OCCUPATION RENT IN ONTARIO
When parties separate, one party moves out of the home eventually. The spouse not in the home (non-occupying party) can ask that the spouse remaining in the home (occupying party) to pay rent as if the non-occupying party was a landlord or landlady. This is called occupation rent.
Occupation rent is infrequently claimed for two reasons. First, many couples decide to sell the home that was occupied by both parties. They both move to premises that fit his or her new budget. Second, the occupying party of a matrimonial home often assumes responsibility for all of the mortgage payments. Since the mortgage is often in the name of both parties, the non-occupying spouse gets the benefit of being relieved of his or her half of the outstanding mortgage.
In the case of Charron. v. Charron, 2014 ONSC 496 the Honourable Justice de P Wright cited favourably the decision of Casey v Casey, 2013 SKCA 58. (Saskatchewan Court of Appeal). In that case, the Honourable Mr. Justice Lane summarized the law regarding occupation rent.:
- Occupational rent is a remedy which may be utilized to obtain justice and equity in appropriate circumstances.
- The remedy is exceptional and should be used cautiously.
- The remedy is a discretionary one requiring the balancing of the relevant factors to determine whether occupational rent is reasonable in the totality of the circumstances of the case.
- The following factors, where relevant, are appropriately considered:
- The conduct of both spouses, including failure to pay support, the circumstances under which the non-occupying spouse left the home, and if and when the non-occupying spouse moved for a sale of the home.
- Where the children are residing and who is supporting them.
- If and when a demand for occupational rent was made.
- Financial difficulty experienced by the non-occupying spouse caused by being deprived of the equity in the home.
- Who is paying for the expenses associated with the home? This includes who is paying the mortgage and other upkeep expenses (maintenance, insurance, taxes, etc.). If there is no mortgage, occupational rent may be needed to equalize accommodation expenses.
- Whether the occupying spouse has increased or decreased the selling value of the property.
- Any other competing claims in the litigation that may offset an award of occupational rent.
Justice de P Wright held that because one must look at the totality of the circumstances then a judge usually should not order occupation rent until the end of trial.
Occupation rent is a legal remedy more flexible than one would usually assume. It is possible for a party to experience real hardship if they must wait until trial to obtain a remedy, however. This is particularly true if the occupying party does not maintain the matrimonial home after the separation.