What types of rental accommodations are covered by Prince Edward Island legislation governing residential tenancies?
The province’s Rental of Residential Property Act governs the rental of furnished, partly furnished or unfurnished residential rental premises, including any type of house, dwelling, apartment, flat, tenement, room, mobile homes and land rented as a mobile home site.
What types of rental accommodations are NOT covered by this legislation?
* Accommodations provided by an educational institution to its students
* Premises licensed under the Community Care Facilities and Nursing Homes Act
* Premises which provide therapeutic or rehabilitative services or temporary shelter such as transition houses and hostels and other such premises which have supervisory services as that term is defined in the Community Care Facilities and Nursing Homes Act
* Premises licensed under the Tourism Industry Act except when such premises are provided as accommodation for a guest for a continuous period of one month or more
* Premises provided as group homes under the Welfare Assistance Act
* Co-operative housing.
What types of rental periods are provided for in the legislation?
Leases must have a fixed term with a predetermined expiry date, or month-to-month and week-to-week rental agreements.
Is it necessary to have a written lease?
No. A verbal agreement can still be binding. If there is a written rental agreement, the landlord must provide the tenant with a full copy of the agreement within 21 days of the date that the agreement was signed. If the landlord fails to do so, the tenant is not bound by any terms of the agreement that go above and beyond those already implied by the Act, unless and until the landlord provides the copy of the lease. Those persons who enter into a written rental agreement or renew a written rental agreement which is not the standard form are deemed to have done so and all provisions of the Act and the standard form apply.
A signed move-in / move-out checklist is not required but is recommended.
Can the landlord charge a deposit?
The landlord can collect a security deposit, not to exceed one week’s rent (in the case of a weekly tenancy) or one month’s rent (in all other circumstances). The landlord must request the security deposit on or before the date that the landlord and tenant enter into the rental agreement. The deposit accrues interest each year at a rate that is set annually by a formula prescribed by legislation. When the tenancy ends, the landlord must either return the interest to the tenant or apply it to damages or rent owing. When the tenant moves out of the premises, the landlord must return the security deposit within 10 days or serve the tenant with notice of intention to keep the funds. The landlord can retain all or part of the security deposit for damages or rent owing. If a tenant receives notice from the landlord and does not agree with the landlord’s reasons for keeping the security deposit, the tenant may file an Application re Determination of Security Deposit within 15 days. A tenant should provide the landlord with a forwarding address when moving out.
It is illegal to require key money.
What about post-dated cheques?
The landlord may request post-dated cheques, but the tenant is under no obligation to provide them.
When is the landlord allowed to increase the rent?
Allowable rate of rent increases is set by The Island Regulatory and Appeals Commission annually. If a landlord wants to increase the rent, he/she must serve the tenant with a Notice of Increase in Rent of Residential Premises at least 3 months before the effective date of the rent increase. Landlords who wish to raise the rent above the allowable rate must apply to the Director of Residential Rental Property for approval. A landlord may not raise the rent under a fixed term lease until the lease expires. Rent increases are tied to the property, not the tenant. A landlord can increase the rent for a rental unit once a year, and the amount of the rent increase is the same regardless of the number of people living in the unit or whether the unit has changed hands. The rent for a new tenant should be the same as for the previous tenant if a rent increase was already made in that year.
When is rent considered late?
Rent is considered late the day after it is due. A landlord may then serve the tenant with a Notice of Termination for non-payment of rent. If the tenant pays the landlord all of the rent due indicated on the notice within 10 days of receiving it, the notice automatically becomes void. If the lease contains provisions for a penalty for late payment of rent, the penalty shall not exceed 1% per month of the monthly rent. If a tenant receives more than two Notices of Termination that indicate non-payment of rent as the reason for termination, the landlord may apply to the Director of Residential Rental Property for an order terminating the tenancy based on persistent late payment.
How can a lease be renewed?
In the case of a fixed term rental agreement which is not terminated by either the landlord or the tenant, upon its expiration it automatically converts to a month-to-month rental agreement. If the agreement contains an option to renew and the tenant fails to renew the fixed term, the landlord can serve the tenant with a Notice of Termination.
How can a lease be terminated?
It is the responsibility of both parties to renegotiate or terminate the lease before the expiry date. Tenants may not terminate during a fixed term lease, only at the end of the fixed term. Landlords may only terminate a tenancy for specified reasons as set out in the legislation and cannot terminate simply because a fixed term has expired unless the lease contains an option to renew and the tenant fails to renew the lease. When a fixed term tenancy goes to a month-to-month term, the landlord cannot force a tenant to sign another lease or agree to another fixed term.
Depending on the circumstances, the parties may need to serve a notice or a document to a landlord, a tenant or the Director of the Island Regulatory and Appeals Commission. Service may be by personal delivery, regular, certified or registered mail.
If the tenant is renting under a fixed-term lease, the tenant must give notice to the landlord at least 2 months before the end of the term. For a month-to-month tenancy, the tenant must provide a written notice of termination to the landlord on or before the day that rent is due and at least 1 month before the tenant wishes to move out.
A landlord must have a reason to give a tenant notice to vacate, and the notice periods depend on the reason:
* 20 days notice for rent arrears
* 1 month’s notice for failing to provide quiet enjoyment
* 2 months’ notice for a family member moving into the premises, demolition or conversion of the building to another use
* 6 months’ notice for mobile home pads.
Can a tenant assign a lease or sublet the premises?
If the tenancy is a fixed term of 6 months or more, the tenant can sublet or assign the rental unit with the consent of the landlord, which cannot be unreasonably withheld. If a tenant believes that consent has been unreasonably withheld, he/she may apply to the Director of Residential Rental Property for an order authorizing the sublet or assignment.
When is the landlord permitted to enter the premises?
Except in the case of an emergency, a landlord shall not enter the premises without the consent of the tenant unless the landlord has served the tenant with at least 24 hours written notice stating the date and time of the entry, which must be between 9 a.m. and 9 p.m.
How can a landlord evict a tenant?
There are several grounds on which a tenant may be evicted and the required notice period the landlord must give depends on the grounds for eviction. The main reason for eviction is rent arrears. If rent is due on the 1st day of the month and the tenant does not pay the rent, the landlord can issue a notice of termination. A tenant can invalidate the notice by paying all of the outstanding rent within 10 days of receiving the notice, failing which the tenant will have to vacate the premises by midnight of the 20th day.
After being served with a notice of termination, a tenant can make application to the Director within 10 days to set aside the notice and the matter is then dealt with in a hearing of both parties. If the tenant does not file an application to set aside the notice within the 10-day period, it is deemed that the tenant has accepted the vacate date on the notice of termination and should be moved out by the date stated. If the tenant fails to vacate the premises, the landlord can file an application requesting possession of the premises.
The foregoing summary is provided for information purposes only and is not to be considered legal or business advice. The information may not be complete, accurate or applicable for any particular situation and should not be relied upon.
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