Extended Eviction Moratorium- another ray of hope for commercial tenants

March 3, 2021 | Danny J. McMullen

With the world still grappling with the economic effects of the Covid-19 pandemic, the Government continues to make efforts to support small business commercial tenants. As mentioned in our previous posts , the federal government had a previous rental assistance program called the Canada Emergency Commercial Rent Assistance Program (“CECRA”), which has now expired and was subsequently replaced by the Canada Emergency Rent Subsidy (“CERS”) program. Under the CECRA program, the Ontario government had previously put certain restrictions on landlord enforcement actions including the right of distraint and the right to re-enter and terminate leases for non-payment of rent. Recently, the provincial government has extended the eviction moratorium by the enactment of Bill 229 (Protect, Support and Recover from COVID-19 Act (Budget Measures), 2020 which received Royal Assent on December 8, 2020. The Bill amends provisions under Part IV of the Commercial Tenancies Act (“CTA”), with retroactive effect to October 31, 2020 and further protects commercial tenants from their landlord’s right to eviction and distress.

Who is eligible?

The Bill applies to tenancies where the landlord:

  • is or was eligible to receive assistance under the CECRA program. You can learn more about CECRA here
  • is receiving or has received assistance under the CECRA
  • would have been eligible to receive assistance under the CECRA program if the tenant and landlord had entered into a rent reduction agreement containing an eviction moratorium
  • would have been eligible to receive assistance under the CECRA if the program was still in operation.

The moratorium on evictions for tenancies eligible under the CECRA (the “CECRA Moratorium”) is retroactive to October 31, 2020.

On December 17, 2020, the Ontario government enacted Ontario Reg. 763/20 to Bill 229 (the “Regulation”).

By virtue of the Regulation:

  • CECRA moratorium will continue until January 31, 2021
  • The Regulation establishes the “CERS moratorium”, which includes any tenancy where:

-the tenant has been approved to receive CERS

-the tenant has provided proof of CERS approval to its landlord

-not more than 12 weeks have passed since the day the tenant was approved for

CERS.

The “non-enforcement period” begins on December 17, 2020 and will expire on April 22, 2022. This means that tenants who qualify under CERS can take advantage of the CERS moratorium until April 22, 2022.

Do I qualify under CERS?

To find out if you qualify under CERS, you can click this link to our previous article.

Tenants who qualify under the CERS Program will enjoy the benefits of the CERS moratorium. for a period of 12 weeks. Tenants can subsequently qualify for another CERS approval for a later time period, which will provide continuing protection.

What protection is available?

The Bill provides a “non-enforcement period” and prohibits the following actions to protect eligible commercial tenants:

  • landlords who exercised a right of re-entry between October 31, 2020 and the start of the new moratorium must restore possession of the premises to the tenant or, if unable to do so, must compensate the tenant for damages
  • tenants’ goods that are seized by the landlord between October 31, 2020, and the start of the non-enforcement period as a distress for arrears of rent, must be returned to the tenant (if unsold)
  • landlords are prohibited from exercising a right of re-entry and right of distress.
  • judges are prohibited from ordering a writ of possession based on arrears of rent

How do I apply?

For information on how to apply for the CERS program, make sure to click this link.

These recent changes provide protection for tenants who were ineligible for CECRA to enjoy the eviction moratorium under Bill 229, as long as they qualify for CERS. Tenants should however note that they must provide proof of CERS approval to their landlord to enjoy protection under the CERS moratorium. For additional information on this new moratorium, Faskens has a great article on the impact of the Regulation here.

For more information about the eviction moratorium or any questions regarding the CERS program, please don’t hesitate to contact Northview Law at 416-639-7639, or follow this link to book a free consultation.