A A A

5th Session, 42nd Legislature

This HTML version is provided for ease of use and is based on the bilingual version that was distributed in the Legislature after First Reading.

Bill 29

THE LIFE LEASES AMENDMENT ACT


  Bilingual version (PDF) Explanatory Note

(Assented to                                         )

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

C.C.S.M. c. L130 amended

1   The Life Leases Act is amended by this Act.

2(1)   Subsections 15(1) and (2) are replaced with the following:

Change in ownership

15(1)   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.

Termination of life lease on mortgage or tax sale or on foreclosure

15(2)   Unless the person acquiring a landlord's interest by mortgage sale, tax sale or foreclosure under The Real Property Act agrees otherwise, each subsisting life lease is terminated immediately after the interest is acquired.

2(2)   Subsection 15(3) is amended, in the part before clause (a), by striking out "clause (2)(a)" and substituting "subsection (2)".

3   The following is added after section 16 and before the centred heading that follows it:

Reserve fund study

16.1(1)   Subject to the regulations, a non-profit landlord of a residential complex must ensure that a reserve fund study is conducted and updated from time to time in accordance with the regulations.

Purpose of study

16.1(2)   The purpose of the study is to determine the appropriate amount required for the reserve fund based on the estimated cost of replacing or performing major repairs to the assets of the complex.

4   Subsection 18(1) is amended

(a) by striking out "and" at the end of clause (a) and adding the following after clause (a):

(a.1) to present any reserve fund study or update conducted under section 16.1 that has not previously been presented to an annual meeting of the tenants; and

(b) by adding the following after subclause (b)(i):

(i.1) any reserve fund study or update conducted or to be conducted under section 16.1,

5   The following is added after subsection 18.2(5):

Generally accepted accounting principles

18.2(6)   The audited financial statements referred to in this section must be prepared in accordance with generally accepted accounting principles in Canada.

6   Section 43 is amended by adding the following after clause (e):

(e.1) respecting reserve fund studies and updates of those studies, including

(i) specifying classes of reserve fund studies and updates and classes of non-profit landlords,

(ii) exempting a class or classes of non-profit landlords from the requirement to ensure a reserve fund study is conducted or updated,

(iii) prescribing the persons who may conduct any or all classes of reserve fund studies and updates and specifying their qualifications,

(iv) governing the content of any or all classes of reserve fund studies and updates, the standards that must be observed in conducting them and the time at which they are to be conducted, and

(v) providing for transitional matters respecting reserve fund studies and updates;

Consequential amendments, C.C.S.M. c. R119

7(1)   The Residential Tenancies Act is amended by this section.

7(2)   Section 68.1 is amended by striking out "clause 15(2)(a)" and substituting "subsection 15(2)".

7(3)   Subsection 126.1(1) is amended, in the part before clause (a), by striking out "clause 15(2)(a)" and substituting "subsection 15(2)".

Coming into force — royal assent

8(1)   Subject to subsection (2), this Act comes into force on the day it receives royal assent.

Coming into force — proclamation

8(2)   Sections 3, 4 and 6 come into force on a day to be fixed by proclamation.

Explanatory Note

This Bill amends The Life Leases Act to enhance the rights of tenants under life leases.

Under the existing Act, when a person acquires a landlord's interest in a life lease complex on a mortgage sale, tax sale or foreclosure, the subsisting leases are terminated and the person has no obligations regarding the tenants' entrance fees. The Bill ensures that the person acquiring that interest is treated as the new landlord under the subsisting life leases, but automatically terminates those leases unless the person agrees otherwise. Such a termination no longer relieves the person of the landlord's obligation to refund an entrance fee.

Currently, a non-profit landlord of a life lease complex is required to maintain a reserve for maintaining, and replacing when necessary, the assets of the complex. Under the Bill, the landlord must ensure that a reserve fund study to determine the amount of money to be maintained in the fund is conducted and updated from time to time in accordance with the regulations.

If requested by a majority of the tenants of a life lease complex, the landlord is required to provide audited financial statements for the complex for each year until that request is withdrawn by a majority of the tenants. The Bill requires these financial statements to be prepared in accordance with generally accepted accounting principles.

Consequential amendments are made to The Residential Tenancies Act.