News & Views

Moratorium on Commercial Evictions Extended to October 30, 2020
October 05, 2020

Moratorium on Commercial Evictions Extended to October 30, 2020

Yesterday, Bill 204, Helping Tenants and Small Businesses Act, 2020 was passed into legislation. It amends the Commercial Tenancies Act, Residential Tenancies Act, 2006, Assessment Act, Election Act, Municipal Elections Act, 1996, Municipal Property Assessment Corporation Act, 1997, and Reopening Ontario (A Flexible Response to Covid-19) Act, 2020.

The legislation extends the moratorium on commercial evictions and restricts landlord remedies for certain eligible landlords, retroactive from September 1, 2020 until October 30, 2020 or such earlier date as may be prescribed (the “Non-Enforcement Period”).

Amendment to the Commercial Tenancies Act

The Schedule adds Part IV to the Commercial Tenancies Act. This Part is applied to a tenancy in respect of which the landlord satisfies any of the following criteria:

  1. The landlord is eligible to receive assistance under the Canada Emergency Commercial Rent Assistance for small businesses program (the “CECRA”).
  2. The landlord would be eligible to receive assistance under the CECRA, if the landlord entered into a rent reduction agreement with the tenant containing a moratorium on eviction.
  3. The landlord would have been eligible to receive assistance under the CECRA if applications under that program were being accepted. This paragraph applies only if applications to the CECRA are no longer being accepted.

Who is Not Impacted?

If a landlord described above is approved to receive assistance under the CECRA is exempted from the following rules and restrictions, if the action/application for a writ of possession, right of re-entry, or seizure of goods and chattels was exercised after the landlord was approved to receive the assistance.

For greater certainty, this applies if the landlord was approved to receive assistance under the CECRA in respect of the tenancy but is no longer receiving assistance under that program.

What is Prohibited?

For those landlords who meet the criteria, the following actions are prohibited during the Non-Enforcement Period:

  1. A judge may not order a writ of possession that is effective during the Non-Enforcement Period if the basis for ordering the writ is an arrears of rent. This means that evictions are prohibited during the Non-Enforcement Period.
  2. No landlord shall exercise a right of re-entry during the Non-Enforcement Period.
  3. No landlord shall seize any goods or chattels as a distress for arrears of rent during the Non-Enforcement Period.

If the Landlord exercised a right of re-entry or seized goods and chattels on or after September 1, 2020, then the landlord is required to restore possession of the premises and/or return the unsold goods to the tenant as soon as reasonably possible. If the landlord is unable to restore possession of the premises or return all of the seized goods and chattels then the landlord will be liable to the tenant for applicable damages, with an exception being if the tenant declines to accept possession.

Note: The CECRA opt-in deadline for existing applications is October 30, 2020.

If you have any questions regarding the matter, please do not hesitate to contact Stephanie Furlan directly at [email protected] or at 905 763 3770 x 217.

*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/en/legislative-business/bills/parliament-42/session-1/bill-204#BK4


About the Author

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.

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.