purpose of being able to evict the Tenants. This interpretation is consistent with the intent of section 48(5) of the Act, which is to deny corporate Landlord’s the right to evict Tenant’s for Landlord’s own use applications.

10.  As I have found that Never Rest Farms Ltd., a corporation, is the true Landlord, the N12 Notice of Termination served on July 13, 2021 does not comply with section 48 of the Act.

It is ordered that:

1.   The Landlord’s Application is dismissed.

February 3, 2022 Date Issued

Camille Tancioco

Member, Landlord and Tenant Board

South West-RO

150 Dufferin Avenue, Suite 400, 4th Floor London ON N6A5N6

If you have any questions about this order, call 416-645-8080 or toll free at 1-888-332-3234.

In accordance with section 81 of the Act, the part of this order relating to the eviction expires on August 15, 2022 if the order has not been filed on or before this date with the Court Enforcement Office (Sheriff) that has territorial jurisdiction where the rental unit is located.