Landlord Loses Bankruptcy Case: Mahmood v Riutta 2024
Landlords cannot evict bankrupt tenants for pre-bankruptcy rent arrears, LTB review order rules
Summarized by RentZenLast updated: September 12, 2024
Case Summary
27 Nathan Cres, Barrie, ON L4N0S2
Decision in favor of
neither
Previous Order
Overturned
Dispute Categories
Notices Sent
Agree with the ruling?
Timeline
Application Date
Dec 2022
Order Date
Sep 3, 2024
Hearing Date
Dec 2024
Dispute Summary
Landlords applied for an order to terminate the tenancy and evict Tenants due to failure to pay rent and utilities. The application was filed after serving valid N4 and N5 notices, which the tenants did not void by paying the arrears. Mr. Riutta vacated the unit in July 2022 and Ms Riutta became bankrupt on March 21, 2023 and vacated the unit on October 4, 2023.
Determinations
- Landlords served valid N4 and N5 notices
- Tenants did not void notices by paying arrears
- Mr. Riutta vacated unit in July 2022
- Ms Riutta became bankrupt on March 21, 2023 and vacated on October 4, 2023
Case Study
The review must be granted and the Hearing Order cancelled based on Ms Riutta's bankruptcy. The LTB is prohibited by section 84.2 of the Bankruptcy and Insolvency Act from terminating the tenancy and evicting the Tenants based on rent owed when the bankruptcy started. The LTB can, however, make an order requiring the Tenants to pay any rent or utilities that became owed after the bankruptcy started.
Decision Summary
The Hearing Order is cancelled. The LTB is prohibited by section 84.2 of the Bankruptcy and Insolvency Act from terminating the tenancy and evicting the Tenants based on rent owed when the bankruptcy started. The LTB can, however, make an order requiring the Tenants to pay any rent or utilities that became owed after the bankruptcy started.
Adjudicator Details
LTB Member
Total Orders
140
Landlord Favorable
69.3%
Tenant Favorable
17.9%
Mutual Agreement
12.9%
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Financial Details
Rent Arrears
$15,750
Other Owed Amount
$1,348
utilities
Total Owing
$17,098 (Owed to Landlords)
Source
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