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City fights `loophole' in tenant legislation

Toronto Star - May 5, 1999
By Bruce DeMara — City Hall Bureau

Toronto is fighting a plan by owners of a Toronto apartment building who wants to claim a series of renovations is a demolition so they can evict tenants and charge higher rents, municipal officials say.

The city is worried the precedent that could be set would encourage other landlords to use the same tactic to raise rents, said Councillor John Adams.

"If (the owners) can argue successfully that this is demolition for the purposes of the Tenant Protection Act, then those units effectively become decontrolled and they can charge whatever they want," said city planning official Barbara Leonhardt.

Today, the city will ask for standing at an Ontario Rental Housing Tribunal hearing involving the building at 1 Clarendon Ave., in the Avenue Rd.-St. Clair Ave. West area.

"We see this as a major new loophole that we have to vigorously challenge," said Adams (Midtown). "Normally, the city wouldn't get involved in a landlord-tenant dispute. But because of this policy question . . . I think there's a huge public interest."

Patrick Devine, who is representing the building's owners, did not return calls yesterday.

The city's move comes just days after a comprehensive housing report said Toronto was among several Ontario cities that face a housing crisis as demand for affordable apartments grows at a much faster rate than construction.

The report found that construction of rental housing dropped from 27 per cent of all Ontario housing starts between 1989 and 1993 to 6 per cent of starts between 1994 and 1998. Many renters have "affordability problems" that will continue to worsen, concluded the Ontario Non-Profit Housing Association and the Co-operative Housing Federation of Canada.

Toronto lawyer Joseph Debono, who is representing four tenants in the Clarendon Ave. building, said the landlord has a building permit to allow extensive renovations to some of the building's 43 units, but not demolition.

Under the Tenant Protection Act, the tenants would be entitled to return to the new units and be charged the same rent or a slightly higher one, based on the cost of construction.

If the owners argue successfully the work is a demolition, the tenants have no "right of first refusal" and there is no limit on the new rent, he said.

"The work that's being done has been described by the City of Toronto plans examiner as fairly minor," Debono said.

City legal staff will argue for an adjournment of the hearing so they can better prepare themselves, Leonhardt said.

There's also a possibility the landlord will try to convert the building into a condominium after rents have been raised, she said. The city has a policy of preventing conversion of affordable rental housing, but allows exemptions in cases where high rents have been charged for a period of two years, she said.

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