Case Comment: Boardwalk General Partnership v Montour, 2015 ABQB 242

The Residential Tenancy Dispute Resolution Service (“RTDRS”) hears applications brought by landlords and tenants, such as for eviction for unpaid rent, the return of improperly withheld damage deposits and a reduction in (or abatement of) rent when a landlord has not properly maintained the rental premises.  A recent decision of Master Schlosser to temporarily stay an eviction order granted by the RTDRS provides landlords and tenants with an important avenue for addressing minor problems arising from RTDRS Orders, short of a full appeal. At the same time, it highlights some of the many challenges facing self-represented litigants who wish to exercise their legal rights with respect to one of their most pressing needs, housing.

On the morning of April 8, 2015, a tenant appeared in Masters Chambers. She was late getting her full rental payment to her landlord. The landlord had changed the locks to her apartment, barring the renter from accessing the suite. She was in court seeking relief.

A landlord cannot immediately evict a tenant after one late rental payment, but this landlord was acting within its legal rights. The tenant had fallen behind on rent before, and the landlord had brought an application to the RTDRS to have the tenant evicted. As commonly happens, the tenant and landlord consented to a Conditional Order. Under the terms of the Order, the tenant was required to repay the outstanding arrears and ongoing rental obligations according to a set schedule of payments. These Conditional Orders are fancifully called Cinderella Orders.  Like the glass slipper wearing princess, who needed to be home before midnight, tenants subject to a Cinderella Order must comply strictly with the time limits set out in the Order.  If any of the payments are late, a landlord is entitled to evict the tenant on as little as 48 hours notice.[1]  The Conditional Order in this case stipulated that a payment of $1,519 was due on April 1, 2015.  By April 1, the tenant had only paid $1,100, and the landlord changed the locks.

The tenant had a compelling excuse for not making a full payment on April 1. Three individuals lived in the rented premises and two of those individuals were receiving social assistance. The $419, which was not remitted on April 1, was to be paid directly to the landlord by a government agency. The government agency misread the Conditional Order and did not remit the rent by the deadline.  The agency had indicated it would issue a cheque, but could not do so before April 15, 2015. The Master extended the time for payment under the Conditional Order to April 20, 2015 and ordered the tenants be given access to the suite.

As the Master noted, this was a factually compelling case, it is also a legally interesting one.  The lawyer for the landlord raised a question about the jurisdiction of the Court to stay or alter a portion of a RTDRS Order.

RTDRS practice is largely governed by the Residential Tenancy Dispute Resolution Service Regulation [the “Regulation”].[2] According to the Regulation, RTDRS Orders can be appealed to the Court of Queen’s Bench. The appeal process has a number of shortcomings.  First, it can be prohibitively expensive for tenants, because the appellant must arrange for a transcription of the oral RTDRS hearing to be prepared and filed.[3] Transcriptions are billed per character, and depending on the length of the hearing can easily cost in excess of $200 and up to $1000 or more in exceptional cases.  Second, the appeal may not provide the tenant with an opportunity to have the merits of his or her case heard. The judge hearing the appeal is limited to the evidence that was before the Tenancy Dispute Officer.[4] A tenant who missed a hearing or who did not comprehend what evidence should be put before the Tenancy Dispute Office, is precluded from submitting new evidence on appeal. Finally, as the Master noted in his reasons, it can take a long time before the appeal is heard, and there is not an automatic stay of the RTDRS Order. A tenant who wishes to stay an Order pending appeal must bring a separate application before the Court.[5]  In the absence of a stay, the relief being sought by the appellant often ends up being moot. On an eviction application, the tenant will be forced to leave the rental premises and (hopefully) find somewhere else to live, before the appeal is heard.

In the case before Master Schlosser, the tenant had not appealed the RTDRS Order. The question posed by the landlord’s lawyer was whether the Court could alter or stay the Order in the absence of a formal appeal.  The landlord’s lawyer pointed to a pair of Alberta cases, in which Justices of the Court of Queen’s Bench had declined to stay RTDRS Orders in the absence of formal appeals.  Master Schlosser distinguished the case of Thomas v Beyer,[6] where Madam Justice Trussler was asked to permanently stay an RTDRS Order.  Master Schlosser noted he was only being asked to stay an RTDRS Order for a matter of days to allow the government assistance cheque to be issued.  In Zibrowski v. Nicolis,[7] Mr. Justice Lee found that the appeal failed for procedural deficiencies (no notice of appeal, no transcript), but also carried out a substantive analysis under the tripartite test for a stay.

The Master found a number of legal grounds upon which he could rely to temporarily stay the RTDRS Order.  RTDRS Orders are filed at the Court of Queen’s Bench and then enforced as Orders of the Court. The Conditional Order was an order for payment and Master Schlosser pointed out that the Judicature Act[8], the Civil Enforcement Act[9] and the Alberta Rules of Court[10] gave the Court broad powers to vary or stay its own Orders.  Master Schlosser reasoned that in the absence of any language directing otherwise, RTDRS Orders must be subject to the same provisions once they are filed at the Court of Queen’s Bench.

Notably, Master Schlosser mentioned Rule 9.15 of the Alberta Rules of Court as a provision that might apply to RTDRS Orders filed at the Court of Queen’s Bench.  Rule 9.15 allows a party to apply to have an Order set aside or varied if the party was given no, or insufficient notice of the initial hearing, or did not appear because of an accident or a mistake. Edmonton Community Legal Centre lawyers have relied on this provision on applications to vary RTDRS Orders, where the tenant missed the initial hearing.  Master Schlosser’s reasons can be read as endorsing this procedural practice.

In the alternative, Master Schlosser was prepared to rely on Rule 1.5 of the Alberta Rules of Court to cure the irregularity in the tenant’s application and treat it as a Notice of Appeal. Presumably, had Master Schlosser gone this route, then he would have been required to transfer the matter to Justice Chambers – as he noted in his reasons, Masters lack jurisdiction to hear appeals.[11]  There might be other problems with this approach. In this case, the applicant had not filed a transcript of the RTDRS hearing with the Court. There might not have been much of a hearing to transcribe, depending on at what point in the process the parties consented to the Conditional Order. In future cases, the RTDRS Order may be granted after a substantive hearing.  Recall that judges hearing appeals from RTDRS Orders are limited to the evidence presented at the initial hearing. Without a transcript of evidence before the Court, it is unclear how an appeal could proceed. Additionally, in cases like this one, where important evidence emerges after the hearing, it would seem that a judge hearing an appeal would be prohibited from taking this new evidence into account. Master Schlosser’s initial approach, to treat an RTDRS Order as an Order of the Court, is more workable than transforming an application for relief into an appeal.

The RTDRS Service is intended to be faster, more informal and less expensive than courts. One can understand why the drafters of the Regulation wanted to limit the ability of a party to appeal, so as to provide for the final resolution of disputes.  But there is a real question here as to how many tenants – who are often self-represented, financially insecure and very uncomfortable appearing in court – would take advantage of a more accessible appeal process to litigate unfavourable RTDRS Orders.  I suspect that the floodgate is not about to open.   The appeal process is too expensive and too complex for a system designed to be used by non-lawyers. Previous governments have intimated that changes are coming to the RTDRS system. The appeal process should be on the list of provisions to amend. Until then, Master Schlosser’s decision provides a mechanism by which tenants and landlords can use the Court to reach common sense resolutions of disputes arising from RTDRS Orders.

[1] Most RTDRS Orders allow landlords to evict tenants who have failed to comply with Conditional Orders after serving a Notice of Default, which usually provides a 48-hour grace period between the service of the Notice of Default and the actual changing of the locks.

[2] Residential Tenancy Dispute Resolution Service Regulation, AR 98/2006 [“RTDRS Reg”].

[3] RTDRS Reg, s 23.

[4] RTDRS Reg, s 25.

[5] RTDRS Reg, s 26.

[6] Thomas v. Beyer, 2006 ABQB 892.

[7] Zibrowski v. Nicolis, 2012 ABQB 236.

[8] Judicature Act, RSA 2000 c J-2, s 17.

[9] Civil Enforcement Act, RSA 2000 c C-15, s 5.

[10] Alberta Rules of Court, AR 124/2010, R 9.14-9.16.

[11] Court of Queen’s Bench Act, RSA 2000 c C-31, s 9(1)(a).