Backing out from a promise to lease can be expensive

A potential tenant who commits to signing a lease cannot withdraw from that commitment at the risk of having to compensate the owner, recalls a recent decision of the Régie du logement. In fact, a candidate who signed a rental application form was sentenced by the court to pay $2,870 in damages to the landlord for the loss of rents that she caused by changing her mind and deciding to no longer rent the apartment.

In her decision, Administrative Judge Lucie Béliveau first pointed out that the Régie du logement had jurisdiction over this dispute, despite the absence of a lease in its true meaning. She argued that the commitment to sign a lease was confirmed as soon as the landlord informed the applicant of the acceptance of her application. In addition, in transmitting her letter of discontinuance, the candidate confirmed the fact that she had initially accepted the offer. As the parties were now bound, they could no longer withdraw from the future lease.

The landlord claimed the equivalent of all rents lost for the period from July 1, 2014, to June 15, 2015, the date on which the unit was re-rented. However, the landlord sold the property in mid-September 2014. Although the landlord made a personal commitment to the buyer to assume the loss of rents for this unit, the judge ruled that the landlord did not have the legal interest to claim the loss of rents from the candidate for the months elapsed after the sale, which was from September 15, 2014, to June 2015. The owner thus received a compensation only for the period during which the building belonged to him.