Docket A-013-01 
Order LR01-12

IN THE MATTER of an appeal, under Section 25 of the Rental of Residential Property Act, by Jo Ann MacBride against Order No. LD01-209 of the Director of Residential Rental Property dated October 18, 2001.

BEFORE THE COMMISSION

on Thursday, the 6th day of December, 2001.

Maurice Rodgerson, Panel Chair
Kathy Kennedy, Commissioner
Norman Gallant, Commissioner

Order

Participants

1.   Appellant:          Jo Ann MacBride
                             Benjamin Hardy, friend

2.   Respondent:      Howard Gay, Representative for Sjored F. W. Van Hasselt   

Reasons for Order

1.  Introduction

The Lessee, Jo Ann MacBride, is appealing Order LD01-209 (Exhibit E-16) of the Director of Residential Rental Property issued on October 18, 2001.

2.  Background

The Lessee rented a house at 215 Fitzroy Street in Summerside from the Lessor and signed a two year lease agreement (Exhibit E-3) on June 21, 2000.  Extensive renovations to the house were completed prior to Ms. Mac Bride moving in.

At the time of renting there was discussion about the possible future sale of the house and the opportunity for the Lessee to buy the property.

Mr. Gay states that it was always the intention of the owners to sell the property and the reason for a two year lease was to ensure stability and some return on investment. 

Ms. Mac Bride states that it was her understanding the house would not be sold during the two year lease period and she would have an option at the end of the lease to buy the house at the appraised value.

While this is an area of opposing views, it is not a matter appealed to the Commission and does not have a bearing on the specific points appealed by Ms. Mac Bride. The Lessor had filed Form 4 (Exhibit E-8) to terminate the Rental Agreement with the stated reasons of failure to fulfill responsibility for ordinary cleanliness and damage beyond normal wear and tear. Through mutual agreement the premises were vacated about half way through the two year lease.

The central issue of the appeal relates to retention of the security deposit for alleged damages to the property.

The Lessor claims the damages are significant and exceed the total of the security deposit and filed a Form 8 {Exhibit E-9(b)} to retain the security deposit, and stated the reason was to "offset damages and outstanding payment of utilities.  Total dollar amount exceeds the security deposit plus accrued interest."

In filing Form 9 (Exhibit E-1) the Lessee contends "There are no damages to offset….Lessor gave me a bill for utilities which was accumulated for seven months….Lease is vague as to who is responsible for sewer charges."

At the Appeal hearing the Lessee stated the damages are not as severe as the Lessor claims, some would relate to normal wear and tear, and further she was not given the opportunity to make the repairs herself.

Several letters have been written by both parties outlining their respective positions on the damages.

The parties signed the Standard Form of Rental Agreement (Exhibit E-3) and that agreement outlines a number of statutory conditions.

Under the heading of Obligation of the Lessee it states:

"The lessee shall be responsible for the ordinary cleanliness of the premises and for the repair of damage caused by any willful or negligent act of the lessee or of any person whom the lessee permits on the premises, but not for damage caused by normal wear and tear."

In this situation it is obvious from the photos provided and from the evidence of both parties that some damages did occur, the disagreement focuses on the extent of those damages and the method of repair.

In the appeal document (Exhibit E-17) Ms. Mac Bride sets out four matters she disagrees with in regard to the award to the Lessor outlined in the original order.

The Commission reviewed the evidence presented at the hearing as well as the written correspondence filed by both parties, the 74 pictures provided, the video and the original order.

The Commission is satisfied that damages occurred to the rental property.  The question then becomes the amount of those damages and, in this case, whether they total more than the security deposit of $718.21 which the Lessor seeks to retain.

The testimony, and photo evidence indicates that the floors were damaged, both by scratches from the dogs and from the attempts to strip the mantle.   While it is logical to expect that a large dog in a house with softwood floors will result in damage, it is unfair to expect that the damage indicated would be considered normal wear and tear, and the damage to the floor next to the mantle is not normal wear and tear.  

The mantle itself can be considered a showpiece of this house, and therefore the stripping of the mantle without the approval of the Lessor is damage well beyond normal wear and tear.

In her Notice of Appeal the Lessee states the following:

"Doors to Kitchen, Halls and Front Entrance and Banister

The repairs were done to these items in March of 2000, when I was away on a business trip.   At no point in time was I ever given notice that these items had to be repaired, and I was never given the opportunity to repair these items myself before moving out on June 01, 2001.  These repairs were done under the landlords own fruition in preparation to put the house on the market …"

Ms. MacBride did not dispute the damage to the bedroom wall, however she stated "I was never given opportunity to repair the damage my self…"

The Commission first sought to determine if the damages to the property were of a value greater than the security deposit of $718.21. In reviewing all the evidence and testimony the Commission is satisfied that damages of a cost greater than $718.21 occurred to the property and under Statutory Conditions, are the responsibility of the Lessee.

The Commission then considered whether the Lessee would have been able to repair the damages to the satisfaction of the Lessor for a cost less than the amount of the security deposit.   Since a variety of materials and supplies would have to be purchased, the only potential saving would be in the area of labour.

In the case of the floors, the Lessee testified that she sanded and placed two coats of varathane on the two areas she admits were damaged by the dogs.  The Lessor contends that rather than correcting the damage the action will add to the cost of repair as additional sanding will be required.  In other words the damage has not been corrected to the satisfaction of the Lessor.

The Commission is satisfied that the total cost of repairs would be in excess of the security deposit and the potential offsetting labour savings would not be sufficient to reduce those costs below the value of the damage deposit.

The Commission notes that the Lessor was granted permission to enter the premises in March while the Lessee was away on a business trip, and a number of the repairs took place at that time.   The concern raised by the Lessee that she was not given an opportunity to make the repairs herself would be more of a consideration if the Commission believed it would reduce the total cost of the damages to less than the security deposit.  That is not the case.

As to the matter of utilities, the Commission is guided by section 10 of the Rental of Residential Property Act regarding Security Deposits. Section 10 (5) states:

The lessor may retain all or part of a security deposit and interest thereon where he believes the lessee is liable to the lessor for damage to the residential premises caused by a breach of statutory condition 4, or for outstanding rent, provided that the lessor, within ten days of the date on which the lessee delivers up possession of the residential premises or such longer period as the Director may permit, serves the lessee with a notice of intention to retain security deposit in the form prescribed by regulation.

The Act restricts retention of the security deposit to damage to the premises or outstanding rent, and does not include utilities. Therefore the Commission has not considered the claim for unpaid utilities in this appeal.

3.  Decision

For the above reasons, the Commission denies the appeal and confirms the Order of the Director of Residential Rental Property.

Order

WHEREAS Jo Ann MacBride filed an appeal dated November 5, 2001 against a decision of the Director of Residential Rental Property;

AND WHEREAS the Commission heard the appeal in Charlottetown on November 28, 2001;

NOW THEREFORE, for the reasons given in the annexed Reasons for Order;

IT IS ORDERED THAT

  1. The appeal is denied;
  2. The Order of the Director of Residential Rental property is upheld; and
  3. The Lessor shall receive payment of $718.21 on December 31, 2001.

DATED at Charlottetown, Prince Edward Island, this 6th day of December, 2001.

BY THE COMMISSION:

Maurice Rodgerson, Panel Chair

Kathy Kennedy, Commissioner

Norman Gallant, Commissioner

NOTICE

Sections 26.(2), 26.(3), 26.(4) and 26.(5) of the Rental of Residential Property Act provide as follows:

26.(2) A lessor or lessee may, within fifteen days of the decision of the Commission, appeal to the court on a question of law only.

(3) The rules of court governing appeals apply to an appeal under subsection (2).

(4) Where the Commission has confirmed, reversed or varied an order of the Director and no appeal has been taken within the time specified in subsection (2), the lessor or lessee may file the order in the court.

(5) Where an order is filed pursuant to subsection (4), it may be enforced as if it were an order of the court.