PEI tenants ordered to pay landlord despite doubled deposit remedy

The Island Regulatory and Appeals Commission ordered two tenants to pay their landlord a net $1,411.13 by Oct. 27, 2026, in S and D Professional Corporation v. Matthew Beamish and Jessica Mae Hainge, 2026 PEIRAC 67. Order LR26-53, issued Oct. 13, 2026, partly allowed the landlord’s appeal and dismissed the tenants’ appeal.

Both sides had challenged a Residential Tenancy Office order directing the landlord to pay the tenants $1,338.87. The commission added $1,250 in unpaid rent and $1,500 for painting and repairs to the landlord’s established claims.

The landlord’s missed security-deposit deadline still entitled the tenants to double the remaining deposit, plus interest. But the commission distinguished claims against the deposit itself from separate rent and damage claims under section 85 of the Residential Tenancy Act. It set off the parties’ total entitlements to reach the amount payable by the tenants.

Fixed term lasted through November

The written tenancy ran from Dec. 1, 2024, to Nov. 30, 2025, at $2,500 a month. The tenants argued the landlord had accepted half of November’s rent because the tenancy ended Nov. 15. They physically left on Nov. 12.

The commission found no agreement releasing them from rent through Nov. 30. It considered the parties’ communications, move-out arrangements and the landlord’s return of $500 from the deposit, but those circumstances did not establish an earlier termination agreement. Physical vacancy alone did not end the fixed term.

Section 55(3) permits notice ending a fixed-term tenancy, but not with an effective date earlier than the agreed end date, the commission explained. With only $1,250 paid for November, the tenants remained responsible for the other $1,250.

Painting award rests on evidence

Under section 39(2), tenants must leave a unit reasonably clean and undamaged, apart from reasonable wear and tear. The landlord had to prove, on a balance of probabilities, tenant-caused damage beyond that standard and a reasonable loss attributable to it.

The unit had been completed in June 2024, and these were its first tenants. That helped establish its starting condition, the commission said, but did not prove they had caused every defect found afterward.

The tenants challenged the move-out inspection. Scheduling conflicts prevented a joint inspection in person, and the landlord proceeded with the tenants participating by phone. The commission considered section 38’s inspection requirements and said the absence of a joint inspection affected the weight of the evidence, without automatically defeating a damage claim supported by other reliable evidence.

The tenants disputed that the claimed damage, apart from the door, exceeded reasonable wear and tear, and called the estimates excessive. The Rental Office had rejected the painting claim because it found the photographs insufficiently clear or detailed to assess the wall damage.

The commission reached a different conclusion after reviewing the photographs and hearing oral evidence. Patch marks and wall damage in the living area required work beyond ordinary maintenance. It considered the $2,500-plus-HST painting estimate excessive, however, and awarded $1,500 for repairs and painting.

The commission found insufficient evidence to increase the other repair awards. The existing $2,758.62 award for repairs and unpaid utilities remained unchanged.

Missed deadline doubled the remaining deposit

The original security deposit was $2,500. After the landlord returned $500 on Nov. 15, 2025, $2,000 remained.

Section 40(1) required the landlord, within 15 days after the tenancy ended, either to return the deposit with applicable interest or apply to the Director to claim against it. The Nov. 30 end date made the deadline Dec. 15, 2025. The landlord filed on Dec. 17.

The landlord said the tenants had accepted responsibility for damage during move-out discussions, so it waited for repair estimates before applying. The commission found no written agreement authorizing retention of the deposit as required by section 40(3)(a). Waiting for estimates did not extend or suspend the deadline.

The commission said section 40(4)’s doubling remedy was mandatory. Its accounting gave the tenants the $2,000 remaining deposit, another $2,000 under that remedy and $97.49 in interest, for a total of $4,097.49.

The missed deadline barred a claim against the security deposit itself; it did not extinguish the landlord’s separately established rent and damage claims. The commission’s final accounting combined the unchanged $2,758.62 award with $1,250 in rent and $1,500 for painting and repairs, totalling $5,508.62. Subtracting the tenants’ $4,097.49 entitlement left $1,411.13 payable to the landlord.

The order’s notice permits an appeal to the Court of Appeal within 15 days of the commission’s decision, on a question of law only. Where the commission has confirmed, reversed or varied an order of the Director, either party may file the order with the Supreme Court. If filed, it may be enforced as a Supreme Court order.