My girlfriend and I took our Landlord to court and won. Tenants of Vancouver, don’t let yourself be bullied by your Landlord

Below is the full story that was featured on The Georgia Straight, April 7th, 2018. https://www.straight.com/life/1054016/renters-vancouver-we-took-big-property-management-company-court

My girlfriend and I were living in a building in New Westminster, British Columbia that was run by a large property management company called Onni Property Management. We decided that we wanted to move to Vancouver to reduce our commute time and live closer to our friends and family. To do that, we had to break a clause in our lease.

When we moved in however, the landlord made us sign an addendum that said that if we left our home before our fixed-term was up, he would keep our $700 damage deposit. We found out that these additional clauses are fairly common, and actually saw the same agreement on my brother’s lease when he moved to Vancouver in late 2017.

We discovered that the clause that Onni required us to sign was illegal. We had to take Onni Property Management to court to confirm this was true, and get our $700 deposit back.

Tenant agreements are standardized for the most part in British Columbia. When you sign a lease, you’ll probably be signing a lease based off a template provided by the government. But landlord’s like Onni Property Management, as we discovered through our court process, typically add clauses to the agreement that go against some rules that are clearly set out by the Landlord Tenancy Act and the Government of British Columbia.

One of these clauses or addendum that are being pushed on tenants to sign, is a forfeiture of deposit if a lease is broken early. It essentially states that if you break your lease during the term, you are to forfeit the deposit you provided to the landlord in full. Meaning if you break the lease, the Landlord gets to keep the deposit.

What’s unfortunate is that these rental contracts or, technically lease addendum are standard practise in Vancouver.

However, deposits are meant to be an insurance tool for the landlord, set aside in case a tenant leaves without paying rent, or if the landlord loses money due to damages.

The fact is, that despite signing yearly leases, Landlords don’t really have much recourse if a tenant decides to break the lease early. As long as 30 days notice is provided, and a tenant provides other similar applicants to take over the lease, the Landlord cannot unreasonably deny breaking the lease. Moreover, if a Landlord doesn’t lose any money during the process through damages or losing revenue, than they can not withhold a tenant’s deposit.

At Onni though, they seem to be employ aggressive tactics to withhold as much of a the deposit as possible, even if they don’t incur a loss.

My girlfriend and I went through this with a guy named Arthur Leong who is the Onni rep managing The Pavillion Building in New Westminster. We had to break our lease early, because we decided to move to Vancouver to reduce commute times and live closer to friends and family.

We provided 30 days notice of our departure and showed our unit to about 15 different potential tenants for around 3 weeks, and provided multiple applications to rent the unit at the same monthly rate. Thankfully, Onni was able to rent the unit starting the day that we vacated, but Arthur Leong and Onni insisted on keeping our deposit.

At first, this seemed unfair. We figured, if we vacate the unit and leave it nice and clean, they would easily be able to have someone move-in when we vacate. Moreover, they would most likely be able to get a bit more rent out of it.

After doing a bit more research, we quickly found out that the forfeiture of a deposit clause we had signed for leaving early is unenforceable.

It’s clearly written in the law:

  • the Act states that “A clause which provides for the automatic forfeiture of the security deposit in the event of a breach will be held to be a penalty clause and not liquidated damages unless it can be shown that it is a genuine pre-estimate of loss at the time the contract is entered into, otherwise the clause may be held to constitute a penalty and as a result will be unenforceable.

*Residential Tenancy Policy Guideline. 4. Liquidated Damages

PDF 4. Liquidated Damages Jan-04

When we brought this to Arthur’s attention, he just kept saying that this wasn’t true and that we had signed a contract. Although we did sign a contract, contracts don’t supersede laws set out by the government. This didn’t seem to click with the Onni representative who kept saying that this was standard procedure.

What irked us the most however, were the aggressive negotiation tactics that Onni employed to take as much money as they could from our deposit that they were not allowed to withhold. Most of our conversations were of us bringing up the fact that this was illegal, and Onni saying “Well we want to work with you here, so how about instead of your full deposit we’ll only take $400 from it”. When we would double down on the fact that this was illegal and that we were willing to bring this to the BC Rental Tribunal, they would respond with “Well, we’ve been down this road before with other tenants and we’ve been able to recoup all of our money back, so you are probably better off just paying us a portion of the deposit”.

Luckily, my girlfriend and I had the time and resources to bring this to the RTB. A few months after, we had our hearing, and Onni was forced to provide us our deposit back in full.

What’s unfortunate about companies like Onni who use such aggressive tactics to try to get as much money as possible from tenants, is that many people are being taken advantage of because they may not fully understand the rules that are set in place and they don’t have the time to bring this to court.

I sympathise with landlords because some tenants are awful and can cause a lot of damage to a property or a loss of revenue. However, rents are already very high, moving is expensive, and taking an entire deposit even though the unit is rented directly after a tenant moves out seems unreasonable to me. As a landlord myself, I’d be quite happy if my tenant gave me 30 days notice, hired a professional cleaner upon vacating, and provided new similar and qualified tenant applications whom are willing to pay more for rent, effectively increasing my total annual revenue on a property.

Lastly, in this housing market, landlords rake in a ton of money — in our case close to $10,000 went to Onni. I’m all for making money, but when monthly income to home expenses are at all all-time high, and you are breaking the law to take someone else’s hard earned cash, I’d say that there is something wrong with the ethics of both the company and the representatives that knowingly enforce these illegal practises.

To see our court documents, please go here for reference:

https://drive.google.com/open?id=1gBvCVg9I6pfk84OizWsDjA9ndTY3CYaL