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The Life Leases and Consequential Amendments Act

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If you need an official copy, contact Statutory Publications.

S.M. 1998, c. 42

THE LIFE LEASES AND CONSEQUENTIAL AMENDMENTS ACT


Table of Contents

(Assented to June 29, 1998)

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:

PART 1

INTERPRETATION AND APPLICATION

Definitions

1(1)      In this Act,

"development" means

(a) the purchase, construction, rehabilitation or purchase and rehabilitation of residential premises to form a residential complex, or

(b) the conversion, or purchase and conversion, of non-residential premises into a residential complex,

and includes the acquisition of land and all activities ancillary to the development of the complex, but does not include the construction or provision of a tenant's extra; (« aménagement »)

"entrance fee", in relation to a rental unit, means an amount, other than a security deposit or rent payable on a periodic basis annually or more frequently, paid or payable in respect of the rental unit to the landlord or a trustee; (« frais d'entrée »)

"initial tenant", in relation to a rental unit, means the first tenant to enter into a life lease in respect of the rental unit; (« premier locataire »)

"landlord" means a landlord, as defined in The Residential Tenancies Act, of a residential complex and includes, in relation to a proposed residential complex, a person who

(a) will be the landlord of the complex, or

(b) alone or together with others initiates or sponsors

(i) the organization, development or marketing of the complex, or

(ii) the founding or constituting of the landlord; (« locateur »)

"life lease" means a written tenancy agreement under or in respect of which

(a) an entrance fee has been paid or is payable in respect of a rental unit, and

(b) the person first entitled to occupy the rental unit under the agreement is granted a right of occupancy for life or for a fixed term of not less than 50 years, if the agreement is entered into after the coming into force of this Act in respect of a rental unit in a residential complex in which no unit has been the subject of a life lease that was entered into before the coming into force of this Act,

and includes any separate agreement under which the entrance fee has been paid or is payable; (« bail viager »)

"minister" means the member of the Executive Council charged by the Lieutenant Governor in Council with the administration of this Act; (« ministre »)

"non-profit landlord", in relation to a residential complex, means a landlord of the complex that is a corporation

(a) to which Part XXII of The Corporations Act applies, and

(b) that meets any prescribed requirements as to payments to its members, directors and officers and as to the distribution of its property on dissolution or at any other time; (« locateur sans but lucratif »)

"occupancy date", in relation to a residential complex, means the first day of the month after the month in which an occupancy permit for the complex is issued by an authority having jurisdiction to issue the occupancy permit, and for the purpose of determining the occupancy date, where the development of a residential complex occurs in stages the complex is deemed to be the part that contains the tenant's rental unit; (« date d'occupation »)

"offer to lease" means an offer by a landlord or tenant to enter into a life lease in respect of a rental unit; (« offre de bail »)

"possession date" means the date when a tenant is entitled to occupy a rental unit under a life lease and the landlord is entitled to payment of rent under the lease; (« date de possession »)

"pre-lease payment" means an amount paid by a prospective tenant to a landlord as an expression of interest in entering into a life lease in respect of a rental unit in a residential complex under development or proposed to be developed; (« paiement antérieur au bail »)

"prescribed" means prescribed by a regulation made under this Act;

"projected completion date" means the date disclosed to a tenant as the latest date when a rental unit is to be available for occupancy by the tenant; (« date prévue d'achèvement »)

"refund fund" means one or more funds established under subsection 19(2); (« fonds de remboursement »)

"tenant" means a tenant, as defined in The Residential Tenancies Act, under a life lease or assignment of a life lease and includes a prospective tenant; (« locataire »)

"tenant's extra" means an alteration or improvement that is agreed to by the landlord and the tenant before the rental unit is first occupied by the tenant under a life lease, and

(a) in the case of an initial tenant, means an alteration or improvement to the landlord's standard specifications respecting the tenant's rental unit, and

(b) in the case of a tenant other than an initial tenant, means an alteration or improvement to the tenant's rental unit; (« extra du locataire »)

"trustee", in relation to a residential complex, means a trustee appointed by the landlord of the complex to receive and administer entrance fees, to hold and administer the refund fund or to hold and administer the refund fund and the mortgage referred to in section 28. (« fiduciaire »)

Other terms and expressions

1(2)      Every term or expression in this Act other than "regulation" that is not defined in this Act and is defined in The Residential Tenancies Act has the same meaning in this Act as in The Residential Tenancies Act.

Meaning of "refundable"

1(3)      For the purposes of this Act, an entrance fee in respect of a rental unit shall be considered to be refundable if, when the tenant takes possession of the rental unit, the landlord is obligated, absolutely or contingently, to effect any undertaking under which the tenant is or may be entitled to be paid an amount, other than a refund of a security deposit, on or after the termination of the tenant's tenancy of the rental unit.

Proposed rental unit

1(4)      In this Act, where a life lease is in respect of a rental unit not yet in existence, "rental unit" means the proposed rental unit and "residential complex" means the residential complex or proposed residential complex in which the proposed rental unit is to be located.

General application

2(1)      Except as otherwise provided in this Act or the regulations, this Act applies to and in respect of every life lease, every tenant and landlord under a life lease, every rental unit that is the subject of a life lease and every residential complex that contains such a rental unit, whether the life lease is entered into or the rental unit or residential complex comes into existence before or after this Act comes into force.

Act binds the Crown

2(2)      This Act binds the Crown.

Non-application to living accommodation

2(3)      This Act does not apply to premises occupied as living accommodation as referred to in subsection 3(1) of The Residential Tenancies Act.

Conflict with other Acts

2(4)      If there is a conflict between this Act and any other Act, this Act prevails.

Conflict with agreements

2(5)      If there is a conflict between a provision of an agreement and a provision of this Act, the provision of this Act prevails.

Restriction or waiver of application void

3         A provision of an agreement that restricts or waives or purports to restrict or waive the application of this Act, or a person's rights or obligations under this Act, is void.

Residential complex on leased land prohibited

4(1)       No landlord shall enter into a life lease in respect of a rental unit in a residential complex located on leased land.

Exception for pre-existing residential complexes

4(2)      Subsection (1) does not apply to any rental unit in a residential complex where, before the coming into force of this Act, the landlord has entered into a life lease of a rental unit in the complex.

PART 2

PAYMENTS AND DISCLOSURE

Permitted payments

5(1)      A landlord may receive or permit a trustee to receive from a tenant a pre-lease payment or an entrance fee in respect of a life lease or a residential complex.

Payments subject to section 6 requirements

5(2)      After the coming into force of this Act, except as otherwise provided in Part 6, a landlord who receives or permits a trustee to receive a payment under subsection (1) shall comply with the requirements of section 6.

Pre-lease payments prohibited after occupancy date

6(1)      A landlord shall not receive or permit a trustee to receive a pre-lease payment from a prospective tenant of a residential complex on or after the occupancy date of the complex.

Information to be disclosed

6(2)      Before receiving or permitting a trustee to receive a pre-lease payment, a landlord shall disclose to the tenant, in accordance with the regulations,

(a) the estimated entrance fee that will be payable in respect of each type of rental unit in the complex or each type in which the tenant has expressed an interest;

(b) the projected completion date; and

(c) any additional prescribed information.

Amount of pre-lease payment

6(3)      A landlord shall not receive or permit a trustee to receive a pre-lease payment that exceeds an amount that is prescribed or determined in a prescribed manner.

Entrance fees permitted

6(4)      A landlord may receive or permit a trustee to receive an entrance fee from a tenant if

(a) the tenant has signed a life lease or an offer to lease and given it to the landlord;

(b) the landlord has disclosed to the tenant in accordance with the regulations

(i) if the entrance fee is refundable, the minimum amount that will be contributed to the refund fund, and

(ii) any additional prescribed information;

(c) the landlord has given the tenant a written statement of the tenant's cancellation rights under section 10;

(d) where the tenant is an initial tenant, the landlord has appointed a trustee under subsection 19(1) to receive and administer entrance fees; and

(e) where the entrance fee is refundable, the landlord has appointed a trustee under subsection 19(2) to administer a refund fund.

Acknowledgement of receipt

7(1)      A person who receives a payment in respect of a pre-lease payment or entrance fee shall give the payer a written acknowledgement of receipt.

Content of acknowledgement of receipt

7(2)      The acknowledgment of receipt shall set out the following:

(a) the amount received;

(b) the date it was received;

(c)  the purpose of the payment;

(d)  if available, the address or location of the rental unit and residential complex in respect of which the payment was made.

PRE-LEASE PAYMENTS

Pre-lease payment held in trust

8(1)      A landlord who receives a pre-lease payment from a prospective tenant shall hold the amount in trust for the benefit of the tenant until it is paid out in accordance with this section or is otherwise refunded by the landlord.

Pre-lease payment: life lease entered

8(2)      Where a landlord and a tenant enter into a life lease in respect of which the tenant has paid a pre-lease payment, the landlord shall pay the pre-lease payment

(a) to the trustee appointed under subsection 19(1), to be credited to the entrance fee payable by the tenant; or

(b) to the tenant, if the entrance fee has been paid in full.

Pre-lease payment: development not completed

8(3)      The landlord shall refund a tenant's pre-lease payment, unless it has already been paid to the trustee under clause (2)(a), if it becomes reasonable to conclude that the development of the residential complex will not be completed by the projected completion date disclosed to the tenant.

Pre-lease payment: failure to enter into lease

8(4)      If a tenant who paid a pre-lease payment in respect of a residential complex and the landlord have not entered into a life lease by the occupancy date of the complex, unless the pre-lease payment is refunded to the tenant, the landlord shall pay the pre-lease payment

(a) to the tenant, if by the occupancy date the landlord has not offered a life lease to the tenant on terms and conditions comparable to those contained in a life lease of a rental unit in the same complex comparable to the rental unit in which the tenant expressed an interest; and

(b) in any other case, to the trustee appointed under subsection 19(1).

Time of payment

8(5)      Each amount payable under subsection (2), (3) or (4) shall be paid within 14 days after it first becomes payable.

ENTRANCE FEES

Entrance fee held in trust

9(1)      A landlord or a trustee who receives an entrance fee from a tenant shall hold it in trust for the benefit of the tenant until the period for cancellation under subsection 10(2) has expired.

General limitation on use of entrance fees

9(2)      Except as otherwise provided in this Act or the regulations, entrance fees and any income or gains earned or realized by the landlord, directly or indirectly by means of a trust or any other means, from the investment of entrance fees may be used only for the purposes of the residential complex in respect of which they were received.

Refund of entrance fee to tenant

9(3)      If

(a) the tenant withdraws the offer to lease before it is accepted by the landlord; or

(b) the landlord rejects the tenant's offer to lease or fails to accept it within the time permitted for acceptance;

the landlord shall, within 14 days after that event, refund the full entrance fee or cause it to be refunded to the tenant.

CANCELLATION RIGHTS

Statement of cancellation rights from landlord

10(1)     A landlord shall include, in accordance with the regulations, a prescribed statement of cancellation rights in a life lease that is given to a tenant other than an assignee.

Cooling-off period

10(2)     Subject to subsection (3), a tenant, other than an assignee, may, by written notice to the landlord before taking possession of the rental unit, cancel his or her life lease within seven days after the day on which the life lease or offer to lease signed by the tenant is given to the landlord.

Statement of cancellation rights not in lease

10(3)     If a statement of cancellation rights is not included in the life lease or is not in the prescribed form, the seven day period under subsection (2) does not commence until the day on which the landlord gives the tenant the prescribed statement of cancellation rights.

Adequacy of wording

10(4)     A notice of cancellation is adequate if, however expressed, it indicates the intention of the tenant to cancel the life lease.

Effective date of cancellation

10(5)     A life lease is cancelled under this section when notice is given to the landlord in accordance with section 39.

Refund of entrance fee to tenant

10(6)     If a tenant cancels a life lease under this section, the landlord shall within 14 days after notice is given under subsection (5) refund the full entrance fee or cause it to be refunded to the tenant.

ASSIGNMENT OF LIFE LEASES

Permitted assignment

11(1)     A tenant may assign a life lease unless

(a) the lease prohibits assignment; and

(b) the lease provides that at least 95% of the entrance fee, other than any portion of it that was paid for tenant's extras, paid in respect of the lease is refundable.

Consideration for assignment

11(2)     A tenant who assigns a life lease may receive consideration for the assignment from the assignee.

Amendment of term11(3) On the assignment of a life lease the term of which is for the life of the tenant, unless the landlord, tenant and assignee amend the lease to provide for a term that is for a fixed number of years or for the life of the assignee, the lease is deemed to be amended to provide for a term that is for the life of the assignee.

Registration

11(4)     Where a certificate of title has been issued under The Real Property Act for a leasehold estate respecting a rental unit that is subject to a life lease,

(a) if the life lease is assigned, a transfer of the leasehold estate may be registered under subsection 85(1) of The Real Property Act, with a copy of the assignment attached as evidence; and

(b) if the term of the life lease is amended or deemed to be amended as referred to in subsection (3), the amendment may be registered under subsection 91(3) of The Real Property Act.

Prohibition re registration

11(5)     No person shall register an instrument described in subsection (4) before the period for cancellation referred to in subsection 12(1) has expired.

No action against district registrar

11(6)     No action lies or is maintainable against a district registrar or Land Titles Office under The Real Property Act for damages that accrue by reason of any action of the district registrar or Land Titles Office as a result of registration under this section or a failure to present an instrument described in subsection (4) for registration.

Disclosure to assignee

11(7)     No tenant shall assign a life lease and no landlord shall provide its consent to the assignment of a life lease unless the assignee has been given the following, set out in the prescribed manner:

(a) the prescribed information respecting the lease and the residential complex;

(b) a prescribed statement of the assignee's cancellation rights under section 12.

Cooling-off period: assignee

12(1)     An assignee of a life lease may, by written notice to the assignor and the landlord before taking possession of the rental unit under the assignment, cancel the assignment within seven days after the latest of the following:

(a) the day that the assignor signs the assignment;

(b) the day that the assignee signs the assignment;

(c) the day that the landlord provides its written consent to the assignment;

(d) if the statement of cancellation rights required by subsection 11(7) is not given to the assignee before he or she signs the assignment, or is not set out in the prescribed form, the day that the statement is actually given to the assignee.

Adequacy of wording

12(2)     A notice of cancellation is adequate if, however expressed, it indicates the intention of the assignee to cancel the assignment.

Effective date of cancellation

12(3)     A cancellation under subsection (1) is effective when notice of the cancellation is given to the assignor and the landlord in accordance with section 39.

Refund of amount paid for assignment

12(4)     An assignee who cancels an assignment under subsection (1) is entitled to a refund, within 14 days after giving notice of the cancellation, of any amount paid in respect of the assignment.

Holdback

12(5)     Despite the terms of an assignment or agreement for assignment of a life lease, the assignee may hold back all or any part of the amount payable to the assignor in consideration for the assignment until the expiry of the period for cancellation provided for in subsection (1).

FAILURE TO GIVE POSSESSION

Failure to give possession

13(1)     Subject to subsection (6), a tenant of a rental unit who has not been given vacant possession of the rental unit 30 days after the projected completion date may, by written notice to the landlord before being given vacant possession of the unit, cancel his or her life lease.

Effective date of cancellation

13(2)     A cancellation under subsection (1) is effective when notice of the cancellation is given to the landlord in accordance with section 39.

Early notice

13(3)     A tenant may, during the 30 day period after the projected completion date, give the landlord early notice of cancellation, but the cancellation is effective only at the end of the 30 day period and only if by that time the landlord has not offered the tenant immediate and vacant possession of the rental unit.

Tenant entitled to full refund

13(4)     A tenant who cancels a life lease under this section is entitled to a refund of his or her full entrance fee.

Refund within 60 days of cancellation

13(5)     The landlord shall refund the entrance fee, or cause it to be refunded, to the tenant within 60 days after the cancellation becomes effective.

Unavoidable delay

13(6)     If, on an application made by the landlord, a judge of the Court of Queen's Bench determines that the failure to give possession within the time period required by subsection (1) was due to unavoidable delay in completing the development of the rental unit and was not the fault of the landlord, the judge may extend the time for completion.

NOTICE OF POSSESSION DATE

Notice of possession date

14(1)     A landlord shall give an initial tenant written notice of the possession date at least 60 days before that date.

Tenant may agree to earlier date

14(2)     A tenant who receives notice under subsection (1) may agree to an earlier possession date.

CHANGE IN LANDLORD

Change in ownership

15(1)     Subject to subsection (2), a person who acquires a landlord's interest in a residential complex or a rental unit is deemed to be the landlord under each subsisting life lease.

Exception

15(2)     Where the landlord's interest in a residential complex or a rental unit is acquired by a person on a mortgage sale, a tax sale or a foreclosure under The Real Property Act, unless the person otherwise agrees,

(a) each subsisting life lease is terminated; and

(b) the person is not bound by an obligation to repay all or part of an entrance fee paid under a life lease.

Right to continue in occupancy

15(3)     Each tenant whose life lease is terminated under clause (2)(a) has a right

(a) to remain in occupancy of his or her rental unit at least until the end of the month in which the life lease is terminated; and

(b) at the end of that month, to continue in occupancy of his or her rental unit under a deemed tenancy agreement for successive rental payment periods, as described in section 23 of The Residential Tenancies Act, subject to a rent increase that complies with the applicable provisions of Part 9 of that Act.

PART 3

RESERVE FUNDS, INSURANCE AND ANNUAL REPORTING

RESERVE FUNDS

Reserve fund for non-profit landlord

16(1)     A non-profit landlord of a residential complex shall, at all times after the occupancy date of the complex, maintain a reserve fund to pay for any unforeseen major repair to or replacement of assets of the complex, including, without limitation, roofs, exteriors, buildings, roads, sidewalks, sewers, heating, electrical or plumbing systems, elevators and laundry, recreational and parking facilities.

Use of reserve fund

16(2)     In addition to being used for the purposes set out in subsection (1), funds set aside under that subsection may be used

(a) to cover any unforeseen cost of the residential complex or shortfall in the revenue of the complex; or

(b) as required by an order made under section 140.1 (application for rent review) of The Residential Tenancies Act.

INSURANCE

Insurance required

17(1)     The landlord of a residential complex shall, at all times during and after the development of the complex, maintain one or more insurance policies in accordance with the regulations.

Notice to tenants

17(2)     The landlord shall give at least 30 days' prior written notice of any cancellation, lapsing or reduction of the insurance required under subsection (1) to all tenants of the residential complex.

ANNUAL REPORTING

Annual meeting

18(1)     The landlord of a residential complex shall call a meeting of the tenants not later than 16 months after the occupancy date of the complex and thereafter not later than six months after the end of each fiscal year of the landlord, or within such further time as the director under The Residential Tenancies Act allows, to present the financial statements referred to in this section and to hear any representations by tenants respecting those statements or the operation of the complex.

Notice of meeting

18(2)     The landlord shall give each tenant of the residential complex a written notice of the time and place of the meeting at least 30 days and not more than 50 days before the meeting.

Content of notice

18(3)     The landlord shall include in or with the notice given under subsection (2) the following information, set out in accordance with the regulations:

(a) if a trustee has been appointed under subsection 19(2), a statement from the trustee disclosing, in respect of the refund fund,

(i) the amounts contributed to, and the amounts paid out of, the fund during the preceding fiscal year, showing separately the amounts paid out to tenants and the amounts paid out to the landlord,

(ii) the balance in the fund at the end of that year, and

(iii) the amounts, if any, owing to former tenants of the residential complex;

(b) a statement from the landlord setting out, in respect of any reserve fund maintained by it,

(i) the amounts contributed to, and the amounts paid out of, the reserve fund during the preceding fiscal year,

(ii) the balance in the reserve fund at the end of that year, and

(iii) an estimate of the amounts to be contributed to, and the amounts to be paid out of, the reserve fund during the current fiscal year;

(c) if the rents charged by the landlord under the life leases are, for any tenant, a share of the costs of the residential complex as specified in the lease, including a contribution to any reserve fund or refund fund, for that tenant,

(i) a statement of the revenues and expenditures of the residential complex for the preceding fiscal year, and

(ii) a detailed budget for the current fiscal year;

(d) any additional prescribed information.

PART 4

TRUSTEES AND REFUNDABLE ENTRANCE FEES

APPOINTMENT AND QUALIFICATIONS OF TRUSTEES

Appointment of trustee re entrance fees

19(1) A landlord who enters into a life lease with an initial tenant shall appoint a trustee to receive and administer the tenant's entrance fee in accordance with this Act and the regulations.

Appointment of trustee re refund fund

19(2)     If an entrance fee in respect of a residential complex is refundable, the landlord shall establish, and shall appoint a trustee to administer, a fund to secure the landlord's obligations to refund entrance fees.

Qualifications of trustee

20(1)     A trustee in respect of a residential complex shall be

(a) a body corporate, incorporated under the laws of Canada or a province of Canada and authorized under The Corporations Act to carry on the business of a trust corporation or an extra-provincial trust corporation, that meets any prescribed requirements; or

(b) a person who meets prescribed requirements and qualifications for trustees under this Act.

Application to court

20(2)     The landlord or any tenant for whose benefit funds are administered by a trustee may apply to the Court of Queen's Bench for an order that the trustee be replaced on the ground that the trustee does not meet the requirements or the qualifications under subsection (1), and the court may make an order on any terms it thinks appropriate.

Replacement trustee

20(3)     Where a trustee ceases to be a trustee in respect of a residential complex and had, immediately before ceasing to be a trustee, any continuing or outstanding obligations to the landlord or the tenants of the complex, the landlord shall immediately appoint another trustee in its place to fulfil those obligations unless the court has done so under subsection (2).

Application of The Trustee Act

20(4)     Any matter arising in relation to a trust or a trustee under this Act that is provided for in The Trustee Act and is not specifically provided for in this Act or The Residential Tenancies Act, shall be determined under The Trustee Act.

INITIAL TENANTS' ENTRANCE FEES

Meaning of "unleased rental unit"

21(1)     For the purposes of clause (4)(b), "unleased rental unit" means a rental unit that, before the first amount is paid out under this section, is not leased to a bona fide initial tenant whose lease has not been and can no longer be cancelled under section 10.

Entrance fee paid to trustee

21(2)     Upon the expiry of the period for cancellation under subsection 10(2), the landlord shall pay the full entrance fee of each initial tenant, together with any interest earned on it, to the trustee appointed under subsection 19(1), unless the landlord has refunded it to the tenant.

Trustee to hold entrance fees and pre-lease payments

21(3)     Any pre-lease payments paid under clause 8(4)(b) to a trustee appointed under subsection 19(1) and all entrance fees received by that trustee, other than those entrance fees that are required by this Act or an order under section 154 of The Residential Tenancies Act to be refunded or paid to a tenant, shall be held by the trustee for the benefit of the tenants until the landlord has met the requirements of clauses (4)(a) and (b).

Prerequisites to payment

21(4)     A trustee appointed under subsection 19(1) shall not pay to or for the benefit of the landlord any amount held by the trustee under subsection (3) until the landlord has provided to the trustee

(a) all evidence required by the regulations respecting

(i) the landlord's legal interest in the lands on which the residential complex is or is to be located,

(ii) the projected costs of the development of the complex,

(iii) the availability of funds to complete the development,

(iv) registration of any mortgage required by a lender to finance development of the residential complex,

(v) contracts entered into for the development and security for the performance of those contracts,

(vi) the obtaining of any regulatory approvals required to carry out the development,

(vii) insurance coverage for the complex as required under section 17,

(viii) the certification of expenditures incurred or work completed in the development of the complex, and

(ix) any other prescribed matter; and

(b) an irrevocable letter of credit or equivalent security for an amount that is not less than the total of the first year's rent that would be payable for all unleased rental units, if they were leased under life leases in respect of which the minimum entrance fees required by the landlord had been paid.

Security reduced if rental unit leased

21(5)     If, before the end of the first year after the occupancy date of a residential complex, a rental unit for which security has been provided under clause (4)(b) is leased to a bona fide initial tenant, the amount secured under clause (4)(b) may be reduced by the amount of the rent that would be payable under the lease, if the tenant had paid the minimum entrance fee required by the landlord, from the tenant's possession date to the end of that year.

Application of funds

21(6)     Where a letter of credit or other security is provided under clause (4)(b) in respect of a residential complex, the funds obtained by the trustee under the letter of credit or on the realization of the other security shall be applied monthly to the operating costs of the complex during the first year after its occupancy date, to the extent of the difference between

(a) the total rent that would, if the rental units referred to in clause (4)(b) were rented under life leases in respect of which the minimum entrance fees required by the landlord had been paid, be payable for the month for those units; and

(b) the total rent that is payable for the month by tenants for those rental units.

Use of funds

21(7)     Except as otherwise provided by the regulations, funds paid to or for the benefit of the landlord of a residential complex by the trustee appointed under subsection 19(1) shall be used for one or more of the following purposes:

(a) to pay for development of the complex;

(b) to pay for tenants' extras;

(c) to refund all or any part of one or more entrance fees paid in respect of the complex;

(d) to fund the landlord's contribution to a refund fund in respect of the complex;

(e) to satisfy an order made under section 154 of The Residential Tenancies Act in respect of an entrance fee;

(f) to reimburse the landlord for amounts paid by the landlord for any of the foregoing purposes;

and any balance not required for these purposes shall be used only for the purposes of the complex.

REFUNDABLE ENTRANCE FEES AND THE REFUND FUND

Minimum refundable

22        At least 95% of each entrance fee payable in respect of a residential complex, other than the portion of the entrance fee payable in respect of a tenant's extras, shall be refundable if

(a) the landlord is not a non-profit landlord; or

(b) the term of the lease is for the tenant's life.

Refund fund

23        If any entrance fee paid or payable in respect of a residential complex is refundable, the landlord shall, before the occupancy date of the complex, contribute to the refund fund an amount not less than the minimum amount stipulated in the landlord's disclosure to the tenants under subclause 6(4)(b)(i).

"Priority date" defined

24(1)     In this section, a tenant's "priority date" means

(a) in the case of a cancellation of the tenant's lease under section 13, the effective date of the cancellation; and

(b) in any other case, the later of

(i) the day on which the tenancy under the lease is terminated, and

(ii) the last day of the third month after the month in which notice of the termination was given by the landlord or the tenant.

Effective date of cancellation

24(2)     For the purpose of clause (1)(a), where the cancellations of two or more life leases are effective within the same calendar month, the cancellations are deemed to be effective on the last day of the month.

Refund of entrance fees

24(3)     A tenant whose entitlement to a refund of all or part of his or her entrance fee has not been paid in full,

(a) in the case of a cancellation of the tenant's lease under section 13, within 60 days after the effective date of the cancellation; and

(b) in any other case, by the end of the third month after the tenant's priority date, or any earlier date provided for in the lease;

is entitled to be paid, out of the funds available in the refund fund, the balance owing by the landlord to the tenant.

Priority

24(4)     If the amount available in the refund fund is less than the total amount payable under this section and section 13 in respect of two or more leases, the trustee shall pay the available funds to the tenants in the order in which their priority dates occurred and, if the available funds are less than the amounts owing to two or more tenants having the same priority date, the available funds shall be paid to them pro rata in proportion to the amounts payable to them.

Use of excess funds

25        If the balance in the refund fund of a non-profit landlord exceeds the total of

(a) the minimum amount stipulated in the landlord's disclosure to the tenants under subclause 6(4)(b)(i); and

(b) the amounts refundable to tenants whose leases have been cancelled or terminated or who have given notices of termination;

the landlord may withdraw the excess from the refund fund and use the proceeds for the purposes of the residential complex or for any other purpose permitted by the regulations.

Limitation

26        If any entrance fee paid in respect of a residential complex is refundable, the landlord shall not use an entrance fee received after the occupancy date of the residential complex for any purpose other than to refund an entrance fee unless, immediately after it is used, the balance in the refund fund equals or exceeds the total referred to in section 25.

Meaning of "fully funded" refund fund

27(1)     For the purposes of this section, a refund fund in respect of a residential complex is fully funded when, after the occupancy date of the complex, the amount in the fund is equal to or greater than

(a) the total amount payable to the former tenants of the complex whose entrance fees have not been refunded; and

(b) the total amount that would be payable to the current tenants of the complex from the refund fund if all the life leases were terminated.

Right to refund

27(2)     If the landlord of a residential complex is not a non-profit landlord, when the refund fund is fully funded,

(a) each of the current tenants of the complex has the right to a refund of the refundable portion of his or her entrance fee; and

(b) the landlord shall notify each tenant of his or her right under clause (a).

Income after fully funded

27(3)     If the landlord of a residential complex is not a non-profit landlord, after the refund fund is fully funded,

(a) the trustee's reasonable fees for the administration of the fund shall be charged to and paid out of the income and, if necessary, the capital of the fund; and

(b) any remaining income of the fund shall be earned by the trustee for the benefit of, and shall be paid at least annually to, the current tenants of the complex who have not requested or obtained a refund of the refundable portion of their entrance fees.

Payment of excess to certain landlords prohibited

27(4)     The trustee in respect of a residential complex shall not pay any part of the refund fund to or for the benefit of a landlord that is not a non-profit landlord.

MORTGAGE SECURITY

Requirement for mortgage

28(1)     If all or a portion of an entrance fee in respect of a residential complex is refundable, the trustee appointed under subsection 19(1) shall not advance or permit to be advanced, to or for the benefit of the landlord, any portion of the entrance fee except, subject to subsection (3), funds for the purchase of the land on which the residential complex is to be located, unless the landlord certifies that

(a) a mortgage that meets the requirements of subsection (2), and any additional requirements set out in the life lease, has been duly registered in the appropriate land titles office against the landlord's interest in the lands that include the complex; and

(b) the security provided by the mortgage will, in respect of the funds advanced, not rank inferior to any registered instrument or encumbrance other than

(i) a mortgage under which funds are advanced to finance the development of the complex,

(ii) one or more instruments referred to in section 141 of The Real Property Act, and

(iii) other registered instruments that are not materially adverse to the security provided by the mortgage or that are required by a government authority to permit the development of the complex.

Terms of mortgage

28(2)     A mortgage under clause (1)(a) shall be in registrable form and shall satisfy the following requirements, and may contain additional terms and conditions not inconsistent with the following:

(a) the trustee appointed under subsection 19(2) shall be named as the mortgagee;

(b)  the mortgage

(i) shall secure at least the total of the refundable portions of all the entrance fees that have been paid and not previously refunded or are payable to the landlord or trustee, and

(ii) shall be repayable on demand by the trustee;

(c) if a life lease in respect of the residential complex so requires, the mortgage shall include an obligation of the landlord to pay interest on the amount demanded under the mortgage from the date of demand until the date of payment, and shall secure the payment of that interest; and

(d) the mortgage shall include all applicable prescribed terms and conditions.

Purchase price of land

28(3)     The trustee may, before the mortgage under clause (1)(a) is registered, release funds to the landlord for the purchase of the land on which the residential complex is to be located only if the landlord provides a written undertaking

(a) to ensure that the funds are sent to the vendor of the land under one or more trust conditions stipulating that the landlord will receive title to the land subject only to agreed-upon encumbrances; and

(b) to register the transfer of the land under The Real Property Act in series with the mortgage referred to in clause (1)(a).

Increase in entrance fees

29        No landlord of a residential complex shall receive or permit a trustee to receive an entrance fee if it would result in the total of the refundable portions of all entrance fees paid in respect of the complex and not previously refunded exceeding the security provided by a mortgage (referred to as the "previous mortgage") that satisfies the requirements of section 28, unless the excess is secured by

(a) an amendment to the previous mortgage; or

(b) another similar mortgage that upon registration ranks equally with or next in priority to the previous mortgage, subject only to intervening registered instruments or encumbrances that are not materially adverse to the security provided by the mortgage.

Mortgage discharged

30        When all entrance fees secured by a mortgage have been refunded, the trustee appointed under subsection 19(2) shall discharge the mortgage.

DEFAULT

Demand by trustee

31(1)     If at the end of two years after the termination of a life lease, or any shorter period set out in the lease, not all of the refundable portion of a former tenant's entrance fee has been refunded, the trustee appointed under subsection 19(2) shall, upon the request of the former tenant, demand payment by the landlord of the unpaid balance within 30 days after the date of demand.

Mandatory foreclosure proceedings

31(2)     Subject to subsections (3) and (4), if the landlord of a residential complex fails to comply with a demand made under subsection (1), the trustee shall commence mortgage sale and foreclosure proceedings under The Real Property Act and shall take all reasonable steps to advance those proceedings expeditiously.

Waiver or postponement

31(3)     If every former tenant of a residential complex who has a right to ask the trustee to take action under subsection (1) has given written notice to the trustee after the termination of his or her lease, waiving, or consenting to an extension of the time for, the payment of the balance of the entrance fee owing to him or her, the trustee shall accordingly refrain from taking, or delay the taking of, any action under subsection (2).

Meeting of tenants

31(4)     Before commencing mortgage sale and foreclosure proceedings, the trustee shall

(a) call a meeting of the tenants whose life leases have not been terminated to consider an application under clause (b); and

(b) if authorized by a majority of the votes cast at the meeting referred to in clause (a), with each life lease carrying an entitlement to one vote, apply to the Court of Queen's Bench for an extension of time for the landlord to comply with the demand before commencing mortgage sale and foreclosure proceedings.

Distribution of refund fund

32        After a mortgage sale or foreclosure or a tax sale of a residential complex, unless the new landlord agrees to be bound by the obligations of the former landlord respecting the entrance fees, the trustee shall distribute the balance of the refund fund, if any, then held by it in respect of the complex pro rata to the persons who were the tenants of the complex at the time of the sale or foreclosure in proportion to their entrance fees.

Surplus on mortgage sale

33        For the purpose of subsection 136(3) of The Real Property Act, the tenants of a residential complex at the time of a mortgage sale of the complex shall be paid, out of any surplus otherwise payable under that subsection to the landlord and in proportion to their entrance fees, the entrance fees paid under their life leases prior to any payment to the landlord.

PART 5

GENERAL PROVISIONS

Non-profit landlord limited to one residential complex

34        No non-profit landlord of a residential complex shall after the coming into force of this Act become, otherwise than under clause (b) of the definition "landlord" in subsection 1(1), a landlord of another residential complex.

Right of first refusal

35        No person to whom a certificate of title has been issued under The Condominium Act for a rental unit that is the subject of a life lease shall sell the rental unit to a person other than the tenant, unless the tenant has been given an option, exercisable at any time before the unit is offered for sale to a person other than the tenant, but not less than 30 days after the date of receipt of the option, to purchase the rental unit at a price not exceeding the price at which the unit will be offered for sale and on terms that are not less favourable.

Notice of life lease filed against the land

36(1)     If a rental unit in a residential complex is subject to this Act, the landlord shall, within 60 days after the occupancy date of the complex, file a notice in the prescribed form

(a) against the title to the land on which the residential complex is located, if the land is subject to The Real Property Act; or

(b) against the abstract records for the land on which the residential complex is located, if the land is subject to The Registry Act.

Failure to file notice

36(2)     Failure to file a notice as required by subsection (1) does not affect the rights and obligations of any person under any other provision of this Act.

Investment by landlord

37(1)     A landlord shall deposit or invest pre-lease payments, entrance fees and all amounts contributed to a reserve fund under subsection 16(1) in accordance with the regulations.

Investment by trustee

37(2)     A trustee shall deposit or invest all amounts received by it under this Act in accordance with the regulations.

OFFENCES AND PENALTIES

Offence: false or misleading statement

38(1)     A landlord, or a person who for consideration is engaged in the marketing or development of a residential complex, who makes a statement that is false or misleading with respect to any material fact or who omits to state any material fact the omission of which makes the statement false or misleading,

(a) to a prospective tenant that may induce or induces the tenant to enter into a life lease; or

(b) in a life lease, an offer to lease, an advertisement offering or soliciting interest in one or more life leases, or in any information required by this Act or the regulations to be disclosed to a tenant;

is guilty of an offence.

Offence: contravention of Act or regulations

38(2)     A person who contravenes any provision of this Act or the regulations is guilty of an offence.

Directors, officers and agents

38(3)     Every director, officer or agent of a corporation who authorizes, acquiesces in or participates in an offence under subsection (1) or (2) is guilty of an offence under subsection (1) or (2), as the case may be.

Defence

38(4)     No person is guilty of an offence under this section if the person can prove on a balance of probabilities that he or she took reasonable steps to avoid the commission of the offence.

Penalties

38(5)     A person guilty of an offence under this section is liable on summary conviction

(a) in the case of an offence under subsection (1),

(i) by an individual, for a first offence, to a fine of not more than $20,000. or to imprisonment for a term of not more than one year, or both, and for a subsequent offence, to a fine of not more than $30,000. or to imprisonment for a term of not more than three years, or both, and

(ii) by a corporation, for a first offence, to a fine of not more than $50,000. and for a subsequent offence, to a fine of not more than $60,000.; and

(b) in the case of an offence under subsection (2),

(i) by an individual, for a first offence, to a fine of not more than $3,000. or to imprisonment for a term of not more than one year, or both, and for a subsequent offence, to a fine of not more than $10,000. or to imprisonment for a term of not more than three years, or both, and

(ii) by a corporation, for a first offence, to a fine of not more than $10,000. and for a subsequent offence, to a fine of not more than $25,000.;

and the court convicting the person may, in addition to any other penalty, order the person to pay compensation or restitution in respect of the offence.

Limitation

38(6)     A prosecution for an offence under this section may be commenced not later than one year after the day on which evidence sufficient to justify a prosecution for an offence under this section came to the knowledge of the director under The Residential Tenancies Act.

NOTICE AND MISCELLANEOUS

Giving of notices

39(1)     A notice or other document under this Act may be given to a person by

(a) handing it to the person, or

(i) if the person is a landlord or a trustee, handing it to an agent of that person, or

(ii) if the person is a tenant, handing it to an apparently adult person in the residence of the tenant; or

(b) sending it by prepaid, first class mail to the address where the person resides or carries on business.

Disclosure to tenant

39(2)     Despite subsection (1), information that a landlord is required under subsection 6(2), clause 6(4)(b) or (c) or subsection 11(7) to give or disclose to a tenant shall be given by

(a) handing it to the tenant, an apparently adult person in the residence of the tenant or a person designated by the tenant to receive the information; or

(b) sending it to the tenant by prepaid registered mail to the address where the tenant resides.

Notice of cancellation

39(3)     Despite subsection (1), a notice of cancellation under subsection 10(2) or 12(1) shall be given to a landlord by a tenant before the end of the period for cancellation by

(a) handing it to the landlord or an agent of the landlord and, if the notice is under subsection 12(1), to the assignor or an agent of the assignor;

(b) delivering it to the address stipulated for this purpose by the landlord and, where applicable, by the assignor; or

(c) if authorized by the landlord or assignor, faxing it to the number provided to the tenant for this purpose by the landlord or assignor.

When given by mail

39(4)     A notice or other document sent by mail

(a) under clause (1)(b) is deemed to be given on the fifth day after the date of mailing; and

(b) under clause (2)(b) is given on delivery;

unless the person to whom it is sent establishes that, acting in good faith, he or she did not receive the notice or other document, or did not receive it until a later date, because of absence, accident, illness or other cause beyond the person's control.

Director or commission may give directions

39(5)     Despite the other provisions of this section, the director or the commission under The Residential Tenancies Act may direct a notice or document to be given in a manner that is not described in this section.

Actual notice is sufficient

39(6)     Although a notice or other document is not given in accordance with this section, it is sufficiently given if it actually came to the attention of the person to whom it was intended to be given within the time for giving it under this Act.

Substantial compliance

40        Substantial compliance with the requirements of this Act or the regulations respecting the content of forms, notices or documents is sufficient unless the director or the commission under The Residential Tenancies Act is of the opinion that it would result in unfairness to any person.

Certificate of director as proof

41        Section 186 (certificate of director) of The Residential Tenancies Act applies with necessary modifications to prosecutions and proceedings under this Act.

REGULATIONS

Regulations by L.G. in C.

42        The Lieutenant Governor in Council may make regulations

(a) respecting the investments that a landlord or a trustee may make with funds received by a landlord or a trustee under or in respect of life leases and income earned on those funds;

(b) exempting residential complexes, rental units, tenants or landlords under life leases, or a class of any of them, from this Act or the regulations or a specified provision of this Act or the regulations;

(c) respecting any other matter the Lieutenant Governor in Council considers necessary or advisable to carry out the intent and purposes of this Act.

Regulations by minister

43        The minister may make regulations

(a) prescribing requirements for the purpose of clause (b) of the definition "non-profit landlord" in subsection 1(1);

(b) prescribing information to be provided to prospective tenants or tenants for the purposes of subsection 6(2), clause 6(4)(b), subsection 11(7) and section 46, and the form and manner in which it is to be provided;

(c) prescribing the maximum amount of a pre-lease payment or the manner of determining the maximum amount for the purpose of subsection 6(3);

(d) for the purpose of subsection 9(2), respecting the use of entrance fees and any income or gains earned or realized from the investment of the entrance fees, including terms and conditions to be met by landlords or a class of landlords before using such funds;

(e) respecting the form and content of statements of cancellation rights referred to in subsection 10(1) and clause 11(7)(b), and the manner in which they are to be provided to tenants;

(f) respecting the insurance to be maintained by a landlord for the purpose of subsection 17(1);

(g) respecting information to be included in or with a notice under subsection 18(3);

(h) prescribing requirements and qualifications for trustees for the purpose of subsection 20(1);

(i) respecting requirements to be satisfied before a trustee releases funds to a landlord under clause 21(4)(a);

(j) respecting the purposes for which funds described in subsection 21(7) may be used;

(k) respecting the purposes for which excess funds withdrawn from the refund fund under section 25 may be used;

(l) prescribing terms and conditions to be included in a mortgage referred to in section 28;

(m) prescribing the notice referred to in section 36;

(n) defining any word or expression used in this Act but not specifically defined in this Act;

(o) respecting any matter required or authorized by this Act to be prescribed.

PART 6

APPLICATION TO MATTERS ARISING BEFORE THE COMING INTO FORCE OF THIS ACT

Pre-lease payments made before coming into force

44(1)     Subsections 6(1), (2) and (3) (pre-lease payments) and sections 7 (acknowledgement of receipt) and 8 (pre-lease payments) do not apply to pre-lease payments received before the coming into force of this Act.

Entrance fees paid before coming into force

44(2)     Section 7 (acknowledgement of receipt) and subclause 6(4)(b)(ii) (disclosure) do not apply to entrance fees received before the coming into force of this Act.

Assignments made before coming into force

44(3)     Subsection 11(7) does not apply to an assignment of a life lease to which the landlord has consented before the coming into force of this Act.

Life leases entered into before coming into force

45(1)     Where before the coming into force of this Act a landlord has entered into a life lease in respect of a residential complex, the provisions or requirements set out in

(a) subsection 6(4) (entrance fees) other than subclause (b)(ii);

(b) section 8 (pre-lease payments);

(c) subsections 9(1) and (2) (entrance fees);

(d) clause 11(1)(b) (assignment);

(e) section 13 (failure to give possession);

(f) section 14 (notice of possession date); and

(g) Part 4 (Trustees and Refundable Entrance Fees), other than the following provisions:

(i) subsection 20(3) (replacement trustee), where applicable, and subsection 20(4) (application of The Trustee Act),

(ii) where applicable, section 30 (mortgage discharged) with necessary modifications,

(iii) where applicable, subsection 31(3) (waiver or postponement) with necessary modifications and where applicable, subsection 31(4) (meeting of tenants),

(iv) section 32 (distribution of refund fund),

(v) section 33 (surplus on mortgage sale);

do not apply to the following:

(h) the residential complex or the landlord;

(i) any pre-lease payment or entrance fee paid in respect of the complex before or after the coming into force of this Act or the life lease under which it was paid or the tenant who paid it.

Entrance fee received after coming into force

45(2)     Subject to section 47, a person who receives, after the coming into force of this Act, an entrance fee in respect of a residential complex to which subsection (1) applies shall hold the amount in trust for the benefit of the tenant until the period for cancellation under subsection 10(2) has expired.

Disclosure where entrance fee paid

46        Where before the coming into force of this Act a landlord

(a) has received an entrance fee from a tenant or consented to an assignment of a life lease; and

(b) has not disclosed to the tenant or the assignee substantially all of the information that it would, if the entrance fee were received or the assignment were made after the coming into force of this Act, be required by subsection 6(2), clause 6(4)(b) or clause 11(7)(a) to disclose to the tenant;

the landlord shall, within three months after this Act comes into force, disclose to any tenant under a life lease that is in effect as of the date of the disclosure, in accordance with the regulations, any information required by the regulations to be disclosed to the tenant in respect of his or her life lease or the residential complex.

Section 10 cancellation right

47        Section 10 and subsection 45(2) do not apply to a life lease where the tenant has signed the lease or offer to lease before the coming into force of this Act.

Section 12 cancellation right

48        Section 12 does not apply to an assignment of a life lease where the landlord has provided its consent to the assignment before the coming into force of this Act.

Annual disclosure

49        If the occupancy date of a residential complex is before the day this Act comes into force, section 18 (annual meeting) applies, with necessary modifications, to the landlord as if the occupancy date were the day this Act comes into force.

Notice of life lease filed against the land

50        If the occupancy date of a residential complex is before the coming into force of this Act, the landlord shall file the notice required by section 36 within 90 days after the coming into force of this Act.

Requirement for reserve fund

51        A non-profit landlord of a residential complex the occupancy date of which was before the coming into force of this Act shall establish a reserve fund in accordance with section 16 (reserve funds) before the day notice is required to be given of the second annual meeting of tenants required by section 18 (annual meeting).

PART 7

CONSEQUENTIAL AMENDMENTS

DIVISION 1

THE REAL PROPERTY ACT

C.C.S.M. c. R30 amended

52         The Real Property Act is amended by this Division.

53(1)      Subsection 91(3) is amended

(a) in clause (b), by adding "amended or" before "extended"; and

(b) in the part following clause (b),

(i) by adding "amending or" before "extending",

(ii) by striking out "a form satisfactory to the district registrar" and substituting "the prescribed form", and

(iii) by adding ", amendment" after "renewal".

53(2)      The following is added after subsection 91(3):

Amendment of term of life lease

91(4)     For greater certainty, for the purposes of this Act, on the assignment of a lease the term of which is for the life of the lessee, an amendment of the lease to provide that the term is for a fixed number of years or for the life of the assignee does not result in a new lease.

54         Subsection 136(3) is amended by adding "and section 33 of The Life Leases Act" before "and subsection 36(4)".

DIVISION 2

THE RESIDENTIAL TENANCIES ACT

C.C.S.M. c. R119 amended

55        The Residential Tenancies Act is amended by this Division.

56(1)     Subsection 1(1) is amended

(a) by repealing the definition "landlord" and substituting the following:

"landlord" includes

(a) the owner, or other person permitting or granting a right to occupancy of the rental unit, and his or her heirs, assigns, personal representatives and successors in title,

(b) a person, other than a tenant occupying the rental unit, who is entitled to possession of the residential complex in which the rental unit is located and who attempts to enforce any of the rights of a landlord under a tenancy agreement or this Act, including the right to collect rent, and

(c) a mortgagee who attempts under the terms of the mortgage to evict a tenant from a rental unit; (« locateur »)

(b) in the definition "tenancy agreement", by adding ", and includes a life lease" after "unit"; and

(c) by adding the following definitions in alphabetical order:

"entrance fee" means an entrance fee as defined in The Life Leases Act; (« frais d'entrée »)

"life lease" means a life lease as defined in The Life Leases Act; (« bail viager »)

56(2)     The following is added after subsection 1(1.1):

Proposed rental unit

1(1.2)    In this Act, where a life lease is in respect of a rental unit not yet in existence, "rental unit" means the proposed rental unit and "residential complex" means the residential complex or proposed residential complex in which the proposed rental unit is to be located.

56(3)     The following is added after subsection 1(4):

Reference to Life Leases Act includes regulations

1(5)      In this Act, a reference to The Life Leases Act includes the regulations made under that Act.

57(1)     Subsection 7(2) is repealed and the following is substituted:

Standard form of tenancy agreement

7(2)      A written tenancy agreement must

(a) be in the prescribed form, unless it is a life lease; and

(b) be signed by the landlord and tenant or their agents.

57(2)     Subsection 7(4) is amended by adding ", other than a life lease," after "A tenancy agreement".

57(3)     The following is added after subsection 7(5):

Representation re life lease

7(6)      A representation made under The Life Leases Act by a landlord to a prospective tenant in respect of a life lease is a term of the lease.

58(1)     Subsection 11(1) is amended in the part preceding clause (a) by adding "other than a life lease" before "may".

58(2)     The following is added after subsection 11(1):

Life lease requirements

11(1.1)   A life lease shall not contain a provision that

(a) is inconsistent with this Act, The Life Leases Act or subsections 5(2) to (2.5) of The Condominium Act; or

(b) imposes an obligation on the tenant that is unreasonable in the circumstances.

58(3)     Subsection 11(2) is amended by striking out "under subsection (1)".

59        Section 14 is amended by adding "or The Life Leases Act" after "this Act".

60        Subsection 21(1) is amended by adding ", other than a life lease," before "specifies" in the part preceding clause (a).

61        The following is added after section 22:

Renewal of life lease for specified term

22.1      When a life lease specifies a date for it to end, if the landlord does not offer the tenant a new life lease at least three months before the expiry date, or if the tenant does not accept the new lease, the tenant has a right to remain in occupancy of the rental unit under a deemed tenancy agreement for successive rental payment periods, as described in section 23, subject to a rent increase that complies with the applicable provisions of Part 9.

62        Section 24 is repealed and the following is substituted:

No automatic renewal for temporary tenancies

24        Sections 21, 22 and 23 do not apply to a temporary tenancy described in clause 102(1)(a), and sections 21 and 22 do not apply to a temporary tenancy described in clause 102(1)(b).

63        Section 40 is amended

(a) by adding "and The Life Leases Act" after "this Part"; and

(b) by adding "or The Life Leases Act" after "this Act".

64        Section 41 is amended

(a) by adding "and The Life Leases Act" after "this Part"; and

(b) by adding "or The Life Leases Act" after "this Act".

65        The following is added after subsection 42(3):

Prohibited assignment of life lease

42(4)     Except as otherwise provided by The Life Leases Act, a tenant may not assign a life lease if the assignment is prohibited by the terms of the lease.

66        The following is added after section 68:

Right of first refusal

68.1      Where a life lease has been terminated under clause 15(2)(a) of The Life Leases Act, and the tenant remains in occupancy of his or her rental unit under subsection 15(3) of that Act, no person to whom a certificate of title has been issued under The Condominium Act for the rental unit shall sell the rental unit to a person other than the tenant, unless the tenant has been given an option, exercisable at any time within a period of at least 30 days after the date of receipt of the option, to purchase the rental unit at a price not exceeding the price at which the unit will be offered for sale and on terms that are not less favourable.

67        Section 86 is amended by adding ", other than a life lease," after "tenancy agreement".

68(1)     Subsection 87(2) is amended by adding ", other than a life lease," after "tenancy agreement".

68(2)     The following is added after subsection 87(2):

Termination by giving notice: life lease

87(3)     A tenant may terminate a life lease by giving the landlord a notice of termination effective no earlier than

(a) the end of the third month after the month in which the notice is given; or

(b) such earlier time as is provided for in the life lease.

Limitation

87(4)     A life lease may provide that the period of notice required under this Act does not begin before the tenant's possession date as defined in The Life Leases Act.

69        Section 88 is amended by renumbering it as subsection 88(1) and the following is added as subsection 88(2):

Application to life leases

88(2)     Subsection (1) does not apply to a life lease entered into before the occupancy date, as defined in The Life Leases Act, of the residential complex in which the rental unit is located.

70        Subsection 98(1) is amended in the part preceding clause (a) by adding ", other than a tenant under a life lease," after "tenant".

71(1)     Subsection 99(1) is amended in the part preceding clause (a) by striking out "A landlord" and substituting "Subject to subsection (9), a landlord".

71(2)     Subsection 99(6) is amended by striking out "When" and substituting "Unless subsection (6.1) applies, when".

71(3)     The following is added after subsection 99(6):

Tenant's right of refusal: conversion to life lease

99(6.1)   When a tenant receives a notice of termination under clause (1)(b) in respect of a rental unit that the landlord wishes to renovate and convert into a rental unit under a life lease, the landlord shall not rent the unit under a life lease to any other person without first offering to enter into a life lease on comparable terms with the tenant.

71(4)     Subsection 99(7) is amended by adding "or (6.1), as the case may be," after "Subsection (6)".

71(5)     The following is added after subsection 99(8):

No termination of life lease without director's approval

99(9)     A landlord shall not terminate a life lease under subsection (1) unless the director has authorized the termination under section 99.1.

72        The following is added after section 99:

Application to director

99.1(1)   A landlord who wishes to terminate a life lease for a reason described in subsection 99(1) shall apply under subsection 152(1.1) to the director for an order authorizing the termination.

Notice of application

99.1(2)   On receiving an application under subsection (1), the director shall give notice of the application, and of their right to object to it, to

(a) the tenant under the life lease; and

(b) each other tenant of the residential complex whose life lease tenancy is not covered by the application but whose interest could, in the director's opinion, be affected by the outcome of the application.

Objection

99.1(3)   Each person entitled under subsection (2) to notice of an application may, within the time period specified in the notice, object to the application by written notice to the director, stating the reasons for the objection.

Order

99.1(4)   The director may make an order authorizing a landlord to terminate a life lease under subsection 99(1), subject to any conditions the director considers reasonable, if, after considering the landlord's submission, any objections received under subsection (3) and the factors set out in subsection (5), the director is satisfied that there is no reasonable and practicable alternative to demolition, renovation or conversion that would allow for continuation of the life lease.

Factors to consider

99.1(5)   Before making an order under subsection (4), the director may consider any matter the director considers relevant, which may include one or more of the following:

(a) the tenant's right of tenure under the life lease;

(b) the financial interests of the tenant under the life lease;

(c) the financial interests of other tenants referred to in clause (2)(b) under their life leases;

(d) the physical condition of the rental unit;

(e) the health and safety of tenants of the residential complex.

73(1)     Subsection 102(1) is repealed and the following is substituted:

"Temporary tenancy" defined

102(1)    In this section, "temporary tenancy" means

(a) the rental by a landlord of his or her residence as a rental unit for a temporary period on the understanding that the tenant is to give vacant possession to the landlord for the landlord's use at the end of the temporary period; and

(b) the rental by a landlord of a rental unit for a temporary period where

(i) the rental unit was previously occupied under a life lease or has never been previously occupied other than under a temporary tenancy, and

(ii) it is rented on the understanding that the tenant is to give vacant possession to the landlord at the end of the temporary period in order for the landlord to give possession of the rental unit to a tenant under a life lease.

Termination of temporary tenancy

102(1.1)  A temporary tenancy is terminated

(a) at the end of the tenancy agreement, if the agreement specifies a date for it to end;

(b) in the case of an agreement for a temporary tenancy described in clause (1)(a) that does not specify a date for it to end, by the landlord's giving the tenant a notice of termination of not less than 1 rental payment period to be effective on the last day of a rental payment period; and

(c) in the case of an agreement for a temporary tenancy described in clause (1)(b) that does not specify a date for it to end, by the landlord's giving the tenant a notice of termination, for the purpose of giving possession of the rental unit to a tenant under a life lease, of not less than 3 rental payment periods to be effective on the last day of a rental payment period.

73(2)      Subsection 102(2) is amended by striking out "described in subsection (1)".

74        The following is added after subsection 116(3):

Non-application to life leases

116(4)    This Part, except sections 118, 119, and 140.1, does not apply to a rental unit occupied under a life lease if

(a) the landlord is a non-profit landlord, as defined in The Life Leases Act, and the residential complex in which the rental unit is located is operated on a non-profit basis; and

(b) the life lease provides for the calculation of the tenant's rent to be based on the tenant's share of budgeted operating costs and budgeted contributions to reserve funds and to any refund fund, as defined in The Life Leases Act.

75        Subsection 123(1) is amended by adding "and section 126.1" after "In this section".

76        The following is added after section 126:

RENT INCREASE AFTER TERMINATION OF LIFE LEASE

Rent increase after termination of life lease

126.1(1)  Despite subsection 123(2), where, after a life lease is terminated under clause 15(2)(a) of The Life Leases Act,

(a) the tenant remains in occupancy of the rental unit as provided for under subsection 15(3) of that Act; and

(b) the landlord desires to increase the rent charged for the rental unit by more than the maximum amount permitted under the regulations;

the landlord may apply to the director under this section for an order permitting the increase.

Limit of one application

126.1(2)  A landlord is limited to one application under this section in respect of a residential complex.

When application to be made

126.1(3)  An application under subsection (1) shall be in a form acceptable to the director and be filed not later than 14 days after the beginning of the 3 month notice period required for rent increases under subsection 25(1).

Whole building review

126.1(4)  A landlord who applies for an order under subsection (1) shall, as part of the same application, apply for a determination of the rents that may be charged for all of the rental units in the residential complex for the 12 months following the effective date of the first rent increase applied for.

Notice by director

126.1(5)  On receiving an application under this section, the director shall give notice to the tenants of the affected rental units of their right to object to the rent increase, but a proceeding is not invalid because a notice is not given to each tenant.

Objection by tenant

126.1(6)  A tenant who receives notice under subsection 25(1) of a rent increase under this section may, not later than 60 days before the effective date of the intended increase, file an objection with the director on the ground that the rent increase is not justified.

Order setting rent

126.1(7)  After considering the landlord's submission, any objection filed by a tenant, the rents charged for rental units of a similar type, size and age, with similar services and facilities and in the same general area as the rental unit, the director shall make an order setting the maximum rent that may be charged for each rental unit in the residential complex, subject to any conditions the director considers reasonable.

77(1)     The following is added after subsection 131(1):

Rent increase for previously exempt unit

131(1.1)  A landlord who lawfully regains or is about to lawfully regain possession of a rental unit that was exempt under subsection 116(4) from certain provisions of this Part may, under the first tenancy agreement after the landlord regains possession that is not so exempt, increase the rent by an amount determined by the landlord.

77(2)     Subsection 131(2) is amended by striking out "subsection (1)" and substituting "subsection (1) or (1.1)".

78        The following is added after section 140 and before Part 10:

LIFE LEASES IN NON-PROFIT RESIDENTIAL COMPLEX

Application for rent review

140.1(1)  A tenant of a rental unit referred to in subsection 116(4) may, within 30 days after receiving notice of a rent increase under subsection 25(1), apply to the director for a review of the rents proposed to be charged for the rental units rented under life leases in the residential complex.

Inquiry and notice by director

140.1(2)  On receipt of an application under subsection (1), the director shall inquire into the matter and, if the director undertakes a review, the director

(a) shall give notice to the landlord of the review and of the landlord's right to make a submission regarding the rents proposed to be charged;

(b) shall give notice to the other tenants of the residential complex of their right to object to the proposed rent on the ground that it is unreasonable, or that the proposed rent is not calculated in accordance with the life lease; and

(c) may require the landlord to file with the director any material respecting the revenue, costs, reserve funds and rents relating to the residential complex that the director considers necessary.

Order

140.1(3)  The director may, after considering any objections received from tenants and information received from the landlord, make an order

(a) adjusting or disallowing any of the budgeted costs;

(b) requiring that amounts held in one or more reserve funds be applied to operating costs;

(c) disallowing any part of the rents designated as a contribution to a reserve fund or to a refund fund under The Life Leases Act; and

(d) setting the rents that may be charged for the rental units in the residential complex, calculated in accordance with the life leases, as of the date for which the landlord gave notice of the rent increase.

Factors to consider

140.1(4)  Before making an order under this section, the director shall consider

(a) whether the budgeted costs or costs incurred are reasonably attributable to the operation of the residential complex for the benefit of the tenants;

(b) whether the amounts held in reserve funds for the benefit of the residential complex, and the purpose of the funds, are reasonable in the circumstances; and

(c) other prescribed matters.

79(1)     Subsection 152(1) is amended

(a) in the part preceding clause (a), by striking out "this section" and substituting "this Act or The Life Leases Act"; and

(b) in clauses (a) and (b), by adding "or The Life Leases Act" after "Parts 1 to 8".

79(2)     Subsection 152(2) is amended by adding "or The Life Leases Act" after "Parts 1 to 8".

79(3)     The following is added after subsection 152(3):

Authority re section 38 of The Life Leases Act

152(3.1)  The director's authority with respect to The Life Leases Act referred to in subsection (1) or (2) does not extend to section 38 (offences and penalties) of that Act.

80(1)      Subsection 153(3) is amended by striking out "If, after investigating" and substituting "Subject to subsection (6), if, after investigating".

80(2)     The following is added after subsection 153(5):

Matter under The Life Leases Act

153(6)     If the question or matter referred to in subsection 152(2) or subsection (3) is a question or matter under The Life Leases Act or respecting a life lease, the director may, instead of making a decision or order under section 154, make a decision declining to determine the question or matter having regard to one or more of the following:

(a) the complexity of the question or matter;

(b) the amount of money involved;

(c) the number of persons or interests involved.

Proceedings initiated in court

153(7)    Where the director makes a decision declining to determine a question or matter under subsection (6), a person directly affected by the director's decision may initiate a proceeding in the court for a determination of the matter.

Powers of the court

153(8)    In a proceeding initiated under subsection (7), the court may

(a) determine the question or matter; or

(b) refer the question or matter back to the director for further consideration in accordance with any direction of the court.

Director's decision final

153(9)    A decision of the director under subsection (6) is final and not subject to appeal.

81(1)     Subsection 154(1) is amended

(a) in clauses (a) and (b) and paragraphs 3, 4, 5 and 12, by adding "or The Life Leases Act" after "Parts 1 to 8";

(b) in paragraphs 1 and 2, by adding ", The Life Leases Act" after "Parts 1 to 8"; and

(c) by adding the following after paragraph 8:

8.1  When termination or cancellation of a life lease is authorized under Part 6, The Life Leases Act or a life lease, terminating or cancelling the life lease.

8.2  Ordering the repayment to a tenant of all or any part of a pre-lease payment, as defined in The Life Leases Act, or entrance fee.

8.3  Ordering the payment of compensation to a tenant in respect of the tenant's right to assign a life lease.

81(2)     The following is added after subsection 154(5):

Order against trustee

154(6)    If all or a part of a pre-lease payment or entrance fee required by an order under paragraph 8.2 of subsection (1) to be repaid has been paid to a trustee under The Life Leases Act, the director may, after notifying the trustee of the application and giving the trustee an opportunity to be heard, order the trustee to pay, out of the funds held by the trustee in connection with the residential complex, the amount to be repaid to the tenant.

82        Subsection 161(3) is amended by striking out "or under section 140 or under" and substituting ", section 140, The Life Leases Act or".

83        Subsection 171(2) is amended by striking out "or under" and substituting ", The Life Leases Act or".

84        Subsection 175(1) is amended by striking out "or under a provision of Parts 1 to 8" and substituting ", Parts 1 to 8 or The Life Leases Act".

85        Clause 185(1)(a) and subsections 185(2) and (4) are amended by adding "or The Life Leases Act" after "this Act".

86        Sections 189 and 190 are amended by adding "or The Life Leases Act" after "this Act" wherever it occurs.

87        Subsection 191(1) is amended by adding "and The Life Leases Act" after "this Act".

88        The following is added after section 197:

Life lease payments

197.1     A pre-lease payment, as defined in The Life Leases Act, or an entrance fee received by a landlord from a prospective tenant or a tenant with respect to a life lease before the coming into force of that Act is deemed not to be and never to have been a payment or consideration prohibited by section 14 of this Act.

PART 8

C.C.S.M. REFERENCE AND COMING INTO FORCE

C.C.S.M. reference

89        This Act may be cited as The Life Leases Act and referred to as chapter L130 of the Continuing Consolidation of the Statutes of Manitoba.

Coming into force

90        This Act comes into force on a day fixed by proclamation.