Chapter 8: Commercial and Residential Tenancies

Question 1

Which of the following statements concerning the difference between a lease and a license is FALSE?

1.) A lease is both a contract and an interest in land, whereas a license is only a contract.
2.) Both leases and licenses confer an exclusive right to possession of the premises.
3.) A lease runs with the land and can bind third parties, whereas a license is only binding on the parties to the contract.
4.) While licenses and leases may appear to be the same, the legal rights involved are very difference.

Answer 1

2.) Both leases and licenses confer an exclusive right to possession of the premises.

Question 2

Janie wished to lease premises in a Yaletown building owned by Stuart. She entered into a lease with Stuart to commence on May 1st. Unfortunately, the present tenant, Gordon, has stated that he intends to remain in the premises despite the fact that his commercial least terminates on April 30th and he has no renewal agreement. Which of the following actions would be available to Janie if Gordon does not vacate the premises on April 30th?

1.) Interess termini
2.) Trespass
3.) Breach of contract
4.) None of the above

Answer 2

3.) Breach of contract

Question 3

Dorinda rents a shop in a building owned by Muhammad. She operates a fabric art studio and sells crafts there. Which of the following terms of Dorinda’s lease are enforceable?

A. The rent is $1,000 per month and damage deposit is $3,000.
B. Dorinda agrees not to assign the lease.
C. All improvements made by Dorinda shall become the property of the landlord.
D. Dorinda is responsible for all taxes, utilities, heating and maintenance costs.

1.) A, C and D only
2.) A, B and D only
3.) B and C only
4.) All of the above clauses are enforceable

Answer 3

4.) All of the above clauses are enforceable

Question 4

Sandy is a commercial tenant whose business is not good shape. Her rent is due on the first day of the month but she is often late. When she fails to pay rent for February by the 11th, her landlord Fred is fed up and he wants to take some action. Which of the following courses of action could Fred take?

1.) Where a tenant is more than seven days late with the rent, as Sandy is, the landlord is entitled to repossess the premises.
2.) If Fred and Sandy’s lease contains and acceleration clause, then Fred can accelerate the rent due for the balance of the term.
3.) Fred is entitled to distrain Sandy’s goods for non-payment of rent provided he complies with the terms of the Rent Distress Act.
4.) All of the above are possible remedies for Fred to pursue.

Answer 4

4.) All of the above are possible remedies for Fred to pursue.

Question 5

Which of the following is NOT an example of a situation in which a landlord can generally terminate a residential tenancy agreement for cause?

1.) The number of persons permanently occupying the suite is unreasonable.
2.) A tenant fails to give the necessary security deposit within 30 days of the tenancy agreement.
3.) The premises must be vacated to allow for renovations which cannot be performed while the premises are occupied.
4.) The premises must be vacated to comply with an order made by the local authority regarding zoning.

Answer 5

3.) The premises must be vacated to allow for renovations which cannot be performed while the premises are occupied.

Question 6

Kyle rents a house from David under a periodic tenancy. Which of the following terms in their lease would likely contradict a provision of the provincial residential tenancy legislation?

1.) The landlord claims the right to distrain for rent that remains unpaid for 15 days after the date that it is due.
2.) Kyle agrees to vacate the premises upon five days’ notice should David require the house for personal occupation or should David sell the house.
3.) Kyle agrees to paint the premises and have the carpets professionally cleaned, regardless of their condition.
4.) All of the above terms are likely to contradict a provision of the provincial residential tenancy legislation.

Answer 6

4.) All of the above terms are likely to contradict a provision of the provincial residential tenancy legislation.

Question 7

Which of the following situations would correctly be described as an “overholding”?

1.) At the end of the term, Julia’s tenancy automatically renews itself for another month.
2.) Julia’s lease expired two months ago, but she remains in the premises while she negotiates a new agreement with the landlord.
3.) Although her lease expired two months ago, Julia is still in the premises and the landlord is accepting rent payments from her, and no negotiations for a new lease are underway.
4.) Julia’s lease expires two months ago; the landlord has notified her that she must leave and has refused to accept rent from her.

Answer 7

3.) Although her lease expired two months ago, Julia is still in the premises and the landlord is accepting rent payments from her, and no negotiations for a new lease are underway.

Question 8

Lionel is renting a store from Sally in the Graceland Shopping Centre in order to carry on the business of an arcade. Which of the following clauses contained in Lionel’s lease are enforceable?

A. The tenant shall be solely responsible for repairs to the wall and floor finishings in the premises.
B. The security deposit shall be the equivalent of two months’ rent, payable prior to taking possession.
C. The tenant shall not assign or sublet the premises without the express written permission of the landlord, which shall not be unreasonably withheld.
D. If the tenant fails to pay rent at the specified time, the next three months’ installments of rent shall be immediately due and payable.

1.) A, B, and C only
2.) B and D only
3.) D only
4.) All of the above clauses are enforceable

Answer 8

4.) All of the above clauses are enforceable

Question 9

A tenancy which automatically renews itself on the last day of the term for a further term of the same duration until terminated by either party with proper notice, is called a:

1.) tenancy at will
2.) tenancy at sufferance
3.) periodic tenancy
4.) term certain tenancy

Answer 9

3.) periodic tenancy

Question 10

Where a landlord refuses to allow a commercial tenant to take possession of the demised premises the tenant may:
1.) get an order for specific performance.
2.) maintain an action for breach of the covenant of quiet enjoyment.
3.) sue the landlord for damages and breach of contract.
4.) do none of the above.

Answer 10

3.) sue the landlord for damages and breach of contract.

Question 11

Where a commercial tenancy is expressed as lasting for a period of one year and terminating on a fixed date, how much notice must be given to terminate the tenancy?

1.) No notice is required
2.) Thirty days’ notice is required
3.) Six months’ notice is required
4.) Reasonable notice is required

Answer 11

1.) No notice is required

Question 12

In which one of the following situations may the landlord generally choose to give the tenant one month’s notice to vacate?

1.) Charles is renting a one-bedroom apartment in the West End of Vancouver on a month-to-month basis. He has been diligent in paying his rent on the due date each month but the landlord has recently discovered that Charles’ friend, Christine, has moved into the apartment with him.
2.) Jordan’s warehouse is long overdue for a major renovation which cannot be completed with the present tenant in occupation. Aladdin, the tenant, has four months left on his fixed term tenancy and does not wish to move.
3.) On September 1st, Kristin moved into a small house owned by Jackson without paying the security deposit of $300 requested by the rental agent. On September 30th she tenders the $600 for the October rent but refuses to pay the additional $300 for the security deposit.
4.) MacGregor’s son is moving to Vancouver and wants to live in an apartment which MacGregor owns and has rented out to Mrs. Julian for the last twenty years.

Answer 12

3.) On September 1st, Kristin moved into a small house owned by Jackson without paying the security deposit of $300 requested by the rental agent. On September 30th she tenders the $600 for the October rent but refuses to pay the additional $300 for the security deposit.

Question 13

In the event that the tenant abandons a commercial premises, the landlord is best advised to notify the tenant that the landlord intends to enter into possession of the premises solely to re-let on the tenant’s account:

1.) or else the doctrine of frustration will be applied to the situation.
2.) to avoid the tenant having grounds for an action in trespass.
3.) so that the landlord’s right to claim further rent from the tenant will be preserved.
4.) because otherwise the landlord will be breaching the covenant of quiet enjoyment.

Answer 13

3.) so that the landlord’s right to claim further rent from the tenant will be preserved.

Question 14

The most effective remedy available to a landlord when a tenant does not pay the rent in a commercial tenancy is:

1.) an injunction.
2.) a garnishing order.
3.) a distress.
4.) a demand letter.

Answer 14

3.) a distress.

Question 15

The main difference between a lease and a license is:

1.) licenses are governed by the ordinary law of contract and confer no estate in land whereas leases convey an estate in land.
2.) licenses are oral contracts whereas leases must be in writing pursuant to the Law and Equity Act.
3.) the terminology used to describe the parties, i.e., landlord & tenant/licensor & licensee.
4.) licenses provide exclusive possession whereas leases only give the rights described in the least document.

Answer 15

1.) licenses are governed by the ordinary law of contract and confer no estate in land whereas leases convey an estate in land.

Question 16

Which of the following statements regarding security deposits for commercial tenancies is TRUE?

1.) The landlord is responsible for returning the deposit, not a subsequent purchaser of the property.
2.) Interest must be paid for the time period between the deposit being given to the landlord to the time it is returned.
3.) The deposit is always applied to the last month’s rent, then any excess funds (due to accrued interest) are returned to the tenant.
4.) The amount which is required for a security deposit, given the nature of the premises, is set by industry standards as equivalent to one month’s rent.

Answer 16

1.) The landlord is responsible for returning the deposit, not a subsequent purchaser of the property.

Question 17

Which of the following statements about residential tenancy legislation in Canada is FALSE?

1.) A common element in the respective legislation frameworks of the provinces and territories is the inability to contract out of the relevant act.
2.) Most provinces have also enacted rent control legislation which provides additional security of tenure to residential tenants.
3.) All of the relevant provincial Acts have preserved the right to distrain goods of former tenants within six months of the end of a residential tenancy.
4.) One of the goals that is common to all the respective Acts concerning residential tenancy in Canada is ensuring minimal standards are met for rental accommodations.

Answer 17

3.) All of the relevant provincial Acts have preserved the right to distrain goods of former tenants within six months of the end of a residential tenancy.

Question 18

When attempting to determine whether a particular relationship is that of landlord and tenant or licensor and licensee, it is best to:

1.) look at the formal wording of the document.
2.) look at the terminology used to describe the parties, i.e. landlord & tenant/licensor & licensee.
3.) consult the appropriate provincial residential of commercial tenancy act.
4.) determine the intention of the parties by examining the substance of their agreement.

Answer 18

4.) determine the intention of the parties by examining the substance of their agreement.

Question 19

In the situation where a residential tenant under a fixed term tenancy abandons the premises prior to the end of the term, the obligation imposed on the landlord to try to re-rent the premises as quickly as possible is referred to as:

1.) the duty to mitigate damages.
2.) the covenant of quiet enjoyment.
3.) derogation from the grant.
4.) the doctrine of interesse termini.

Answer 19

1.) the duty to mitigate damages.

Question 20

The duty to repair commercial premises:

A. is generally a landlord’s obligation unless the lease specifies otherwise.
B. is not imposed by the common law on a tenant except for an implied covenant to treat the leased premises in a tenant-like manner and to deliver up the premises as he or she found them, “wear and tear excepted”.
C. should be dealt with in writing in a lease to avoid disputes between lessee and lessor.
D. is enforceable by a court only if the lease is in writing and registered in the appropriate Land Title Office as requested.

Which of the above statements is/are FALSE?

1.) B and C only
2.) A and D only
3.) None of the above are false.
4.) C only

Answer 20

2.) A and D only