After weeks of intensive searching, you have finally found your ideal accommodation. However, when you sign the lease, your future landlord asks you to pay the first and last month’s rent. Afraid of losing the chance to have an apartment that perfectly suits your needs, you decide to accept and dip into your savings in order to withdraw this much higher sum than you expected when you came to sign the lease.
The illegality of a deposit
The Civil Code of Québec stipulates that the landlord may require a deposit at the time of signing the lease. However, this deposit cannot exceed one month’s rent.
The key word here is require. Indeed, the law aims to prevent the landlord from requesting or claiming a deposit of more than one month’s rent so that it becomes a condition for the formation of the lease contract.
In particular, the landlord may not require the following clauses to be included in the lease:
- The payment of a sum of money other than rent, whether in the form of a security deposit or otherwise, even if the tenant has consented to it;
- Issuance of post-dated cheques;
- Demand full rent in case of non-payment or delay;
- Payment of the first and last month’s rent at the signing of the lease;
It is also important to note that the requirement to pay the first and last months’ rent has disadvantages for the tenant, including the financial constraint that could arise from paying two months’ rent in a short period of time.
In addition, the refundable deposit in the last month’s rent is also problematic in the sense that it is often refundable in the last month of occupancy of the property, which can occur years later. This can make it difficult to recover a deposit paid a few years earlier if the landlord has changed in the meantime.
The legality of offering to pay a deposit
The use of the word “required” in the Civil Code invites us to make an important distinction with respect to the legality of the deposit. Thus, if on the one hand the landlord cannot demand the payment of a deposit, the tenant who offers to pay one is acting legally. A tenant who volunteers to do so therefore waives the protection that the law provides in this regard.
This is what the Tribunal administratif du logement has found. In one case, the tenant, who was unable to provide a conclusive credit check, voluntarily offered to pay two months’ rent when signing the lease. Subsequently, she failed to meet her obligations to pay the rent on several occasions, which led to the opening of a file against her at the Administrative Housing Tribunal.
In its defence, the tenant claimed reimbursement of the deposit she paid to the landlord when the lease was signed, arguing that the landlord was not entitled to it. However, the court determined that it was freely and voluntarily that she offered to pay the landlord a security deposit for two months’ rent when the lease was signed, and that this proposal, when accepted by the landlord, became an agreement.
Thus, it must be remembered that the deposit freely and voluntarily paid by the tenant is not illegal. However, the waiver must be clear, unambiguous and not a form of requirement or cause the tenant to fear that they will not be able to rent the unit if they do not pay the deposit.
It is therefore necessary to pay close attention to the context surrounding the payment of a deposit, and to consider whether there is any pressure on the part of the landlord on the tenant to make this payment.
If you are faced with such a situation and you are not sure how to assert your rights, do not hesitate to contact us. Indeed, our housing lawyers are at your disposal to answer your questions. Our lawyers help you with: Tenants’ rights, Abandonment of the dwelling, Pets, Rent increase, Deposit application, Rent deposit, Rodent infestation, Unfit for habitation, Delivery obligations, Repairs, Neighbourhood disturbances, Validity of the lease, Sale of housing