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When the Tenant Wants to Dump the Lease and the Landlord Doesn't, "Whose Problem is it?"

Thursday, Feb 08, 2024

The 1971 landmark Supreme Court of Canada decision in Highway Properties Ltd. v. Kelly, Douglas and Co. Ltd., transformed the commercial leasing landscape by adding a fourth option of relief provided to landlords. Prior to this, landlords had three options available: do nothing and demand payment when due, terminate the tenancy and elect to pursue a claim for arrears, or re-enter the premises and re-let on the tenant's behalf. In this decision, a fourth option was introduced, affording landlords the option to terminate the lease and pursue a claim for both arrears and damages. The decision affirms that commercial leases, similar to a contract, ought to be recognized and treated as such, which affords landlords the full remedies under both contract and conveyance laws. However, a recent claim was brought before the courts, where a tenant challenged the decision in Highway Properties, requesting the previous decision be overturned.

Are Exclusive Covenants About to Become Extinct?

Wednesday, Nov 29, 2023

On June 27, 2023, the Bureau released the Competition Bureau Retail Grocery Market Study Report aptly named “Canada Needs More Grocery Competition”. This report contained recommendations to the government, including that the Tribunal take measures to limit exclusive use covenants (referred to in the Bureau’s report as “property controls”) in the grocery industry.

Mitigation After Termination, Not Before

Wednesday, Oct 11, 2023

The Ontario Superior Court of Justice recently confirmed some well-settled law: if a landlord chooses to keep the lease alive despite the tenant's default, it need not make efforts to mitigate its losses.

The Clock Might Be Ticking on Transfer Requests

Wednesday, Sep 13, 2023

When a lease requires a landlord to respond to a request for consent to a transfer within a specific period, failure to do so may result in the landlord being deemed to have unreasonably withheld its consent.

Does the Duty of Good Faith Limit “Unfettered Discretion”?

Monday, Aug 21, 2023

In a recent Ontario case, the landlord had the right to allocate realty taxes among premises of the property in its “sole and unfettered discretion”. The Court analyzed the scope of the Landlord’s allocation authority against the organizing principle of “good faith” in contractual performance.

Removal and Restoration

Thursday, Aug 03, 2023

Landlords and tenants should approach removal and restoration obligations carefully. These obligations often seem clear at the conclusion of negotiations, but become ripe for dispute as the tenancy approaches the end of its term.

Indemnifier Beware!

Wednesday, Jun 07, 2023

A properly drafted indemnity agreement can be a powerful tool in a landlord’s arsenal. All the more so since a recent Ontario court decision held that a landlord had no duty to mitigate its claim against an indemnifier under an indemnity agreement.

Meaning Out of Thin Air: How Courts Resolve Contractual Ambiguities

Thursday, Apr 20, 2023

In a recent Ontario Superior Court of Justice decision, the Court was tasked with determining whether certain costs related to an open-air atrium, a rent free fixturing period, and leasing commissions were all “reasonable” expenses in connection with a sublease transaction.

This Again! The Rent Relief / Force Majeure Saga Continues

Tuesday, Mar 14, 2023

The Ontario Superior Court followed ample previous authority to hold that force majeure clauses cannot be used to avoid paying rent unless the terms of the clause expressly say so. Now, the Ontario Court of Appeal ruling has muddied the waters.

It Is Reasonable to Withhold Consent Until a Default Is Cured

Wednesday, Dec 21, 2022

In a recent Ontario Court of Appeal (the “ONCA”) decision, Tabriz Persian Cuisine v. Highrise Property Group Inc., a landlord's refusal to consider consenting to an assignment until the tenant had satisfied certain conditions was front-and-center.