Tenant told he must pay utilities fees separate from rent to a new company owned by landlord
A Vancouver man is worried a new payment scheme introduced by his landlord means he'll soon be paying more for his West End apartment.
Wesley Harmer has rented at the 84-suite Holly Lodge building for five years and intended on renewing for a sixth upon his lease expiring at the end of the month.
But major changes in his new lease documents have raised red flags.
Instead of his current rate of $2,225 per month, utilities included, the new agreement quotes a lower rental rate but at the same time insisted he open an account at APT Utility Corp. to start paying $530 per month in utility charges separate from rent fees.
Harmer fears once cleaved from his rental agreement, his utility costs will no longer be subjected to provincial rent controls.
It looks like they're just trying to make extra money because they weren't able to increase rent for two years, he said.
There is nothing protecting us from a sudden increase.
A notice introducing APT Utility Corp. to Holly Lodge tenants reads, in part, "APT Utility Corp has been hired by a building owner to take over handling all the work involved in managing utilities for the building.
This means that each tenant going forward will pay rent to us, as the building owner, exclusive of utilities. They will also pay APT for utilities including electricity, heat, water, sewer and garbage ... but other than paying two bills each month instead of one, your total bill after the change will be the same.
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In an emailed statement, Wolverton said the change at Holly Lodge
does not affect the limit on rent increases, which we will continue to comply with.
However, he also states,
We think it is clear from the Residential Tenancy Act that the government meant the rental cap to limit increases in rents, not utilities and rents.
Wolverton said utility costs are increasing faster than the rate of inflation and have been
inadvertently caught by the province's restrictions.
With the Provincial Government capping rent, this has become a huge issue as subsidizing utility cost increases is unsustainable for landlords, he said.
Utilities turned off and/or eviction
In an email to Harmer, Wolverton said,
After we hand over your utilities to the utility company, if you did not wish to purchase utilities from APT they will simply be turned off and/or you may be evicted.
Harmer has taken his concerns to the Residential Tenancy Branch. An RTB spokesperson told CBC it could not comment on the specifics of the case because the Compliance and Enforcement Unit (CEU) is assessing whether to open an investigation.
In a 2019 decision, the RTB CEU levied a rare penalty of $1,000 against Huntley Investments Ltd. and Brent Wolverton (new window) for misrepresenting the company as a family corporation to justify evicting tenants from a Melville Street property.
A closer look
Harmer's existing tenancy agreement sets his total monthly rent at $2,225, of which $100 is earmarked for utilities. The entire amount is subject to provincial restrictions on rent increases. Harmer pays his hydro bill separately, which he estimates averages $15 per month.
In the new tenancy agreement, Harmer's monthly rent charge would drop to $1,640.00, with zero dollars earmarked for utilities. A separate form states he will be charged separately for utilities, including hydro, an average of $530 per month after
mandatory sign up with APT Utility Corp.
The RTA says a landlord may terminate or restrict a service if rent is reduced in an equivalent amount to the value of the service.
Harmer disputes that his actual utility usage comes anywhere near $530 per month because he is often away for work. Wolverton said charges will be based on the square footage of each unit.
Patterson said the complexity of the situation may ultimately require an arbitrator to sort it out.
One point of contention could be whether APT Utility Corp. can be considered an alternative service provider to Holly Lodge tenants.
Under the Residential Tenancy Act, landlords cannot terminate a service that is deemed essential. However, the RTB withdrawal of service form states a service is considered not essential
if the tenant can obtain it, or a reasonable substitute, from an alternative source.
A tenant could argue that the landlord's utilities company is not an alternative source,
since it is still owned/operated by the landlord, said Patterson.
Patterson's advice is that renters should never feel pressured into signing anything they don't understand.
Karin Larsen (new window) · CBC News