Well, forgive me, for my egregious error in referring to a security deposit. If I am not mistaken ( and I am sure you'll correct me if I am), a "rent deposit" is permitted in Ontario. From what I have heard (and perhaps inaccurate) is that it's common for landlords to ask for and tenants to agree to it being held as security for the last month's rent. If that be so, and the L/L holds one, then call it what you will, but I see it being at risk. If that is not the case, then the L/L in this case holds nothing, is in a very weak position, and better not be too relaxed about getting the place producing rent, and quick.
I'll grant, I was a tenant in Ontario in my law school days, then I departed the province. My experience as a landlord is largely confined to rental properties in Vancouver and Los Angeles; in both cases for decades, so I have some understanding of the business, its exigencies and realties.
Yes, I am aware it might not be easy to find another good tenant. I do not believe my language was couched in absolutes. That is why I addressed some of the variables that might influence the L/L's thinking.
You mention getting the place ready for a new tenant. As I read the OP, the lease is just beginning. Not a whole lot of time for wear and tear. The place should be available to re-let with little fuss. And here, I was suggesting negotiating with the L/L. The two might agree to the tnt remaining in situ while looking for a new tnt. All kinds of possibilities come to mind.
I am not sure I can agree with your notion that L/Ls "aren’t in a rush to rent if they know you will be responsible for the rent". As I said above, the law expects reasonable steps to mitigate. The law might not expect "in a rush", but reasonable diligence will be a requirement. And, when you talk about the L/L basking in the comfort of knowing the departed tnt is responsible for the rent, that's where any deposit that might be applied comes in. If there is none, or if it has been exhausted, what comfort does the L/L really have? The comfort of knowing they must pursue a remedy at law, with all the headache that entails? As you have advised, security deposits in Ontario are forbidden, so our landlord here might do well to be in a rush, albeit tempered with sound business practice.
How many times have you taken judgment against a tnt, then gone out and enforced it? I never have. But then, I have never had a defaulting tenant either. In June 2020, I had one tnt in LA tell me he had lost much of his income due to C-19. He asked to be let out of his lease, since he said he could no longer afford $4,500/mo. I advertised and showed the place while he was still there. I got a new tnt at $4,800 a month. I let him go and was happy to hand back all of his $4,500 security deposit. Win-win. I did not lose one day of rent. I could have played hardball. I could have told him he had 8 months left on his lease and suck it up. What then? He'd probably have pulled the pin after not paying rent at all for a few months (LA was under a C-19 eviction moratorium, only just now ending). He could then have left and left damage behind out of spite. If I was out a few months rent, plus some repair costs, what chance would I have of collecting, say, $15,000 from him? Better to accommodate him, move on and avoid avoidable losses.
