Docket A-004-99
Order LR99-05

IN THE MATTER of an appeal, under Section 25 of the Rental of Residential Property Act, by Gavan and Brenda Gill (the Lessors) against Order LD99-049 of the Director of Residential Rental Property dated April 26, 1999.

BEFORE THE COMMISSION

on Wednesday, the 9th day of June, 1999.

Wayne D. Cheverie, Q.C., Chair
Weston Rose, Commissioner
James Carragher, Commissioner

Order

Participants

1. Appellants:

Gavan and Brenda Gill

2. Respondent:

Helene Smith

Reasons for Order

1. Background

Gavan Gill and Brenda Gill (the Appellants), are the Lessors of property located at 155 Cumberland Street in the City of Charlottetown in the Province of Prince Edward Island. On the 4th day of August 1998, they entered into a standard form of rental agreement (Exhibit 4) with the Lessee, Helene Smith (Respondent). Schedule D of that agreement provided for, among other things, the fact that no pets were allowed in the rented premises. The agreement stated that it was for a fixed term commencing on the 1st day of September 1998 and to end on the 31st day of August 1999. The rent per month was $675.00 and this also was the amount of the security deposit paid by the Respondent to the Appellants.

Notwithstanding the prohibition with respect to pets in the rented premises, the Respondent admits that she accepted a small dog as a gift on December 26, 1998 and made the Appellants aware of this shortly thereafter. The evidence supports the fact that as a result of the pup being kept in the apartment, there was no obvious mess as a result thereof nor were there any stains on the floor. This is confirmed by the Appellant, Mr. Gavan Gill in his direct evidence and by the Respondent in her evidence. Nevertheless, when the Respondent vacated the rented premises, she had the premises cleaned. As well, the Appellants had the carpets cleaned at a cost of $80.25 (Exhibit 5) and then sought to retain this amount from the security deposit.

The Director of Residential Rental Property, Twila M. Whalen, was called upon to decide this matter pursuant to section 10(7) of the Rental of Residential Property Act ( the Act) as the Respondent had disputed the retention of this portion of the security deposit, and the Director issued an order in this regard dated April 26, 1999. That order directed the Respondent to receive payment of $80.25, being the amount in dispute. It is from that order that the Appellants have launched the present appeal.

2. Decision

This appeal was heard by the Commission on 26th of May 1999. At that time, Mr. Gavan Gill gave evidence on behalf of the Appellants and clearly indicated that while he was annoyed with the fact that the Respondent had violated the rental agreement by having a dog in the apartment, he readily admitted that there was no obvious mess left behind nor was there any stains on the floor, but rather he felt that because a dog had been in the premises that it was necessary to steam clean the carpets. For her part, the Respondent admitted to housing a dog in contravention of the rental agreement, but gave an explanation with the respect to where the dog came from and the fact that she had notified the Appellants immediately thereafter and received no immediate response from them. Such being the case, she thought that it was okay to keep the dog on the premises. As well, she confirms that the dog did not create any mess in the apartment, and furthermore, she had the apartment thoroughly cleaned when she gave up the premises.

The Appellants gave notice via Form 8 pursuant to sub-section 10(5) Rental of Residential Property Act, that they intended to retain that portion of the security deposit in the amount of $80.25 in compensation for steam cleaning the carpets in the subject apartment. The Respondent, via Form 9 of the Act applied for Determination of the Security Deposit (Exhibit 1). The law with respect to the taking and disposition of security deposits is set out in section 10 of the Rental of Residential Property Act. In particular, subsection 10(5), pursuant to which the Appellants made application to the Director, reads as follows:

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, serves the lessee with a notice of intention to retain security deposit in the form prescribed by regulation.

It is clear then from this section that the Lessor may lay claim to all or part of the security deposit for one of two reasons – (1) a breach of statutory condition 4 or (2) for outstanding rent. Since there was no question concerning any outstanding rent, then the Appellants must satisfy the Commission that there was a breach of statutory condition 4. Statutory condition 4 is found in section 6 of the Act and reads as follows:

Obligation of the Lessee

The lessee shall be responsible for the ordinary cleanliness of the interior of the premises and for the repair of damage caused by any wilful 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.

Unless the Appellant can satisfy the Commission that there was a breach of this condition, then the Appellants cannot be successful in their claim for a retention of the security deposit or part thereof. In the opinion of the Commission, the Appellants have failed to prove any such breach. In fact, the evidence is that the dog did not leave any stains on the carpet or any obvious mess as is confirmed by the evidence of the Appellant, Mr. Gill. That being the case, the Appellants' case fails.

While the Commission has decided that the present appeal must be dismissed, we are also mindful of the situation facing the Appellants. Certainly they had cause for concern upon being notified that a stipulation explicitly set out in their rental agreement had been violated. In fact, they could have made application to the Director of Residential Rental Property pursuant to section 8 of the Act which reads as follows:

8. Where a lessor or lessee fails to comply with a statutory condition or any other condition or covenant of a rental agreement, a person may make written application to the Director indicating the condition or covenant alleged to have been contravened and seeking a remedy, and the Director shall investigate the matter and may

(a)    inspect the residential premises or have them inspected by an appropriate authority;
(b)    prohibit the discontinuance of any services;
(c)    authorize the discontinuance of any service and make an appropriate adjustment to the rent;
(d)    authorize the subletting or assigning of the rental agreement;
(d.1)   make a finding that an amount of rent is owed or that a security deposit, or part thereof, should be forfeited or returned;
(d.2)    order that an amount found to be owed be paid;
(d.3)    order that possession of the residential premises be surrendered to the lessor and directing the sheriff to put the lessor in possession;
(e)    authorize the termination of the rental agreement in accordance with section 11; or
(f)    make such other decision or order as he considers necessary to ensure compliance with, or to remedy a violation of, this Act or the rental agreement.

As one can see from that section, the Director has broad powers to investigate and impose a remedy where appropriate. At the hearing, the Appellant, Mr. Gill, indicated that his experience in renting apartments was fairly limited in that he had only been in the business of residential rentals for about one year and in fact only had two rental units. That being the case, and given the fact that he indicated that he had no prior experience with any problem with any other lessee, he may not have been fully familiar with all of the provisions of the Rental of Residential Property Act. The Commission urges him to more fully familiarize himself with the provisions of the Act so that he might be aware of his rights as well as his duties as a lessor.

The Commission is not taking the position that the Appellants might have been successful had they sought a determination of their problem under section 8 of the Act, but only that it was available to them while the rental agreement existed. Unfortunately for the Appellants, they did not proceed with an application pursuant to section 8 but rather chose to proceed under section 10 of the Act and as the Commission has already determined their case under section 10 has failed.

IN THE MATTER of an appeal, under Section 25 of the Rental of Residential Property Act, by Gavan and Brenda Gill (the Lessors) against Order LD99-049 of the Director of Residential Rental Property dated April 26, 1999.

Order

WHEREAS Gavan and Brenda Gill filed an appeal on May 4, 1999 against a decision of the Director of Residential Rental Property;

AND WHEREAS the Commission heard the appeal in Charlottetown on May 26, 1999;

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

IT IS ORDERED THAT

1.    The appeal is dismissed;
2.    The Respondent shall receive a payment of $80.25;
3.    The payment shall be made within fifteen (15) days of this order.

DATED at Charlottetown, Prince Edward Island, this 9th day of June, 1999.

BY THE COMMISSION:

Wayne D. Cheverie, Q.C., Chair
Weston Rose, Commissioner
James Carragher, 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.