Ontario Tenancy Laws and damage deposits. Are they illegal?

This year I decided to live in a shared home within the "York University Village". They are homes right on the border of the YorkU campus.

Anyway, my landlord has collected last month of rent + a damage deposit in the amount of a few hundred dollars and at the time I paid it, I did not know it was illegal. I have since then discovered it is illegal (to the best of my knowledge) and I have attempted to contact him and discuss this with him.

My problem is, he says it's not illegal because other landlords in the area charge damage deposits and also he says his lawyers secretary says it is legal but he has not yet had time to talk with his lawyer. She has told him

I called the lawyer’s office today and talked with his secretary since he was busy in meeting. I have briefly describe the issue about the deposit and told him the by-law clauses provided by your following email. His secretary told me that if you want to be a lawyer, you need to read the whole book instead of just some paragraphs.

Sort of rude I suppose.. but regardless, does anyone know if maybe I am wrong? It is a semi-furnished master bedroom that came with a bed, desk, chair, and wardrobe. Maybe the law is different for semi-furnished rooms?

Below I've quoted damage deposits laws which state they are illegal in Ontario. Perhaps I am misreading the rules?

Rent and Extra Fees

[...]

• It is an offence to charge or attempt to charge a tenant, sub-tenant or prospective tenant any type of fee on top of the rent, such as a damage deposit.

[...]

http://www.ltb.gov.on.ca/en/Key_Information/111901.html

Second Proof (important parts highlighted in bold red).

Originally Posted by [B]Residential Tenancies Act, 2006"[/B]][B]PART VII
RULES RELATING TO RENT[/B] General Rules
[B]Security deposits, limitation[/B]
105.[URL="http://www.e-laws.gov.on.ca/html/statutes/french/elaws_statutes_06r17_f.htm#s105s1

(1)[/URL] The only security deposit that a landlord may collect is a rent deposit collected in accordance with section 106. 2006, c. 17, s. 105 (1).

Definition
(2) In this section and in section 106,
“security deposit” means money, property or a right paid or given by, or on behalf of, a tenant of a rental unit to a landlord or to anyone on the landlord’s behalf to be held by or for the account of the landlord as security for the performance of an obligation or the payment of a liability of the tenant or to be returned to the tenant upon the happening of a condition. 2006, c. 17, s. 105 (2).

Rent deposit may be required
106. (1) A landlord may require a tenant to pay a rent deposit with respect to a tenancy if the landlord does so on or before entering into the tenancy agreement. 2006, c. 17, s. 106 (1).

Amount of rent deposit
(2) The amount of a rent deposit shall not be more than the lesser of the amount of rent for one rent period and the amount of rent for one month. 2006, c. 17, s. 106 (2).

Same
(3) If the lawful rent increases after a tenant has paid a rent deposit, the landlord may require the tenant to pay an additional amount to increase the rent deposit up to the amount permitted by subsection (2). 2006, c. 17, s. 106 (3).

Qualification
(4) A new landlord of a rental unit or a person who is deemed to be a landlord under subsection 47 (1) of the Mortgages Act shall not require a tenant to pay a rent deposit if the tenant has already paid a rent deposit to the prior landlord of the rental unit. 2006, c. 17, s. 106 (4).

Exception
(5) Despite subsection (4), if a person becomes a new landlord in a sale from a person deemed to be a landlord under subsection 47 (1) of the Mortgages Act, the new landlord may require the tenant to pay a rent deposit in an amount equal to the amount with respect to the former rent deposit that the tenant received from the proceeds of sale. 2006, c. 17, s. 106 (5).

Interest
(6) A landlord of a rental unit shall pay interest to the tenant annually on the amount of the rent deposit at a rate equal to the guideline determined under section 120 that is in effect at the time payment becomes due. 2006, c. 17, s. 106 (6).

Deduction applied to rent deposit
(7) The landlord may deduct from the amount payable under subsection (6) the amount, if any, by which the maximum amount of the rent deposit permitted under subsection (2) exceeds the amount of the rent deposit paid by the tenant and the deducted amount shall be deemed to form part of the rent deposit paid by the tenant. 2006, c. 17, s. 106 (7).

Transition
(8) Despite subsection (6), the first interest payment that becomes due under subsection (6) after the day this subsection comes into force shall be adjusted so that,
(a) the interest payable in respect of the period ending before the day this subsection comes into force is based on the annual rate of 6 per cent; and
(b) the interest payable in respect of the period commencing on or after the day this subsection comes into force shall be based on the rate determined under subsection (6). 2006, c. 17, s. 106 (8).

Deduction of interest from rent
(9) Where the landlord has failed to make the payment required by subsection (6) when it comes due, the tenant may deduct the amount of the payment from a subsequent rent payment. 2006, c. 17, s. 106 (9).

Rent deposit applied to last rent
(10) A landlord shall apply a rent deposit that a tenant has paid to the landlord or to a former landlord in payment of the rent for the last rent period before the tenancy terminates. 2006, c. 17, s. 106 (10).

http://www.e-laws.gov.on.ca/html/sta...17_e.htm#BK123


Third Proof:

Can the landlord charge the tenant a damage deposit?

No. A landlord cannot collect a damage deposit that they would use if there is damage done to the unit. Also, a landlord cannot use the last month’s rent deposit to cover damages in the unit.



If the landlord finds that a tenant has damaged the unit or caused damage to the building, the landlord can give the tenant a notice and/or ask them to pay for the damages. If they do not, the landlord can apply to have the Board determine if there are damages and what should be done about them. For more information about the remedies available to a landlord if a tenant causes damage, see the Board’s brochure on Maintenance & Repairs.

http://www.ltb.gov.on.ca/en/Key_Info...02_111479.html

Thanks everyone for the replies. Louis, that website is great... I should have read through it the first time I saw it on google.

Leich, yes I have decided to let it go for now. I called the Tenant and Landlord Board helpline and they also confirmed it was illegal and offered to begin a filing process to get the money back. I told them that would not be necessary yet. Previous to my discoverey of this illegal deposit, the landlord asked me to manage the house (it's a shared home with 15 rooms/students) and he is paying me weekly to manage the network and also ensure things stay tidy. He does take care of the house well thus far, but it is a brand new home and he is new to being a landlord.

If things go south, I know I'll be able to get the money back regardless of what happens. It just drives me a little loopy to sit back and let someone take advantage of me.

So, if I've got this straight..

The law:
1) You can make a damage deposit equal to one month rent before tenant goes into tenancy.
2) You cannot charge a recurring damage deposits.

Chris:
Were you being charged for damage deposit monthly, or is it illegal to charge any damage deposit? I'm just not sure of what legal boundary was crossed.

Originally Posted by zensunni

So, if I've got this straight..

The law:
1) You can make a damage deposit equal to one month rent before tenant goes into tenancy.
2) You cannot charge a recurring damage deposits.

Chris:
Were you being charged for damage deposit monthly, or is it illegal to charge any damage deposit? I'm just not sure of what legal boundary was crossed.

It is legal to ask for the last month of rent up front. This money has to be applied to the tenants last month of living in the residence before the tenant leaves. The landlord also has to pay interest on it yearly.

Damage deposits are flat out illegal. I wasn't being charged monthly for a damage deposit, he charged me one time up front when I moved in. The only legal deposit other than last month of rent is a key deposit. Key deposits can't be any more than the cost of replacing a key.