Applications for Rent Increases Above the Guideline
Interpretation Guideline 14

Interpretation Guidelines are intended to assist the parties in understanding the LTB's usual interpretation of the law and promote consistency in decision-making. A Member is not required to follow a Guideline and may make a different decision depending on the facts of the case.

This guideline assists parties to understand the law and procedures applicable to applications for an above the guideline rent increase (AGI). A more general overview of the AGI process is found in Information About Applications for a Rent Increase Above Guideline.

All increases in rent are subject to the rules in the Residential Tenancies Act, 2006 (RTA). The RTA requires the Minister to set the guideline for rent increases every year. A rent increase guideline is the maximum amount by which a landlord can increase the rent for a current tenant without the LTB's approval. The LTB does not set the guideline and has no power to increase or decrease the guideline.

Generally, a landlord can only increase the rent by the rent increase guideline. However, under certain circumstances a landlord can apply for an increase in rent above the guideline to recover expenses that are not taken into account in calculating the guideline. This is called an application for an above the guideline rent increase or AGI.

See RTA s.126.

An AGI application may include all or just some of the rental units in the residential complex.

A landlord may make an AGI application in any of the following situations:

  1. There has been an extraordinary increase in the cost for municipal taxes and charges for the residential complex or any building in which the rental units are located. See RTA s. 2(1), s.126(1).1, s.126(2) and O.Reg 516/06, s.28, s.29 and s. 41;
  2. The landlord has eligible capital expenses (extraordinary or significant renovation, repair, replacement or new addition the expected benefit of which extends for at least five years) for the residential complex or one or more of the rental units in it. Tenants who began their tenancy after the capital expenditure was completed cannot be included in this application. See RTA s.126(1).2,126(7),126(8),126(9) and O.Reg 516/06, s.18, s.26-28;
  3. The landlord has experienced operating costs related to security services provided in respect of the residential complex or any building in which the rental units are located by persons not employed by the landlord for the first time or the costs have increased. See RTA s.126(1).3 and O.Reg 516/06, s. 30.

Except in the limited circumstances described below, the LTB must issue an order for an above the guideline rent increase if the landlord meets the statutory requirements.

The LTB has no power to take a tenant's personal financial circumstances into account when considering an AGI application.

Filing an AGI Application

An Application for an Above Guideline Increase (L5) form is available at:

Instructions for completing the Application form are also provided on the LTB's website: L5 Instructions.

All relevant documents must be included with the AGI application, including a completed schedule of parties identifying all affected tenants. See O.Reg 516/06 s.22.

The LTB may refuse to process the application until any missing documents or information is filed. The LTB may refuse to allow the applicant to rely on documents at the hearing if they were not filed in time.

The application MUST be filed at least 90 days before the effective date of the first intended rent increase being claimed in the application. This is called the first effective date (FED).

Once the LTB is satisfied the application is complete and it is scheduled for a hearing, the landlord is ordered to give a copy of the application and the Notice of Hearing to the tenants whose units are affected by the application. The LTB's Rules require these documents be given to the tenants as soon as possible and at least 30 days before the hearing date.

Capital Expenditure Information for Tenants

Where an AGI claims capital expenditures, the landlord must make all the supporting documents and materials available to affected tenants as follows:

  1. On the request of a tenant subject to the application, the landlord must provide a compact disc containing PDF versions of all the material provided to the LTB for a charge of not more than five dollars, OR
  2. the landlord and tenant may agree that the landlord will provide the tenant with either a photocopy of the material for no more than the landlord's reasonable out-of-pocket costs for the photocopying or an email attaching PDF versions of the materials, at no charge to the tenant.
  3. If a landlord has not provided the LTB with a compact disc because it qualifies for an exemption from this requirement, the landlord must, on the tenant's request, provide the tenant with a photocopy of the materials for a charge of not more than five dollars.
  4. If the landlord has an office in or close to the residential complex, the landlord must, during normal business hours and at no charge, make a photocopy of the materials available for viewing by tenants.

In the application the landlord must inform every tenant subject to the application of the ways in which a tenant may obtain access to the materials filed with the application.

See RTA s.126(4) and O. Reg. 516/06 s.23.


All AGI applications filed on or after January 1, 2018 must include a summary of items in work orders or orders issued under section 21 of Technical Standards and Safety Act, 2000 or repairs, replacements or other work ordered by the LTB, that are yet to be completed and that relate to one or more elevators in the residential complex. The summary must include. (1) a description of the ordered work; (2) the person or entity who ordered the work and the specified compliance date; and (3) who made the order and the date the order was made. The summary must be included with the application even if the compliance period set out in the order for doing the work has not yet expired.

See RTA s. 126 (3.1), 126(3.2).

Written or Oral Hearing?

The LTB will review the complete application and may decide that the issues can be decided in a written hearing. If this happens the LTB will issue a Notice of Written Hearing which the landlord must give to the tenants within 20 days. Applications seeking an AGI due to an extraordinary increase in municipal taxes and charges and applications seeking an AGI due to operating costs related to security services are usually scheduled for a written hearing.

A tenant may file a written response, including supporting documents, within 50 days from the date the LTB issues the Notice of Written Hearing. The response does not need to be delivered to the landlord or the other tenants. The landlord may file a reply to the tenants' response no later than 65 days after the Notice of Written Hearing is issued.

An application seeking an AGI based on capital expenditures is usually scheduled for an oral (in person) hearing.

Case Management Hearing and Consent Orders

Where the LTB decides to hold an oral hearing it may require the parties to first attend a Case management hearing (CMH). A CMH is always held in AGI applications based on capital expenditures. The CMH is conducted by a Dispute Resolution Officer (DRO).

If the landlord fails to attend the CMH the application may be dismissed as abandoned.

A tenant who fails to attend the CMH may be deemed to accept all of the facts and claims in an application and may not be given any further notice of the application.

During the CMH the parties have an opportunity to mediate some or all the issues in dispute. Where no CMH is scheduled and parties want to explore settlement the LTB generally makes the services of a DRO available on the day of hearing.

If mediation resolves the application, the tenants who attend the CMH and the landlord may agree to a consent order for an increase that is not greater than the increase that the evidence filed with the application would support. This consent order binds all of the parties to the application even if they are not present at the CMH.

The order must specify the percentage increase attributed to the capital expenditure and include a date on which a rent decrease will take effect if the tenant continues to occupy the rental unit. The landlord must decrease the rent due to the elapse of the weighted useful life period for capital expenditures, by the percentage by which the landlord increased the rent.

See RTA s.129.

An AGI application can also be resolved by a mediated agreement. The rent increase in a mediated agreement is limited to an amount equal to the guideline plus 3% of the previous year's lawful rent. This limit does not apply to mobile homes or land lease sites.

See RTA s.194(3).

Case Management Orders

If the application is not resolved at the CMH the DRO may make case management orders to help the parties and the LTB hold a more efficient and expeditious hearing. A Case Management Order may, among other things:

  1. identify and simplify the issues in dispute,
  2. identify agreed facts or evidence, and
  3. set dates for any further steps in the proceeding.

Adjournments of AGI hearings will only be granted in exceptional circumstances.

The landlord must deliver the Notice of Hearing to all affected tenants at least 30 days before the hearing date. This provides ample time for tenants to review the application and supporting documentation and consult and, if they wish, retain a representative.

The LTB reserves a substantial amount of hearing time for AGI applications. This time resource cannot be recovered if the hearing is adjourned. Often, AGI applications involve a large number of tenants who may be inconvenienced if required to attend more than once.

See TEL-63026-15 (Re), 2016 CanLII 72073 (ON LTB), TNL-68214-15 (Re), 2017 CanLII 48726 (ON LTB).

Applicants are expected to be ready to proceed on the date set for the AGI hearing and have filed all necessary supporting information in accordance with section 22 of O.Reg 516/06.

A landlord seeking to file documents that should have been filed with the application must first ask the LTB to extend the time for filing. The LTB will consider the factors set out in the Rules in making that decision. An extension will rarely be granted where the reason for failure to file on time is the applicant's neglect.

See Gramercy Apartments Limited (Greenwin Property Management Inc.) v. Anthony, 2008 CanLII 6643 (ON SCDC)

The AGI Decision

Extraordinary Increase in Municipal Taxes and Charges RTA s.126(1).1

What are Municipal Taxes and Charges?

Municipal taxes and charges include:

An application may be made about an increase in municipal taxes and charges resulting from an appeal of a tax assessment.

See RTA s. 2(1) and O.Reg 516/06 s. 29 and s.41.

Municipal taxes and charges do not include:

What is an Extraordinary Increase?

An increase in municipal taxes and charges is extraordinary if it is greater than the guideline plus 50% of the guideline. As discussed below, the costs incurred by the landlord during two consecutive 12 month accounting periods are compared for this determination.

See O. Reg 516/06 s.28.

The LTB uses the guideline for the calendar year in which the application's FED falls. If the guideline is less than zero, any increase in the cost of municipal taxes and charges is considered extraordinary.

Example: If the first rent increase requested in the application takes effect on September 1, 2017, the 2017 guideline of 1.5% is used. The following calculation can be used to figure out how much the increase must be to be considered "extraordinary": 1.5% x .50 (50%) = 0.75%, 1.5% + 0.75% = 2.25% If the increase in municipal taxes and charges is greater than 2.25%, it is considered "extraordinary."

The total justified rent increase is determined by O. Reg 516/06 s.29.

See TEL-57659-15 (Re), 2017 CanLII 48950 (ON LTB), TSL-52521-14 (Re), 2015 CanLII 34313 (ON LTB).

Operating Costs Related to Security Services RTA s.126(1).3

A landlord can apply for an AGI order due to the operating costs related to a new security service or increased operating costs of an existing security service. The allowance is determined in accordance with O.Reg 516/06 s.30.

No claim for employees

A landlord can only make claim for security services provided by persons who are not the landlord's employees. For example, an application claiming increased costs for a building superintendent who provides security services in addition to his/her regular responsibilities will not be allowed.

What is the "accounting period" for calculating increased security costs?

In order to determine if the increase in operating costs related to security services is extraordinary, the landlord selects a 12 month accounting period referred to as the base year. The base year is the most recent 12 month accounting period completed at least 90 days before the date the first intended rent increase for the rental units covered by the application will take effect. The costs incurred by the landlord during the base year are compared to the costs incurred during the 12 month accounting period that is immediately before the base year. This is referred to as the reference year.

See O. Reg 516/06 s.19(1).

How does a previous AGI order affect determination of the base year?

The base year for a subsequent AGI application must start and end on the same days as the base year in the previous order. This rule applies even if a new landlord has purchased the residential complex, or the landlord has changed the FED in the current application to a different month of the year.

Capital Expenditures RTA s.126(1).2

The amount of a capital expenditure item and the allowance is determined according to sections 16 and 27 of O. Reg 516/06.

What is a capital expenditure?

An allowable capital expenditure must:

Definition of Capital Expenditure

A "capital expenditure" is an expenditure for an extraordinary or significant renovation, repair, replacement or new addition, the expected benefit of which extends for at least five years.

The LTB considers all of the circumstances, including the size of the complex, the nature of the work, its effect on and importance to the unit or complex, and the amount of the expenditure when determining if the expenditure is extraordinary or significant.

The period of the expected benefit is determined as of the time that the expenditure is incurred. If an item is expected to last more than five years but does not, the landlord is not disqualified from recovery of the expenditure.

See O.Reg 516/06 s.18(1).

A capital expenditure is eligible if it:

See RTA s.126(7).

Physical integrity means the integrity of all parts of a structure, including the foundation, that support loads or that provides a weather envelope and includes the integrity of:

See O.Reg 516/06 s.18(1).

See TEL-63026-15 (Re), 2016 CanLII 72073 (ON LTB), TSL-58549-14 (Re), 2016 CanLII 88389 (ON LTB).

Capital expenditure does not include:
  1. routine or ordinary work undertaken on a regular basis or undertaken to maintain a capital asset in its operating state, such as cleaning and janitorial services, elevator servicing, general building maintenance, grounds-keeping and appliance repairs, or
  2. work that is substantially cosmetic in nature or is designed to enhance the level of prestige or luxury offered by a unit or residential complex.

In Helberg Properties Limited v Caldwell, 2015 ONSC 7863 (CanLII), the Divisional Court upheld the LTB's determination that new balconies and railings were not ineligible because they would have a more "cosmetically pleasing appearance" than the old rusted, deteriorating ones that they replaced. Rather they were necessary to ensure the integrity of the concrete balcony slabs and to address the rusting railings.

See also SWL-21457 (Re), 2009 CanLII 51173 (ON LTB).

Ineligible capital expenditures

A capital expenditure to replace a system or thing is not an eligible capital expenditure if the system or thing that was replaced did not require major repair or replacement, unless the replacement of the system or thing promotes:

See RTA s.126(8).

See TSL-62594-15 (Re), 2016 CanLII 71626 (ON LTB), TNL-64931-14 (Re), 2016 CanLII 52821 (ON LTB).

A capital expenditure is not an eligible capital expenditure with respect to a rental unit if a new tenant entered into a new tenancy agreement in respect of the rental unit and the new tenancy agreement took effect after the capital expenditure was completed.

See RTA s.126(9).

Definition of Incurred

In addition to meeting the definition of capital expenditures, the items claimed must have been incurred by the landlord at the time the application is filed.

"Incurred" means that full payment of the capital expenditure, other than any hold back that is required under the Construction Lien Act, must have been made by the time the application is filed. If a capital expenditure relates to a lease, "incurred" means the assumption of the obligations under the lease. If an expenditure relates to work undertaken by a municipality, local board or public utility, "incurred" means that the work is completed.

See O. Reg 516/06 s.18.

Completion of Work

The work necessary for the capital expenditure must have been completed by the landlord during the 18 month period that ends 90 days before the FED.

See O. Reg. 516/06 s.26(2).

In 226603 Investments Ltd. v. Lutrario, [1997] O.J. No. 930 OCJ (Gen Div), the Court rejected the landlord's argument that the time it took for the landlord to pay for the capital expenditure should be included when determining whether "the work was completed" during the specified period. The Court agreed that the regulation refers to actual physical completion.

Where a project takes more than 18 months to complete the LTB will allow recovery if the project was completed within the prescribed period. However, a landlord who has undertaken several similar projects over an extended period will not be allowed to recover all the projects in one application. For example, a landlord who repaired one part of a roof five years ago, repaired another part three years ago and the rest within the last six months, cannot argue that the work on the roof was completed six months ago and recover everything spent in a single application.

Leased assets

Capital expenditure includes an expenditure with respect to a leased asset if the lease qualifies.

The lease will qualify if substantially all the risks and benefits associated with the leased asset are passed to the lessee and, at the commencement of the lease, any one or more of the following four conditions are met:

See O. Reg 516/06 s. 18(2).

Net present value is determined using the interest rate fixed by s. 20 of O. Reg. 516/06. The rate is the chartered bank administered conventional five-year mortgage interest rate on the last Wednesday of the month before the month in which the application is filed, as reported by the Bank of Canada.

See O. Reg 516/06 s.18(2).4

Work by a municipality, local board or public utility

An expenditure that the landlord is required to pay on work undertaken by a municipality, local board or public utility also qualifies as a capital expenditure, other than work undertaken because of the landlord's failure to do it.

For example, a municipality may upgrade the sewer system and require the landlord to pay for the service improvement by a special levy on the municipal tax bill. The landlord can claim the upgraded sewer system as a capital expenditure. The special levy charged by the municipality will be the costs incurred by the landlord.

If a landlord is subject to a work order and completes the required work this may qualify as a capital expenditure. The fact that a work order was issued does not remove the work from the definition of a capital expenditure.

See O.Reg 516/06 s.18(1).

Non-arm's length transactions

If a landlord incurs costs from a transaction involving related persons, this is considered a non-arm's length transaction. In such a situation, the LTB will only consider the part of the landlord's cost that is less than or equal to the cost resulting from a similar market transaction.

See O.Reg 516/06 s.25.

Calculating the amount of capital expenditure

If an item qualifies as a capital expenditure, the Member must determine the amount to be allowed when calculating the allowance. The amount is calculated by totaling:

  1. the purchase price, cost of leased assets, and the installation, renovation and construction costs, and
  2. the value of the landlord's own labour,
  3. any grant or other assistance from a federal, provincial or municipal government of insurance, salvage, resale or trade-in proceeds.

See O. Reg 516/06 s. 26(5).

Landlord's own labour

The value of the landlord's own labour in carrying out the work related to a capital expenditure may be recognized when determining the amount of the capital expenditure item. This is calculated by multiplying the amount of time the landlord spent by a reasonable rate of pay based on their experience and skill in the type of work done. If the time spent exceeds what is reasonable the LTB will allow the reasonable amount of time. The value of the landlord's own labour cannot exceed what a skilled tradesperson would charge.

The value of the landlord's own labour does not include any amount relating to the management and administration of the capital work.

See O. Reg. 516/06 s.26(3).

Government loans and grants

If a landlord received financial assistance from any level of government, the amount of any grant or forgivable loan must be subtracted from the purchase price, installation, renovation and, construction costs of each affected capital expenditure item.

Revenue from insurance, salvage, resale or trade-in

The landlord must also provide information about any revenue received from insurance, salvage, resale or trade-in proceeds. The amount of a capital expenditure must be reduced by the amount reported under these categories.

Useful life

The useful life is the estimated number of years that the capital expenditure is expected to last or benefit the complex. The useful life of a capital expenditure item is determined according to the following rules:

If the useful life of work done or a thing purchased cannot be determined because the work or thing is not in the Schedule and nothing with similar characteristics is in the Schedule, the useful life of the work or thing will be what is generally accepted as the useful life of such work or thing. In no case will useful life be less than 10 years.

See O. Reg 516/06 s.27(1), s.27(2).

Where an AGI order includes multiple eligible capital expenditures with different useful lives, an overall blended useful life must be calculated for all the capital expenditures. This is done by determining the allowable expenditure related to each claim, dividing it by the total for all capital expenditures approved and multiplying it by the useful life for that claim. The useful lives for all of the eligible capital expenditures are then added and rounded to the nearest full year. This results in a weighted useful life for the capital expenditures for each unit subject to the application.

See TSL-58549-14 (Re), 2016 CanLII 88389 (ON LTB).

Rent decrease

If the tenant who is subject to an AGI order continues to occupy the rental unit when the weighted useful life has ended, the landlord must reduce the rent by the percentage increase that is attributed to the capital expenditure on the date in the LTB order. This is also specified in the order issued by the LTB. The regulation sets the rules for calculating the date the rent decrease can take place.

RTA s. 129, O. Reg 516/06 s.38.

Allocation of costs

Only the portion of a capital expenditure, municipal tax or charge, or operating cost related to security services that is applicable to the units covered by the application will be included in the calculations. Costs related to non-residential components, other residential complexes or units in the complex not covered by the application are excluded.

Non-residential components allocation

If the costs also relate to non-residential components in the complex or other residential complexes on one or more of these factors may be used to perform the allocation:

The usual approach is to allocate based on square footage because, in the usual case, an expenditure will benefit all parts of a complex equally.

The decision on allocation is made for each expenditure. Different methods may be chosen when allocating different cost categories. Landlords must indicate in the application how they have chosen to allocate the costs between residential and non-residential (or other residential) components. That choice is not binding on the LTB. The LTB can find a different method more reasonable after considering how much of the costs and expenditures are attributable to the residential components in the complex or the residential complex.

See O. Reg 516/06 s. 24.

See TEL-63026-15 (Re), 2016 CanLII 72073 (ON LTB), TSL-52521-14 (Re), 2015 CanLII 34313 (ON LTB).

The allocation factor

If the AGI application covers only some of the units in the complex and the cost category affects units not covered by the application, the LTB must adjust the cost and allowance so that only the part of the cost and allowance that is applicable to the units covered by the application will be passed on to those units.

Applicable costs and allowances are calculated by multiplying the total costs or allowances by an allocation factor. If an operating cost category affects units not covered by the application, the allocation factor is set out in s. 21(1) of O. Reg. 516/06.

The formula for the allocation factor is:

Total rents for rental units subject to the application and affected by the operating cost category divided by Total rents for rental units affected by the application

The rent for a rental unit that is vacant or not rented is deemed to be the average rent charged for the rental units in the residential complex.

Calculating the allowance

Allowances for capital expenditure are calculated on a unit by unit basis. The method for calculating the allowance is determined by the regulation. The allowance for the unit for each capital expenditure takes into account the fact that the capital expenditure may not affect all rental units in the complex.

See O. Reg. 516/06 s. 26(6).

3% Limitation

The maximum annual increase allowed in an application based on capital expenditures or security services or both is 3% above the guideline. Where more than 3% is justified, the rent is increased by 3% in the first year and any remaining increase may be taken in subsequent years, to a maximum of two additional years at 3% each year.

The 3% limitation does not apply where the application is based on an increase in the cost of municipal taxes and charges. Where an increase is justified by these categories, the landlord may take the entire increase in the first year.

See RTA s.126(11), O.Reg 516/06 s.33.

Exception for mobile home parks and land lease communities

Where a landlord incurs a capital expenditure for a mobile home park or a land lease community for "infrastructure work" required to be carried out by any level of government or agency of government the LTB can set the number of years over which the justified rent increase may be taken.

See RTA s.167, O.Reg 516/06 s.51.

Apportioning the rent increase

In many cases, a capital expenditure affects all units covered by the application equally, and all units will receive the same percentage rent increase attributable to that capital expenditure. This generally includes structural elements relating to the physical integrity of the complex, such as the roof or foundation. Some capital expenditures only relate to specific units, such as the installation of new appliances. The LTB may determine that only those specific units will receive a rent increase for that capital expenditure.

Charging the approved rent increase

In order for the landlord to collect the above guideline rent increase they are asking the Board to approve, they must have first given the tenant a notice of rent increase indicating this higher amount. The tenant does not have to pay this higher amount unless it is approved and the order is issued. Where a landlord has filed an AGI application and gives a tenant a notice of rent increase before the LTB orders the increase, the tenant must at a minimum pay the amount that the landlord could lawfully charge, without the order.

If the tenant pays more and the application is unsuccessful, or the LTB orders a lesser amount, the landlord owes that tenant any amount overpaid. If the AGI application is successful and the tenant has not paid the amount required by the order, the tenant owes the landlord the difference between the amount paid and the amount required by the order, provided the landlord has served a proper notice of rent increase for that amount.

If the LTB orders an above the guideline rent increase three months or more after the FED, the LTB can also order that any money owing by the tenant as a result of the ordered rent increase can be paid in monthly installments over a period of no more than 12 months.

Where a landlord does not take an increase in the 12-month time period for which it is ordered, the landlord may not take the increase at a later date and the right to take that increase is lost.

See RTA s.116(1), s.205, O. Reg. 516/06 s.33(2).

See TEL-57659-15 (Re), 2017 CanLII 48950 (ON LTB).

Responding to an AGI Application

During a hearing tenants are entitled to ask the landlord questions about the claims contained in the AGI application and present evidence to explain why the claims should not be allowed. Tenants are also entitled to present evidence that the landlord is in serious breach of the landlord's maintenance obligations, or has not completed ordered repairs to an elevator. A landlord is responsible for providing and maintaining a residential complex, including the rental units in it, in a good state of repair and fit for habitation and for complying with health, safety, housing and maintenance standards.

See RTA s.20(1).

When deciding an AGI application the LTB can only consider existing serious breaches of the landlord's maintenance obligations. This means the alleged failure to repair or maintain must relate to a current and unresolved failure to maintain.

See RTA s.126(12).

If the LTB finds a landlord:

the LTB must:

See RTA s.126(13).

Even if the LTB finds serious existing breaches of health, safety, housing or maintenance standards it cannot order remedies for those specific breaches, such as a rent abatement.

A tenant may file a separate application about maintenance whether or not the maintenance issues are raised at the AGI hearing. The LTB's authority to order remedies on a tenant application are much wider. For more information on tenant applications for breaches of maintenance obligation see Interpretation Guideline 5: Breach of Maintenance Obligations.

What is a serious breach

The maintenance breach must be serious in order for the LTB to have the authority consider it during an AGI hearing. This word is not defined in the RTA or regulations. The LTB has interpreted "serious" as meaning something which is "substantial and ongoing and not merely minor, trivial or of passing concern" or a breach which "adversely, materially and substantially, affects a tenant's enjoyment of the rental unit".

See TNL-94712-17 (Re), 2017 CanLII 60324 (ON LTB); TNL-89540-17 (Re), 2017 CanLII 60348 (ON LTB).

When deciding whether the landlord is in serious breach of the landlord's obligations to repair or maintain the LTB considers:

For example, water leaking through the roof which is flooding the rental unit is serious. It is serious because the situation is severe or extreme and because the adverse and material effect on the tenant is substantial.

A landlord who has been given notice and failed to make a number of minor repairs within a reasonable time, or repeatedly ignores requests for necessary repairs or maintenance may be found to be in serious breach. This is so even if each one of the minor repairs, considered by itself and without regard to the time needed for repair, would not be considered severe or to have an adverse effect on a tenant.

Read more about how the LTB interprets "serious breach" in Interpretation Guideline 7: Relief from Eviction - Refusing or Delaying an Eviction.

Does the serious breach affect a rental unit named in the AGI?

If the LTB finds the landlord is in serious breach the next step is to decide whether any rental unit included in the AGI is affected by the serious breach.

The LTB will determine which rental units named in the AGI are:

Dismissing or delaying a rent increase

If LTB finds a current, serious breach of the landlord's obligation to repair or maintain, the Member must decide on the appropriate remedy. If the landlord knew or should have known about the serious breach, a Member may dismiss the AGI application. However, if the landlord did not know or could not have known about the serious breach the Member may delay the AGI increase until the serious breach is fixed.

If the LTB dismisses the AGI application the order is final.

If the LTB delays the increase until the serious breach is fixed, the order will grant the AGI increase but state that the landlord cannot increase the rent until the LTB is satisfied the serious breach no longer affects the rental units. The order will identify the units affected and set a deadline for fixing the serious breach. The order will also explain how the landlord makes a motion to the LTB to show that the serious breach is fixed.

If some of the rental units named in the AGI application are not affected by the serious breach the order will say that the landlord may charge the above guideline rent increase that has been justified for those rental units.

Landlord's motion showing breach is fixed

The landlord must make a motion which includes documents showing:

See RTA s.126(13).

The landlord's motion must be served on the tenants of the affected units in accordance with the LTB's Rules, and filed with the LTB, within the time specified by the LTB.

Based on the evidence and submissions of all parties at the hearing of the landlord's motion the LTB will decide whether the serious breach no longer affect the rental units. If satisfied the landlord has remedied the breach the LTB will permit the AGI increase to be applied to the affected rental units as of that date.

If the landlord's motion is not successful the LTB may dismiss the landlord's application with respect to the affected rental units.

See CEL-39925-15 (Re), 2015 CanLII 111130 (ON LTB), CEL-35821-13 (Re), 2016 CanLII 107391 (ON LTB).

February 7, 2018