Docket A-007-92
Order LR93-5

IN THE MATTER of the Rental of Residential Property Act, R.S.P.E.I. 1988, C. R 13.1,

and

IN THE MATTER of an appeal under Section 25 of the Rental of Residential Property Act, by Dewar MacDonald, Lessor, of Charlottetown R.R.#2, Prince Edward Island, against Order No. LD92-11 of the Director of Residential Rental Property dated June 8, 1992.

APPEAL HEARD BEFORE:

John L. Blakney, Vice-Chairman
Anne McPhee, Commissioner
 James Nicholson, Commissioner

DATE OF HEARING: August 4, 1992

DATE OF ORDER: March 9, 1993

Order

Participants

Roddy MacDonald Appellant (Lessor)
Representing Dewar MacDonald

Terry MacKay Respondent (Lessee)
Did not attend hearing

Background

The Lessor owns the property located at 34 Brookdale Drive, Winsloe, and the Lessee rented the house April 1, 1991 until March 31, 1992.

On March 23, 1992, the Lessee filed, with the Director of Residential Rental Property (the Director), an Application for Enforcement of Statuatory or Other Conditions of Rental Agreement. The Lessee requested the Director to find that rent is owed because rent was paid to the Lessor in the amount of $525.00 per month. This amount represented an increase in rent from $325.00 in April, 1991 - an increase above the allowable amount.

On April 13, 1992, the Director held a hearing to consider the matter. The Lessees, Terry MacKay and Rick Arsenault appeared at the hearing but the Lessor did not appear. Based on the evidence heard, the Director issued an Order on April 14, 1992, Reference #92-0073 which ordered that:

1) An amount of $200.00 per month was overcharged by the Lessor. The total amount being $2,000.00 for the total occupancy period.

2) The total amount of $2,400.00 found owing shall be paid by the Lessor to the Lessee on or before April 30, 1992.

Subsequently, the Lessor submitted new evidence and, as a result, the Director re-heard the matter and issued a new Order on June 8, 1992 ordering that:

1) As the Lessor has not complied with the provisions of the Act regarding rent increases, the Lessor shall pay to the Lessees the amount of $600.00. This amount represents the difference between the actual amount charged to the Lessees and the 1988 amount of $475.00 - the amount from which the illegal increases have been applied. An overpayment of $50.00 per month was charged over a twelve-month period - this being the occupancy period of the Lessees.

2) The Lessor shall pay to the Lessees the amount of $600.00 on or before June 30, 1992.

On June 29, 1992, the Lessor made Notice of Appeal of the ammended Order LD92-11 to the Island Regulatory and Appeals Commission (the Commission) which was delivered by hand to the Commission on July 3, 1992. The Commission heard the appeal on August 4, 1992.

Evidence and Argument

Although notified of the appeal and the hearing date, neither Terry MacKay or Rick Arsenault appeared at the hearing.

Roddy MacDonald who appeared on behalf of the Lessor argued that the Lessees did not provide any evidence that they paid $525.00 per month for rental of the premises. No receipts or other evidence were presented to the Director or the Commission. Subsequent to the hearing, and at the request of the Commission, Roddy MacDonald had delivered to the Commission a two-page exhibit entitled Ledger 1991 and 1992 which indicated that the Lessor had collected $475.00 per month.

The Lessees failed to attend the hearing of the Commission. However, subsequent to the hearing, Terry MacKay - one of the Lessees - was given an opportunity to review the exhibits filed with the Commission and to present documents to support his allegation that the Lessor collected $525.00 per month rent. On February 18, 1993, Mr. MacKay appeared before Vice-Chairman Blakney and made a sworn statement that he was paying $525.00 at 34 Brookdale Drive.

Decision

The Commission believes that one cannot underestimate the gravity of a situation involving the charging of rent in an amount that violates the Act. Consequently, it takes very seriously any allegation that excessive rents were charged or are being charged and collected by a Lessor.

The Commission considered the evidence and submissions made by both the Lessor and Lessee subsequent to the hearing and has decided to allow the appeal.

The Commission finds that the evidence provided by the Lessor on the actual amount paid by the Lessee for rent of the unit varied significantly from $525.00 per month to $475.00 per month. The Commission finds it amazing that it was not until after two hearings and two Orders of the Director that the Lessor finally discovered that he had not charged $525.00 but $475.00 per month. The Commission assumes the Lessor had at his disposal the same ledger provided to the Commission by Roddy MacDonald and, therefore, wonders how he could reach the conclusion indicated in his letter to the Residential Rental Property Officer that he was charging the Lessees $525.00 per month. In addition, Lorna Good signed a letter dated May 2, 1992 that during the period from May 1, 1990 to March, 1992 she paid $500.00 monthly to rent the premises. However, the cancelled cheques for the months of May and July of 1990 indicate she paid only $475.00 per month. Based on the inconsistent evidence submitted by the Lessor, the Commission finds that it cannot be sure what rent was charged to the Lessees.

The Commission has no evidence other than the sworn statement by Terry MacKay that he actually paid $525.00 and even though it is a sworn statement, the allegation remains unsubstantiated or unsupported. Because of the gravity the Commission attributes to such an allegation, the Commission believes it is not enough to merely provide a sworn statement but such a statement must be supported with substantive evidence to prove the alleged fact. In this case, it is the view of the Commission that substantive evidence would consist of a cancelled cheque or a receipt for rent paid in cash. Without such evidence to prove this serious allegation, the Commission cannot find for the Lessee. The onus to prove the allegation must be on the person making it and although the Lessor's evidence is inconsistent, the Commission cannot reach a conclusion that the rent was $525.00 based on the evidence submitted by the Lessee.

Consequently, because the Lessee failed to substantiate his allegation, the Commission has no alternative but to allow the appeal.

With its understanding that there have been no applications for rental increase filed with the Director, it is the Commission's observation that the rent presently being charged for the residential premises at 34 Brookdale Drive would not be in excess of $475.00, plus the allowable rental increases.

IN THE MATTER of the Rental of Residential Property Act, R.S.P.E.I. 1988, C. R 13.1,

and

IN THE MATTER of an appeal under Section 25 of the Rental of Residential Property Act, by Dewar MacDonald, Lessor, of Charlottetown R.R.#2, Prince Edward Island, against Order No. LD92-11 of the Director of Residential Rental Property dated June 8, 1992.

Order

1.  The appeal is allowed and the Order of the Director (LD92-11) is hereby quashed.

DATED at Charlottetown, Prince Edward Island, this 9th day of March, 1993.

BY THE COMMISSION:

John L. Blakney, Vice-Chairman
Anne McPhee, Commissioner
 James Nicholson, Commissioner