Written by Adam JD Martin
One hundred and ninety-five days. That’s how long it took from the time I served my N13, until the day I was finally sitting in the Landlord Tenant Board, patiently waiting through hearing after hearing, as landlords and tenants presented their respective cases to the adjudicators. The air was sterile, no one was comfortable, and you could hear the raised voices of angry disagreements from the mediation rooms. It was not a pretty sight.
My hearing was set for 1pm. I showed up 15 fifteen minutes early, not wanting to drag the process out any longer by missing the call for our case. The public board of hearings showed that 65 cases had been heard ahead of me that day. My hearing didn’t come until about 4:30pm. As I sat waiting in the courtroom, I was sucked into the stories and claims that were being made by frustrated tenants and landlords. It was utterly fascinating (fascinated by court cases and arguments, I know, I’m obsessed).
Most of the cases were related to late or no payments (N4), or persistent late payments (N8). However, there were also cases of tenants interfering with the reasonable enjoyment and causing damage (N5). For the most part, the hearings were comical. Both sides often made heated claims against each other, it was evident that any whiff of professionalism had been left at the door. Don’t get me wrong, there were some very respectable people in attendance, but it was hard to see the trees through the forest in front of me.
One thing was clear. There was a disproportionate number of people that were making claims that were completely unsubstantiated by any reasonable evidence. It was as if everyone’s arguments were based on hearsay. No matter the issue that brought the two parties in, at least one of them was making claims that could not be backed up by anything as tangible as even a date or time, never-mind witnesses or documentation. The consequences of this were clear in the rulings that were being handed out. In almost every case where one party could not substantiate their claims, they were either disregarded as being factual, or the ruling moved the case to further in the future.
I began thinking about my case. We had served the N13 in good faith. Hand delivered, on time, and by the book. We had obtained permits for the work we planned on doing, and had begun work in the units that were already vacant. We had clear intention, documentation, and had followed the process perfectly. This gave me the comfort I needed as I watched case after case get delayed or land on unfavourable terms for the frustrated landlords. Most of them had pretty good claims and I could relate to them quite easily, but I still found myself in agreement with the adjudicator on most decisions. A process exists, and it has to be followed. Otherwise, caveat emptor would apply. Enter at your own risk, but buyer beware, if you have not done your homework properly, you’re not likely to leave with the result you had hoped for.
Four and a half hours later, my case finally made its way to the adjudicator (after failing to be resolved through mediation). I double-checked my hair, shined my shoes, and tucked in my shirt – I was ready! Our paperwork was flawless and though our tenants didn’t have much of an argument, they went for it anyways. Having received what felt like hours of free legal advice, they took their shot at claiming they did not actually receive the N13 form from me. They claimed they had never received such notice, and they were 100% confident we had no intention of renovating the property.
Maybe it was the new windows, new roof, and 40 tons of materials (with receipts and documentation) that we had taken out of the building that gave us away, maybe it was the fact that we had done everything by the book and had not made any mistakes in our paperwork, or maybe it was the fact that we stuck to the FACTS only, but the adjudicator immediately threw out their claim that they had not received notice, and even asked them why they thought they were at tribunal. With all of that, no reasonable arguments against us, perfect process and paperwork, our ruling was still not delivered on the spot. We waited just over a week for the delivery of our long awaited results. The tenants, who also happened to be destroying our building and not paying any rent at the time, were ordered to leave within two weeks! This was the best possible verdict we could have asked for.
I had seen so many cases that day get pushed back and unfavourable results that I had begun fearing the worst when they said they would withhold their decision and get back to us by mail. I already began to think about the contractors that I had planned on doing my work, and all the demand they must have at this time of the year, the carrying costs of the building, and the opportunity cost of postponing construction further. My fear turned out to be nothing more than fear itself. However, I am certain that had we not taken the time to accurately file and deliver our paperwork, documenting every action along the way (and its costs), I would have been in exactly the same boat as so many of my fellow investors that day.
In conclusion, the importance of due diligence in the accuracy and documentation of your tenant issues can not be understated. If you fail to do so, you put yourself at high risk of facing large opportunity costs financially, but also mentally. It’s draining sitting there all day listening to people scream at each other, your tenants will be equally as furious, and it is unlikely that anything good will come out of that relationship at that point. It’s best to have a clean break and get on with your investing career for all the right reasons! Focus on your WHY and the benefits of having your portfolio operate at its highest use. COMPLETE YOUR PAPERWORK PROPERLY.