Relief From Forfeiture Isn't Always A Relief

In the common law provinces, when its lease is terminated for a default, the tenant may apply to the court for “relief from forfeiture”. In Ontario, this remedy is available under section 20 of the Commercial Tenancies Act (Ontario) (the “CTA”). Other common law provinces have similar statutes.

Relief from forfeiture, as we have discussed in previous News ReLeases, is an equitable remedy: the Court may reinstate a terminated lease to allow the defaulting tenant back into the premises, on certain terms and conditions and depending on the conduct of the parties and the circumstances. When making an order for relief from forfeiture, the Court will set the terms and conditions for that relief; subject to compliance, the lease will come back into effect.