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Utilities Increases - Div. Ct. Appeal (50 Panorama Court)

ACTO filed an appeal in April 2002 to the Divisional Court from a decision of the Ontario Rental Housing Tribunal (ORHT) granting the landlord a rent increase of 3.38% in addition to the allowed guideline increase of 3.9% in 2002.

The landlord’s application was based almost exclusively on the increase in heating costs in 2000-2001 due to the huge jump in natural gas prices. In fact, the number of applications for rent increases above guideline filed with the ORHT across the province increased from 535 in 2000 to 1573 in 2001 - an increase of 194%. And despite the fact that natural gas prices had declined back to 1999 levels by September 2001, the tenants have no ability to apply under the Tenant Protection Act (TPA) to decrease the rent.

In April, 2002, ACTO held a media conference on this issue, joined by Ontario Coalition of Senior Citizens’ Organizations, the Federation of Metro Tenants’ Associations and the Ontario Electricity Coalition, to draw public attention to the devastating impact of rent increases tied to utility costs.

ACTO's factum in the appeal argued that ORHT has the authority to reduce the rent if regulations under the TPA are read in light of section 188 which requires ORHT to look at the real substance of transactions relating to the building, particularly the decline in natural gas prices after the filing of the landlord’s application.

The factum also argued that the overall purpose of the TPA is to protect tenants and the interpretation of the TPA must reflect this overarching objective. Allowing a permanent rent increase, when the costs are no longer borne by the landlord, is inconsistent with the purpose of tenant protection.

However, in another appeal filed prior to 50 Panorama Court, Burton et al. V. Leadway Apartments, the Divisional Court ruled that section 188 does not provide any substantive rights and that there was no conflict between the formula in the regulations and section 188. The tenant’s appeal in that case was dismissed. As a result, the tenants of 50 Panorama Court withdrew their appeal.

ACTO is continuing to mount a law reform campaign on this issue.