QUEEN’S BENCH FOR SASKATCHEWAN Citation: 2013 SKQB 265 Date: 2013 07 05 Docket: Q.B.G. No. 707 of 2013 Judicial Centre: Saskatoon IN THE MATTER OF S. 72(1) OF THE RESIDENTIAL TENANCIES ACT, 2006 BETWEEN: GLENKO PROPERTIES INC., and DIANE WYSHYNSKI, and THE OFFICE OF RESIDENTIAL TENANCIES, Counsel: Davin R. Burlingham for the appellant No one appearing for the respondents JUDGMENT LAING J. July 5, 2013 [1] The appellant landlord appeals a decision of the Residential Tenancies hearing officer on the following two questions of law: a) That the Hearing Officer misinterpreted ss. 19(1)(g)(iii) of The Residential Tenancies Act, 2006 in finding that the tenancy agreement was not fixed-term agreement, and thereby committed an error of law; and b) That the Hearing Officer misinterpreted ss. 8(2) of The Residential Tenancies Act, 2006 in finding that the landlord’s efforts at mitigation were not reasonable within the meaning of that section and that the landlord is legally disentitled to compensation pursuant to s. 8(1) of the Act, and thereby committed an error of law. [2] The tenancy commenced on April 1, 2012. The term of the lease stated as follows: TERM For term of 12 months from the 1st day of April, 2012 to the 31st day of March, 2013 and continuing thereafter from month to month until the tenancy is terminated by one of the parties giving to the other party notice in writing not later than the last day of any month of the tenancy, to be effective on the last day of the immediately following month of the tenancy. The respondent vacated the unit on or about October 30, 2012. The monthly rental was $2100. [3] The respondent gave written notice to landlord to terminate the tenancy dated September 18, 2012 in which she advised she was terminating the tenancy and giving up possession of the premises on the 31st of October, 2012. The appellant did not attempt to rent the premises following his receipt of the notice, because he had decided to furnish the unit prior to re-renting it. He testified he spent approximately $15,000 on furnishing the unit and made the decision to do so because in his opinion it would be quicker and easier to re-rent to better clients. The appellant did not advertise the unit for rent until the middle of January 2013 and obtained new tenant effective February 1, 2013 at $2500 per month, which was $400 more than when the apartment was unfurnished. [4] Section of The Residential Tenancies Act, 2006, S.S. 2006, c. R‑22.0001 (the Act), which addresses tenant’s liability for not complying with the Act or tenancy agreement states: 8(1) If landlord or tenant does not comply with this Act, the regulations or their tenancy agreement, the non-complying landlord or tenant must compensate the other for any damage or loss, including loss of rent paid or payable, that results. (2) landlord or tenant who claims compensation for any damage or loss that results from the other’s non-compliance with this Act, the regulations or their tenancy agreement must do whatever is reasonable to minimize the damage or loss. THE HEARING OFFICER DECISION [5] With respect to whether the tenancy was for fixed term the hearing officer referred to s. 21 of the Act which states: 21 If written tenancy agreement does not contain the information mentioned in subclause 19(1)(g)(iii), the tenancy is deemed to be periodic tenancy on monthly basis. Section 19(1)(g)(iii) states: 19(1) written tenancy agreement must comply with any prescribed requirements and must contain all of the following: (g) the agreed provisions respecting the following: ... (iii) if the tenancy is fixed term tenancy, the date the tenancy ends. Section 2(d) defines “fixed term tenancy”. It states: (d) “fixed term tenancy” means tenancy under tenancy agreement that specifies the date on which the tenancy ends. The hearing officer concluded that because the term of the lease provided for month‑to‑month tenancy following the end date of the tenancy described in the term clause there was no certain date in the tenancy agreement for the end of the tenancy and it was not therefore fixed term tenancy, but month-to-month tenancy for which proper one month’s notice had been provided by the respondent. [6] The hearing officer in the alternative stated that if she was in error in this respect and it was fixed term tenancy, the fact the appellant did not advertise the premises for lease after receiving the September 18, 2012 notice from the respondent meant he did not within the meaning of s. 8(2) “do whatever is reasonable to minimize the damage or loss”. For this reason the appellant failed to prove any entitlement to rent revenue loss. She held that if the landlord had commenced advertising the unit immediately after receiving the notice the unit may have been re-rented for November 1, 2012. She also noted the fact that it was rented at $400 per month more commencing February 1, 2013. She concluded the appellant had failed to prove entitlement to any rent revenue loss, and the application was dismissed. [7] With respect to whether or not the lease was for fixed term, the wording of the lease indicates it is for fixed term of one year from April 1, 2012 to March 31, 2013, and may thereafter be continued on month‑to‑month basis. The fact that an indefinite term follows the fixed term of one year does not detract from the fact that the respondent was committed to the fixed term of one year at the time she gave notice to terminate the lease on September 18, 2012. similar wording to this lease was upheld as fixed term lease in the case of Morguard Residential Inc. v. Adams, 2005 ABPC 271 (CanLII), [2005] A.J. No. 1259 (QL), at para. 4, where it was noted: “The aforesaid Residential Tenancy Agreement or lease was fixed‑term tenancy agreement which terminated April 30, 2004. It also provided that month‑to‑month tenancy could follow the primary term. ...”. I conclude the hearing officer erred in law in holding that the fact a month‑to‑month tenancy would follow the primary fixed term negated a fixed term. The one-month notice provision referred to in the term of the lease was applicable only if the tenancy was extended to a month-to-month tenancy following the end of the fixed term. [8] With respect to the hearing officer’s conclusion the appellant had failed to mitigate its loss with respect to the respondent’s early notice of termination of the tenancy, counsel for the appellant relies on the case of 10113307 Saskatchewan Ltd. v. Mattison, 2012 SKQB 22 (CanLII), [2012] S.J. No. 22 (QL), decision in which Gerein J. noted, “A failure to minimize damage or loss does not eliminate an entitlement to compensation; rather it mandates an adjustment in the amount of compensation. This is the effect of s. 8(2) of the Act.” The remarks of Gerein J. were appropriate on the facts of the case he was considering, where the hearing officer concluded the fact the tenant had not complained to the landlord about the noise was failure to mitigate disentitling him to any compensation. The facts in this matter are quite different. The question in this matter for the hearing officer, was would there be any loss if the appellant had done what was reasonable to minimize his loss. [9] At common law, the onus is on defendant to establish failure to mitigate on the part of the plaintiff. Vide: Nikulak v. Finnson, [1991] S.J. No. 491 (QL) (C.A.). The effect of s. 8(2) of the Act quoted above, reverses this onus and places the same on the person claiming the loss. It was therefore the appellant who had the obligation to show that he did whatever was reasonable to minimize his loss. [10] While the appellant gave evidence before the hearing officer that September was difficult time to rent the premise in question, the fact is he did not try, because he had decided it would be better going forward to have furnished premise for rent. This decision was made not with respect to the possibilities of renting an unfurnished premises as of September 19, 2012, but was a macro decision based on his business going forward. None of this macro decision can be attributed to the respondent. To put the matter in perspective, if the appellant had not chosen to make the change to furnished premises and had simply waited until November to start advertising the suite for rent, and thereafter had found tenant in the next six weeks, there would be no difficulty in concluding he had failed to take reasonable steps to minimize his loss. The fact that he chose to convert the premise to furnished one does not alter the foregoing reasoning. In the absence of any evidence the hearing officer was not in position to guess whether the premises would have been leased within six weeks or not, and if so whether it would have been leased at the same rent. [11] The appeal is allowed with respect to the fixed term issue, and dismissed with respect to the claim for loss. [12] Judgment accordingly.
The appellant landlord appealed a decision of the Residential Tenancies hearing officer. The tenancy in question had commenced in April 2012. On September 18, the tenant had given six weeks' notice of her intention to terminate the tenancy. The term of the lease stated that it was for a term of 12 months (April 2012 to March 2013) and continuing thereafter from month to month until one of the parties gave one month's notice. The appellant did not try to rent the premises following receipt of the notice because he had decided to furnish the unit prior to re-renting. He spent $15,000 doing so and advertised the unit in mid-January, increasing the rent by $400 and obtained a new tenant as at February 1. Although it is not stated what relief the landlord sought from the Office of Residential Tenancies, the hearing officer stated in the decision that the lease was a month-to-month tenancy. The appellant argued that the hearing officer made errors in law in that he 1) misinterpreted s. 19(1)(g)(iii) of the Residential Tenancies Act, 2006 in making that finding, as the lease was for a fixed term; and 2) misinterpreted s. 8(2) of the Act in finding that the landlord's efforts at mitigation were not reasonable within the meaning of the section and the landlord was legally disentitled by s. 8(1) of the Act. HELD: The Court held that the hearing officer had erred in law in finding that the lease was for a month-to-month tenancy. The one-month-notice provision only applied if the tenancy was extended beyond the fixed term. The appeal was allowed on this issue. The Court found that the decision of the landlord to furnish the premises was a business decision, and the result of this decision could not be attributed to the tenant. The Court dismissed the appellant's claim for loss.