Executive Summary: Key Legal and Evidentiary Issues

• The case addressed whether a tenant renting a room to a roommate qualifies as a landlord under Yukon’s Residential Landlord and Tenant Act (the “Act”).

• The Director of Residential Tenancies mistakenly assumed jurisdiction by treating the roommate dispute as a landlord-tenant relationship.

• Section 34 of the Act was misinterpreted; subletting applies only to whole rental units, not shared occupancy arrangements.

• The Director’s finding that the tenant acted on behalf of the landlord was not supported by evidence and contradicted the statutory definition of “landlord.”

• The Court applied the correctness standard to review jurisdictional authority and found the Director’s decision unreasonable.

• Judicial review was granted and the Director’s decision was quashed, confirming such roommate disputes fall under Small Claims or Supreme Court jurisdiction.

Background of the dispute and administrative decisions

In February 2023, Scott Westerlaken and Byron Holbein entered into an oral agreement under which Holbein rented a room and shared common areas in a rental home already occupied by Westerlaken, his partner, and child. After a dispute on April 30, 2023, Westerlaken asked Holbein to vacate immediately. Holbein left the next day and subsequently applied to the Yukon Residential Tenancies Office, seeking the return of his security deposit and compensation for lack of notice. Westerlaken counterclaimed for unpaid rent, property damage, and other expenses.

The Deputy Director found the relationship to be one of landlord and tenant and ruled in favour of Holbein, awarding him $1,349.39. The amount included the return of the $965.61 security deposit (with interest) and $383.78 for camping costs incurred after being told to vacate.

Westerlaken applied for review under section 84 of the Act, challenging jurisdiction. The Director dismissed the review, holding that Westerlaken acted as a landlord by subletting the space and therefore fell within the definition of "landlord" under the Act. The Director reasoned that subsection 34(1), which prohibits subletting without landlord consent, applied and thus suggested that Westerlaken acted on behalf of his own landlord.

Judicial review in the Supreme Court of Yukon

On judicial review, the issue was whether the Residential Tenancies Office had jurisdiction to adjudicate disputes between roommates where the primary tenant does not act on behalf of the property owner.

Justice E.M. Campbell held that the applicable standard of review was correctness, given that the issue involved statutory interpretation and the jurisdictional divide between an administrative tribunal and the courts. The Court found the Director had erred in law in applying section 34 to the facts. The Residential Landlord and Tenant Act requires that for a tenant to be considered a landlord, they must act on behalf of the property owner, which was not the case here.

The Court concluded that the term “sublet a rental unit” in section 34 refers to the entire rental unit—not just a single room—making the section inapplicable to a shared living arrangement where both parties reside in the same rental unit. There was no evidence that Westerlaken had his landlord’s consent or acted as the landlord’s agent. Therefore, the definition of “landlord” under the Act did not apply to him.

Final determination and next steps

The Court granted Westerlaken’s application for judicial review and quashed the Director’s decision. It held that the Residential Tenancies Office lacked jurisdiction over the matter. The Court clarified that disputes between roommates, such as this one, fall within the jurisdiction of the Small Claims Court or the Supreme Court of Yukon, depending on the amount in issue.

Justice Campbell left the stay of a garnishment order in place and directed that the matter return to court to determine additional relief and the issue of costs. No final financial award was made as part of this decision.