A residential landlord is $50,000 poorer after unsuccessfully
challenging the constitutionality of the City of Waterloo’s
Rental Housing Licensing Program.
In 2011, the City of Waterloo implemented By-law 047 and a new
comprehensive rental housing licensing program. The purpose was,
among other things, to improve the health and safety of residential
The program requires most landlords of low-rise units to
A general inspection report from the electrical safety
authority (every 5 years);
An HVAC certificate (every 5 years);
Proof of insurance (required annually);
A criminal record check (every 5 years); and
A floor plan for each unit.
Landlords are also required to submit an annual fee.
Although many landlords may not have been happy with the new
requirement to be licensed, one such landlord was especially
unhappy. So much so that it went to court to challenge the
constitutional validity of the City’s ability to pass the
The landlord made two arguments in this respect. The first was
that the licensing fee was really a form of taxation and that the
City did not have the jurisdiction to impose such a tax. The second
was that the by-law was discriminatory under the Human Rights Code
because it applied to townhouses and exempted apartment buildings.
Since, according to the landlord, more families live in townhouses
than apartment buildings, this was unfair to the occupants of
townhouses on the grounds of family "status".
At the time of the hearing the landlord had accumulated 305
charges under the relevant by-law and was also facing 61
outstanding work orders.
The court held that they by-law was intended by the City to be
revenue neutral over the long term and to address effectively
numerous health and safety issues directly affecting landlords and
tenants throughout the City of Waterloo. The court also accepted
that the license and renewal fees were calculated by the City based
on estimated costs associated with administering the program. The
court ultimately held that the fees were not taxes because their
purpose is to defray expenses, not to raise revenue.
With respect to the human rights argument, the court held that
the landlord was unable to establish that the by-law discriminates
based on family status (or on any other protected status). The
court noted that the by-law applies to low-rise rental properties
regardless of whether the property is being rented to a family or
non-family, and that it applies throughout the City and does not
target any particular person or group of people or whether or not
the housing is affordable.
The court ordered the landlord to pay the City $50,000 in legal
costs. The landlord, a numbered company, is identified in the
decision as the operator of the property. I wonder whether or not
the landlord is also the owner, and whether it has assets to
satisfy the cost award. Alternatively, I wonder what municipal
remedies the City may wield against the landlord's rental
business if the costs are not paid and the work orders not complied
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Russell v. Township of Georgian Bay provides a useful reminder of the fact that while municipal officials sometimes appear to hold all of the cards in disputes with home owners, that is not always the case.
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