Do you know the difference between roommates, subletting and lease assignment?

*This article has been edited to clarify landlord’s rights pertaining to lease assignments*

As per the Rental Tenancies Act (RTA), there are a few ways in which tenants can legally share their rental home or have someone else take it over from them in Ontario, but each is different and governed by a specific set of rules.

Roommates

A tenant in Ontario can choose to share their rental home with roommates or move in a partner or spouse with no legal obligation to inform or take permission from the landlord.

“The way that I like to frame it generally is it’s frankly none of the landlord’s business who else lives in your unit,” says Don Valley Community Legal Services staff lawyer Karly Wilson.

“If you wanna add a tenant to a lease, then you have to obviously communicate that to the landlord because that’s a contract between the two of you. But if it’s just someone moving into the unit and they’re paying rent to you directly, and then you pay it to the landlord, that’s totally fine. As long as you’re not overcrowding the unit with too many people, it’s really not up to your landlord who lives there.”

Wilson says the terms of the lease, for example utilities being included and costs possibly increasing due to more use, have no bearing on the rights of the tenant to have roommates.

“It’s not a nice way to say it, but that’s something the landlord should have thought of when they were putting the lease together, if that was a concern,” she says.

In such a case, the leaseholder is responsible for the rent and roommates are not protected by the RTA nor do they have any recourse with the Landlord and Tenant Board (LTB).

Subletting

Subletting a rental home is often confused with having a roommate or paying guest.

However, Wilson explains that subletting refers to the tenant temporarily renting their unit to someone else during a period in which they are not occupying it themselves.

“Necessarily for subletting, you have to have a set end date and you have to have an intention to return to the unit after that end date. So someone just takes your place for a period of time,” she says.

“The really common one you’ll see are students who have a one year lease, but they’ll go away for the summer or a co-op semester.”

Unlike with roommates, in order to sublet, the tenant must seek permission from the landlord.

“They essentially have to let you sublet unless they have a good reason not to. So reasons why a landlord might not want to let somebody sublet is if you’re offering a sublet to a particular person [who] has a bad credit rating or they have really bad landlord references, that’s a good reason. Or if you have sublet before and the subletters you’ve used have trashed the place or they haven’t paid rent,” says Wilson.

If a tenant believes a landlord does not have good reason or is arbitrarily refusing the sublet, they have the option to file an A2 form with the LTB requesting that the board order the landlord to give permission. On the other hand, if a tenant sublets the unit without the landlord’s permission, the landlord can file the same form with the LTB.

A hearing will then be held – but Wilson warns that there is currently over a year’s wait for A2s to be heard at the LTB.

Tenants are responsible for the sublessee’s behaviour and any damage or other problems that may arise. The duration of a sublet must also be less than the term of the lease.

“So if you’re on a one year lease, you can’t say I’m going to sublet it for 18 months. Right. What that also means is if you’re on a month to month lease, technically your sublet term has to be one month minus a day,” she adds.

“A lot of landlords will give consent to back to back sublets. So if you can only sublet for one month, they’ll [say] you can do four of those back to back to somebody else.”

The terms of the sublet must be the same as the lease and tenants cannot charge a sublessee more rent than they are paying or for any amenities included in the rent such as parking.

“[That is] very against the rules, very against the Residential Tendencies Act, and will absolutely get you busted,” says Wilson.

In case the tenant is unable to return to the rental unit or chooses not to, they are still responsible for the rent even if the sublessee moves out.

“You can ask the permission of the landlord to let that [person] become a tenant essentially, or you’re now on the hook to find someone to fill that spot,” says Wilson.

Lease Assignment

Assigning a lease refers to a tenant passing on a lease onto another person with no intention of returning to the rental unit.

“You’re taking the contract you signed and you’re giving it to a different person,” says Wilson.

If a tenant wants to assign their lease, they must ask the landlord for permission. In this case the landlord can refuse assignment. However, if they agree, they cannot unreasonably decline proposed assignees.

As with a sublet, if a tenant feels the landlord is unfairly refusing an assignee, they can file an A2 with the LTB and the landlord can do the same if a tenant assigns the lease without permission.

However, if a landlord refuses assignment or does not reply to the tenant’s request, a tenant can legally terminate their tenancy early — before the end of the lease term — with only 30 days notice, as opposed to the usual 60 days.

“So if you’re in a one-year lease and then three months in, your life changes and you ask your landlord, c’an I assign the rest of my tenancy, nine more months to somebody else?’ If they don’t reply or they just say flat ‘no’ without any reasons, then you can terminate your tenancy,” explains Wilson

In order to terminate the tenancy in such a case, the tenant would send the landlord an N9 notice which includes a section for refusal to assign.

The terms of the assignment remain the same as the lease and once it expires, it automatically becomes a month-to-month tenancy as it would have with the original tenant. The assignee is under no obligation to sign a new lease and rental terms cannot be changed by the landlord.

“So you signed a contract that says you are going to rent somewhere for 12 months and then it automatically turns to a month to month. If you give that halfway through to somebody else, they still have the same rights and responsibilities as you did. They are effectively taking your place as a tenant with all the rights, all the burdens that come with it,” says Wilson.