What Landlords Need to Know about the New Marijuana Laws

As of October 17, 2018, the possession, sale and consumption of marijuana was legalized in Canada. In most provinces, it is legal to grow up to four plants per residence and smoke marijuana at home. But what are the implications for landlords? Hydroponics is an expensive business. Who will foot the bill?

We take a look at steps landlords can take to protect themselves.

Who do the new laws affect?

Legislation varies from province to province. For example, some provinces impose a minimum age limit of 18 years, while in others it is 21.

Canadians can smoke marijuana for recreational purposes throughout Canada. Some provinces prohibit the smoking of marijuana in public spaces. Canadians are permitted to grow up to four plants at home in all provinces, except Quebec and Manitoba, where home-grown marijuana is prohibited.

Regional restrictions cover the sale and transportation of recreational marijuana, as well as landlords’ rights to restrict its use and cultivation in rental properties.

Why might landlords have objections?

Landlords may object to tenants smoking marijuana in their rental properties for a number of reasons:

• Property damage: Like cigarette smoke, marijuana has a very distinct, pungent aroma, which can linger long after the tenant has vacated the property. This leads to bigger cleaning bills, and quite possibly the need to renovate completely, redecorating and replacing flooring and drapes. As with tobacco, smoking in a confined area can cause staining, leaving a sticky, dark residue which is extremely difficult to remove. There is also the risk of burn-damage.
• Nuisance to other residents: Marijuana smoke is highly pervasive. It could drift to neighbouring properties, causing a nuisance to other tenants. With the rise of lung conditions like asthma and COPD, the impact on neighbouring tenants is a serious concern. In addition, marijuana is a drug that, like alcohol, can affect behaviour. A US government study published by the NCBI reveals correlations between marijuana use and antisocial behaviour.
• Health and safety: The dangers of passive smoking in relation to tobacco are well documented. Marijuana is somewhat of an unknown quantity. There are also the obvious fire risks associated with smoking, and the risk of fire spreading to adjacent properties. This could have implications in terms of property insurance.

With regard to the growing of marijuana, landlords also have legitimate concerns.

Who is going to pay for it?

Cultivating marijuana is a lot more involved than simply planting a seed and watching it grow. The drug is derived from female plants, which require just the right conditions to flower and produce a crop.

Most home-growers rely on hydroponics. These installations, often installed by amateurs, pose an inherent fire risk.

The British Columbia Fire Chiefs’ Association cited marijuana grow lamps as the cause of 36 fires throughout the province between 2007 and 2012. Bearing in mind that home-growing is now legalized, that figure is set to rise.

It is arguable that many of these fires occurred in industrial-scale growing operations, involving high-powered lighting that is not designed for home use. Nevertheless, marijuana plants do require 12-18 hours of light, a demand which simply cannot be met in the depths of winter without artificial assistance. This raises the question: who is going to pay for it?

Many Canadian landlords include basic services such as light, heat, electricity and water. There is understandable concern amongst these landlords that they might end up footing the bill for additional costs they had no idea they were signing up to when the tenancy was taken out. In addition, there are the insurance implications: whether they will be insurable, and if they are, who will cover the inevitable rise in their premium?

What can landlords do?

The legalization of marijuana understandably sparked huge concerns amongst Canadian landlords. Aside from their own objections, they also have a duty of care to other tenants. But what can they do to stop marijuana being consumed and grown in their rental properties?

The truth is, it depends. Just as legislation varies from province to province, so do landlords’ powers. Let’s take a look at each province in turn.

Ontario

Landlord lawyers in Toronto warn that not all landlords will be able to retroactively prohibit the smoking of cannabis in existing rentals. Landlords can include restrictive clauses in any new lease, however.

The general rule is that tenants can smoke cannabis in their own unit, but where the smoke drifts and affects neighbours, Ontario landlords can take action. The Ontario Landlord Tenant Board can impose an eviction under 64 of the Residential Tenancies Act where a tenant’s behaviour impinges upon a landlord or neighbouring tenant’s right to quiet enjoyment of their own property.

Under the Ontario Landlord Tenant Act, landlords can serve notice to end the tenancy, but the Landlord Tenant Board makes the final decision.

Section 61 of the Landlord and Tenant Act Ontario also provides that a tenancy may be terminated where a tenant commits an illegal act. Growing more than four marijuana plants, or selling cannabis from the property, could therefore be legitimate grounds for eviction.

Alberta

Many Alberta landlords updated rental agreements prior to implementation of the new marijuana legislation, restricting or prohibiting the smoking and cultivation of marijuana in their rental properties.

Under the Alberta Residential Tenancies Act, landlords can set rules for what is and isn’t allowed in their properties, and can prohibit marijuana growing and smoking. There is some debate, however, regarding the lawfulness of these restrictions on tenants who use cannabis for medical reasons, with some lawyers arguing that a blanket ban impinges upon their fundamental human rights. It is arguable though that medical marijuana can be ingested by alternative methods to smoking, and bought from a licensed manufacturer rather than grown in the home.

British Columbia

Under BC legislation, marijuana plants must not be visible from public spaces. This means that plants must be grown away from windows, necessitating artificial lights and ventilation systems.

Under the Cannabis Control Act, Section 160, landlords have the power to restrict the smoking and cultivation of marijuana in BC. The Act permits BC landlords to add clauses restricting or prohibiting cultivation and smoking of marijuana to new tenancy agreements.

They may seek to add a restrictive addendum to existing tenancy agreements, but existing tenants cannot be compelled to agree. However, where an existing tenancy agreement includes a no-smoking clause, this automatically prohibits the smoking of marijuana.

Landlord BC, an organization representing landlords across the province, petitioned hard for this legislation. CEO David Hutniak points out that BC landlords offer housing, not greenhouses, and the four plant maximum was open to abuse.

Some landlord lawyers caution against imposing an outright ban, however, warning that such steps simply drive tenants’ activities underground.

Manitoba

Manitoba’s marijuana legislation is somewhat more conservative. Growing cannabis plants within the home is strictly prohibited.

It is illegal to smoke or vape marijuana in public places in Manitoba, including apartment common areas, inside or outdoors.

Many property management companies in Manitoba have implemented their own cannabis policies, banning vaping and smoking within properties, including on balconies. Such policies are contentious, with landlord lawyers warning that they may not be valid where existing tenants withhold agreement. Nevertheless, where a smoking ban is imposed under the tenancy agreement, this automatically includes the use of marijuana.

New Brunswick

Landlords are granted powers to restrict the cultivation and smoking of cannabis in New Brunswick rental properties, but cannot prohibit consumption altogether. Landlords can impose smoking restrictions, but they cannot prohibit the consumption of marijuana via other methods.

Leases must expressly state that cultivation or smoking is prohibited for the ban to be lawful. Existing leases can only be amended with the tenant’s consent. The term “no smoking” in New Brunswick tenancy agreements is all encompassing.

Newfoundland and Labrador

Prior to the legalization of marijuana in Canada, this province amended its standard form rental agreement to include optional restrictive clauses regarding the cultivation and use of cannabis.

Landlords can also dictate whether or not cannabis can be smoked on porches and balconies, as well as in common areas inside and outside their rental properties.

Nova Scotia

Under the Cannabis Control and Residential Tenancies Acts, landlords in Nova Scotia have the power to amend existing tenancy agreements to add new rules regarding the cultivation and smoking of recreational cannabis. Up until April 30, 2019, landlords must provide four months’ written notice of the changes they seek to impose, whereupon the tenant can then decide whether or not they want to terminate the lease. If they opt to terminate, tenants can use a standard form to provide their landlord with three months’ written notice.

Prince Edward Island

Landlords can prohibit growing and smoking of marijuana in their rental properties in new rental agreements and seek consent to amend existing leases. In Prince Edward Island, smoking marijuana in public spaces is prohibited. It is allowed in common areas of a rental building, at the landlord’s discretion.

Saskatchewan

In Saskatchewan, landlords have the right to change existing leases to prohibit the cultivation of cannabis in their rental properties. Marijuana cannot be consumed in public places. Many Saskatchewan landlords changed their smoking policy ahead of the legalization of cannabis in Canada, and it is estimated that 80% now prohibit smoking in their properties.

Quebec

Quebec landlords were given 90 days to add no smoking policies to existing leases once the new marijuana legislation came into effect.

Growing cannabis at home is prohibited in Quebec.

Conclusion

Legislation varies from province to province, but there are some key steps landlords can take to protect their interests.

• Check the terms of existing lease carefully. Where a smoking ban is imposed, this is generally accepted to include the smoking of recreational marijuana in most provinces.
• Include no smoking and/or growing policies in new leases. If the tenant proceeds to smoke in the rental property after signing up to a no-smoking clause, landlords will have grounds to evict. It should be remembered that the eviction process can be an expensive and protracted business, however, and not everyone reads the fine print. It’s a good idea to be upfront about any restrictive clauses before the tenant takes out the lease. If you don’t allow marijuana to be grown or smoked on your property, then it’s vital to be clear, to avoid any problems later on.
• Seek to add restrictive clauses to existing leases. These could cover the growing and/or smoking of marijuana in your rental property. It is important to note that in some provinces, tenants cannot be forced to agree to new terms. Nevertheless, where growing or smoking causes damage to property, or interferes with the rights of others to quiet enjoyment of their own unit, landlords may be able to impose sanctions.
• Review the services you want to provide. Growing one pound of marijuana is estimated to require around 2,000kWh of electricity. Are you happy to foot the bill? Landlords should review precedent contracts and decide which services they want to include with new rentals, and which they require tenants to pay themselves.
• Insurance. Where growing and/or smoking is permitted in the rental property, landlords will need to make enquiries of their insurers to ensure they are adequately covered.
• Carry out regular inspections of the property. Remember, in provinces where home-growing is allowed, tenants are only permitted to grow up to four plants. Regular inspections are a sensible step to ensure that growing or smoking isn’t causing damage to property. In most provinces, 24 hours’ notice in writing is required.

Being a landlord isn’t always easy, but there are simple steps landlords can take to protect themselves. Landlords need to be aware of issues that could arise through the growing and smoking of marijuana in their properties, and how these could become a nuisance, not only to them, but to neighbouring tenants.