Tenant Not Paying Rent in PEI

In Prince Edward Island (PEI), rent is due on the day your written tenancy agreement says it is due. The Residential Tenancy Act has no grace period. You can serve an eviction notice for unpaid rent the day after the due date. In practice, many landlords call or write first, but the Act does not require a warning before the notice.

A tenant has no right to hold back rent, even when something in the unit needs fixing. The Rental Office says a tenant who withholds rent for any reason can be served a Form 4A. The tenant's lawful route for a repair problem is an application to the Rental Office, not withholding rent.

Repeated late payment is a separate ground. If a tenant is repeatedly late, you can give a for-cause notice, which works differently from the unpaid-rent notice (see below). For the general picture on late payers, see our Ask page on what to do when a tenant pays rent late.

If your lease says the tenant pays utilities to you, unpaid utility charges can be treated as unpaid rent. The tenant must be more than one month past a written demand for payment before you give the notice.

1. Confirm the amount owed. Check the due date in your tenancy agreement and your records, including any cash receipts you gave.
2. Fill in Form 4A. It is the Rental Office's eviction notice with 10 days to dispute. Get it from the Rental Office forms page, and sign it.
3. Set an end date that fits the Act. The tenancy can end not earlier than 20 days after the tenant receives the notice.
4. Deliver it and keep proof. The periods run from the day the tenant receives it, so record when and how you delivered it.
5. Wait for the tenant's response. Within 10 days, the tenant can pay all the overdue rent, which means the notice has no effect, or dispute the notice with the Rental Office.

The Act and the Rental Office describe these steps in the Residential Tenancy Act and the Rental Office FAQ. There is no winter exception: the eviction rules are the same year-round.

There are three outcomes.

• The tenant pays everything owed within 10 days. The notice has no effect and the tenancy continues.
• The tenant disputes on Form 2A. The Director decides whether the notice stands. You may be asked to attend a hearing, which can be held by phone.
• The tenant does nothing. The tenant is treated as accepting the end date and must leave by it.

If the end date passes and the tenant is still there, you cannot remove the tenant yourself. File Form 2B with the Rental Office and send a copy to the other party within five days. The Director may refuse the application, try mediation, hold a hearing, or issue an order without one. An order is due within 90 days of the application, although a late order is still valid. A vacate order can be sent to the sheriff, who cannot act until the appeal period has ended. For non-payment orders that period is 7 days. See our guide for a tenant who will not leave after notice for the enforcement steps.

Be careful about partial payments. The tenant still owes rent until moving out, and you are entitled to compensation for use and occupation after the tenancy ends. Accepting arrears or that compensation after a notice does not cancel the notice unless you and the tenant agree in writing. Read anything you sign so you do not reinstate the tenancy by accident.

Getting the tenant out and getting paid are separate steps. For money, you also go through the Rental Office rather than court. The Director has exclusive authority over matters arising under the Act, and can order a tenant to pay money. An application can be made during the tenancy or within six months after it ends. Use Form 2B, the landlord application to determine a dispute.

Once you hold an order, you may file it in court if no appeal is underway. A filed order can then be enforced like a court order. The court rules list tools such as a writ of execution and garnishment of debts owed to the debtor. Which court office accepts the filing and any filing fee were not confirmed, so ask the court office. Our Ask page on suing for unpaid rent gives the general idea.

The deposit is not a shortcut. You may keep money from a security deposit without an application only if the tenant agrees in writing at the end of the tenancy, or to cover an amount the Director has already ordered the tenant to pay and that is still unpaid. Otherwise, within 15 days after the tenancy ends, return the deposit with interest or file Form 2B claiming against it. Miss that deadline and you lose the right to claim against the deposit and must pay the tenant double. Our PEI guide on the landlord security deposit covers the full rules.

The Act lists the fees a landlord may charge. A late-payment fee is not on the list, and the Act does not authorize it. Whether a late-fee clause in a lease can be enforced was not confirmed, so do not rely on one. Our Ask page on late fees covers the general question.

A returned cheque is different. You may charge the bank's own fee for the returned cheque plus an administration fee of not more than $25. A lease clause that makes the rest of the term's rent due as soon as the tenant breaches any term is banned.

A tenant behind on rent does not lose the protections of the Act.

• No cutting services. You cannot end or restrict heat, water or other services the tenant uses as part of living there. The Act counts utilities and heat as services and gives no exception for unpaid rent.
• No seizing belongings. A landlord cannot seize a tenant's personal property or block access to it. The old remedy of distress is abolished.
• No lockouts. A lock can be changed only if every tenant gets a new key, and possession comes only through the tenant leaving or an order sent to the sheriff.

Breaking the Act can bring an administrative penalty of up to $10,000 per breach and a fine of up to $25,000.

Other problems are paperwork. A notice on the wrong form, a short end date or an inaccurate amount owed can be set aside, and you start again. The tenant can appeal a vacate order to IRAC within 7 days for non-payment, and serving the appeal stays the order. For the whole sequence, read our PEI landlord eviction guide.

This guide explains the rules in general terms; for a specific case, ask the tribunal or a licensed legal professional.