Subletting is a common occurrence in Ontario’s rental market, offering flexibility for tenants and continuity for landlords. However, creating a legally sound sublease agreement in Ontario requires careful attention from all parties. Unlike a direct lease, there is no government-mandated standard form for a sublease, making a well-drafted document essential for everyone’s protection.
Here is a comprehensive guide for tenants (sublandlords) drafting the agreement and landlords (head landlords) providing consent.
1. The Critical First Step: Landlord’s Written Consent
For a sublease to be legally valid under the Residential Tenancies Act (RTA), the tenant must obtain the landlord’s permission in writing before a subtenant moves in.
| For the Tenant (Sublandlord) | For the Landlord (Head Landlord) |
|---|---|
| Send a formal, written request detailing the subtenant’s name, the duration of the sublet, and a copy of the proposed sublease agreement. | Do not unreasonably refuse. You must have reasonable grounds (e.g., poor credit, past rental history, too many people occupying the unit) to reject the subtenant. |
| Document everything. If the landlord unreasonably refuses, the tenant has the right to file an application with the Landlord and Tenant Board (LTB). | Provide written consent (or refusal) promptly. Written consent is your proof that you approved the arrangement. |
Crucial Note: A refusal gives the tenant the right to give 30 days’ notice to end their own tenancy.
2. Essential Elements of the Sublease Agreement
The sublease agreement is a contract between the original tenant (Sublandlord) and the new occupant (Subtenant). It must be thorough and must always follow the terms of the original lease.
A. Clear Identification and Term
- Parties: Include the full legal names and current contact information for the Original Tenant (Sublandlord), the Subtenant (Sublessee), and a section noting the Head Landlord’s name.
- Premises and Term: State the complete address and specify that the sublet must have a definite start and end date. The duration must be shorter than the original tenant’s lease term. The original tenant must have a genuine intention to return.
- Original Lease: The sublease agreement must explicitly state that the subtenant is bound by all the terms and rules of the Original Lease. Attach a copy of the original lease to the sublease agreement.
B. Financial Responsibilities
- Rent Amount: The rent charged to the subtenant cannot exceed the amount of rent the original tenant pays to the landlord. Overcharging is illegal under the RTA.
- Rent Payment: Specify the due date, the payment method, and who receives the payment (typically the original tenant, who remains responsible for paying the head landlord).
- Rent Deposit: A last month’s rent deposit is permitted, but it cannot exceed one month’s rent. Damage deposits are generally not allowed in Ontario. The deposit must be returned with interest upon the subtenant vacating the unit, or applied to the last month’s rent.
- Utilities and Services: Clearly itemize which utilities (hydro, heat, water, internet) are included in the rent and which the subtenant is responsible for.
C. Tenant and Landlord Protections
- For the Sublandlord: You remain responsible to the head landlord for the subtenant’s actions—including late rent or damage to the unit. The sublease agreement is your recourse to recover costs from the subtenant.
- For the Head Landlord: Your legal relationship and your right to collect rent are still with the Original Tenant. The subtenant cannot deal directly with you unless the original tenant defaults and the LTB is involved. The written consent confirms your awareness but does not create a direct tenancy with the subtenant.
Sample Sublease Agreement in Ontario
This is a template designed to meet the minimum legal requirements for a sublease agreement ontario tenants and landlords should use.
SUBLEASE AGREEMENT
This Sublease Agreement (the “Agreement”) is made this [Day] day of [Month], [Year], in the Province of Ontario.
BETWEEN:
The Original Tenant (Sublandlord):
Name(s): [Original Tenant’s Full Legal Name(s)]
Address: [Original Tenant’s Current Mailing Address]
Phone: [Phone Number] | Email: [Email Address]
AND:
The Subtenant (Sublessee):
Name(s): [Subtenant’s Full Legal Name(s)]
Address: [Subtenant’s Current Mailing Address]
Phone: [Phone Number] | Email: [Email Address]
AND (For Reference Only):
Head Landlord/Property Owner:
Name: [Head Landlord’s Name or Company Name]
Contact: [Landlord’s Phone or Email]
1. PREMISES
The Sublandlord agrees to sublease to the Subtenant the property located at:
[Full Street Address, Unit Number, City, Ontario, Postal Code]
(The “Premises”). The Premises will be used as a private residence only.
2. TERM OF SUBLEASE
This sublease agreement commences on [Start Date (Day/Month/Year)] and shall end definitively on [End Date (Day/Month/Year)].
The Subtenant agrees to vacate the Premises by the end date, as the Sublandlord intends to resume occupancy. This end date is prior to the end of the Original Tenant’s lease term with the Head Landlord.
3. RENT
The Subtenant agrees to pay a total monthly rent of $[Amount], due on the [Day] day of each month.
- Payment Method: Payments shall be made to the Sublandlord via [Specify method, e.g., e-transfer to Sublandlord’s email].
- Rent Cap: The Subtenant acknowledges that this rent amount does not exceed the amount the Sublandlord pays to the Head Landlord.
4. RENT DEPOSIT
The Subtenant agrees to pay a last month’s rent deposit in the amount of $[Amount] on [Date Deposit Paid]. This deposit shall be applied to the final month’s rent (or rent period) of this sublease. The Sublandlord shall pay interest on this deposit as required by the RTA.
5. INCLUDED UTILITIES AND SERVICES
The following utilities/services are included in the monthly rent: [Check all that apply: Heat, Hydro, Water, Internet, Cable TV, Parking Spot]
The Subtenant shall be responsible for all other utilities/services.
6. RELATIONSHIP TO ORIGINAL LEASE (MASTER LEASE)
The Sublandlord has a legal tenancy agreement (the “Master Lease”) with the Head Landlord dated [Date of Original Lease].
The Subtenant agrees to be bound by, and to fully comply with, all the terms, covenants, and conditions contained in the Master Lease. The Sublandlord has provided the Subtenant with a complete copy of the Master Lease and the Head Landlord’s written consent to this sublease, both attached as Schedule A and Schedule B.
7. RESPONSIBILITIES (MAINTENANCE AND DAMAGE)
- The Sublandlord remains liable to the Head Landlord for all obligations and liabilities under the Master Lease.
- The Subtenant shall be responsible for damage to the Premises caused by the Subtenant or the Subtenant’s guests beyond ordinary wear and tear.
- The Subtenant shall immediately notify the Sublandlord of any need for maintenance, repairs, or emergencies.
8. DEFAULT
If the Subtenant fails to pay rent or breaches any term of this Sublease or the Master Lease, the Sublandlord may pursue remedies including termination of the sublease and eviction proceedings through the Landlord and Tenant Board (LTB).
9. SIGNATURES
By signing below, the parties confirm that they have read and agree to all terms of this sublease agreement.
| Original Tenant (Sublandlord) | Subtenant (Sublessee) |
|---|---|
| Signature: _________________________ | Signature: _________________________ |
| Name: ____________________________ | Name: ____________________________ |
| Date: ____________________________ | Date: ____________________________ |
SCHEDULES:
* Schedule A: Copy of Original Tenancy Agreement (Master Lease)
* Schedule B: Head Landlord’s Written Consent to Sublet
Disclaimer: This is a sample template for a sublease agreement. While it adheres to key requirements of the Ontario Residential Tenancies Act, it is not a substitute for legal advice. It is recommended that all parties consult with a legal professional to ensure the agreement is comprehensive and appropriate for their specific circumstances.
