Introduction
As previously discussed on our BLOG, significant changes to Ontario’s residential tenancy laws take effect on September 21, 2026. One of those changes allows residential landlords to provide a longer notice period for a landlord’s own use eviction and avoid paying the statutory one month’s compensation. Additional changes are now coming into force that may have an even greater impact on landlords who serve an eviction notice for landlord’s own use.
On July 21, 2026, Ontario announced filed O. Reg. 240/26 under the Residential Tenancies Act, 2006, introducing a new requirement that establishes a deadline of a 60-day period for the person identified in the eviction notice, to move into the rental unit. Failure to comply with this new timeline may result in a presumption that the eviction notice was given in bad faith. Understanding these changes before serving the N12 eviction notice may help landlords avoid costly disputes before the Landlord and Tenant Board.
Ontario’s new 60-day occupancy rule for N12 personal use evictions takes effect September 21, 2026. Learn how these changes may affect bad faith eviction claims and what residential landlords need to know.
Why This Change Matters
An allegation of bad faith eviction can have significant financial consequences. If a tenant successfully proves that an N12 Notice was given in bad faith, the Landlord and Tenant Board may order the landlord to pay compensation of up to $50,000, together with additional remedies authorized by the Residential Tenancies Act, 2006. In appropriate cases, administrative fines may also be imposed.
The new regulation does not create a new cause of action. Instead, it expands the circumstances in which bad faith may be presumed, shifting the burden to the landlord to demonstrate that the notice was genuinely served in good faith.
Current Law Before September 21, 2026
Under the current legislation, a tenant who vacates a rental unit following an N12 eviction notice may bring a bad faith application within one year after vacating the rental unit. A tenant who fails to commence the application within that one-year period may lose the right to pursue the claim.
Currently, legislation states the intended occupant had to move into rental unit within “reasonable time” after the tenant vacated. What is “reasonable” has always been at the discretion of the adjudicator hearing the bad faith application. In addition, the Landlord and Tenant Board may presume bad faith where evidence establishes that, during the period beginning when the notice was served and ending one year after the tenant vacated, the landlord:
- Advertised the rental unit for rent;
- Entered into a tenancy agreement with another tenant;
- Advertised the rental unit or the building for sale;
- Demolished the rental unit or building; or
- Took steps to convert the property to a non-residential use.
These circumstances often require the landlord to provide evidence explaining why the notice was nevertheless served in good faith.
What’s Changing on September 21, 2026?
Effective September 21, 2026, section 57 of the Residential Tenancies Act, 2006 will include a new subsection creating an additional presumption of bad faith. Under O. Reg. 240/26, if the individual identified in the N12 Notice does not move into the rental unit within the prescribed period, it will be presumed that:
- the notice was given in bad faith; and
- the intended occupant did not move into the rental unit within a reasonable time.
When these amendments were first announced earlier this year, the legislation referred only to a “prescribed period,” without specifying its duration. O. Reg. 240/26 now confirms that the prescribed period is 60 days.
The New 60-Day Rule Explained
The regulation establishes two different timelines depending upon when the tenant vacates the rental unit.
If the Tenant Vacates On or Before the Termination Date: The intended occupant must move into the rental unit within 60 days after the termination date stated in the N12 Notice.
If the Tenant Vacates After the Termination Date: The intended occupant must move into the rental unit within 60 days after the tenant actually vacates the rental unit.
Failure to satisfy either timeline creates a presumption that the eviction notice was served in bad faith.
Does This Mean the Landlord Automatically Loses?
No. The regulation creates a presumption of bad faith—it does not automatically determine that the landlord acted in bad faith. Where the intended occupant fails to move into the rental unit within the prescribed 60-day period, the landlord may still present evidence explaining why the notice was nevertheless given in good faith. Whether the presumption has been rebutted will depend on the evidence presented in each individual case. Careful planning before serving an N12 Notice may help reduce the risk of future bad faith allegations.
Transitional Rules: Does This Apply to Existing N12 Notices?
One important aspect of the new regulation is when the presumption of bad faith will apply. The new presumption created by O. Reg. 240/26 applies only to tenant applications commenced on or after September 21, 2026. However, this does not mean the N12 Notice itself must have been served after that date. As a result, some N12 Notices served before September 21, 2026 may still be affected by the new rule.
For example, where:
- a landlord served an N12 Notice between September 21, 2025 and September 21, 2026; and
- the tenant files a bad faith application on September 21, 2026 or after
the new presumption may apply to that application. Tenants must still file the application within one year after they vacated the rental unit. Accordingly, landlords who have recently served, or are considering serving, an N12 Notice should be aware that the timing of the tenant’s application, rather than simply the date the notice was served, may determine whether the new presumption applies.
Conclusion
Ontario’s new within 60-day occupancy requirement represents an important change to the personal use eviction process. Beginning September 21, 2026, landlords should ensure that the individual identified in the N12 Notice moves into the rental unit within the applicable 60-day period whenever possible. Failure to do so may result in a presumption of bad faith, requiring the landlord to demonstrate that the notice was nevertheless served honestly and in compliance with the Residential Tenancies Act 2006.
As Ontario’s residential tenancy laws continue to evolve, landlords should remain informed of legislative amendments that may affect their rights and obligations.
Disclaimer
This article is provided for general informational purposes only and does not constitute legal advice. Every situation is unique, and the outcome of any particular matter will depend upon its specific facts and circumstances. Reading this article does not create a paralegal-client, lawyer-client, or solicitor-client relationship. If you require legal advice regarding your situation, you should obtain professional legal assistance, or contact the residential landlord legal team at Gobin & Leyenson LLP.
Footnotes
- Residential Tenancies Act, 2006, SO 2006, c 17, s. 57.
- O. Reg. 240/26, filed July 21, 2026, effective September 21, 2026.
- Residential Tenancies Act, 2006, SO 2006, c 17, s. 57(6.1).