'I'm back to square one': Halifax woman loses apartment after refusing to pay illegal deposit

When Kirsten Parnell went to sign a lease for a one-bedroom apartment in Halifax two weeks ago, she thought her gruelling search for a place to live was over. She was wrong. 

Before securing the apartment, Parnell was asked to provide a co-signer and pay first and last months' rent on top of a damage deposit. That totalled $2,750 and would have nearly emptied her savings account. 

She was so desperate, she initially considered paying the money in the face of Nova Scotia's housing crisis and difficulties finding an affordable one-bedroom apartment in Halifax.

But she did some research, and discovered the rental company's request is illegal.

"I actually waited until I came to the appointment to sign the lease so I could speak to them face-to-face about it," Parnell said. "I was then told to either illegally pay them the funds or I was denied the apartment."

She left with no lease signed, and no apartment. 

According to Dalhousie Legal Aid Service, what happened to Parnell is not an isolated incident.

'Few choices'

Mark Culligan, a community legal worker with the service, said a landlord asking for an illegal application fee is common and the housing crisis is making it worse.

"Many of the companies that do this have been doing this for a long time," said Culligan. "I think part of what we're seeing now is people are more desperate, so they're putting up with it in a way that they might not have before, because there's so few choices."

Parnell was forced to move in with family.

"It's heartbreaking because I know I'm back to square one," she said. "And there's thousands of people in Halifax looking for apartments right now and they're in the same situation as me."

Parnell said the search for housing is exhausting, on top of working full time.

"I spend hours a day online bouncing from different search engines, Kijiji, Facebook marketplace, even going to specific rental company pages and reaching out with phone calls, emails, text messages, anything you can to contact someone who might have an apartment available," she said.

No recourse

According to the Residential Tenancies Act, "No landlord shall demand, accept or receive from a tenant as a security deposit a sum of money ... in excess of one half of the rent per month."

Knowing this, Parnell sought help from the Residential Tenancies Board, but she was told she had no recourse.

"Because I didn't pay [the landlord] any funds, nor did I sign any documents to establish a tenant-landlord relationship, they told me that there was nothing they would do," she said.

Dalhousie Legal Aid told her the same thing.

"It's very hard to stand up for your rights as a tenant when you're confronted with these kinds of application fees," Culligan said.

"If you actually pay it and you sign a lease ... you can maybe make a claim to try to get the money back. But if you're being asked to pay these application fees and you say no, there isn't really a meaningful protection for you because your landlord can just say, 'Hey, I'm going to rent it out to someone else instead.'"

Culligan said there have been calls for years for some sort of enforcement division within residential tenancies.

"And that hasn't been a priority in the past," he said. "But frankly, there's quite an extensive case law going back many years, repeatedly saying that these … practices are illegal."

The provincial department in charge of the Residential Tenancies Board is the Department of Service Nova Scotia and Internal Services.

"Asking a tenant to pay their first and last months' rent is not permitted," said Blaise Theriault, a spokesperson for the department. "If a tenant is being asked to do something by their landlord and they don't think it's right, they should seek independent legal advice and/or contact a legal aid society."

Theriault said his department is "aware of the interest in enforcement."

"[We] are always looking for opportunities to strengthen the Residential Tenancies Act, while balancing the needs of both tenants and landlords," he said.

Halifax property management company W.M. Fares Group is the owner of Wedgewood Court, where Parnell applied to rent. Wadih Fares, the company's president, told CBC News it isn't the company's standard policy to ask for first and last months' rent as a deposit, but it uses the practice under certain circumstances.

"If a prospective tenant doesn't meet the credit check, our property managers, in order to accommodate the applicant, make a judgment call and may waive the credit requirement, and ask for more security," Fares said. "That is done to help the applicant secure an accommodation … in today's high demand for rental."

Parnell said she tried to reach Fares twice, but her voice mails were not answered.

She said she wants to see more enforcement of the Residential Tenancies Act, but in the meantime she hopes her story can help other tenants. 

"I want people to know that this shouldn't be happening," she said. "I'm hoping … that something is done about it and people can rent apartments fairly and be given a fair chance."