A B.C. landlord recovered thousands of dollars in unpaid rent despite the tenant not living there for half of the tenancy.
A Residential Tenancy Branch (RTB) received an application from a landlord on Sept. 23 who asked to recover the money they were owed for unpaid rent and other expenses. They said the tenant broke the lease early, resulting in the loss of several months' rent while they searched for a new tenant.
The tenancy commenced on Aug. 1, 2022, and was meant to expire on July 31, 2023, with a monthly rent due of $2,500.
At the outset of the tenancy, the landlord collected a security deposit of $1,125 and a pet deposit of $1,125, which they retained.
The tenant didn't have any issue with the rental agreement and even thanked the landlord for being "such a good landlord" in one of the submitted emails. However, they wanted to end the tenancy early and asked the landlord if that might be possible if they helped find a new renter and cooperated for viewings during the process.
On Dec. 11, 2022, the landlord responded to the tenant, stating that they would "put [the unit] on the market ASAP this week" but added that they would need to have another renter lined up before they would accept a change in the contract.
The landlord claimed they couldn't get the unit rented until mid-May 2023, resulting in several months of lost rent totalling $10,718.75. They also hired a real estate agent to help them rent the unit for $1,968.75.
Under section 26 of the Residential Tenancy Act (RTA), a tenant must pay rent when it is due under the tenancy agreement. In this case, they were required to pay rent until the contract expired on July 31, 2023.
But the tenant said the landlord's realtor didn't list the unit until Jan. 6, 2023, nearly a month after they told him they were putting it on the market. Also, he said the realtor only listed it on her website and didn't include it on popular websites such as Facebook or Kijiji.
B.C. tenant generates more interest in rental unit via Facebook and Kijiji
The tenant said he decided to link the realtor's advertisement on several listing websites to generate interest and received multiple responses. He showed the space to "at least six potential tenants." He said a suitable family wanted to move in and claimed the landlord didn't accept them because they had children. However, the landlord refuted this claim, saying they had a bad credit score.
The tenant also advised the landlord to lower the asking price for the monthly rent and offered to pay the difference until the contract expired. However, the landlord noted that they wouldn't be able to increase the rent at the end of the term and would lose money with the next tenant.
The RTB ruled in favour of the landlord, citing Policy Guideline three conditions for loss of rental income claims, which states that tenants must compensate landlords for any loss that occurs because they vacate or abandon the premises before the tenancy ends.
"This can include the unpaid rent to the date the tenancy agreement ended and the rent the landlord would have been entitled to for the remainder of the tenancy agreement term," according to the guideline.
But Policy Guideline five adds that a "landlord has a duty to minimize loss of rental income," meaning they must try to re-rent the unit as soon as possible.
In this case, the landlord waited several weeks before placing the unit on the market and the agent only advertised it on her website. The RTB said this was "unreasonable" and they could have minimized their losses by advertising it earlier.
The RTB awarded the landlords $4,500 for loss of rental income from March 1 to May 15 because they didn't sufficiently minimize their losses per guidelines three and five. For March, the rent owed was decreased by 20 per cent to $2,000. For April, it was reduced by 30 per cent to $1,750 and by 40 per cent in May to $875 (see slide two)
The loss of income for hiring a realtor was reduced by 50 per cent from $1,968.75 to $984.37 since the landlords were only tasked with finding another renter for half the length of the tenancy.
The board did not return the pet and damage deposits to the tenant but subtracted the amount ($2,557.37) from the total owed to the landlord (see slide three).
On Feb. 14, 2024, the RTB ordered the tenant to pay the landlord $3,027 for loss of rent and costs associated with re-renting the unit.
