Condo Rentals: must landlords disclose the rent amount to the Corporation?

Condo owners who rent out their unit are required to disclose certain information to the corporation. One question that often arises is whether they must also disclose the rent amount?

The short answer is yes—unit owners are required to disclose the rent amount. Then why is there still confusion on this topic? The answer lies in how the information is presented in both the Condo Act and on the CAO’s website.

Section 83 of the Condo Act

Section 83 of the Condo Act sets out the disclosure obligations required of owners who lease their unit. This section states that an owner who leases their unit must, within 10 days:

a) Notify the corporation that the unit is leased;

b) Provide the corporation with the lessee’s name, the owner’s address and a copy of the lease OR a summary of it in the form prescribed; and

c) Provide the lessee with a copy of the declaration, by-laws, and rules of the corporation.

An owner has therefore two options. They can either:

• provide a copy of the lease—which obviously includes the rent amount—or

• they can submit a summary of the lease using the prescribed form.

This has left many to wonder whether a summary of the lease must include the rent amount. Many are of the view that this information (the rent amount) is private and irrelevant to the condo corporation.  So what must be included in the summary?

The prescribed form of the Lease summary

The Condo Act does not expressly define what must be included in the “summary” of a lease but it does refer to “the form prescribed by the Minister.” So where does one find the “prescribed form”?

By now, most of our readers would know to look for that form on the CAO’s website.  Indeed, the CAO is now assuming responsibility over most of the forms required under the Condo Act.

As expected, you will indeed find the Summary of Lease or Renewal on the CAO’s website and this form does explicitly ask for the rent amount to be included. But the form is marked as optional. Moreover, section 16.1 of the general regulation adopted under the Condo Act does not list the summary of lease as one of the mandatory form to be published by the CAO.

This leads certain landlords to conclude that they can prepare their own summary and that they can leave out the rent amount.

In our view, these landlords would be mistaken on two fronts:

• this form is not optional (if you opt not to provide a copy of your lease, you must use the CAO’s form); and,
• the rent amount is a required piece of information that must be disclosed to the corporation.

So where do we find the list of information that must be included in the prescribed form?  Well, not where you would likely expect it…

Regulation 49/01: Description and Registration

While most times you’ll find the “prescribed”information in the general regulation adopted under the Condo Act (Ontario Regulation 48/01), the prescribed information pertaining to the summary of the lease has been (oddly enough) tucked away in another less-used regulation (Ontario Regulation 49/01). This regulation usually deals with what goes into condo descriptions and how to register them on title.

Yet, Section 40 of O. Reg. 49/01 snuck in there what must be included in the summary of the lease… and in fact expressly provides that owners must use the form specified by the CAO.

Section 40 also expressly list the following as some of the many pieces of information that must be included in the summary of the lease:

5.  A statement of the terms of the lease, sublease or assignment of the lease, including,

i.  a statement of the date of commencement and the date of termination of the lease;

ii.  an indication of whether there is an option to renew the lease and, if so, a description of the option, and

iii.  a statement of the amount of the rent payable under the lease, and the times at which the rent is payable.

So is the form optional? 

Perhaps the CAO’s reference to the form being optional was meant to signal that owners can choose between providing:

• a copy of the lease or
• a summary of it

In that sense, the form is optional (in that the owner can chose to, instead, provide a copy of the lease). But this labelling may actually cause some confusion as the form is (in our view) mandatory  – unless you provide a copy of the lease.

Why is the rent amount relevant to the condo?

So, why is the rent amount relevant to the condo corporation?

Because section 87 authorises the corporation to “seize” the rent if the unit is in default of paying its common expenses. Indeed, amongst the multiple powerful tools available to the corporation when an owner defaults on paying their common expenses, the corporation can turn to the tenant and ask them to pay the arrears (up to the value of the rent). A tenant who pays the rent (or part of the rent) to the corporation to be applied towards the arrears is not in default of their lease.

In our view, this is why the rent amount is relevant to the corporation. They need to know what amount they can seize in case of default.

 

Updated on February 20, 2024 at 5pm.