May a Property Manager Provide Legal Services For a Landlord?
When Landlord Tenant Board Forms Are Completed By a Realty Agent or Property Manager the Forms and Proceedings Initiated Subsequent to Issuance of Those Forms May be Nullified, Struck, and Dismissed. Only Persons Authorized By the Law Society Act Should Provide Legal Services.
Similar Questions About Landlord Services Include:
- Can a Bookkeeper Provide Legal Services For a Landlord?
- May a Property Manager Appear At a Landlord Tenant Board Hearing On Behalf of a Landlord?
- What Can Happen If a Landlord Is Represented By a Property Manager?
- May a Real Estate Agent Perform Legal Services For a Landlord?
- Is a Property Manager Allowed to Appear on Behalf of a Landlord?
Historically, property managers, real estate agents, among others, provided assistance with legal Forms including documents prescribed by the Residential Tenancies Act, 2006, S.O. 2006, Chapter 17, being the various documents required applicable to proceedings of the Landlord Tenant Board. In the past, landlords have also used property managers or real estate agents, among others, for legal advocacy and assistance such as negotiation efforts, preparing settlement agreement documents, and even for representation appearance at hearings of the Landlord Tenant Board. Landlords continuing this practice currently may now find grave difficulties whereas adjudicators of the Landlord Tenant Board are now enforcing the law that restricts the commercialization of legal services exclusively to persons holding license from the Law Society of Ontario. With effective enforcement of the law, it is now becoming common that the Forms prepared, issued, filed, among other tasks within the course of processes of the Landlord Tenant Board must be done so by a qualified licensee of the Law Society of Ontario, or a person exempt such as the Landlord or a friend or family member acting unpaid on behalf of the Landlord. Where unlicensed persons, such as property managers or real estate agents, are providing a commercialized service, whether paid directly or indirectly, to the landlord, the Landlord Tenant Board is striking the Forms and dismissing the procedures commenced subsequent to issuance of those Forms. The reasoning for doing so was recently provided by the Landlord Tenant Board within the case of Parmar v. Chanski, EAL-81351-19 (unreported) where it was stated:
5. The property management company does not own the rental unit and the lease was not signed by the property management company. Therefore, the property management company does not permit occupancy of the rental unit and does not meet the definition of "landlord" as set out in the Residential Tenancies Act, 2006.
6. It was also agreed that the 'N-4' notice and the L-2 application were drafted, signed and served by Mr. Thompson, who is neither a lawyer nor a paralegal, nor otherwise exempt from the licensing requirements of the Law Society Act.
7. JD submitted that in Law Society of Upper Canada v. Chiarelli, 2014 ONCA 391, it was established by the Court of Appeal for Ontario, that although Chiarelli operated a property management company, he did not meet the Act's definition of Landlord and furthermore since he was an unlicensed individual he was not authorized to provide legal services to the Landlord.
8. JD stated that legal services includes the drafting of notices and application and the serving of notices and is not limited only to representation on the day of the hearing. Therefore, the notice was invalid as was the application and the application ought to be dismissed.
9. JD also cited the decision of the Board in TEL-97410-18 where the presiding Member dismissed the application based on finding that the applicant (third party property management company) did not have standing to serve the notice or file the application with the Board. This decision is currently awaiting review.
10. Also cited by JD was the Board Order EAL-80406-19 in which the presiding Member concluded that since the application was signed by the owner of a private property management company retained by the landlord, who was not authorized to provide legal services, the application was not properly before the Board. The application was dismissed.
14. I have considered the argument made by JT that there having been no demonstrated prejudice to the Tenants or abuse of process, the matter ought not be dismissed on what appears to be a technicality.
15. However, the principles set out in the Chiarelli case are binding upon me. I have re-examined the Chiarelli case at length. The decision quotes relevant sections from the Law Society Act (the 'LSA') in deciding what activities are the "provision of legal services".
16. Section 1.(6) of the LSA specifically includes the giving of advice regarding legal interest rights or responsibilities (sub-paragraph 1.(6)(1)), the selection, drafting, completion or revision of documents for use in a proceeding before an adjudicative body (sub-paragraph 1.(6)(2)), and representing a person in a proceeding before an adjudicative body (subsection 1.(6)(3)).
17. In the Chiarelli case, the decision was unanimous on this point: an unlicensed person, such as a property manager, who is not a statutory party to an application (i.e. meets the definition of Landlord) may not provide legal services, including the completion of forms and documents, and does not have standing before the Board.
18. Therefore, I have concluded that JT does not have standing before the Board, and as such could not represent the Landlord at the hearing, nor file the application, nor complete and serve the N-4 on the Landlord's behalf.
19. Although decisions of the Board are not binding in the same way as decisions of Divisional Court or Court of Appeal are binding, I find both Board decisions (TEL-97410-18 and EAL-80406-19) to be informative and to be consistent with the direction set by the Chiarelli decision and the analysis remains valid.
20. As a result, since the notice and application were not completed by the Landlord or the Landlord's authorized and licensed representative as required by the Chiarelli decision, they are not valid. Furthermore, the Landlord was also represented by an agent at the hearing who is not a licensed representative and thus did not have standing before the Board. For these reasons, the application is denied.
As above, it is clear that the Landlord Tenant Board is becoming much more stringent on who may be permitted to act as a representative at Hearings as well as who may complete the Forms and perform other services on behalf of a landlord. Accordingly, it would be wise for a landlord using a property management service or realty agent for various services to ally with a licensee of the Law Society of Ontario, such as Sarah Teal Legal Services so to ensure authorized representation and proper standing within legal proceedings. Whereas the process for initiating and obtaining Hearing dates at the Landlord Tenant Board may be quite lengthy, and so to avoid undue delays in ensuring that a matter is heard rather than dismissed, it appears obvious that a qualified licensee of the Law Society be hired to act on behalf of the landlord.
The Landlord Tenant Board is enforcing decisions that restrict who may act on behalf of a landlord (and presumably a tenant) at a Hearing as well as who may issue Forms of the Landlord Tenant Board as the documents that commence the legal processes. It appears clear that a person acting commercially, such as a property manager or realty agent, will be precluded from involvement and that only licensees of the Law Society of Ontario shall be permitted to do so.