Legislative Assembly of Ontario

RENT CONTROL ACT, 1991 / LOI DE 1991 SUR LE CONTRÔLE DES LOYERS

CONTENTS

Monday 27 January 1992

Rent Control Act 1991, Bill 121 / Loi de 1991 sur le contrôle des loyers, projet de loi 121

STANDING COMMITTEE ON GENERAL GOVERNMENT

Chair / Président(e): Brown, Michael A. (Algoma-Manitoulin L)

Vice-Chair / Vice-Président(e): McClelland, Carman (Brampton North/-Nord L)

Abel, Donald (Wentworth North/-Nord ND)

Bisson, Gilles (Cochrane South/-Sud ND)

Harrington, Margaret H. (Niagara Falls ND)

Mammoliti, George (Yorkview ND)

Marchese, Rosario (Fort York ND)

Marland, Margaret (Mississauga South/-Sud PC)

O'Neill, Yvonne (Ottawa-Rideau L)

Poole, Dianne (Eglinton L)

Turnbull, David (York Mills PC)

Winninger, David (London South/-Sud NDP)

Substitution(s) / Membre(s) remplaçant(s):

Jackson, Cameron (Burlington South/-Sud PC) for Mr Turnbull

Morin, Gilles E. (Carleton East/-Est L) for Mr McClelland

Owens, Stephen (Scarborough Centre/-Centre ND) for Mr Marchese

Ward, Brad (Brantford ND) for Mr Bisson

Clerk / Greffier: Deller, Deborah

Staff / Personnel: Baldwin, Elizabeth, Legislative Counsel

The committee met at 1412 in committee room 1.

RENT CONTROL ACT, 1991 / LOI DE 1991 SUR LE CONTRÔLE DES LOYERS

Resuming consideration of Bill 121, An Act to revise the Law related to Residential Rent Regulation / Projet de loi 121, Loi révisant les lois relatives à la réglementation des loyers d'habitation.

The Chair: The committee is reviewing Bill 121 clause by clause. At the completion of Thursday, I believe we had just finished standing down subsection 30(8). Mr Mammoliti?

Mr Mammoliti: I will not take up much time, but I think it is important that we note a letter which has been sent to you, Mr Chair. It is important for me to point out just a couple of things this individual states in the letter. Would that be possible at this time?

The Chair: Before you start, I would point out that this letter is addressed to me and that all members of the committee have just received a copy of it.

Mr Mammoliti: Right. There is no point in my reading the letter. Everybody has a copy. I would appreciate their reading it when they have a spare moment, but I do want to stress a couple of key points that this individual has mentioned in his letter.

Let me start by saying that the person's name is Frank Haines. I believe a lot of us are familiar with Mr Haines. He is a tenant advocate in the city and he has done a marvellous job organizing tenants and representing them.

Mr Haines starts off by talking about some of the political grandstanding that has been going on with the committee and how he wishes this would stop. Frankly, I agree with him on that. We have only another four days in this committee and I would like to see as much work accomplished as possible. I thought I would mention that as well.

He talks a little about how Bill 51 affected the tenants and how we cannot salvage all the harm Bill 51 has done overnight. I cannot agree with him more. He also talks about this bill not being 100 per cent. When he talks about 100 per cent, he talks about it being a perfect bill and how no bills have ever been perfect. He believes this bill is a good one and that tenants across the province are waiting for it. Then he talks again about the political grandstanding and how be believes it should stop.

I will leave it at that. I am hoping the members of the committee will read the letter, because I think it is an important one, in order for us to finish our business by the end of the week.

Mr Jackson: I have read the letter and I want to thank Mr Mammoliti for bringing it forward. However, perception is an unusual thing. I received a phone call from one of the tenants in my riding Friday, when I was having my regular constituency day, who felt that the delay in the legislation was a clever tactic because it was enabling the NDP to re-examine the caps. They would then be in a position to provide even more equity and fairness for tenants.

It is an unusual commentary that tenants somehow felt that delaying the legislation would give the government a window further on in the session from which it could see that its caps were too high and were not helping tenants. That was just a perception of a tenant in my riding which quite fascinated me, so this is one point of view. Certainly there will be others and, as always, they are in the eye of the beholder.

Section 30:

The Chair: We shall then move on to subsection 30(9). Questions, comments or amendments?

Ms Harrington: Mr Chair, because it is related to subsection 30(8), we wish to stand this subsection down.

The Chair: Can I have unanimous consent to stand down this subsection?

Agreed to.

The Chair: Subsection 30(10).

Ms Harrington: Subsection 30(10) specifies the rate of interest that will apply to the amount of illegal rent, excess rent, owing. Specifically, the rate of interest is the post-judgement interest rate published under the Courts of Justice Act, 1984. This rate is calculated on a quarterly basis and published in the Ontario Gazette. The Courts of Justice Act, 1984, indicates that the post-judgement interest rate is the rate established by the Bank of Canada for short-term advances to chartered banks, rounded to the next higher whole number, plus 1%. The regulations under the Rent Control Act will set out the calculations and periods to use when applying the interest rate.

The Chair: Thank you. Questions or comments? Shall subsection 30(10) carry? Carried.

Subsection 30(11).

Ms Harrington: Subsection 30(11) establishes the $5,000 monetary jurisdiction of the Rent Control Act. Currently, outside Metropolitan Toronto, the monetary jurisdiction of the Small Claims Court is less than $5,000. Subsection 30(11) specifically provides, for the purposes of the Rent Control Act, that the monetary jurisdiction is at least $5,000. This amount refers to the amount of illegal excess rent paid by and owing to the tenant and does not include the amount of interest that may be applicable on that amount. Therefore, an order made under this section or sections 28 and 32 could order the landlord to repay to the tenant a total amount owing that exceeds $5,000, for example, $5,500, provided that the illegal excess rent owing does not exceed the $5,000 ceiling.

The Chair: Questions or comments?

Ms Poole: Briefly, Mr Chair, I had a question for the parliamentary assistant or perhaps Ms Parrish. Here we have referred to the monetary jurisdiction of the Small Claims Court as $5,000. I believe it was relatively recently that they raised the jurisdiction to that amount. Would there be any problem if the Small Claims Court changed its monetary jurisdiction to a larger amount in future? Would that make our legislation in contravention of it or create any difficulties?

Ms Harrington: Ms Parrish, could you please respond?

Ms Parrish: No, all this section says is that our jurisdiction is the same as the Small Claims Court jurisdiction, but in areas where it is still $3,000 -- there are still those areas -- we say that our jurisdiction is $5,000. It has been $5,000 for quite a while in Toronto, but not elsewhere. There is another section, I think, that says it is the Small Claims Court jurisdiction.

Ms Poole: That is all right. That certainly answers it. In your opinion, if the Small Claims Court changes the ceiling in future, that will not have an impact.

Ms Parrish: No, the ceiling would just rise. If you look at the earlier sections, subsection 30(4), subsection 30(5) and so on, they refer to the monetary jurisdiction of the Small Claims Court. Then later on you say, "What is the monetary jurisdiction of the Small Claims Court?" It is whatever is established under that statute. But if it is less than $5,000, we just say it is $5,000 so that we do not have a situation where our jurisdiction in Toronto is $5,000 and our jurisdiction in Thunder Bay is $3,000.

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Mr Jackson: In plain English, a jurisdiction that had a ceiling of $3,000 now has a ceiling of $5,000 for matters relevant to a tenant rebate.

Ms Parrish: Or that a landlord would get as well under this statute.

Mr Jackson: That was going to be my next question. I did not quite catch it because I do not have the section in front of me. Does it apply the other way for damage to an apartment where the landlord is going to Small Claims Court?

Ms Parrish: That would be under the Landlord and Tenant Act, so it would be the jurisdiction of the act.

Mr Jackson: No. You are talking about the cap. In other words, the judge would not accept it in Small Claims Court but he would be required under this legislation to receive a claim in Small Claims Court that is greater than the court cap. That is what I understand this section to mean.

Ms Parrish: There is only one way you would get into the Small Claims Court under this statute and that would be if you registered your judgement and tried to enforce it. What you have essentially is a mechanism to enforce your judgement. The debt, however, is created under this statute. The only way you could get into Small Claims Court would be if you were taking a judgement that you could not enforce and registering it in the Small Claims Court.

Mr Jackson: Correct. For our purposes, that can be now a maximum of $5,000 even in a jurisdiction where it is $3,000.

Ms Parrish: Yes.

Mr Jackson: Where there is a debt to a landlord, whether it is arrears or damage, and there is a judgement -- I see, because the judgement cannot be any greater than $3,000.

Ms Parrish: Because the judgement would have been received under the Landlord and Tenant Act and not under this act.

Mr Jackson: But they will not receive amounts greater than $3,000 in a Small Claims Court, regardless of the Landlord and Tenant Act.

Ms Parrish: They will enforce the judgement; they just will not give the judgement. Under the Landlord and Tenant Act they will be bound by whatever the jurisdiction is in that court.

Mr Jackson: That is my point. You are modifying a threshold on one set of circumstances to the credit of the tenant, but you are not making a coequal concession to landlords on the same basis.

Ms Parrish: In any system in which an obligation is created, under this statute both landlords and tenants are treated equally. Where you have an obligation created under another statute, the Landlord and Tenant Act, then we are bound by the laws that affect the Landlord and Tenant Act, both landlords and tenants. If a tenant, for example, were applying for a section 96 rebate in a jurisdiction in which the $3,000 was the limit, that is all he would be able to get. The jurisdiction is not flowing from whether you are a landlord or a tenant; the jurisdiction is flowing from what statute you are exercising your rights under.

Mr Jackson: To be direct, I am not sure I understand you clearly or whether you understand the nature of my question. I understand how Small Claims Court works: Regardless of what statute you apply, there is a limit. An amount greater than that can go elsewhere.

Ms Parrish: That is right.

Mr Jackson: The purpose of this clause is, where there is a judgement, a tenant can then go to the Small Claims Court for an amount greater than the cap in that jurisdiction. That is what I have listened carefully to hear you say. In jurisdictions where there is not a cap, they are all deemed to be basically $5,000 limits.

Ms Parrish: I may have not explained myself very clearly. What these provisions say is that it is possible that indeed when you calculate the amount of rent owing it is more than $5,000. If that occurs, there is nothing we can do. We can only go to $5,000, and that is our jurisdiction across the province. It would make no difference where we were.

Mr Jackson: That is not the case in Ontario. We have different thresholds for different amounts.

Ms Parrish: Under some statutes. Under other statutes, we have a uniform jurisdiction.

Mr Jackson: Under this statute it is not uniform.

Ms Parrish: Under this statute it is $5,000.

Mr Jackson: Regardless of where it is?

Ms Parrish: Regardless of where it is and regardless of who it is.

Mr Jackson: All right then, to make sense of all this my question should have been, is the regulation under the Landlord and Tenant Act uniform across the province as it relates to arrears and damages claimed by a landlord?

Ms Parrish: No. To my knowledge it is based on the Small Claims Court jurisdiction, but I can inquire into that and find out for you. It is possible that I could be wrong about that, and I will look into it.

Mr Jackson: I would like to stand this one down briefly. I do not want to dwell on it, I would like to move on, but I would like that information. My concern is that we are not being equitable in the sense that where there are arrears and damages, this becomes an expense to the entire building, and when moneys go to recoup that or to write off those losses, there is that much less to go into the building. Those tenants who wilfully damage property or who leave with excessive arrears do affect certain fiscal outcomes in a building which do not work to the best interests of the remaining tenants.

A landlord's legitimate right of recovery should be equivalent, in my view. If we could get that information, then perhaps we can recommend that certain provisions of the Landlord and Tenant Act be examined so that the tenants are treated the same across the province, which is the spirit and intent of the government's motion in this case.

Ms Harrington: That act is under a different ministry.

Mr Jackson: I realize that.

Ms Harrington: We are free to recommend, but we have to deal with this legislation.

Mr Jackson: I understand that. I would support it, but if it is not the case in the Landlord and Tenant Act, then I may not support it, because I do not think we should be equitable on one side of the equation and discriminatory on the other. That would be the basis for my vote. I do not want to dwell on it. I simply would like the information that would help guide me in that regard. That is all I want to say.

Ms Parrish: On a point of clarification, I have just had an opportunity to speak to one of our lawyers who has more experience with the Landlord and Tenant Act than I do and he says that the jurisdiction is $25,000, because the application is to the Ontario Court (General Division), what used to be the old county court and is now the new system. He says the jurisdiction is $25,000 there, higher than ours. I do not know if that is of some assistance to you.

Mr Jackson: This is for a claim by a landlord?

Ms Parrish: Yes, or a tenant for that matter, under the Landlord and Tenant Act.

Mr Jackson: I understand the cases for tenants, but the ones from landlords, I understood, were routinely going to small claims.

Ms Parrish: That is only because the landlord may have chosen to abandon the upper limit on his claim because he wanted to move more quickly. He is not forced to do that; he simply chooses that remedy because he thinks that maybe it is not worth the aggravation for the additional couple of hundred dollars or whatever, and he can take the case himself. He is not prevented from recovering up to $25,000.

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Mr Winninger: It is an interesting issue and I thought I might be able to help shed some light on it. In London, by the way, the monetary jurisdiction for our Small Claims Court is only $1,000. It was $3,000 in Toronto and I gather it has been increased to $5,000. If a tenant had already moved out, a lawyer or a landlord might take a claim to Small Claims Court to recover rent arrears, but if it was over the $1,000 jurisdiction in Toronto, for example, he would have to abandon the excess.

Here we have a situation where there has already been an order for excess rent owing and you are looking for a court to enforce it in. All this says is that if your claim is within the limit of the Small Claims Court in your jurisdiction, you agree that you will recover up to the monetary jurisdiction there and you may have to abandon the excess rent. If you go to Small Claims Court in London, you would be looking for $1,000. If you go in Toronto, you would be looking for $5,000. But I notice that subsection 5(b) says that you can also commence a proceeding in any court of competent jurisdiction for the full amount, so you would be going to the next level, which would be the Ontario Court (General Division).

That is where you are representing a tenant, but if you are representing the landlord, typically, unless the tenant has already moved out and the Landlord and Tenant Act no longer applies, if the tenant is still there, then you have to go to Ontario Court (General Division) to get your order terminating the lease for arrears and compensation and whatever else, so the monetary jurisdiction limit there would not really apply for landlords because now it is up to, I believe, $50,000.

Ms Parrish: Elizabeth Baldwin also pointed out to me that the jurisdiction of the Supreme Court and the Ontario Court (General Division) is now merged so you can go for as much as you want. When landlords or tenants have to look at debt enforcement, they have to decide whether they are willing to incur the greater cost of going to a court where it would be difficult to proceed without a lawyer, or whatever.

Mr Winninger: My only point was the landlord and tenant will likely be in different courts to start with. The landlord would not be subject to the same limit that the tenant would when he or she wants to recover rent. I gather that subsection 11 just says, if we are talking about monetary jurisdiction, it will be deemed to be a reference to $5,000, but in London, for example, the monetary jurisdiction would be only $1,000. I do not think this can by itself change the monetary limits under the Courts of Justice Act.

Ms Parrish: It only changes what we can order, not what they can enforce.

Mr Jackson: That makes sense, thank you.

The Chair: Shall subsection 30(11) carry? Carried.

Subsection 30(12).

Ms Harrington: Subsection 30(12) limits the amount that can be rebated to illegal excess rent paid to the amount paid within six years prior to the filing date of an application made under this section. This provision is consistent with the calculation of tenant rebates under the Residential Rent Regulation Act.

The Chair: Shall subsection 30(12) carry? Carried.

We have a government amendment to subsection 30(13) as printed, I believe?

Ms Harrington: As printed, yes. Subsection 30(13), as amended, provides that a person who is currently not a tenant can make an application if that person was a tenant when the conduct giving rise to the application occurred. This is a government amendment that clarifies the policy intention of who can make an application.

Ms Poole: Subsection 30(13) in the amendment put forward by the government uses the words, "a person who is not a tenant." We brought this up in another section where we thought it might be clearer if we used the words, "a person who is no longer a tenant." It is not that it is incorrect in its current form, but I think it would certainly be much clearer if we did make that minor amendment. I wonder if the government members or the parliamentary assistant would be willing to entertain changing "not" to "no longer."

Ms Harrington: Let me just confer for a moment. I am advised that we have already passed a similar type of wording and that if we changed it now we would have to review the whole statute and look at the wording again. We would like to pass it as it is and assure you that we will look at this particular wording throughout the act and if it can be improved, do it in clause-by-clause in committee of the whole House.

Ms Poole: Even if you wanted to do it before we finish committee clause-by-clause and reopened it, we would certainly be happy to agree to that.

Ms Harrington: Okay.

Ms Poole: I do not think it is wrong, but it is much clearer.

Ms Parrish: There is nothing problematic about your amendment. I am just concerned that if we do it once we had better do it throughout. Otherwise people will assume we must have meant something else. So we want to do it consistently.

Mrs Marland: I first brought this point up under subsection 23(5). I raised the question of this wording. Subsection 23(5) is: "A person who is not a tenant may make an application under this section as a tenant based on a discontinuance or reduction in services and facilities if the person was a tenant and was affected by the discontinuance or reduction of the services and facilities."

In the discussion around this question, when I raised it last week, I started off thinking that if we let the wording stand, it almost suggests an agent of that tenant may act. That brings us into another question when we are dealing with subsection 30(13). Is it possible under this act to have an agent act in an application on behalf of the tenant, or is it the tenant solely who must seek recourse through any of the sections in this bill?

Ms Parrish: Yes, of course, the tenant can be represented by an agent. That person may be an agent or a lawyer acting on that person's behalf. It is still the tenant who is the applicant and who is asking for the relief. It is still the tenant who has to have been the tenant at the time the conduct, ie, the illegal rent, occurred. The only reason we are asking for some time to stand this down is that if you say, "A person who is no longer a tenant may make application under this section," it almost sounds as if he is no longer a tenant anywhere. You probably need something like, "He is no longer a tenant in this complex," or something like that. What happens to the tenant who has just moved to another unit in the same complex? The reason I am asking for a little grace on this is that I think we can improve the drafting to make it clear what the intention is, including this confusion about who can apply. It is not as easy a fix as you might think at first blush, that is all, but the section clearly says the applicant who wants this relief, this money paid back, must have been the tenant at the time the illegal rent was collected, or whatever.

Ms Poole: I do not want to prolong this, particularly since the parliamentary assistant and ministry staff are going to take a look at it, but you might even want to consider a person who is no longer a tenant in that unit, or in the unit, because I think earlier in the legislation we were defining complex and unit. That may make clearer that you are just talking about a specific unit, a specific former tenant. That is just a suggestion to look at.

The Chair: Further questions, comments? Shall subsection 30(13) carry? All in favour?

Mr Abel: Five minutes.

The Chair: Twenty minutes.

Interjections.

The Chair: Can we do five? Twenty minutes; that means we will call the question one minute after three.

The committee recessed at 1442.

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The Chair: Members will take their seats. I understand that during the recess we have had unanimous consent on an amendment to change this section. In that case, I do not think we will take the vote. The parliamentary assistant.

Ms Harrington: I do not have a copy of the amendment.

The Chair: No, just withdraw this one.

Ms Harrington: Okay. Mr Chair, I wish to withdraw the government amendment as reprinted in the bill, subsection 30(13), and place an alternative amendment.

The Chair: Which, at the mercy of the photocopier, will be here very shortly.

Mr Jackson: In at least 20 minutes.

Ms Harrington: And then we will have a drink of water.

Ms Poole: Mr Chair, while we are waiting for the photocopy --

The Chair: It is now here.

Ms Poole: Oh, thank you.

The Chair: Ms Harrington will read the amendment into the record.

Ms Harrington moves that subsection 30(13) of the bill, as reprinted to show the amendments proposed by the minister, be struck out and the following substituted:

"(13) A person may make an application under this section as a tenant of a rental unit if the person was a tenant of that rental unit at the time the conduct giving rise to the application occurred even if the person is no longer a tenant of that rental unit at the time of the application."

I should point out to members that it will also be necessary to get unanimous consent to revert to subsection 23(5) so that we can reopen that section and make the same wording change. We will not do that right at this moment because we do not have that amendment, but I will be asking that after we pass this amendment, if I could be so presumptuous to believe that it is going to pass. Mrs Marland.

Mrs Marland: Mr Chairman, there is an expression, something about "A rose by any other name" I am happy to support the rewording of subsection 30(13), as I raised it under subsection 23(5). I certainly would be in agreement with us reverting to subsection 23(5) if that is the first place that similar wording occurred in the legislation. It makes excellent sense, and I appreciate the drafting of the legislative counsel to facilitate this change, which is obviously a great improvement and means more clarity in the bill. So we do support it.

Ms Poole: She likes it.

The Chair: Thank you, Mrs Marland. Further questions or comments? Shall subsection 30(13), as amended, carry? Carried.

I guess we should ask for unanimous consent to reopen subsection 23(5) in the future, at the appropriate time.

Agreed to.

The Chair: Subsection 30(14).

Ms Harrington: Subsection 30(14) provides that both past and present subtenants can also make an application for payment of illegal rent, provided that the subtenant was the person who paid the illegal excess rent to the tenant. In these cases, section 30, payment of illegal rent, will apply as if the subtenant was the tenant and the tenant was the landlord.

The Chair: Questions, comments regarding subsection 30(14)? Shall subsection 30(14) carry? Carried.

As members will note, we have stood down two sections, subsections 30(8) and 30(9), which we will return to when there is agreement among the parties.

Section 31:

The Chair: Subsection 31(1).

Ms Harrington: Subsections 31(1) and 31(2) prohibit any landlord or any landlord's agent, including a superintendent, property manager or other person acting on behalf of the landlord, from collecting or attempting to collect any payment other than the lawful rent as a condition for leasing the rental unit. This is commonly known as key money. In addition, neither the landlord nor his or her agent, including a superintendent, property manager or other person acting on behalf of the landlord, may charge a rent for part of a rental unit that when added to all the other rents payable for the remaining parts of a rental unit, results in a total rent being higher than the maximum rent for the whole unit.

The Chair: Questions, comments or amendments to subsection 31(1)? Shall subsection 31(1) carry? Carried.

Ms Harrington: Subsection 31(2) is a government amendment that clarifies the concerns raised by tenants in submissions for Bill 121 when superintendents or property managers collect key money without the knowledge of the landlord.

The Chair: Questions, comments, further amendments to subsection 31(2)?

Mrs Marland: Has the intent of these two subsections never been addressed before in legislation?

Ms Harrington: Yes it has been addressed before in legislation.

Mrs Marland: Which bills?

Ms Parrish: Section 31 is very similar to what is in the RRRA and section 32 is quite similar too, except that in the RRRA it simply says that the superintendent or manager, in order to commit a key money offence, must be collecting the money on behalf of the landlord. In many cases, the landlord has no idea the superintendent is asking for extra money and is quite shocked and horrified to find out that happened. This really just clarifies the current law, brings it forward and clarifies this one area where there have been actual cases in which superintendents did this off their own bat and not with the landlord's approval. But these provisions are quite similar to what is in the current statute.

The Chair: Further questions, comments on subsection 31(2), the government amendment as printed? Shall subsection 31(2), as printed, carry. Carried.

Subsection 31(3).

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Ms Harrington: Subsection 31(3) provides similar restriction to tenants as in subsections 31(1) and (2), prohibiting the collection of extra charges, that is key money, as a condition of renting. No tenant may sublet for a higher rent than that legally charged by the landlord. This means tenants may not increase the rent in a sublet. In cases where the maximum rent is higher than the actual rent charged, the tenant is still restricted to subletting at the same amount as charged by the landlord.

Tenants are also subject to the same restrictions as landlords in charging rent for part of the rental unit. The total rent charged for all parts of a rental unit cannot be more than the rent lawfully charged by the landlord. An example of this is where a person rents a house and turns it into a rooming house. The total rent paid by the roomers can be no greater than the total rent paid to the landlord. In addition, tenants may not charge key money or other payment as a condition for the sublet.

Mrs Marland: In the case of subletting, what intervention or control does the legislation provide to protect future tenants, because is not subletting often done without the owner of the property knowing about it?

Ms Harrington: You are asking what protection there is.

Mrs Marland: Does the property owner always know when somebody is subletting from the lease he has with the tenant? Or, as we learned last week, they do not necessarily even have leases any more. What written protection is there? If you do not have written leases, how do you know who is subletting? Is it simply by the name on the cheque? How do you know there is not a side deal going on if the same person continues to pay the rent, but is in fact receiving money from somebody else in that unit?

Ms Harrington: That is a good question.

Ms Parrish: If there is no lease, it may very well be that the landlord does not know who has been sublet into the apartment. A lot of leases require that if you do have a lease, you notify, and even that there must be approval, although it goes on to say that you cannot unreasonably withhold that approval and you cannot charge an unreasonable amount of money to agree. However, these provisions do say that if the tenant is charging the subtenant key money, you can charge the tenant and you can deal with the tenant. The landlord may be completely blameless in that situation. It may be the head tenant, or whatever you want to call that person, who would be charged, not the landlord, because the landlord did nothing wrong. In fact, I know there have been instances where we have prosecuted tenants who have attempted to take advantage of subtenants in this way for charging key money.

Mrs Marland: Where does it say here that the tenants may be charged?

Ms Parrish: These provisions say that no tenant and no person acting on behalf of a tenant shall do these things.

Ms Harrington: That is a prohibitive statement.

Ms Parrish: That is what we would call in the jargon a charging section. Later on in the act, where we have set out what the offences are under the act, we say that anybody who does anything contrary to this section has committed an offence.

Mrs Marland: I am sorry, we are in section 31.

Ms Parrish: Yes, subsection 31(3).

Mrs Marland: Subsection 31(1) says, "No landlord shall, directly or indirectly, in respect of any rental unit," that goes through clauses (a), (b) and (c), which are involving the same things.

Ms Parrish: Subsection 31(3) says "No tenant...."

Mrs Marland: Okay, so we have looked after landlords, superintendents, property managers and we are now looking after tenants.

Ms Parrish: Tenants and persons acting on behalf of tenants. Then if you look at page 70 of your reprinted bill, in your offence provisions, section 124, it talks about contravening these sections. Clause 124(1)(d) on page 71 talks about contravening section 31. So anybody, landlords, tenants, superintendents, whoever did the thing.

Mrs Marland: But actually, Ms Parrish, last week I do not know whether you said the majority of occupancies were without leases, but you said a very high number of occupancies now did not have written contractual agreements any more.

Ms Parrish: I do not really know what the majority of people do. I do know at one time tenants had a tremendous incentive to have a lease because then they would be assured their rents would not increase during the period of the lease and that they would receive notice. Now those protections are provided statutorily so there is often less of an incentive to nail all of this down with a lease. We do not require people to have leases.

Mrs Marland: I come back to the point that in the absence of leases we will not know if any of this is going on. Even with leases a lot of people were not aware of subletting and these other things. In the absence of leases, how are you ever going to get a handle to protect those tenants who could be vulnerable to "subletting at a higher rent"?

Ms Parrish: I think your point is well taken. There is always a proof problem, and a lease is a handy method of proof. We also have registration of the unit, so in many cases, the unit will be registered.

Mrs Marland: Yes, but today less than 50% of the units are registered, from the figures we got, are they not? I am talking about 50% of the units in the province, the majority of which do not have leases. This legislation is certainly not giving any protection to those future tenants under subleases of non-existing leases. It is a lot of nonsense, is it not?

Ms Parrish: These people have a lease of course. They just do not have a written lease. In many cases they will have a registered rent. Certainly in the larger buildings about 96% or 98% are registered. In the case of smaller buildings it is like any other piece of evidence.

Certainly if I were subletting from someone and there was no lease or he or she was not willing to show me a lease, I would ask the landlord what the rent was in order to protect myself against paying more in the form of key money. That is the most likely situation in which we find out about this. The landlord tells the subtenants they are paying more rent than they should be. This does occur often when people move in.

It is like everything else. We are moving to improve our registration over time. As units come in for above-guideline rent increases we register them, and that approach is increasing the knowledge of what the legal rents are. But tenants have other avenues of request. They can ask other tenants in the building. They can ask the landlord, if they are subletting, and they can find out this information.

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Mrs Marland: It sounds very simple, but if you are desperate to get an apartment there is no way you are going to speak to the landlord. You are just going to deal with the person who has advertised the apartment who might even pretend that he or she is the landlord. The general public is not going to be aware of what the law is anyway no matter how much advertising we do.

I think it is fine to pass all these sections we are dealing with right now, but I do not see that the enforcement of them is going to be very easy. These sections are going to be there when something is brought before the authorities, but all the other stuff that is going on under the table all the time will not be remedied, because nobody is going to start phoning around to find out who the landlord is if there is a chance to sublet a place. With the shortage of rental accommodation, they are just going to jump in and sublet it and pay whatever they are asked to pay if it is what they want. I cannot see them trying to find out what the legal rent is, because at that point the landlord may say: "Aha. My tenant is not going to lease this to you. It's my contract with the tenant and I'm not going to allow a sublet."

Sometimes rattling the sabres may leave somebody out in the cold. I think that is a fact of life. I do not think you have a remedy in here to address that concern of the whole subject of subletting.

The Chair: Further questions or comments on subsection 31(3)?

Ms Poole: Right now we are dealing with subsection 31(3)?

The Chair: Yes, including an amendment in there, as printed.

Ms Poole: I apologize. I was out of the room for a moment so I was not here at the beginning of the discussion. Mrs Marland's objection is that she does not feel the remedy provided is sufficient?

Ms Parrish: I would not want to speak for Mrs Marland, but the impression I have is that her concern is that there are always market inequities and in some cases people are vulnerable in the marketplace and therefore, in order to get a place to live, they may end up paying what they should not pay because they are vulnerable or desperate or have not been educated as to their rights.

To some extent I think she is right. That always occurs. There are also tenants who are well able to protect their interests. It is hard for me to answer the question. I think you need to have these provisions, because if you do not have these provisions, people cannot exercise their rights.

There is a further question as to what we can do to empower people, either through education or other assistance, to exercise those rights and know what those rights are. There are a number of answers for that, some of which are in this bill and some of which are in other places.

Ms Poole: Certainly from my perusal of subsection 31(3), I think this section goes a long way in specifying exactly under what conditions a tenant can charge a certain rent for subletting. Key money is obviously a problem, not only from the vantage point of a landlord or a superintendent trying to charge the key money but also of tenants themselves. It is actually much easier to police if it is a superintendent. There is much more of a chance they will be caught.

I think you are quite right, Ms Parrish, when you say it is extremely difficult to legislate enough protection for people who are not aware of their rights. I think this is probably as far as we can go without infringing on other people's rights. This quite clearly sets out that tenants, superintendents, property managers, landlords or any person may not charge a rent in excess of the maximum legal rent if they are subletting. I think this section deals quite well with what you are trying to do.

Ms Harrington: Thank you, Ms Poole.

The Chair: Further questions, comments to subsection 31(3)? Shall subsection 31(3) carry? Carried.

Section 31, as amended, agreed to.

Section 32:

The Chair: Subsection 32(1).

Ms Harrington: Subsection 32(1) is the provision that allows a tenant or a subtenant, depending on the circumstances, to make an application for the rebate of illegal additional charges at any time where she or he has been paid key money or any other payment as a condition for leasing a rental unit. A tenant or subtenant may also make an application at any time where she or he has been charged an amount of rent for part of a rental unit that, when added to all the other rents payable for the remaining parts of the rental unit, result in a total rent being higher than the maximum rent for the whole unit. Note, this is a government amendment that responds to concerns raised by tenants in submissions on Bill 121 that there need not be a conviction of an offence before an application can be made under section 32.

The Chair: Thank you. Questions, comments on subsection 32(1)? Shall subsection 32(1) carry? Carried.

Subsection 32(2).

Ms Harrington: Subsection 32(2) gives the rent officer the authority to make findings on whether the landlord or the tenant, in the case of sublets, has collected or attempted to collect an illegal additional charge and in such cases order the landlord or the tenant to repay that amount, provided the amount of the additional illegal charge does not exceed the monetary jurisdiction of the Small Claims Court which, for purposes of the Rent Control Act, is at least $5,000.

The Chair: Questions, comments, amendments to subsection 32(2)? Ms Poole.

Ms Poole: Originally, in one of the other sections, I brought up the fact that it did not say "written findings." I believe the parliamentary assistant and Ms Parrish had undertaken at that time to take a look at the issue and hopefully to bring it in compliance throughout the act when we got to the procedural section that it would be written findings to which we were referring. I just wanted to bring to members' attention that we have another instance. If it is very clearly spelled out that it is written findings, it would be quite helpful.

Ms Harrington: I believe staff have already noted this section to be looked at.

The Chair: Shall subsection 32(2) carry? Carried.

Subsection 32(3).

Ms Harrington: Subsection 32(3) provides that the amount of the illegal additional charge may be treated as if an application had been made under section 30, payment of illegal rent, for recovery of that amount and that the order under this section may contain any terms and conditions that can be made under section 30, including the application of interest. Furthermore, under subsection 32(2), by virtue of subsection (5), a tenant may recover the total amount of the illegal additional charge through the courts where the amount is in excess of the monetary jurisdiction of the Small Claims Court.

The Chair: Thank you, Ms Harrington. Questions, comments? Shall subsection 32(3) carry? Carried.

Section 32, as amended, agreed to.

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Section 33:

The Chair: There is a government amendment, a technical amendment to clause 33(1)(d), if you could just explain that, and then I believe there is a Liberal amendment.

Ms Harrington: It is just a technical amendment in clause 33(1)(d) to correct the number there. It reads, "whether an agreement referred to in subsection 45(1) has been entered into as a result of coercion".

The Chair: Thank you. Ms Poole, you have an amendment?

Ms Poole: Yes, I do.

The Chair: Ms Poole moves that clause 33(1)(d) of the bill be struck out and the following substituted:

"(d) whether an agreement referred to in subsection 45(1) has been entered into as a result of coercion or because of a false, incomplete or misleading representation by the landlord or an agent of the landlord; and"

Do you wish to speak to that amendment?

Ms Harrington: I wish to speak to that.

The Chair: Generally speaking, Ms Poole would have the first opportunity.

Ms Poole: What we have done under 33(1)(d) is to place an amendment which would expand the difficulties with an agreement, not only to include coercion but also to include situations where there was a false, incomplete or misleading representation by the landlord or the agent of the landlord. We felt this was very important to insert into the legislation.

We also have a corresponding amendment under subsection 45(1) to this effect, because not all cases this section is meant to cover will be covered by coercion. There are other instances where a landlord or an agent of the landlord has given the tenant a set of false assumptions and that tenant has agreed to certain things or undertaken certain things because he believed there would be a different outcome. We felt it very important that tenants received the protection in cases where any representation by the landlord did not meet fairly strict criteria. I am very much hoping that the government would support this particular item since I think it is helpful for full protection of tenants and I look forward to hearing Ms Harrington's comments.

Ms Harrington: The government would be very pleased to accept this amendment from the Liberal Party.

Ms Poole: But? No buts? This is wonderful.

Ms Harrington: That's it.

Ms Poole: This has made almost all my work worthwhile. Thank you.

Mr Mammoliti: I am glad the Liberals have brought this forward, and I have spoken over the past few weeks about coercion and how it happens quite frequently, even in my riding. I understand you have another amendment, 45(1), but even if both of them go through, and I am anticipating that they will, we still as members have to make sure we define what is coercion as well perhaps. We have to look at our particular buildings and at the particular things that happen within our buildings and make sure that definition of "coercion" is there somehow. I do not know how we are going to do that. You know precedents mean a lot, and if the definition is not what we want, then it may hurt in the long run. I just thought I would mention that. I do support it.

The Chair: Further questions or comments?

Ms Poole: As the parliamentary assistant was going by she said to me, "Now you can be Robin Hood." So I am delighted to be Robin Hood for the day, for the moment or at least for the amendment.

With reference to Mr Mammoliti's request for a definition of "coercion," this may seem a strange thing for me to be saying when I have been so adamant about defining things such as "neglect," or at least providing criteria, and "inadequate maintenance" and terms such as that. Coercion is somewhat different, because coercion can be very subtle and if you try to define it, I think some of the subtle coercions, which any reasonable person might consider to be coercion, might not be covered under the definition.

For this particular one, while I agree that wherever possible we should be providing guidelines, I am not sure I would want a rigid definition. But any time we can have guidelines and criteria to assist the rent officer in making these decisions, I think it would be a good thing. I would just put on one proviso, that we cannot afford to make it too rigid, or else situations we want to be covered will not be covered.

The Chair: Further questions or comments? Shall Ms Poole's amendment to clause 33(1)(d) carry?

Motion agreed to.

The Chair: Questions or comments on subsection 33(1)? Shall subsection 33(1), as amended, carry? Carried.

Subsection 33(2).

Ms Harrington: Subsection 33(2) allows a landlord, a tenant or the rent registrar to make an application to a rent officer to determine specific questions with respect to the rent information contained in the rent registry, including the following: (1) whether a notice of change of rent information should have been filed with the rent registrar; (2) whether the rent information filed with the rent registrar is correct and complete; (3) whether the maximum rent recorded in the rent registry is correct; (4) whether the rent information contained or a decision made in a notice from the rent registrar is correct and complete; (5) whether the calculated decrease to the maximum rent as a result of a lower market value assessment is correct or it should be recalculated as a result of an appeal of the assessment and, finally, any other matter prescribed under the regulations.

The Chair: Questions, comments or amendments to subsection 33(2)? Shall subsection 33(2) carry? Carried.

Subsection 33(3).

Ms Harrington: Subsection 33(3) sets out that the rent officer shall make findings on any of the issues put before him or her under subsections 33(1) and (2). Subsection 33(1) refers to status applications and subsection 33(2) refers to applications related to the rent registry. The rent officer would also have to follow any regulations made under the Rent Control Act. Decisions are expressed as orders.

The Chair: Questions or comments on subsection 33(3)? Shall subsection 33(3) carry? Carried.

Section 33, as amended, agreed to.

The Chair: At this point, maybe we should revert to subsection 23(5) to make the wording change that the committee had agreed on. Do I have unanimous consent to open subsection 23(5)?

Agreed to.

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Section 23:

The Chair: Ms Harrington moves that subsection 23(5) of the bill, as reprinted to show the amendments proposed by the minister, be struck out and the following substituted:

"(5) A person may make an application under this section as a tenant of a rental unit, based on a discontinuance or reduction in services and facilities, if the person was a tenant of that rental unit and was affected by the discontinuance or reduction of the services and facilities, even if the person is no longer a tenant of that rental unit at the time of the application."

Mrs Marland: I think we should be proud about all the trees we are saving with this recirculated amendment, and the little insert looks like a comic conversation note. Anyway, as I said, I am intrigued that we are now doing this, since I did suggest it last week, and I am entirely complimented and flattered by the fact that the government is now moving an amendment I had suggested. Naturally I am very supportive of this amendment. I just wonder, was there a full moon over the weekend, or what happened to change things?

Ms Poole: I think I can offer an explanation for Mrs Marland. When she introduced the concept of changing the wording in subsection 23(5), that was before we had the new, improved air of cooperation among all three parties. Our minds were just obviously closed at the time. This week they are now open and we are passing amendments right, left and centre, so she just lucked into good timing this week. No?

The Chair: Shall subsection 23(5) carry?

Motion agreed to.

Section 23, as amended, agreed to.

The Chair: Now we are back to section 34.

Mrs Marland: You are doing a very good job, Mr Chairman.

The Chair: Thank you, Mrs Marland.

Mrs Marland: You must have a very good clerk who is keeping us on track here.

The Chair: We will start with section 34, but I notice there is an extensive amendment about to be proposed. You could give us a brief explanation of section 34.

Ms Harrington: Section 34 addresses the transitional issues as we move from one system to another. It saves provincial maintenance matters issued under the Residential Rent Regulation Act and transfers them to the director of rent control under the Rent Control Act. The director is identified as the recipient of all outstanding reports, orders and files currently held by the Residential Rental Standards Board. This permits smooth transition and ensures that the work done to date in prescribed files is not lost.

The Chair: Ms Poole has an amendment to sections 34 through 41, inclusive. I think the way to deal with this is to deal with Ms Poole's amendment to all those sections simultaneously, if that is the wish of the committee.

Ms Poole: That would certainly expedite matters. The Liberal amendments to sections 34 to 41 I believe are six pages long. In what is probably an unorthodox move, I would like to dispense with the reading of these six pages until such time as I get some indication from the parliamentary assistant about whether the government is willing to reinstate the standards board. If they are unwilling to reinstate the standards board, I do not see any purpose to wasting the committee's time and my breath going through six pages of amendments. Would that be agreeable to the committee?

Mrs Marland: That is a very good way to proceed.

Ms Harrington: That certainly is a reasonable thing to ask. I do not want anyone to waste their breath here. Let me indicate that the government has given certainly long thought to this. We have been through this for almost a year now, and we have listened to many considerations from all sides.

The government's position is that we are definitely trying to eliminate a step here, that we want fairness, which I am sure you are trying to have, but we also want a system that works efficiently, a system that works much better, and that is what the intent of the steps in this next few sections of the bill sets forward. So I will indicate to you, Ms Poole, that we have made a decision with regard to the standards board.

Ms Poole: Mr Chair, then I will move to dispense with the reading of the amendments. However, I would like to state for the record my concerns with the government's actions in this regard.

The Chair: In other words, you are not going to move the amendments.

Ms Poole: No. I am moving the amendments but I am moving to dispense with the reading.

The Chair: If you are going to move the amendments, you must read them.

Ms Poole: Okay. So you are saying that if I do not move the amendments, I cannot debate the substance. What I am going to propose to do is to read subsection 34(1).

The Chair: Just a moment while I consider what steps might be taken to be helpful to you and the committee. I see two alternatives, Ms Poole. One is that we could ask the committee for unanimous consent to discuss the principles behind these amendments, or you could discuss these amendments as we go through each clause that they relate to which the government has proposed.

Ms Poole: With the committee's indulgence, I would prefer option one. If the committee would grant unanimous consent to dispense with the reading of the six pages of amendments, then I would be prepared to discuss the principles without taking the time to read them into the record, if we could deem them read into the record for the purpose of Hansard.

The Chair: We cannot deem them read into the record. Unanimous consent would be to discuss it. If we could have unanimous consent from the committee, we can discuss the implications of these proposed amendments.

Agreed to.

Ms Poole: What the proposed Liberal amendments to sections 34 through 41 were intended to do would be to reinstate the standards board. The Residential Rental Standards Board was created by the Liberal government under the RRRA in order to provide a board that would deal with issues of maintenance standards, of ensuring that buildings were well maintained, and to provide an outlet for penalties to be made.

The standards board itself was a mixture of landlords and tenants with equal representation on the board. They had the ability to go through rent review and stay a landlord's obtaining of the guideline amount if the maintenance standards were not maintained. The board, I think, was an excellent concept. It was supported by both landlords and tenants. The difficulty and the delay at the standards board come about to a large extent because of the fact they had to go through rent review in order to get an order. I think what the ministry has done by abolishing the standards board is to actually throw the cat among the pigeons.

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The rent review process was primarily responsible for the delay of standards board orders. Therefore, it has now given the whole responsibility to rent review. To me, that is a very backwards way of working. The parliamentary assistant has said the reason they have made this change is they wanted to eliminate a step and they also wanted a system that works efficiently. I have not yet been convinced that putting more responsibility into the rent review system is one that is going to lead to greater efficiency. In fact, I believe the opposite is going to happen.

If a backlog develops at rent review over the next few years because of the fact that a substantial number of Bill 4 orders will have to be dealt with, plus a new system put into place, my fear is that issues of maintenance and standards will take a second seat to rent issues in the rent review system. Many tenants and many landlords have said that they think the concept of the standards board is a good one and that the standards board should be maintained and in fact improved.

What our amendments would have done is not only reinstate the standards board, but give it the direct jurisdiction to make the orders on its own without going through rent review. Once those orders were made for a rent penalty, then those orders would be transmitted to rent review so that the tenants could be advised, but they would not rely on rent review to make the decision. I am really quite dismayed that the government has chosen to lump maintenance standards and rents all in one big mass under rent review as opposed to having a separate board.

One of the difficulties we have had in Ontario is that there has been an alienation of landlords and tenants, particularly over the last year and a half. There are very few opportunities for landlords and tenants to get together and have a meeting of the minds. With tenant reps on this board and with landlord reps on this board, that happened to an amazing degree. I think that is what we should be fostering: landlords and tenants working together to make decisions that affect tenants and landlords. Does it not make a lot of sense? But instead what the government has chosen to do is put everything into the bureaucracy, put everything into rent review and the --

Mr Winninger: The air of cooperation is getting a little thin.

Ms Poole: The air is very high up here at the moment. I think the government is moving in the wrong direction, absolutely.

Mr Mammoliti: Is it 180 degrees?

Ms Poole: No. I am not even sure I give them half a circle, Mr Mammoliti; I think they have been running around in full circles. The problem with what the government is doing is that on the one hand the government has been extremely critical of the rent review process, extremely critical of the backlog. Yet in the same breath they are now saying, "We want to expand the jurisdiction of rent review and give them more to do rather than have the standards board as a separate entity."

I am not quite sure what the government actually does believe about rent review and rent officers, about backlogs and everything else, because I think it is creating a system where the matters dealt with by the standards board are going to be dealt with as a poor sister. If there is a rent order, then it is going to take precedence over the maintenance orders. I think this will particularly cause problems in municipalities where they do not have their own bylaws and standards, where the provincial standards apply.

When we were in Sudbury, the Muskoka Legal Clinic came before us. One of their very strong recommendations was that the standards board be reinstated. They said that particularly for northern communities and isolated communities where they did not have separate municipal bylaws and standards to address their concerns it was absolutely imperative that a body like the standards board be re-established. In fact, they felt that rent review would not do justice to their particular situation.

I could go on for a number of hours about what the standards board has done and what it is capable of doing and what it would be capable of doing if we expanded the jurisdiction instead of cutting it off at the knees. I guess it is probably more accurate to say it has been cut off at the neck. But I really do not see any point in belabouring it. If the government has made the decision that it is not willing to put maintenance standards as the highest of priorities with a separate board to administer them, then I feel there is no point in continuing the debate.

Ms Harrington: I would just like to briefly comment that, as Ms Poole has mentioned, we have heard submissions with regard to this in Sudbury plus many other places. We have looked at all the issues surrounding this and we know it certainly has been of interest to tenants as well as landlords. We have substantially increased the remedies for inadequate maintenance, as you know, and the failure to comply with work orders is something we feel is an integral part of this piece of legislation.

In fact, this is more than in any other legislation in North America, to comply with the work orders, to make sure maintenance standards are enforced. So we feel we are adequately addressing this. We are improving the system, streamlining it, and we certainly believe it will work.

Ms Poole: I just have one question for the parliamentary assistant. If your government was so critical of the rent review system -- and that is what we still have, no matter how many times you can call it rent control; it is still a rent review system -- and if your government was so critical of the backlog and the inefficiency of the rent officers, why do you now take the position as a government that rent review should be expanded and in fact have jurisdiction over matters where it previously did not?

Ms Harrington: We could get into quite an extended discussion on this, but I would prefer not to. The one question you raised was with regard to backlog. I would ask Ms Parrish to comment about that particular situation and how it would be under the new legislation.

Ms Parrish: We have tabled material in response to questions that were raised before about backlog in the system and certainly it is no secret that there was a significant backlog when rent review was first started. That has diminished to a situation where there is no backlog except in the central Toronto area. All other areas are essentially at currency.

Under the new system of course there is always uncertainty. We are trying to manage our affairs to minimize backlog, for example, asking people who wish to make transitional capital applications to do it within six months of the proclamation of the new bill so that you can deal quickly with cases. It is important to remember that under the previous system the backlog was occasioned largely by bringing in a very significant number of buildings that had never been covered before, the post-1976 buildings. This was the major cause of the backlog.

The other significant factor is that under the previous legislation a significant number of applications were made related to financial loss, economic loss and so on. Those grounds for relief no longer exist, and that is likely to affect workload. On the other hand, there will be more applications from tenants for maintenance matters because they have the capacity to make application under this statute; they did not have the capacity to make application under the previous statute. We fully expect that tenants will take advantage of those provisions in order to ensure better maintenance and better response to maintenance problems.

We have put in place a number of provisions designed to speed up the system, for example, the automatic work order system essentially suspending rent increases where a work order is issued. We will be looking at those sections fairly shortly, so there are a number of provisions designed to streamline but still give people the opportunity to have their case heard, and to give them a hearing at the first instance, which many people had asked for. I think that is as much as I can say on the issue of backlog.

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Ms Poole: To use a phrase from the not-so-late but very great Sam Cureatz, it is "passing strange" that a Ministry of Housing under an NDP government would say that the significant reason for the backlog from rent review was due to the significant number of buildings brought into rent review that previously were not. I can remember making those same arguments myself, so all the post-1976 buildings were brought into rent review due to Liberal legislation, the units that had rents greater than $750 were brought into rent review and there was the creation of a rent registry. These three items significantly accounted for a massive influx of applications and created great problems with the backlog.

The most interesting thing is that when the NDP were in opposition it was the incompetence of the Liberals; the incompetence of the Ministry of Housing; the incompetence of the rent review officials; the incompetence of everybody, of course, except the NDP opposition. Now that they are the government, I guess they have come to the conclusion that they must have been wrong, that actually it must have been due to the massive influx of applications from buildings not previously covered under rent review.

I very much thank the parliamentary assistant and Ms Parrish for that explanation. I feel quite vindicated, for what I was saying for three years is now deemed to be truth. It is politically correct. It must be because it has been said by a Ministry of Housing official under an NDP government, and I will just tell all my tenants that we were right. What can I say?

Mrs Y. O'Neill: I thought about this quite a bit when the legislation was first presented. I find the reasons for the removal of the standards board are really bureaucratization of the whole system, and housing is for people. Housing is homes for people and the standards board, as Ms Poole has pointed out and as we all know, brought together tenants and landlords on a regular basis. They talked at a level that was meaningful, where progress could be made in the thinking of these two groups, and where -- perhaps we can use the word here -- compromises were reached that were helpful to tenants in general. There was an advocacy component to the standards board as well that, in my humble opinion, cannot be maintained in the bureaucracy.

With those few words, I feel there has been a great loss to the system. Many people across this province do not realize that this is going to go with Bill 121. There certainly are enough fears about Bill 121 and this is just one more nail in the coffin.

Mr Jackson: In my capacity as Chair of the estimates committee, I had occasion to examine some questions with respect to rent review. Of course, this was an area I was actively involved in, not only because I did not vote for Bill 51, but I was the critic and had occasion to raise a lot of questions about it.

My information is that the computer program for the rent registry has been an abysmal and costly failure, and it was only in the recent estimates that the minister and staff confirmed that all those lengthy glitches have been cleared out and in fact we might anticipate some more stability in this area. To the extent that is true, it is on record and may be one of the most serious problems faced. I know the rent registry was doomed from the start because they could not get the computer program to work and they could not get the 9Rs out fast enough to get the responses.

To the point that was raised and this motion in particular, the standards board approach which was in the old legislation had some positive and some negative aspects to it, and my concern is in the area of compliance and ultimate authority here. In my view, the old system relied heavily on municipal involvement, and I think it is naïve to suggest that the bureaucracy is going to be able to deal with this.

I was critical of municipal involvement because it was a pure case of downloading. As you know, municipal standards bylaws are not mandatory in this province. Some municipalities have them; some do not. Some municipalities only have a portion in their municipality because they were an outgrowth of the original federal-provincial agreements for redevelopment and rehabilitation and they said, "If we're going to be putting moneys into rehab housing units in the core areas, then you must have a bylaw governing standards. Otherwise, you'll just take money and spend it willy-nilly." They had to have a regulatory framework for it to work. But rental units in this province do not all comfortably fit into these areas.

In my view -- not that I am always looking for regulatory authority -- it is clear that the province has a patchwork as it relates to making standards and bylaws. I am not clear in my own mind what the solution is and who is going to pay. My fear is that nothing will happen. At least with the Liberals' plan the ultimate responsibility fell on the local municipality, which then has to step in regardless.

But again, it all comes from taxpayers' pockets, regardless of whether it is payment to the federal government, the provincial government or the municipal government. The point I am really getting at is I am worried that this process now throws it into limbo, into a no person's land. At least we knew with the standards board that we had a circumstance where it could be explained to tenants what the cost implications for those items could and would be and what is required, and what is expensive and what is not expensive.

I think we should heed some of the concerns raised by Ms Poole. If you listen to some people, they will tell you there are absolutely no redeeming values in Bill 51. There were some redeeming values. There were not enough for me to vote for it, but there were some redeeming values. I travelled all over this province on all those hearings. You cannot say that everything about that bill was wrong.

I fear the government may have glossed over this area in some degree of appeasement. I am quite concerned that in this next four-year period the whole issue of maintenance standards is going to be tested to the extreme, even from the point of view of quality work and performance. I am not convinced that the framework being proposed by the government is the most appropriate one. Those comments were mostly for the record.

Ms Harrington: I wonder if it might be helpful for us to briefly outline exactly how the system will work, if that can be done briefly.

Mr Jackson: Do you want to rub salt in our wounds? I understand how it works; I just wanted to put it on the record. I do not think we have to dwell on that. I did not want to debate the issue. I have a lot of experience in this area and I have some concerns on behalf of my tenants and my landlords, who appreciated being able to sit down to discuss it.

The Chair: To be helpful to the committee, perhaps an explanation of how the system would work would be more appropriate when we go through the sections clause by clause. We have undertaken a rather unusual procedure here to begin with. If it is agreeable now, we could revert to the clause-by-clause. I am certain the other issues members wish to raise will come up as we go through the particular sections that revolve around this important issue. So with that, section 34. Is that all right, Ms Poole?

Ms Poole: One further comment on my proposed amendments, which I have not withdrawn yet.

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The Chair: If you would like to wind up your discussion, that is fine. Then we will move to section 34.

Ms Poole: Mr Chair, one thing we have not discussed today is the fact that right now, with the standards board, we have a body of knowledge. We have a group of trained people who are experts in the area of looking at compliance at property standards, at maintenance standards in the province. Once you disband that type of group, the problem is that you are setting in motion things you may not be able to reverse later. If you disband a very knowledgeable body that is functioning well, it would take quite a time to get that body of knowledge and that expertise together again, if after three or four years the government in its wisdom deems it necessary to reinstate a standards board because it is not working within the rent review system.

It is the same problem I have with abandoning the appeals board. Aside from all the other arguments about what it is going to do to take away rights of tenants and landlords with the right of appeal, once the appeal board is gone it is going to be extremely difficult for them to ever build it up again should they decide in their wisdom some three to four years down the line that they made a mistake.

So in each of these areas where willy-nilly the government has come in and said, "This was the Liberal conception, ergo, it must be bad," I think that with some thought given to it, in later years it may find it really destroyed a tool that could have been very helpful in implementing what the government desires in the way of protection of tenants with relation to property standards, maintenance and compliance. I really think this government will rue the day when it destroyed this very valuable board and the work it has been doing.

Mrs Marland: It will be missed.

Ms Poole: It will be sorely missed.

The Chair: Thank you, Ms Poole.

Ms Poole: That was a eulogy.

The Chair: We will now move on to section 34.

Ms Harrington: I just wanted to comment.

The Chair: We have another comment on Ms Poole's comment.

Ms Harrington: I certainly appreciate the eulogy, the tone of it, except for your statement that the only reason the government took this approach was because the standards board was a Liberal creature, let's say. It is certainly not true. It was not for those reasons. It was because of an evaluation of the total situation and an effort to make sure that we had a good system in place.

Ms Poole: Is this a confession or admission by the parliamentary assistant that some Liberal ideas are good ideas? Is that what we are coming down to?

Ms Harrington: I think we have signified that through several amendments.

Ms Poole: Only if they agreed with it.

Section 34:

The Chair: Perhaps we could deal with section 34 directly. Ms Harrington, with the permission of the committee, as we have dealt with Ms Poole's concerns on this issue through sections 34 to 41, perhaps this would be a good time for you to give us an overview of how these sections are intended to work. We will give it a general overview, and then we will deal with the particular clauses.

Ms Harrington: Are we going to vote on section 34 first?

The Chair: Is it not all in the same part? You were wishing to give an explanation of how --

Ms Harrington: Maybe when we come to that part. Is that all right?

The Chair: Okay, fine. I thought we were there.

Ms Harrington: We first have to vote on this, do we not?

The Chair: No, we are commencing with section 34, which is titled "Compliance with Standards." I was just wondering if this would be the appropriate time to give us a general overview of sections 34 through 41 so that we all understand what we are talking about.

Ms Harrington: I would like to do it on section 35, if that is all right.

The Chair: Sure. Let's go with section 34, then. Questions or comments? Ms Harrington has made an explanation of section 34. Shall section 34 carry? All in favour?

Ms Harrington: Yes, we are in favour. Do you want us to raise our hands?

The Chair: Please raise your hands if you are in favour, yes. Opposed?

Section 34 agreed to.

Section 35:

The Chair: There is a government amendment to section 35 as printed, I believe. Ms Harrington.

Ms Harrington: Section 35 of the bill has provisions with respect to the receipt of municipal work orders that are set out in subsections 35(1), (2) and (3). A municipality may issue a work order under any bylaw respecting occupancy and maintenance standards or any general or specific act such as the City of Toronto Act.

At this point I would like to place a government motion, an amendment to subsection 35(1).

I move that subsection 35(1) of the bill, as reprinted to show the amendments proposed by the minister, be amended by striking out the first four lines and substituting the following:

"Subject to subsection (2), the director shall receive a copy of any order relating to a residential complex or a rental unit in it or any notice of appeal or decision on an appeal from such an order if the order is," and then it lists the qualifications.

The Chair: I am having some difficulty finding the copy of that, Ms Harrington.

Ms Poole: This is the January 14 package of amendments, I believe.

The Chair: Thank you, Mrs Poole. Do all members have a copy of the amendment just placed by Ms Harrington, just so we are all looking at the same thing.

Mrs Marland: Just a moment. I have them in my binder, but they're not punched.

Mr Mammoliti: Bring it over here and I'll give it a belt.

The Chair: All right, I think everyone has found where we are. Do you wish to place an explanation for the amendment, Ms Harrington?

Ms Harrington: This amendment provides that the director shall now receive any notice of appeal or appeal decisions related to an order issued by a property standards officer or made under any general or special act respecting standards of maintenance, along with the work order. This is necessary in order to know whether a prohibition of rent increase should be imposed immediately, or imposed but the effect stayed during the appeal period.

Ms Poole: Under ordinary circumstances this would be a reasonable amendment as a point of clarification of what happens when there is an appeal in effect. The Liberal caucus will not be supporting it because we do not agree with the principle that the standards board be abolished and the system be brought into rent review.

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Mrs Marland: We are into some really interesting wording here. First of all, when the parliamentary assistant read the explanation, she said this amendment is necessary in order to know whether a prohibition of rent increase should be imposed immediately or imposed. I do not understand that at all. I know what imposed immediately means.

Ms Harrington: Or imposed but the effect stayed during the appeal period. Those are the two alternatives.

Mrs Marland: Could you explain that?

Ms Harrington: We will try.

Ms Parrish: This really relates to later amendments in this section, in 35(2) and (3). Essentially, when the work order comes in and the municipality says, "There's been a work order. The landlord has been given a time to comply and has not complied and has not appealed our work order," then the director would immediately impose the prohibition on rent increase.

Alternatively, the municipality could say to the director of rent control, "We have imposed a work order and there has not been compliance. However, the landlord has appealed our work order, arguing that it should not be maintained," for whatever reason the landlord has. At that stage we would say: "All right. There is an imposition of a prohibition on rent increases, but it is stayed, ie, it doesn't go into effect, during this appeal period." So the landlord continues to increase the rent under the statutory scheme, pending this appeal.

Later on the sections say, "What if the landlord has this appeal and the courts say, `There's no merit whatsoever in your appeal, we completely dismiss your appeal, and the work order is in force'?" Then we would say that the imposition of this rent penalty was no longer stayed, and if the landlord had taken rent increases during this period, he would essentially owe the money back to the tenants.

This section is part of a series of amendments which occur here and later that essentially prevent the delay involved in appealing to be misused. If, however, the courts say, "Landlord, we agree with you that this work order was improperly imposed on you," then there would be no prohibition of rent increases. So this really deals with the later system, which is designed to ensure that the ability to appeal work orders is not merely used to avoid the application of these provisions, which prohibit rent increases until work orders are complied with.

Mrs Marland: If the work order is upheld by the appeal board --

Ms Parrish: By the courts. There could be another panel appealing this. It depends on the municipality.

Mrs Marland: That was what I wanted to know. Who hears these appeals? It depends on the municipality?

Ms Parrish: Some municipalities have an internal appeal system and in some municipalities you go directly to the court.

Mrs Marland: So if the work order is upheld by the hearing body, whatever it is, and that process takes 12 months or any long period of time -- it is not so likely if it is a municipal hearing panel -- but if it goes before the courts, it is not going to be high on the priority list, I suspect, for hearings set within crowded courts. A year later, the work order is upheld. Are the tenants then going to be entitled to a rebate on the increased rent they have paid?

Ms Parrish: Yes, because the work order was imposed. It was imposed as of that date, but the effect would stay during the appeal period.

Mrs Marland: It violates any rent increase that was granted during the outstanding deliberations of the work order?

Ms Parrish: It disentitles the landlord from receiving the money. The landlord will not have committed an offence under the statute, so we would not be able to prosecute him, but the tenants would be entitled to receive back any moneys during this period.

Mrs Marland: Municipalities which do not issue work orders, and I understand there are some. Is that correct?

Ms Parrish: I just want to clarify one thing. If you have a municipality that does not have any standards bylaw, it will be covered by the provincial standard, which would be very similar to that which is currently in place under the standards board now. That would be prescribed by regulation. First of all, if you have a municipality that has no standards, as is the case now, it would be covered by the provincial standards. You may have a municipality that has standards but does not issue work orders, so in the first case what you will have is that the province will issue the work order as it does now.

The second case is a more difficult situation. Because the system does depend on a municipal work order to be triggered, you must have a municipal or provincial work order in order to start this system operating. The tenants of course also have the ability to make a direct application on their own behalf itemizing that there is inadequate maintenance.

Mrs Marland: But you are disbanding the standards appeal board?

Ms Parrish: The board is gone under this statute, but the functions of the board are retained. The standard is retained, the ability to enforce the standard is retained and the ability to do inspections and issue work orders is retained. They are the same functions. It is just a different method of performing those functions.

Mrs Marland: The standards appeal board is gone but the functions remain. That means you are going to have a whole lot more of little wizards running around and doing the functions, I suppose. Who is going to do all those functions? In a municipality that does not issue work orders, you said it is within the jurisdiction of the province to issue the work orders if there is a complaint by a tenant.

Ms Parrish: If the municipality does not have any standards bylaw, then the provincial standard applies and there is a provincial order issued. If you have a municipality that has a standard, then we have to wait for it to issue a work order. It is their obligation, under their bylaw, to issue work orders.

Mrs Marland: When you say "standards," Ms Parrish, you are talking about property standards, are you not?

Ms Parrish: Yes. Basically they are usually called property standards now.

Mrs Marland: I know they are. In our municipality we have property standards bylaws and we have bylaw officers who enforce those property standards. In Mississauga we also have a committee that hears complaints under the property standards bylaw, but where none of that exists you are now saying the province has the legal power to issue work orders under property standards complaints.

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Ms Parrish: Under provincial property standards.

Mrs Marland: Right.

Ms Parrish: The same as they do now.

Mrs Marland: Okay. So what ministry enforces those standards? If I call with a complaint as a tenant, who comes out from what ministry to look at my complaint and decide that it qualifies for a work order?

Ms Harrington: When we did our travels through the province I remember in various areas, specifically down towards the Kingston area, we heard some rural people in Hastings county or in that area describing how things operate down there. This is exactly what you are talking about. There are provincial standards which apply because they do not have municipal standards and there is an office -- I am not sure whether it is in Kingston or Belleville -- of the Ministry of Housing and it has inspectors who go out and do that function.

Mrs Marland: So the inspectors are employees of the Ministry of Housing?

Ms Parrish: We will be discussing this in greater detail in section 36 which talks about this.

Mrs Marland: Oh, I might not live that long.

Ms Parrish: I would be very sad if that was the case.

We have two systems of inspection under the current statute and that is likely to stay the same under the Rent Control Act. We have employees of the Ministry of Housing who are inspectors and they do inspections. We also retain as agents municipal building inspectors from nearby municipalities, for example.

We give them a per diem to come out to inspect and we also use people on a per diem or agency basis. For example, we retain people who have recently retired from being building inspectors; there are a number of part-time people who are retained on a case-by-case basis. So we have two kinds of people, agents and our own staff, and that would continue under the new section.

Mrs Marland: You know, this becomes more interesting because now we have retired part-time people doing inspections. We have agents who are seconded from being bylaw officers in municipalities -- tell me if I am correct in interpreting what you have just said -- and the people who are seconded from the municipalities are paid a per diem. I would certainly like to know a little more about how that convoluted system could work.

Ms Harrington: If you would like, we can try to explain clearly or briefly how that situation would work if someone has a complaint. Is that your desire?

Mrs Marland: No. I can picture how it works if somebody has a complaint. What I am looking at here is, we are eliminating the standards appeal board and we are giving this autonomy to people who may be -- I do not know whether they are moonlighting from the municipality or the municipality has agreed that they can be seconded from their staff on a per diem to go and do these inspections in that municipality.

We need a lot more information about how this is going to work, because it would seem to me that if the taxpayers in the municipality which is paying for its staff to do a certain job knew some of that staff deployment was being applied to enforcement in a provincial government jurisdiction -- if the ministry started using our bylaw officers from Mississauga, which would not happen because we have our own standards enforcement -- I would have a lot of questions if I was a taxpayer in some small community. I am sure that if we could afford an inspector, his time would be fully deployed.

Now we are saying the Ministry of Housing can come along and for a per diem can take that staff person and have him do the Ministry of Housing inspection and enforcement. It is rather an interesting, almost incestuous relationship, I would suggest, between the province and the municipalities. I would like to know where it goes on and I would like some examples of how it works.

Let's set that aside. That in itself needs some explanation I think in order for it to be accepted, in order to make this work, but the appalling part comes when you look at the power that is given to these people. There is no appeal to their judgement, is there?

Ms Parrish: All the inspector can do is make the report, like he does now. You have to go before a rent officer if you want to dispute it. You have the same right of hearing as you would in the other case, but somebody has to do the initial assessment and the original inspection and make a report. Then the parties can dispute whether or not the inspector was right. There is a right to have a hearing and have the evidence tested. The inspectors simply make their report. Section 36 lays out the situation. It is the director of rent control who directs the inspector to make his report. They then can have that tested in a hearing before a rent officer before there is a final work order issued.

Mrs Marland: Have you explained why you are discontinuing the standards appeal board?

Ms Harrington: Yes. I believe you may not have been in the room at that time.

Mrs Marland: In that case, I will read Hansard, if you have actually answered that direct question.

Ms Harrington: I would like to briefly comment on what Mrs Marland has said so far. I think this is important. What she is actually getting at is how these processes happen and how the tenant accesses this legislation to make sure that they are helped by this legislation with regard to maintenance.

As you may appreciate, the rural areas are a little different in many ways than the urban areas. Because I have been working on a new Building Code Act, I know that when buildings are put up in many parts of remote Ontario there are no building inspectors available through the municipality, and certainly not if it is a complex building, like an industrial-type building, and they do have to bring in experts to do the inspections.

This system across Ontario is a reflection of differences between rural and urban areas. The province does have this responsibility where there are no municipal inspections. It is a concern, because we want to give equal treatment and equal opportunity to everyone, so I thank you for bringing this up. It is something we have been looking at and our staff people are working on: that everyone has the same opportunity for the protection of this legislation.

I wonder if staff would like to comment any further on that.

Ms Parrish: No, I think you have answered that one.

Mrs Marland: Do you think it would be possible to have some examples given to us about how you see this working? It just sounds very haphazard, this hiring retired people and the deployment of municipal staff on a per diem basis paid by the ministry. I really would like to know how that works today. If that is what is in effect today, I would like to know how that is done. If somebody can given me a brief précis answer to that tomorrow or Wednesday, that is fine. I would just like a description of how that actually works and maybe an example of the size of municipality we are talking about.

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Ms Harrington: We would like to provide that tomorrow under section 36 because that is where it would be most appropriate.

Mrs Marland: How will I get it tomorrow, in writing or verbally?

Ms Parrish: We will use our best efforts to get you something in writing. Realistically, if you want it in writing, it is more likely to be afternoon. If you want it orally, I could probably tell you by tomorrow. It is not for me to speak as to how the committee would like to receive the material.

Ms Harrington: If it is okay with you, Mrs Marland, in the course of our discussions on section 36 we will give an example and if that is adequate for you we will leave it at that. If you want something further in writing, then we will provide it.

Mrs Marland: Is that because you are going to have to look up a specific example to explain how it works? Seriously, if you are only going to give me an example why not give it to me today? I do not want an example in the land of Oz, I would like an example in Ontario, a small rural community where that is the system working today under the existing legislation and that this is what you actually do; that the ministry enters into a contractual agreement with the municipality to use their bylaw officers or their building inspectors to go out on a per diem basis, which is what you said, to enforce the act.

Ms Parrish: I am sure I can give you an example. The only reason I am not proceeding now is that I want to make sure, when I give members of the committee information, that it is accurate.

Mrs Marland: That is fair enough. I will accept that, but I would like it in writing so I can research it myself. In this reason for an amendment where you refer to "or made under general or special act respecting standards of maintenance" you do not want to say what acts you are referring to there. Are you talking about the Municipal Act or the Building Code Act? Is that why you are not specifying it because it is a number of acts?

Ms Parrish: There are a number of acts in addition. There are quite a few municipalities that have their own special legislation and if we listed them every time -- if the city of Mississauga, which has a City of Mississauga Act, decided to put something in its act we would have to open this up. There are quite a few municipalities that have special legislation. The city of Toronto is a good example.

The other thing is that there are quite a few statutes. For example, there is the Elevating Devices Act. There are public health statutes under which we can receive orders. The Elevating Devices Act is an example of where the order is not from a municipality but from a provincial ministry and the job is to inspect for faulty elevators.

Mrs Marland: Is it possible that it could be so broad as to be a complaint under the Pesticides Act on the property of an apartment building? Anything that affects that dwelling unit -- there could be a whole list of acts.

Ms Parrish: It has to pass the test that it is in the residential complex or rental unit and in relationship to health and safety of occupants. I suppose your point is well taken. I cannot say I know from my personal knowledge, but it is quite possible that the building was sprayed with some inappropriate chemical that could hurt the health or safety of these individuals.

Mrs Marland: I have quite a bit of concern with the wording or implications of this as it stands, but I will yield the floor to someone else.

The Chair: Further questions or comments to Ms Harrington's amendment to subsection 35(1)? Shall section 35(1) carry? I am sorry, I put the question incorrectly. Shall Ms Harrington's amendment to subsection 35(1) carry? All in favour?

Mrs Marland: We would like a recorded vote, Mr Chairman, and I guess we need 20 minutes.

The Chair: In that case, due to the hour I suggest we take this up at 10 am tomorrow. Committee adjourned.

The committee adjourned at 1647.