News & Views

Pause to Commercial Evictions, Landlord Rights & Remedies
June 23, 2020

Pause to Commercial Evictions, Landlord Rights & Remedies

The Protecting Small Business Act, 2020 (the "Act"), formally known as Bill 192, received royal assent on June 18, 2020. The Bill amends the Commercial Tenancies Act to temporarily prevent eligible commercial landlords from taking certain action against small business tenants for the non-payment of rent during Covid-19. The non-enforcement period began on June 18, 2020 and is effective until the Act is repealed on September 1, 2020 or on an earlier day to be named by proclamation of the Lieutenant Governor.

The Act affects the enforcement of a landlord's rights and remedies against a tenant for rent arrears. It prevents evictions during the non-enforcement period and prevents re-entry and the seizure of assets or chattels from May 1, 2020 - September 1, 2020.

Am I Affected?

Landlords who evict or evicted a commercial tenant during the non-enforcement period are affected if they are or would be eligible to receive assistance under the Canada Emergency Commercial Rent Assistance ("CECRA") for small business program, whether by entering into a rent reduction agreement with the tenant containing a moratorium on eviction or not.

Landlords are not affected if the tenant default occurred after they were approved to receive assistance under the CECRA for small business program or if they are not eligible for the program.

The CECRA program offers forgivable loans to commercial property owners to cover 50% of monthly rent payments owed by small business tenants during the months of April, May and June. Property owners are required to reduce rent by 75%, meaning that they forgo 25% of the rent payment. Applications are currently open until August 31, 2020 and the rent assistance will apply retroactively.

Ban on Evictions

To eligible landlords, the Act prohibits judges from ordering a writ of possession on the basis of rent arrears that is effective during the non-enforcement period. This temporary ban on commercial evictions applies in respect of any action or application that was commenced before, on or after the day this Act came into force.

For clarity, eligible landlords may not evict tenants during the non-enforcement period, regardless of when their original action for eviction was commenced.

Restoration of Possession and Compensation for Re-Entry

Eligible landlords who exercised their right of re-entry on or after May 1, 2020 are required to restore possession of the premises as soon as reasonably possible, unless the tenant declines. If landlords are unable to restore possession of the premises, they must compensate the tenant for all damages sustained.

If a landlord restores the premises or compensates the tenant, the tenancy is deemed reinstated on the same terms and conditions as previously, unless agreed otherwise.

Return of Seized Goods or Chattels

During the non-enforcement period, landlords may not seize any goods or chattels as a distress for arrears of rent. Goods that have already been seized and were seized after May 1, but were unsold as of June 18th, are to be returned to the premises.

Non-Compliance with the Act

In addition to any other remedy available at law, a landlord who contravenes the Act in terms of re-entry or the seizure of goods or chattels is liable for damages to the person aggrieved as a result of the contravention or non-compliance.

If you have any questions regarding the matter, please do not hesitate to contact Leslie Fluxgold directly at [email protected] or at 905 763 3770 x 210. 

*The material provided in this article is for general information purposes only. It is not intended to provide legal advice or opinions of any kind.

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*Reference: https://www.ola.org/sites/default/files/node-files/bill/document/pdf/2020/2020-06/b192ra_e.pdf


About the Authors:

Leslie A. Fluxgold is a respected advisor to the business community, with a focus on commercial real estate and commercial lending. Les has the expertise and hands-on experience to guide clients through complicated real estate matters and commercial loan transactions. 

Stephanie Furlan was recently called to the Bar in Ontario. Stephanie's current focus is on corporate commercial and commercial real estate transactions, including secured lending. 

CECRA for Small Business Application
May 25, 2020

CECRA for Small Business Application

Written by the FIJ Team

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The CECRA for small businesses application portal opens at 8:00 a.m. EST on Monday, May 25th, 2020. Due to the large volume of expected applications, the Government is asking eligible commercial property owners in Ontario with up to 10 tenants to apply on Tuesday, May 26th. All other property owners in Ontario are encouraged to apply on Wednesday, May 27th. See the full registration guidelines here.

To apply, you must provide attestations from yourself, as property owner, and your tenant or sub-tenant. You must provide specific property information, applicant information and tenant information. You must provide a rent reduction agreement and forgivable loan agreement executed by yourself and your tenant. Sample documents have been provided by CMHC. We encourage you to contact your lawyer for assistance with these documents.

The CECRA program will provide unsecure, forgivable loans to eligible commercial property owners to cover up to 50 per cent of small business’ gross rent for the months of April, May and June. It requires property owners to offer a rent reduction of 75 per cent to small business tenants for the corresponding three months.

If you have any questions, please feel to reach out to Leslie Fluxgold directly at [email protected] or at 905 763 3770 x 210 for further information.

The material provided in this article is for general information purposes only. It is not intended to provide legal advice or opinions of any kind.


About the Author:

Leslie Fluxgold is a respected advisor to the business community, with a focus on commercial real estate and commercial lending. Having served as counsel for the Ministry of Municipal Affairs and Housing, practiced privately for over 20 years and having spent over 15 years acting for many of Canada's leading commercial lenders, Les has the expertise and hands-on experience to guide clients through complicated real estate matters and commercial loan transactions. He identifies their objectives, assesses their options and gets them to the finish line.