Interpretation of section 1959.1 on the renter’s income

Article locked Published on by Me Jean-Olivier Reed

Topic(s): Legal

Note aux lecteurs : Ces articles sont des résumés de décisions rendues dans les affaires citées. Veuillez noter qu'il ne s'agit pas d'une revue de la jurisprudence et que d'autres décisions peuvent être rendues par la suite ou être différentes et changer l'état du droit. C'est également le cas si les faits ne sont pas les mêmes que ceux présentés dans l'affaire mentionnée.

Contradictory jurisprudential trend to be followed at the Administrative Housing Tribunal.

Since the coming into force of section 1959.1 of the Civil Code of Québec in 2017, which restricts by 3 cumulative conditions, the repossession of a housing, some decisions have been rendered by the Administrative Housing Tribunal, particularly as to the maximum income to be considered.

First, the 3 conditions of this section are cumulative, so if one of them is not respected by the tenant, the exception no longer applies which allows the owner to repossess the housing.

The one we are dwelling on today refers to the “maximum income” and reads as follows:

... and whose income is equal to or less than the maximum income allowing him to be eligible for a low-rent dwelling under the Regulation respecting the allocation of low-rent dwellings (chapter S-8, r. 1).

It is therefore relevant to know which income is part of this condition and how the administrative court interprets it.

A first trend considers all the income of people living with the tenant and the reasoning is mainly contained in the judgement that will be called “Gamache” of administrative judge Camille Champeval beginning at paragraph 32 of the decision:

Gamache v. Boivin, 2019 QCRDL 2538 (CanLII)

“... Income to be considered:
32 By referring to the annual scale published by the Société d’Habitation du Québec (SHQ), the legislator limits the scope of section 1959.1 C.c.Q to seniors in a precarious financial situation.
33 Each year, the SHQ’s website publishes the income limits considered in the process of obtaining low-rent housing. The gross income of the future tenant is considered.
34 For the year 2017, this maximum income is... for the Montreal area, whether it is a single person or a couple. For the year 2018, it is .....
35 The Société d’Habitation du Québec defines the income limits determining core needs (PRBI- Plafonds de revenu déterminant les besoins impérieux) as follows:
“The PRBI corresponds to the maximum income that allows a household to be eligible for low-rent housing under the Regulation respecting the allocation of low-rent housing. It is used to assess an applicant’s eligibility and to weigh their application. 3
36 It must therefore be understood from this definition of the PRBI that the total income of the household is considered in the allocation of low-rent housing, regardless of the individual financial situation of either one of its members.
37 Moreover, on this subject, the author Pierre-Gabriel Jobin mentions the following in his treatise on renting:
“In the third place, the lease of low-rent housing is, for a large part, exempt from the general mechanism of rent control. This area is very particular and differs, in many ways, from the normal field of residential leasing. In general, low-rent housing, or “HLM,” is the result of direct state intervention. It is a social assistance measure for low-income people. The landlord is not interested in profit-making; he provides kind of a public service. The rent, moreover, is set according to special criteria, in particular in that it depends on the income of the household that is renting.” 4 (our emphasis)
38 According to section 1 of the Regulation respecting the conditions for renting low-rent dwellings, a household is composed of one or more persons who occupy the same dwelling. 39 In summary, it is therefore the total income, whether it is a person living alone, in a couple or with a family, that will be considered in the assessment of a request for low-rent housing.
40 Although the term “household income” is not expressly used by the legislature in section 1959.1 of the C.c.Q., the latter, by referring the reader to the annual thresholds published by the SHQ, expressly designates this time the scale to be considered: it must be understood that the income of the tenant, inseparable from that of his spouse in the process of qualifying an “HLM,” will be the same in the request of section 1959.1 of the C.c.Q.
41 To conclude otherwise would be meaningless: it would thus amount to saying that a tenant with an income too high to obtain a “low-cost housing,” but whose spouse has an income meeting that same criterion, could defeat a request for the repossession of a housing. This would create a disruption of the delicate balance between the rights of the tenant and those of the landlord.
42 This interpretation is consistent with the legislator’s intention to protect seniors, who are vulnerable not only because of their age but also because of their income.
43 The following excerpts from the debates or discussions in parliamentary committee are revealing in this regard:
“Mr. Martin Coiteux: First, seniors were defined as being 70 years of age or older. Then, to ensure that vulnerable seniors were protected, first and foremost, there was an income criterion, the income criterion being the same as that which gives access to housing such as low-rent housing, for instance.
Mrs. Carole Poirier: (...) So, the security that the bill provides for a category of seniors who are those who are 70 years old, who have been living for 10 years in their housing and who have a lower income — an income that is comparable to an income to obtain a low-rent housing, - they, we will come to secure them.” 5

Section 3 of the Regulation respecting the conditions for renting low-rent dwellings specifies the period for which income must be considered: “The income considered for
the purposes of this Regulation are the sums earned during the calendar year preceding the date on which the lease begins by each of the persons who make up the household.” 
44 It is appropriate to transpose this parameter for the purposes of establishing income in the context of the application of section 1959.1 C.c.Q.”...

At least two other decisions conclude that a combination of the income of the occupants of a dwelling is required in order to determine whether or not a tenant aged 70 and over meets the requirements of section 1959.1 C.c.Q:

Cyrenne v. Pilon, 2019 QCRDL 5365 and Meunier v. Garreau 2020 QCTAL 8964 (CanLII), 2020 QCRDL 8964

On the other hand, another line of jurisprudence is beginning to emerge in the opposite direction and advocates the use of the tenant’s income only, in particular in the “Hall” decision.
Diaz Lillo v. Hall, 2021 QCTAL 5978 (CanLII)

Indeed, in this recent decision of 2021, the administrative judge, Me Luce de Palma, mentioned that the “Gamache” approach would restrict this exception to persons living alone, which, in her view, would distort the principle of Section 1959.1 and it excludes any possible cumulation. Based on an article by Me Pierre Pratte1, and a similar decision, it completely rejects the theory of the “Gamache” decision.

(similar decision) Byron v. 9254-3230 Québec inc.,2018 QCRDL 21548 (CanLII)

Judge De Palma explains, in particular in paragraph 55 of the decision, that section 1959.1 does not provide for considering the incomes of other members of the household, even if they reside on the premises.

“...  55 Also, the mere fact that a tenant lives, at the time of the repossession, with a spouse or a child whose income, added to his low income, exceeds, or has exceeded, the maximum permissible threshold published by the SHQ, should not make him lose that right to remain in the premises that the legislature intended to protect, nods the undersigned.”...

We consider that the legal reasoning and the conceptual links between the various regulations and laws made by Judge Champeval in the “Gamache” decision better reflect, with respect for the contrary opinion, the intention of the legislator as well as logic and fairness and should become, we hope, the majority jurisprudential current.

We consider that completely discarding the income of other members of the household who remain on the premises with a tenant, while knowing full well that they contribute to the expenses of the “household” is illogical. Especially since section 1959.1 refers directly to the Regulation respecting the allocation of low-rent housing (chapter S-8, r. 1) without specifically excluding the concept of “household income” or even part of that concept. In our view, the legislator is asking for a reference to it without excluding the concepts it contains.

To be continued...

1 Pierre Pratte, Section 1959.1 of the Civil Code of Québec, Repères, EYB2020REP3132.

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