Open this photo in gallery Manal Khader, 37, seen here on Jan. 8, 2019, says she was homeless for six weeks after losing a challenge to an eviction order at a Landlord and Tenant Board tribunal. Marta Iwanek/The Globe and Mail

It is a little understood loophole in Ontario tenancy laws, but one so potent that it can put tenants out on the street with little recourse. Called an N12, it allows a landlord to evict a tenant simply by stating the owner or an immediate family member intends to move in.

And in tight rental markets such as Toronto’s, where demand far outstrips the city’s supply of available units, it’s a tool that a growing number of landlords appear to be using to flip units back into the market and charge higher rents.

Toronto landlord Ke (David) Wang used the N12 loophole to evict renters from at least four apartments in two of his properties in the space of just over a year, claiming that the units were needed for family members. He told at least one tenant in another property she had to leave too. When one tenant fought back, Mr. Wang told the province’s Landlord and Tenant Board that his mother, Hui Ming (Amy) Zhang, needed another apartment because Ms. Zhang’s dog had a difficult time climbing the stairs from a basement unit in the same building – a unit whose tenant Mr. Wang had sent an N12 notice to just months earlier.

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“I was homeless for six weeks,” says Manal Khader, who in 2017 lost a challenge to one of Mr. Wang’s eviction orders at the LTB tribunal. “I had my [stuff] in storage while I was relying on friends to support me.”

Andrea Dearing, a graphic-design professional also lost a challenge to Mr. Wang that same year. “I want attention to be paid. He booted us out of our home.”

The number of N12 evictions disputed before the LTB has almost doubled since 2012, according to data reviewed by The Globe and Mail. Geordie Dent, executive director of the Federation of Metro Tenants’ Associations, says that concerns about illegal evictions represent the “No. 1” concern of renters who call his organization for help. “It’s just through the roof,” he says.

Under an N12, a loophole accessible only to individual landlords (not corporate property owners), landlords can take back apartments for an immediate family member – defined as a parent, child or spouse – who pledges to live there for at least 12 months. If a tenant applies for and wins a case alleging a “bad-faith” eviction – one in which there was no genuine intention to move into the unit -- the fine to the landlord can be as high as $25,000, plus financial relief in the form of rent-subsidy payments.

However, the data shows that bad-faith findings at the Landlord and Tenant Board (LTB) are exceedingly rare. “Basically, this is an illegal eviction factory,” says Mr. Dent of the FMTA, which collects data on the market through a tenants’ help line that it runs to educate and assist renters.

In 2012, N12s were used for 1,542 eviction applications. By 2018, that number had soared, to 2,919, as Toronto’s rental market has dropped to record low vacancy.

Ontario is reviewing rental regulations and expects potential legislative changes in the fall, said Conrad Spezowka, a spokesperson for the Ministry of Municipal Affairs and Housing.

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“Our government cares about the well-being of the people of Ontario and wants to make sure both tenants and landlords are treated fairly. We want to encourage a safe and fair system when renting a property so both the tenant and landlord can benefit."

Other provinces have similar rules to N12 that allow landlords to break a tenancy to allow a landlord to move in or offer a unit to close family members (among other reasons), though elsewhere, the penalties for abuse can be stiffer: The NDP government in British Columbia moved in 2018 to extend the amount of compensation for tenants evicted in bad faith from one-month’s rent to 12-months’ rent, and Quebec has many more rules that accompany the practice (including bans on repossessing apartments from seniors over the age of 70) and even on routine, good-faith evictions tenants can claim damages that can climb into thousands of dollars.

Stopping abuse of the loophole will only come with better tracking and real penalties, says Mr. Dent. Currently, he says, “Landlords know they can get away with breaking the law with no consequence.”

In the case of Mr. Wang, an examination of property records and more than a dozen interviews conducted by The Globe and Mail paint a portrait of a landlord who has built a multimillion-dollar property empire. Since 2011, he and his mother have together spent close to $8.5-million buying five houses in downtown Toronto that are rented to a mix of long-term and short-term tenants. (At one point, Mr. Wang had 26 listings on Airbnb spread across several houses.)

Mr. Wang has declined multiple times to comment to The Globe and Mail about the allegations by his former tenants.

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The maximum annual rent increase on rent-controlled units in Ontario is now set at 1.8 per cent. And yet, according to Canada Mortgage and Housing Corporation data, average rents in Toronto increased by 5.5 per cent in 2018. (Province-wide, the average was 4.9 per cent.)

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Because of rent controls, there has long been, implanted in Ontario’s Residential Tenancy Act, a powerful financial incentive for private landlords to find ways to “turn over” rent-controlled units – that is, to replace current tenants with new ones: So-called “vacancy decontrol” allows such landlords to reset the rent, at whatever rate the market will bear, whenever a tenant vacates a unit.

Open this photo in gallery Toronto landlord David Wang used the N12 provision to evict renters from at least four apartments in two of his properties, saying that he needed the units for family members. The Globe and Mail

In that market climate, Mr. Dent believes, tougher financial sanctions need to be applied to curb N12 abuse.

Other critics of the current system are also calling for reform on how landlord behavior is tracked. Currently, the LTB doesn’t keep tabs on whether landlords fulfill their legal obligations; instead, the board relies on tenants to notify it if there are cases of bad faith. The non-profit Ontario Tenant Alliance has encouraged the development of an online N12 registry, a crowd-sourced tool that would allow renters to check on the status of apartments from which they have been evicted.

The Federation of Metro Tenants’ Associations represents more than 50,000 renters in Toronto. Until about 2016, its help line received an average of five to eight calls a month regarding N12 eviction issues. But that began changing in 2017 – and since October of that year, the FMTA hotline has been getting more than 50 calls a month.

A Globe analysis of 2018 data provided by Social Justice Tribunals Ontario found that the number of tenants who took their N12 evictions to a hearing had nearly doubled since 2012, to just over 2,900 such applications.

There are also more tenants than ever refusing to accept their eviction lying down: In 2009-10, just 128 applications sought redress for bad-faith evictions (known as T5s). By 2017-18, applications had more than doubled, to 295.

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As Mr. Dent notes, landlords have the right to evict someone when they themselves are moving in. “But when they are not,” he says, “that's a gross violation of the law. It's one of the worst things you can do. You're evicting somebody and forcing them to go through the nightmare of moving, and finding a new place and paying new deposits and paying higher rent. And you're doing it illegally, just to cash in.”

Yet, because N12 notices can be downloaded from the Social Justice Tribunals Ontario website, and then hand-delivered, the SJTO is not able to keep records on how many N12s have been served to tenants. That, in turn, can make it difficult to establish how many times a particular landlord has claimed an apartment for their own use. This becomes particularly relevant for tenants seeking to establish a pattern when arguing that their landlord was simply planning to relist the apartment.

And even establishing such a pattern “is not enough,” notes Toronto lawyer Caryma Sa’d, who specializes in housing law. “It all turns on your intent when you hand the N12 notice to your tenant,” she notes. “You can have what you think is a strong case, the landlord says whatever they say, and there’s no real way to contradict them.”

Because the odds are long, Ms. Sa’d takes up only about a quarter of the N12 cases she is approached about.

“Landlord-tenant law is very, very good for tenants,” Ms. Khader says, “except when it comes to the N12.”

Open this photo in gallery Handout

On Feb. 15, 2017, a company called TO Property Management, which is controlled by Mr. Wang, paid $3.2-million for a rowhouse with 12 rental apartments at 396-400 Dundas St. E., between Sherbourne and Parliament streets in Toronto, where Ms. Dearing and Ms. Khader had lived (in separate apartments) since 2015.

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On June 22, Mr. Wang served each of them with an N12, saying that he and his mother intended to live in the apartments. The two women were to be out by Aug. 31.

Both tenants felt confident that the N12s were nothing more than a convenient tool to end their tenure. On Sept. 19, each was given a hearing, in front of adjudicator Renée Lang, at the LTB tribunal. The Globe has obtained audio recordings of the hearings.

In her hearing, Ms. Khader provided evidence that in May of that year – just a month before Mr. Wang had given notice to her and Ms. Dearing – he had sent an N12 notice to another tenant in the building, Eryn Morgan, who lived in a basement unit. As part of that earlier notice, Mr. Wang had claimed that his mother needed Ms. Morgan’s apartment for herself.

In the hearing before Ms. Lang, Mr. Wang claimed that, despite the earlier N12 to Ms. Morgan, his mother needed to switch to Ms. Khader’s first-floor unit. The reason? It had fewer steps, and her aged dog had health and mobility issues that necessitated a more easily accessible apartment.

Ms. Khader, a social worker, has lived in Toronto since 2015, working on short-term contracts to help refugees acclimatize to their new lives in Canada. “I’ve worked with vulnerable people so much in my career,” she says – and thought she could successfully advocate for her own rights at the LTB.

Ms. Khader believed that Mr. Wang’s multiple N12 notices would represent a pattern of bad faith that would protect her tenure in the apartment. But, in the hearing that September day, Mr. Wang maintained that the N12 sent to Ms. Morgan had been subsequently withdrawn, and that she had made a voluntary agreement to move out.

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There were other vacant units available but Mr. Wang insisted he needed these two.

“Why are you evicting someone, rather than taking a unit you don’t have to evict anyone for?” asked the adjudicator.

His answer? “I want to live close to my mother.”

In the recordings, Ms. Lang is explicit about what she expects from Mr. Wang if she is to use the N12 justification to evict the two women. “What I’m looking for, in an application of this nature, is evidence the landlord … has a good-faith, genuine intention to move into the unit, for his own, in this case, personal residential permanent occupation.” The recording captures her putting strong emphasis on the word “permanent.”

Ultimately, Ms. Lang ruled in favour of Mr. Wang. Ms. Dearing was ordered to move out by Nov. 1, 2017; Ms. Khader was to leave by Dec. 1.

Open this photo in gallery Handout

A key provision of a successful N12 eviction requires that the landlord or an immediate family member must live in the vacated unit for at least a year after the tenant’s eviction­.

At Ms. Khader’s hearing, Barrington Lue Sang, the paralegal representing Mr. Wang, told the adjudicator that, in anticipation of taking over Ms. Dearing’s apartment for himself, Mr. Wang had given notice to vacate a condominium unit in which he was living at 220 George Street, Apt. 501, just a few blocks from his Dundas Street apartments. “He was renting on a month-to-month basis,” Mr. Lue Sang said. “He just had to give notice to move; he has done that."

During those same September, 2017, hearings, Mr. Wang told adjudicator Lang that he had lived in the George Street unit for at least two years before the move-out date he was seeking for Ms. Dearing. However, in subsequent N12 paperwork to yet other tenants, Mr. Wang created a paper trail that suggests he did not, at the time of Ms. Khadar’s eviction, move out of 220 George.

When reached for comment, Mr. Lue Sang declined to comment on whether he knew if Mr. Wang actually gave notice.

Mr. Wang also declined to give any detailed comment to The Globe and Mail either on the phone, in text or in person. On June 14, 2018, The Globe approached him following a second LTB hearing with Ms. Khader (on then-unresolved maintenance issues), where he declined to confirm whether he had lived up to Ms. Lang’s order that he take up permanent residence in Ms. Dearing’s apartment. “I prefer to keep my private residence private,” he said. Asked whether he had ever moved out of 220 George St., as he told the LTB he was going to, he said, “I don’t think that’s relevant to anything. I don’t want to answer for me.”

Regardless of whatever happened with Mr. Wang’s tenancy in the George Street unit, that same N12 provision required that he live in the former apartment of Ms. Dearing until at least October of 2018 (and that his mother live in Ms. Khader’s unit until that November; it is unclear if she did so).

Though at least two of his former tenants filed bad-faith complaints (Ms. Dearing missed a filing deadline, and hers was dismissed; Ms. Khader’s has been heard, but no decision has been issued), sanctions by the tribunal are rare, says Ms. Sa’d, the Toronto lawyer and housing-law specialist.

Ms. Sa’d recounts a case in which other clients filed a T5 after being sent an N12 eviction notice by a landlord who claimed she was moving into their unit with her boyfriend. The tenants filed that T5 with what seemed like powerful evidence: The landlord had earlier issued threats, by e-mail, to evict them if they didn’t agree to a rent increase; and the apartment was listed on Kijiji within months of the eviction.

Ms. Sa’d says the tenants even recorded the landlord admitting she wasn’t going to move in. It was, says Ms. Sa’d, “as much evidence as you can imagine having.”

But at the hearing, she recounts, the landlord said, “Well, I broke up with my boyfriend, so my plans changed.”

“That,” notes Ms. Sa’d, “was sufficient to get the T5 dismissed.”

Open this photo in gallery In 2017, TO Property Management paid $3.2-million for a rowhouse with 12 rental apartments at 396-400 Dundas St. E., between Sherbourne and Parliament streets in Toronto. The Globe and Mail

Mr. Wang has continued to purchase real estate and evict tenants since sending Ms. Dearing and Ms. Khader on their way.

In 2018, he bought two houses close to his Dundas Street complex: On Jan. 5, a company called Thinkers Holding Inc., controlled by Mr. Wang, purchased a house at 394 Dundas St. E. for $900,000. One week later, under his own name, Mr. Wang purchased a house around the corner, at 272 Berkeley St., for $1.27-million.

The house at 272 Berkeley is a classic example of Cabbagetown’s red-brick charm. Then-owner Janet Coles says she received verbal pledges that Mr. Wang would not evict her tenants: Peter Quinsey, a software developer; and Karen Whaley, a board member of Heritage Toronto, who together had been renting an apartment in the home’s upper floors for almost nine years.

After Mr. Wang purchased the property, says Ms. Whaley, “We didn’t hear anything for about a week. Then he came over to meet us. ... He gave us verbal indication that he and his mother would be moving into this building.”

When Ms. Whaley eventually received an N12 from Mr. Wang, it listed his 220 George St., Apt. 501 – the same unit in which he had been living prior to the eviction of Ms. Khader and Ms. Dearing.

Ms. Whaley eventually bought her own house, and signed the eviction agreement on the day she was moving out.

Even though she was in communication with Ms. Khader (they found each other on a Facebook messaging board about Ontario tenants’ rights), who remained convinced of Mr. Wang’s bad faith, Ms. Whaley did not know that Mr. Wang had allegedly made similar overtures to tenants of yet another of his nearby properties.

Among those other tenants was Jessica Qi. A student at George Brown College, the native of Belleville, Ont., had moved into 394 Dundas St. E. – next door to Ms. Khader and Ms. Dearing’s building – in September of 2017. Five months later, in January, 2018, Thinkers Holding Inc., the company controlled by Mr. Wang, purchased the property in which Ms. Qi was living.

From the time she first moved into the house, says Ms. Qi, she and several other fellow tenants each rented separate rooms, and shared a single kitchen. There were padlocks outside each door. In other words, it bore the hallmarks of a single-room-occupancy house, that is, a rooming house; 394 Dundas St. E. was not one of the city’s small number of licensed rooming houses.

Ms. Qi had signed no lease with the original landlord, Lian Jun Wang, who owned the house with her husband, Hong Tao Ju. When Thinkers bought the house, said Ms. Qi, Lian Jun Wang told her, “Don’t worry, they are not going to make you move out,” and, soon after, she brought David Wang over to introduce himself. “That was the one time that I’ve seen him in person,” Ms. Qi said.

Nevertheless, weeks later, her original landlord informed her that Mr. Wang wanted Ms. Qi to move out by May. She happily went after finding a better place at a similar price, but still questions the reason for the eviction. “They said they wanted to live here for themselves,” says Ms. Qi. “I never really believed that.”