Long delays and controversial decisions regarding Residential Tenancy Act hearings are hurting the rental market, says Claire Flewelling-Wyatt, managing broker for Pemberton Holmes.
“My biggest concern is with delays,” she said. She cited as an example what happened after a 10-day eviction notice was issued to a tenant who hadn’t paid their rent for July. The tenant had a five-day period to pay the rent or dispute it and decided to dispute it.
“The hearing date is set for Oct. 4,” noted Flewelling, who has been involved in property management for 20 years. “That means the owner won’t receive rent for July, August and September. By the time we get to the hearing, it’s always a 50-50 crap shoot. If we win, the chances of recovering those funds are practically zero.”
Flewelling-Wyatt recalled a recent case where Pemberton Holmes was assisting a landlord pro bono in dealing with a tenant who hadn’t paid rent since March.
After winning the hearing, which didn’t take place until June 15, they obtained an order of possession to take hold of the property. The tenant asked for a review of the decision, which took two more weeks before an arbitrator maintained the initial order.
“The tenant didn’t move out so we had to get a writ of possession from the Supreme Court and hire a bailiff at a cost of $5,000,” she explained. “So the owner was without rent for five months and had to pay another $5,000 for the bailiff as well.”
Recent discussion about the shortage of rental properties in Victoria, where about 60 per cent of people rent, underscores the need for expedient decisions by the Residential Tenancy Office in settling disputes, Flewelling-Wyatt emphasized.
“People aren’t going to want to rent when one bad tenant could bankrupt them,” she said.
There also needs to be more consistency in the decisions, Flewelling-Wyatt added. “Each hearing is on a case-by-case basis, but decisions aren’t based on case law. I’ve been attending arbitration hearings for 10 years and there’s no rhyme or reason from one arbitrator to the next. There doesn’t appear to be any consistency with respect to their decisions.”
A recent hearing involving an elderly tenant who had a fixed term lease and vacated the property two months early illustrates her concerns. “We tried to show some compassion on behalf of the owner by asking for only one month,” she said. “The arbitrator ruled that the owner owed double the security deposit and we received no rent. The owner’s out two months rent and an extra $575 for the security deposit despite the fact there was a legal binding agreement in place. What’s so frustrating is that another arbitrator could have made a completely different decision.”
Flewelling-Wyatt believes a tight deadline of 30 days for all hearings needs to be established immediately. Presently, a monetary order regarding a damage to property claim for painting, cleaning or repairs can take up to six months.
“Too often, the tenant can’t afford to pay it or moves away, leaving the owner on the hook,” she said, adding another area that needs to be addressed is the vagueness of the Residential Tenancy Act.
“You wouldn’t believe how often the word ‘reasonable’ comes up,” Flewelling-Wyatt noted. That’s such an arbitrary word. We need to create a more level playing field. We’re in danger already with the amount of Airbnbs taking up rental stock. If we don’t do something to ensure disputes are settled reasonably and quickly, more people are going to move away from renting their property.”