A WINDFALL FOR “CAMPERS” AND LIABILITY FOR LAND OWNERS

The Ontario Court of Appeal recently declared that owners of permanent structures on
leased land are subject to the provisions of the Residential Tenancies Act (RTA). For
owners of recreational campgrounds and recreational land lease properties the ruling
creates unexpected and costly liability because if the RTA applies, the owner of the land
is required to maintain roadways, trees, provide garbage removal, snow removal, and
ensure compliance with all “housing” standards required by municipalities or other
provincial legislation. The owner must also comply with rigorous security of tenure
provisions and rent control provisions of the RTA. The net effect is to convert the
property from a recreational use to a residential use regardless of zoning and
infrastructure. For the owners of land lease homes, the ruling is a windfall: they
effectively receive a transfer of the entire land value, plus extra’s, free of charge at the
expense of the land owner. You cannot “contract out” of the RTA.

Where recreational camp structures owned by campers are “permanently” affixed to
leased land, there is a high risk of the RTA applying. The risk declines if the operations
on the land fall within an exemption provided in section 5 of the RTA which exempts
“living accommodation…occupied for a seasonal…period in a….campground, trailer
park…or vacation home”; however, if the structure is “permanent”, thereby making the
structure a “land lease home”, then the exemption cannot apply. If you are an owner
with concerns about the degree of permanence of some homes in your community and
the potential that the RTA applies, then it is time to do a careful and objective audit of
the structures on your property and the current leasing/licensing arrangements in place.
Ignoring the problem won’t make it go away and will cripple the value of your property
and costs of operations if campers obtain a declaration that the RTA applies to your
community.

At Cohen Highley LLP we act exclusively for property owners and operators of
campgrounds, land lease communities and mobile home parks. Our lawyers assist
owners with land use transitions from campgrounds to residential use; with infrastructure
approvals; with leasing and licensing documents; and we initiate or defend owners in legal
proceedings in all levels of Ontario Superior Court and other adjudicative Boards and
Tribunals.

The Court of Appeal decision referred to in this Bulletin is Algoma Timberlakes Corporation
v. Mathews. The decision can be accessed through:
http://www.canlii.org/en/on/onca/doc/2010/2010onca468/2010onca468.html.

Joe Hoffer and Kristin Ley of Cohen Highley were the lawyers for Algoma Timberlakes
Corporation. They were successful at the Landlord and Tenant Board and in Divisional
Court, but the Court of Appeal disagreed with the courts below and substituted its own
reasoning which is highly prejudicial to campground operators in Ontario.

For further information about our legal services or the contents of this Bulletin, contact Joe
Hoffer at
or telephone 519-672-9330.

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