A bad faith N12 application is one where the landlord or purchaser had no genuine intention of using the unit as stated. The LTB takes these seriously. If caught, the financial consequences can be severe — and the tenant’s representative will be looking for every red flag.
What Makes an N12 Bad Faith?
Bad faith generally means the stated reason for the eviction — personal use or purchaser’s own use — is not genuine. Common indicators include: the unit being re-rented shortly after the tenant leaves, the person who was supposed to move in never did, or evidence that the landlord was trying to get the tenant out for other reasons (such as a rent that was well below market).
How the LTB Investigates
If a tenant files a T5 application alleging bad faith, the LTB will look at what happened to the unit after the eviction. Records of new tenants moving in, advertising the unit for rent, or evidence of communication showing a different motive are all discoverable. The LTB adjudicator can draw adverse inferences when a landlord’s story does not add up.
What the Penalties Look Like
Under the Residential Tenancies Act, the LTB can order a landlord found to have acted in bad faith to pay the former tenant up to 12 months’ rent. Additional damages — moving costs, price difference between old and new rent — can also be awarded. These are not small numbers on Toronto-area rents.
Red Flags the LTB Looks For
Below-market rents, recent conflict with the tenant, a pattern of N12 applications across multiple properties, failure to actually move in after the tenant vacates — these are all red flags. Adjudicators have seen every version of this story and are experienced at distinguishing genuine need from pretextual eviction.
How to Protect Yourself
If your N12 is genuine, document everything. Keep records showing the person intended to move in — confirmation of other housing arrangements being cancelled, communications about the move, and evidence of actual occupancy after possession is granted. The cleaner your paper trail, the harder a T5 application is to sustain.
What Comes Next
Stonegate advises Ontario landlords on when an N12 is appropriate and how to document it correctly. Book a free call at https://calendly.com/stonegatelegalservices/20min.
▶ Watch: Determining Bad Faith in N12 Applications: Insights into the LTB Process
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