Commercial Tenancies in Ontario: Fixed-Term, Periodic, at Will, and at Sufferance — What Determines What You Have
Ontario commercial leases are governed by the Commercial Tenancies Act and common law — not the Residential Tenancies Act. This guide explains the four types...
Frequently Asked Questions
What law governs commercial tenancies in Ontario?
The Commercial Tenancies Act, R.S.O. 1990, c. L.7, together with general contract law and the common law. The Residential Tenancies Act does not apply to commercial leases. Disputes go to the Superior Court of Justice, not the Landlord and Tenant Board.
What are the four types of commercial tenancy?
Fixed-term (a lease with a start and end date), periodic (renews automatically — weekly, monthly, or yearly — until terminated by notice), tenancy at will (occupancy with the landlord's consent but no fixed term), and tenancy at sufferance (the tenant remains after the lease expires without the landlord's consent).
What happens when a commercial lease expires and the tenant stays?
It depends on the lease and the landlord's response. If the lease has an overholding clause, that clause controls (typically a month-to-month tenancy at a premium rent). Without an overholding clause, common law applies: if the landlord accepts rent, a periodic tenancy is created (year-to-year if the original term exceeded one year). If the landlord demands possession and refuses rent, the tenant is at sufferance and may owe double rent under s. 58 of the Commercial Tenancies Act.
How much notice is required to end a month-to-month commercial tenancy?
At least one full month's notice, expiring at the end of a monthly rental period. Some sources cite 60 days for the landlord's notice. Always check your lease — it may specify a different notice period that overrides the default.
How much notice is required to end a year-to-year commercial tenancy?
At least six months' notice at common law, expiring at the end of a yearly period. This is the default that applies when a fixed-term lease of more than one year expires and the tenant holds over with the landlord's consent (for example, by the landlord accepting rent).
Can a commercial landlord change the locks on a tenant?
Yes, in certain circumstances. Unlike residential tenancies, where self-help eviction is illegal, the Commercial Tenancies Act gives commercial landlords a right of re-entry when the tenant is in default — subject to conditions in the lease and the risk of a wrongful re-entry claim. The landlord should obtain legal advice before exercising this remedy.
What is double rent under s. 58 of the Commercial Tenancies Act?
Section 58 provides that a tenant who "wilfully holds over" after the landlord has delivered a written demand for possession is liable for rent at 200% of the rate in the expired lease. This applies to tenancies at sufferance — where the landlord has not consented to the continued occupancy.
Can a commercial tenant walk away from a lease early?
Not without consequences. A commercial tenant who abandons mid-term remains liable for the remaining rent until the landlord re-lets the space or the term expires. The landlord has a duty to mitigate by making reasonable efforts to find a replacement tenant, but the original tenant bears the financial risk if the space sits empty.
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