Landords can’t require more than first and last but tenants can offer more

An interesting article by Mark Weisleder in the Toronto Star concludes with:

As a result of the MacPherson case, lenders who sell a rental property after an owner defaults will typically state that the buyer accepts any tenancy arrangement. A buyer in this situation must do due diligence in advance to try and verify what payments were made by the tenant to the prior landlord so that they are not faced with a similar situation where the tenant has prepaid rent to someone else and now they are stuck with it.

Here are the lessons to be learned from these cases

Landlords cannot advertise that they will require more than first and last month’s rent in advance of the tenant moving in. This includes any security deposit.

If the tenant offers to pay extra money up front, make sure that it is clear that the offer is coming from the tenant. This could include a deposit to cover any damages or clean the unit when the tenant wants to bring a pet.

Tenants need to keep a receipt for the payment as proof that the amount was paid, in case it is ever challenged later by anyone.

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Those interested should read the complete article and possibly the case itself. The most narrow interpretation of the decision is (I think) that:

1. Although an Ontario residential tenancy lease can’t have terms inconsistent with the Residential Tenancies Act;

2. An Ontario residential tenancy lease can include terms that are NOT inconsistent with the Residential Tenancies Act

Obviously, this decision also has implications for buying an Ontario property that has a tenant in it.