CANADA Trends and Developments Contributed by: Isabella Tamilia and Alexander Rigante, De Grandpré Chait
Bill 31 – housing Following long-winded consultations and par - liamentary debates which began in the fourth quarter of 2023, An Act to amend various legisla - tive provisions with respect to housing (“Bill 31”), was adopted in early 2024 by Quebec’s legis - lative assembly. The objective of this omnibus legislation is to address core issues related to the ongoing housing crisis, notably by facilitating the increase in supply and tightening the regu - latory framework on evictions, rental increases, and lease assignments/subleases. Housing Minister France-Élaine Duranceau was quoted in the press as saying that the rationale for the new law was to “re-establish balance between renters and landlords and increase [the] housing supply”. Some of the key changes introduced by Bill 31 that have impacted the regulatory framework for residential leasing are as follows: Eviction compensation Residential landlords are entitled to evict a tenant for a variety of reasons that are not related to the tenant’s default. However, whereas prior to Bill 31, tenant compensation for eviction was three months’ rent plus reasonable moving expenses, under Bill 31, landlords must now pay tenants an indemnity ranging from three to 24 months’ rent, depending on the number of uninterrupted years that a tenant has leased the premises, plus reasonable moving expenses. Furthermore, landlords are now required to demonstrate, on a balance of probabilities, that an eviction and/ or repossession was carried out in good faith, failing which, tenants may recover damages in addition to applying for punitive damages in cases where the eviction and/or repossession is deemed to have been carried out in bad faith.
Rental increases Procedures regarding rental increases have changed. Landlords are now required to include the maximum rent that they may charge for five years following the date on which the unit is ready to be leased (if the unit forms part of a new build or a building that has recently undergone a change of use). Punitive damages may also be claimed by tenants in contexts where a landlord intentionally: (i) omits to notify a new tenant of the lowest rent paid; (ii) omits to notify a new ten - ant of the last rent paid if the unit was vacant for more than 12 months; and/or (iii) falsifies infor - mation provided to the tenant with respect to items (i) and (ii). Lease assignment Traditionally, where a residential tenant request - ed the landlord’s consent to assign the lease, the landlord could not withhold its consent without a “serious reason” (as such concept is used in the Civil Code of Quebec). Under Bill 31, landlords now have the right to withhold their consent to a proposed lease assignment for a reason other than a serious reason, without the necessity to provide any justification. In such a case, the lease is cancelled (resiliated) on the date of assign - ment indicated in the tenant’s notice, at which point the tenant is released. Furthermore, since Bill 31 now prohibits tenants from assigning or subletting for a profit, the tenant has nothing to gain financially. In modifying the landlord’s right to refuse its consent to a reasonable grounds standard, the landlord is given the option and not the obligation to terminate the lease, without having to justify its decision. Thus, Bill 31 cre - ates a balance between the legitimate interests of both the landlord and the tenant. In addition, Bill 31 allows for municipalities to temporarily override existing by-laws and regu - lations related to zoning and urban planning to
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