Westphal Court Ltd. v. Herd: Court Steps in to Strike Down Unfair Landlord Rules and Uphold Tenants’ Rights
The recent Supreme Court decision impacts hundreds of people living in mobile home parks who were told they had to install water meters on their homes and pay extra for water.
Written by Hanying Zhang | 7 min read
“Rules” or “policies” on paper can be intimidating, especially when they are from someone with power or authority, like a landlord or even a government. However, just because something is written on paper doesn’t make it reasonable, let alone legal. That is what the court confirmed in Westphal Court Ltd. v. Herd, 2025 NSSC 185, by striking down an unfair landlord rule as well as part of a Residential Tenancies Program policy.
A Divided Community
In Woodbine Park, a mobile home park owned and operated by Westphal Court Ltd., a rule was added to the Community Guidelines in 2015. The new rule required a water meter to be installed on any home being sold. These meters tracked household water usage, and the tenants with water meters were billed quarterly. The Community Guidelines form part of the lease that tenants had to sign when purchasing a home. Both respondents in the case moved in after the amendment to the Community Guidelines, and paid fees for the water meters.
However, the rule only applied at the time of the sale. Therefore, the tenants who already owned their homes before the amendment did not need to install a water meter and still had water included in their lot rent.
In 2023, the Nova Scotia Residential Tenancies Program issued Policy 45, which stated that requiring a tenant to install and pay for a water meter is not a reasonable rule and is not permitted. Westphal responded to the issuance of Policy 45 by removing the requirement for water meters. However, Policy 45 also stated that it did not apply to tenants who already had water meters installed on their homes. Therefore, the tenants who had water meters installed between 2015 and 2023 continued to be charged for their water usage.
The result was a fragmented community. Some tenants never paid for water. Some continued to pay simply because their homes had meters already installed. The rule and the policy divided tenants into classes, with different treatment in the same park.
The Nova Scotia Supreme Court Decision
Westphal argued that they had complied with Policy 45, which they claimed was law. But the Supreme Court disagreed. It clarified that a policy is not legally binding and must be consistent with its parent statute, in this case, the Residential Tenancies Act (“the RTA”).
The court made two points. First, it agreed with Policy 45 that the landlord’s rule requiring the installation of water meters was unreasonable. However, the court also found that the part of Policy 45 that excluded tenants who already had water meters was unreasonable. The finding was based on section 9A(3)(c) of the RTA, which requires that landlord rules apply fairly to all tenants.
The decision recognized that fairness doesn’t mean treating everyone exactly the same in every situation. But there must be a good reason for treating people differently. In this case, tenants were being charged differently for water simply based on whether their home already had a water meter installed, something that is beyond tenants’ choice. The court said that rule is not reasonable.
Finally, the court pointed out that Westphal does have legal options if they are concerned that utility costs are going up. Under the RTA, they can apply to increase rent beyond the allowable amount, based on increasing operating expenses like water. What they should not do is keep enforcing an unfair rule, even it is no longer being applied to new tenants.
The decision reaffirms the reasonableness rule for landlord rules under the RTA. As a result, the Residential Tenancies Program amended Policy 45 and removed the impugned statement. Westphal sent a letter to tenants, stating that they would immediately stop charging water bills to all tenants and proposing a settlement.
Further Reading
A recap on Landlord rules: https://www.tenantsrightsguide.ca/landlord-rules