The question of the legality of the security deposit in the context of residential leases is the subject of ongoing legal debate in Quebec courts. When a lease is concluded between a landlord and a tenant, various contractual terms may be negotiated, including the security deposit. This is a sum of money paid by the tenant to cover any claims the landlord may have.
The practice of requiring a security deposit is governed by Article 1904 of the Civil Code of Quebec, which stipulates that the landlord may not require each payment to exceed one month’s rent. Furthermore, no amount other than the rent may be demanded, whether in the form of a deposit or otherwise, and no cheque or other post-dated instrument may be requested for payment.
The courts have interpreted the term “demand” in its usual sense, including the notions of request, solicit, require, or claim. Thus, the landlord cannot present the security deposit as a condition precedent to entering into the lease. Even when it is offered as one of several options, the security deposit cannot be required as a condition of the lease, on penalty of illegality.
Despite this prohibition, a tenant may choose to voluntarily pay a security deposit in certain circumstances. However, for this waiver of legal protection to be valid, the tenant must freely and voluntarily offer the deposit, and the landlord must ensure that this offer is clear and unequivocal. In the event of a dispute, the Tribunal administratif du logement (TAL) must determine whether the deposit was offered voluntarily or required by the landlord.
Finally, it is essential to emphasize that the landlord is obliged to return the deposit at the end of the lease if all rents have been paid. Under no circumstances can the landlord withhold the deposit as compensation for any loss, except in the case of damage or loss caused by the tenant. Even in this case, recourse to the TAL is necessary to establish the legitimacy of the retention of the deposit.
In short, although the landlord may voluntarily accept a security deposit offered by the tenant, he or she must scrupulously respect the legal provisions governing this practice and may under no circumstances make it a condition for the conclusion of the lease.
Don’t hesitate to contact us at 514.975.1133 or by e-mail, UpperBee immo your reference in condominium real estate brokerage.
