Tenant-Ladlord side agreements

johnkord

Inspired Forum Member
Registered
May 6, 2008
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Macdonell Avenue, Toronto, Ontario
#1
Yesterday I visited the "Ladlord`s Self-Help Centre" in Toronto, funded by Legal Aid Ontario. They are staffed by 4 full-time Community Legal Workers, and offer "summary-advice" to small-scale landlords. I spoke with one of the staff regarding a question I have:

"Can I (a landlord) set up an agreement with my tenant whereby the tenant would be responsible for minor repairs and maintenece, and I would agree to compensate them financially for the trouble. I would charge normal rent (their rental payment cheques would be as per lease agreement), but I would pay them separately in return, say $75 per month, for their upkeep of the property. Major repairs and all materials would be a burden on me, of course."

Their emphatic answer was NO ! No-way, now-how. I found this surprising. Here was their explanation:

The Landlord and Tenant Act (Ontario) stipulates that the landlord is responsible for all repairs and maintenance.
Further, there can be no side-contracts which contravene the Act. They would be considered null and void.

Well, I asked, how about if I negotiated an agreement verbally with the tenant ? (i.e., not a written side-contract /agreement ?)
The lady countered: I don`t recommend it. What would you do if the tenant, after a couple of months stopped doing the work ? "
Simple, I said, I would simply stop making the payments to them, and that would be the end of it.

That didn`t go down well either. I was told (to my disbelief
) that if I put in place a regime where I make a payment back to the tenant for services rendered, then in a dispute, the Landlord and Tenant Board would consider it part and parcel of my lease agreement with the tenant (wittten or not) and once having been set up, I would have to continue the payments forever, even if the tenant stopped doing the work. It would be considered a part of the lease agreement. Lease agreements apparently do not HAVE to be written to be legal.

I am not convinced that what I was told is correct. Could anyone please comment on any experiences you may have had (good or bad) with any agreements beyond the written lease agreement with your tenants ?

John
 

Sherilynn

Real Estate Maven
REIN Member
Oct 22, 2007
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Edmonton
www.qdhomequest.com
#2
Although I am in Alberta, I would agree on principle with what you were told.

What you could consider is hiring your tenant on a piecemeal basis. If the tenant has skills as a handyman, you could hire him for specific jobs based on quoted fees. Personally, I don`t like tenants working on my properties anyway. What would you do if you were not happy with the quality of his work? That could ruin your more important landlord/tenant relationship.

One exception is my arborist tenant. This is his profession and I have a lot of trees. But a tree has very little impact on my property. (Well, let`s hope trees don`t impact my properties!)

BTW, a verbal agreement is still a contract. If contracts had to be written to be enforceable, it would change the very fabric of our society. (That being said, I don`t do anythingn without a written agreement.)

Regards,
Sherilynn
 

housingrental

Frequent Forum Member
REIN Member
Oct 10, 2007
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Waterloo
#3
Do not hire your tenant to do work
If you are though:
Ensure proper coverage and certification for job being done (insurance, wsib, professional designation or license, etc..)
Ideally they have other clients where they do same work or you`ve provided proper training
Ideally its at properties other than where they live
Ideally its on one off contract work not ongoing salary

Its amazing how many trip and falls and other interesting events resulting in claimed serious injury happen with seemingly able bodied and aware people if you hire enough.
 

Berubeland

New Forum Member
Registered
Apr 26, 2010
171
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Toronto
#4
The information you were given is correct.

You cannot contract out of the law. The landlord is 100% responsible for maintenance and repair of the property.

That said I always provide a lawnmower and snowblower and my tenants maintain the property, some better than others. If they don`t do it then the landlord has to.
 

ThomasBeyer

Senior Forum Member
REIN Member
#5
QUOTE (johnkord @ Aug 7 2010, 07:15 AM) ..

I am not convinced that what I was told is correct. ..
Indeed !

You have a 2nd agreement with the tenant as a "handy man". He does repairs for X $s/h or Y$/month in locations as per schedule A.Schedule A may be amended at your discretion from time to time. Schedule A initially might include only his own suite .. or none .. or 5. It is like a contract for an onsite manager, which is usually separate form his/her lease.

So, two contracts: one is a lease. One is an arrangement for services not tied to the lease. You or he/she can cancel at any time.

Of course, anyone can complain later and argue .. and yes you may lose in court.

This is my OPINION .. not legal advice or a legal interpretation.

Of course the bigger question is why one should invest at all in socialist regimes like North-Korea, Venezuela .. or Ontario with its very landlord unfriendly rent control and tenant policies ! 0.7% rent increase allowed in 2011 and HST adding easily 3-4% in expenses !

Invest in the"right" provinces only !!
 

EdRenkema

New Forum Member
Registered
Sep 18, 2007
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Beamsville, Ontario
#6
QUOTE (ThomasBeyer @ Aug 7 2010, 01:21 PM) Of course the bigger question is why one should invest at all in socialist regimes like North-Korea, Venezuela .. or Ontario with its very landlord unfriendly rent control and tenant policies ! 0.7% rent increase allowed in 2011 and HST adding easily 3-4% in expenses !

Invest in the"right" provinces only !!

Ouch!
The truth hurts
 

johnkord

Inspired Forum Member
Registered
May 6, 2008
40
1
8
70
Macdonell Avenue, Toronto, Ontario
#7
Thanks to Sherilynn, Adam and Thomas for responding. It seems I`ve waded into the grey zone - not the type that Don warns against, but rather the type where you intend to be perfectly legal, and ask ahead of time about how to do it, but there are no definite answers. Regardless, all of your comments are valuable.

Thomas, love your allusion to the socialistas - you know Ontario plates say "Yours to Discover", and as landlord one certainly discovers some fascinating and mind-bending logic under the socialist Welcome mat. OK - end of rant. I have an urelated question for you. You once wrote about Powell River, B.C., recommending waterfront properties. How is the market there now ? Worthy of a cash-flowing investment ? (I believe you had a multi-door building there). Would a Rent-To-Own be a good idea there ? Would there be potential RTO tenants ? Maybe you could recommend a realtor in the area. ... John
 

housingrental

Frequent Forum Member
REIN Member
Oct 10, 2007
4,734
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38
Waterloo
#8

Of course the bigger question is why one should invest at all in socialist regimes like North-Korea, Venezuela .. or Ontario with its very landlord unfriendly rent control and tenant policies ! 0.7% rent increase allowed in 2011 and HST adding easily 3-4% in expenses !


Better than the frozen hellscape that is Alberta most of the year!

Lets revisit this when oil is at $40/barrel in seven years and see what worked better:

Someone investing in Calgary multi-family in 2010
Someone investing in Waterloo student housing in 2010
 

Sherilynn

Real Estate Maven
REIN Member
Oct 22, 2007
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Edmonton
www.qdhomequest.com
#10
Yes!

And when was the last time that Alberta had an "ice-storm" that encased the city and brought down all the power lines?

As far as I`m concerned, Alberta is the land of milk and honey...or ice cream and popsicles, either way works for me!


Sherilynn