Breaking a Lease

Consequences for Breaking a Lease

When a tenant breaks a lease, the amount of money owed is generally tied to the amount of money the landlord loses. However, the landlord also has a legal responsibility to minimize or mitigate their losses by taking reasonable steps to re-rent the unit. In other words, if you break your lease, your landlord should advertise your unit at a fair price, arrange viewings for interested tenants, and ultimately choose someone to replace you within a reasonable period. See Residential Tenancy Branch (RTB) Policy Guideline 5 for more information. If your landlord loses rental income after making an honest effort to re-rent your unit without delay, you may have to cover some or all of their losses. To help your landlord find a replacement tenant, consider sending them TRAC’s template letter, Finding a Replacement Tenant.

If your landlord is forced to re-rent your unit at a $25 discount to secure a replacement tenant, they could be entitled to $25 per month over the remaining term of your agreement. However, if your landlord can re-rent your unit for more than what you were paying, that additional money they will earn over the remaining months of your agreement can be or applied to, or “set off” against, any other money you owe your landlord for unpaid rent or damages.

See RTB Policy Guideline 3 for more information.

Liquidated Damages

A tenancy agreement can contain a “liquidated damages” clause. If you break a lease that includes this type of clause, you may have to pay an amount of money, specified in your agreement, to cover the costs associated with finding a replacement tenant. A liquidated damages clause is supposed to be a reasonable pre-estimate of the cost of re-renting a unit – not a penalty for breaking a lease. This means that it cannot be unreasonably high, especially considering the number of free online advertising options available to landlords.

Since a liquidated damages clause is agreed to at the start of a tenancy, you may have to pay it even if your landlord does not lose any rental income as a result of you breaking your lease. However, if you think your liquidated damages clause might be a penalty, rather than a genuine pre-estimate of the cost of re-renting your unit, you can refuse to pay it until ordered to do so by a Residential Tenancy Branch arbitrator.

See RTB Policy Guideline 4 for more information

Alternatives to Breaking a Lease

Breaking a lease should be viewed as a last resort. A tenant should consider the following alternatives before illegally ending a fixed term tenancy agreement:

• Mutual Agreement to End Tenancy
• Sublet or Assignment
• Breach of Material Term
• Family Violence and Long-Term Care

Mutual Agreement to End Tenancy

Your landlord may simply agree to end your tenancy early. To persuade them, you can offer to help find a replacement tenant by advertising your rental unit, making it accessible for regular viewings, and otherwise cooperating with your landlord. You can use Residential Tenancy Branch form, Mutual Agreement to End Tenancy, if your landlord agrees to end your tenancy early.

Sublet and Assignment

See TRAC’s webpage, Sublet and Assignment, for more information.

Landlord Breach of Material Term

See TRAC’s webpage, Breaching Important Terms / Tenant Ending a Tenancy for Breach of a Material Term, for more information.

Family Violence / Long Term Care

A tenant can end a fixed term tenancy early by providing one month written notice if they:

• need to leave their rental unit to protect themselves or their children from family violence;
• have been assessed as requiring long-term care; or
• have been accepted into a long-term care facility.

To legally end a tenancy in these circumstances, you must provide your landlord with an approved form, Ending Fixed Term Tenancy Confirmation Statement, signed by an authorized third-party verifier.

When ending a tenancy early due to family violence, here are some common examples of third party verifiers:

• medical practitioner;
• nurse practitioner;
• psychologist;
• social worker;
• police officer;
• counsellor;
• practising lawyer; or
• victim court support caseworker;

When ending a tenancy early due to long-term care, here are some common examples of third party verifiers:

• medical practitioner;
• nurse practitioner;
• psychologist;
• social worker;
• manager of a long-term care facility; or
• occupational therapist.

For more information on this topic, including a full list of all third-party verifiers, see Part 7 of the Residential Tenancy Regulation.

Previous Legal Decisions

• Liquidated damages

• Cost of ending fixed term tenancy

• Landlord did not try to minimize loss