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Legalization of Cannabis- how does it affect your rental properties?

The legalization of cannabis has drifted into the real estate industry, leaving many Canadian landlords worried and confused.

Although it’s legal in Canada, it may set your mind at ease to know that where, when, and how it’s used are restricted. In fact, many lease agreements include a clause prohibiting cannabis use.

Cannabis laws vary from province to province, but under the Alberta Residential Tenancies Act (RTA), “landlords can set rules for what is and isn’t allowed in their properties”. As a landlord, you may forbid:

  • Smoking of any or all substances, including cannabis
  • Non-smoking consumption of cannabis
  • Growing cannabis in your rental premise

Additionally, as a landlord, you may evict a tenant for smoking any substance if it interferes with other tenants’ reasonable enjoyment of their home, if it poses a serious risk to safety, or causes damage to the premises.

But there’s a catch.

Medical cannabis – a catch 22

Tenants who have a prescription to smoke medical marijuana for health reasons are protected under the Human Rights Code, and you may have a duty to accommodate them. For example, you may allow tenants with medical documentation to smoke on a condo balcony or back yard deck; unless they can demonstrate their disability stops them from consuming their medical cannabis outside. However, medical marijuana can be ingested by alternative methods to smoking and bought from a licensed manufacturer rather than grown in the home.

According to rabble.ca, Landlord, tenants and cannabis: Who has rights and what are the obligations, Pro Bono and Claudia Padrero, October 24, 2018; “Under the Access to Cannabis for Medical Purposes Regulation (ACMPR), people who are prescribed cannabis by their doctor can purchase from licensed producers, register to produce their own limited supply, or designate a third party to grow for them. Production licenses from Health Canada allow patients to cultivate more than the recreational limit of four plants. For example, according to Health Canada’s calculator for medical cannabis production, a patient who is prescribed five grams of cannabis per day can grow up to 25 indoor plants. However, the ACMPR doesn’t set out different rules for where medical cannabis can be consumed — permission to smoke is determined by provincial, territorial, municipal governments, and property owners.”

This creates a curious dilemma for landlords who also have a duty to accommodate tenants who have allergies or illnesses aggravated by smoke exposure.

Condominiums also set regulations regarding cannabis consumption. Tenants/condominium owners should check the condominium bylaws for cannabis restrictions and the locations where smoking or growing cannabis is forbidden.

Condo bylaws for cannabis

Condominiums also set regulations regarding cannabis consumption. Tenants/condominium owners should check the condominium bylaws for cannabis restrictions and the locations where smoking or growing cannabis is forbidden.

Although legalization of medical cannabis is covered under the Human Rights Code, it may offer some relief to know that recreational cannabis consumption is not covered under the Human Rights Code.

Where should you do as a landlord?

Although legalization of cannabis may leave you scratching your head about what you can do, here are a few suggestions.

  • Check your current lease, if cannabis restrictions are not included, include them in an addendum
  • Include no smoking/growing policies in new leases
  • Check with your insurance to see if it’s allowed in your province, and make sure insurers provide adequate coverage
  • Make regular property maintenance inspections

Moving forward, even with the legalization of cannabis, you can still include no smoking/growing policies in your lease. Check with your insurance provider for suitable coverage, and check provincial legislation for provinces where Cannabis is allowed. Read through the condominium bylaws to confirm where smoking cannabis is restricted and above all make sure to carry out regular property inspections.

Have you had any issues with the legalization of cannabis with your rental properties? I’d love to hear about it nelda@neldaschulte.com

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