One of the most important things you do as the manager of a rental property is communicate with the tenants. For things like rental increases, evictions, major repairs and the sale of a property you have to serve official notice, and you must follow the notice periods laid out in the Residential Tenancies Act. The most important rule, for both tenants and landlords, is this:
On the first of the month for the end of the month.
This is important for a whole bunch of situations where this is important, but one came up on myREINspace last week, so it’s a good time to walk through it.
The actual paragraph from the Alberta RTA is this (as of October 2009):
Notice to terminate monthly tenancy
8(1) A notice to terminate a monthly tenancy must be served
(a) by a tenant on the tenant’s landlord, on or before the first day of a tenancy month to be effective on the last day of that tenancy month, or
(b) by a landlord on the landlord’s tenant, on or before the first day of a notice period to be effective on the last day of the notice period.
(2) In this section and section 10(2)(b), “notice period” means a period of 3 consecutive tenancy months.
Now, there was recently a case on myREINspace (only available to REIN members) of someone who had sold their property, but gave the tenant 90 calendar days notice, instead of ninety days from the beginning of the month, like they were supposed to. Here’s their story:
We have an ‘interesting’ scenario that we need some advice on. We sold one of our homes in September and agreed to a December 15th possession. We and our Realtor asked a local property management company to verify the notice period for tenants to vacate as the buyers asked for vacant possession. They said 90 days and we confirmed 90 calendar days. They said yes. So, we gave proper written notice, 90 days and confirmed they had to out by December 11th. Our tenant has just informed us that he doesn’t have to be out until December 31st because we didn’t give him proper notice and that the 90 days must be 3 full tenancy months. OOPS! He’s right. The buyers are refusing to move the possession date and our tenant is being a ‘jerk’ and saying ‘I’ll move when I want to move and that may or may not be before December 31st’ because he knows we are in a pickle. We have had a good relationship with him so this is somewhat surprizing.
Anyway, we are looking for advice on how ‘bad’ can this become if the tenant refuses to vacate and the buyer refuses to move the possession date and ANY advice on how to get this sale back on track.
So, the short story is that they missed the boat on when to submit the notice. The correct time would have been on the first of the month. By serving on the 11th of September, requesting possession for the 11th of December, was in fact, incorrect. The next step would have been to almost instantly serve them with a notice dated October 1 for a December 31st/January 1 possession. Then you can approach your buyers about moving the possession date.
In this case the buyers did end up offering to move the date, at some cost, but the tenant also may have changed his mind. The thread was updated earlier this week:
Right now we are waiting patiently for a notice letter as the tenant is ‘tentatively’ leaving next week now. Talk about a rollercoaster ride. First he threatens to stay until Dec 31 and now he’s bolting early. We’ll take the early vacate over the other one so it’s looking positive. However, until we have it in writing and the walk out is done, I’m making sure we educate ourselves on our options.
There was some great discussion about other ways to get the tenant out early, and a reminder that breaching the sale contact could be an very expensive proposition. It’s be cheaper to encourage the tenant to move out sooner, say with a $5,000 cheque. That always plays well before the holidays.
Important rule, great example, and a wonderful thread. This is one of those times where I’m glad I’m a REIN member.
A nicely presented post.
I liked your analysis of this situation.
I especially liked the use of the black and grey font, where you presented your position in the black font, and the case study in the grey font.