RTB failed to properly consider landlord’s ‘ulterior motive’ for evicting tenant of 18 years: B.C. court

The Law Courts building, which is home to B.C. Supreme Court and the Court of Appeal, is seen in Vancouver on Nov. 23, 2023. (Darryl Dyck / The Canadian Press)

A long-time tenant has won the right to stay in her home, at least for a little while, after the B.C. Supreme Court ruled in her favour.

Yuk Ching Leung has been a tenant in Hui Fen Kung’s property for 18 years, according to the judicial review decision handed down by Justice Kevin D. Loo on Thursday.

The decision, which was published online Friday, does not specify where in B.C. the property is located, though the case was heard in Vancouver.

For most of the tenancy, Leung and Kung got along, with the landlord only raising the rent by the provincially set maximum each year, according to the decision.

Then, in November 2023, Kung informed Leung that the rent would be increased to $1,400 a month, which the decision indicates was a 41.7-per-cent increase on the amount Leung had been paying.

While the decision does not specify what the previous rent was, math suggests it was just under $1,000 a month for Leung’s two-bedroom, one-bathroom basement suite—well below the market rate for such a home in most parts of B.C.

The maximum rent increase allowed in B.C. during 2023 was 3.5 per cent, according to the decision. When Leung pointed this out, the decision says, Kung was “angry.”

“The petitioner ultimately agreed to a 23-per-cent increase in December 2023,” the decision reads. “The relationship between the parties subsequently deteriorated.”

The eviction notice and the RTB decision

In September 2024, Kung issued Leung a four-month notice to end tenancy for landlord’s use.

In B.C., landlords may evict tenants without cause if they or a close family member intend to move into the rental unit.

These “landlord’s use” evictions must be made in good faith, and the person moving into the unit must do so within a reasonable amount of time and live there for at least a year. Landlords who fail to meet these criteria and cannot prove there were extenuating circumstances can be ordered to compensate the tenants they evicted.

Leung challenged the eviction notice, arguing before an arbitrator of the province’s Residential Tenancy Branch that Kung was acting in bad faith and only seeking to evict her because she was paying below-market rent.

For her part, Kung told the arbitrator that she needed to move into Leung’s unit because she had fallen in April 2024 and was suffering chronic leg and back pain. Rather than continuing to live in the upstairs unit of the home, she wanted to move into the basement unit “so that she would have to deal with fewer stairs,” according to Loo’s decision.

The RTB arbitrator ultimately sided with Kung, upholding the eviction notice and ordering Leung to vacate the property.

Leung petitioned the B.C. Supreme Court for a judicial review of the RTB decision, which is how Loo came to be involved.

‘Ulterior motive’

In court, Leung argued that the RTB arbitrator had erred in several ways, only some of which Loo accepted.

The judge found that the arbitrator had “ranked” Kung’s motives for issuing the eviction notice and “failed to grapple” with the evidence Leung presented to suggest that Kung had an “ulterior motive.”

The arbitrator’s decision concluded that Kung’s stated reasons for moving in outweighed her alleged desire to re-rent the property at a higher price, describing the landlord’s injury as the “predominant” reason for the eviction.

Previous B.C. Supreme Court decisions have established that RTB arbitrators may not rank a landlord’s motives when considering challenges to eviction notices, according to Loo.

“The notice cannot be said to have been issued in good faith if it was influenced by an ulterior or dishonest motive, regardless of whether that motive is characterized as primary or secondary,” the decision explains.

“It is not open to this court to ignore the arbitrator’s use of the words ‘outweighs’ and ‘predominant’ and to substitute other words in their place. The meaning of those words is plain. I conclude that the decision is flawed in that the arbitrator found that the respondent’s good faith motive outweighed her ulterior motive, and that it was the predominant motive compared to her ulterior motive.”

Moreover, Loo found, the arbitrator failed to adequately explain why the landlord’s evidence was preferred to the evidence Leung presented suggesting an ulterior motive.

For these reasons, the judge concluded the arbitrator’s decision was “patently unreasonable,” and must be set aside.

Loo stopped short of substituting his own decision, however, opting instead to send the case back to the RTB for reconsideration.