Property manager on the hook for $32K payment to wrongfully evicted tenants, B.C. court rules

This stock image shows a door with an eviction notice on it. (Credit: Shutterstock)

A property management company has been ordered to pay wrongfully evicted tenants more than $32,000 in compensation after failing to convince a B.C. judge the owners should be held liable instead.

The B.C. Supreme Court’s ruling on the dispute was posted online Monday, dismissing the company’s application for a judicial review of a Residential Tenancy Branch decision.

The tenants were evicted in 2024 under a section of the Residential Tenancy Act that allows a landlord to end a tenancy if they or a close family member intend to occupy the unit. While the owner did apparently move in, the unit was listed online roughly four months later.

“Apparently, the respondents had seen the advertisement for the rental unit and deduced that the owner had not occupied the unit for 12 months,” the decision said.

The law requires a landlord or close family member to occupy the unit for at least a year after an eviction. The tenancy branch found that requirement was not met in this case and ordered compensation equivalent to 12 months rent, which worked out to $32,928.

The arbitrator found Homax Real Estate Services a.k.a. 1256206 BC Ltd. was acting as the owner’s “agent” and met the legal criteria for a “landlord” under the province’s Residential Tenancy Act, and was therefore liable for compensating the ousted tenants.

“The agent oversaw the issuing of the two-month notice and took no action to substitute or add the rental unit’s owner as a respondent,” the judge’s decision said, quoting from the arbitrator’s decision.

“I find that the (company) was actively managing and performing duties under the act on behalf of the rental unit owner… and therefore (Homax Real Estate Service) meets the act’s definition of landlord.”

Homax Real Estate Services did not dispute that compensation was owed but argued the company should not have been ordered to pay because it did not own the unit.

The arbitrator’s decision, the company argued in its petition for judicial review, was unreasonable because it was not “a party to the tenancy agreement” and therefore “the arbitrator’s decision results in an absurdity because it makes a person who is not a party to the contract liable for one of the contracting party’s debts.”

But the court said landlord-tenant disputes are not contract disputes and that the Residential Tenancy Act “creates a right of compensation that must be paid solely by the ‘landlord.’”

The legislation defines a landlord as “the owner of the rental unit, the owner’s agent or another person who, on behalf of the landlord, permits occupation of the rental unit under a tenancy agreement, or exercises powers and performs duties under this act, the tenancy agreement or a service agreement.”

Evidence that the property management company collected rent, functioned as a liaison between tenants and the owners, conducted the pre-move-out inspection and served the eviction notice were all cited as duties the company performed while acting as the owner’s agent.

The decision also said the tenants sent their notice of dispute to the address listed in their tenancy agreement and on the eviction notice, which was the business address for the company.

“Apparently, the petitioner did not advise the owner of the dispute notice. Nor did the petitioner seek to add the owner as a party to the dispute resolution proceedings,” the court said.

“The (company) reasoned that because the owner was not named in the dispute and because the (company) is not the owner of the unit, the dispute notice was essentially defective.”

The judge found it was the company’s responsibility to take the necessary steps to make sure the owner was notified and named in the dispute and by failing to do so, it had exposed itself to liability.

“It is in keeping with the purpose of the Act to require the owner’s agent, who represents the owner and is the face of the owner to most tenants, to take those steps rather than force the tenant to chase down the owner and ensure the owner is properly named,” the judge wrote.

“The (company) tried to take advantage of what it thought was a defect in the notice and elected not to alert the owner, seek to name the owner as a party, or otherwise substantively respond to the dispute notice.”

The petition was therefore dismissed, with costs awarded to the former tenants.