The statute text
107 (1) A landlord shall repay the amount received as a rent deposit in respect of a rental unit if vacant possession of the rental unit is not given to the prospective tenant.
(2) Despite subsection (1), if the prospective tenant, before he or she would otherwise obtain vacant possession of the rental unit, agrees to rent a different rental unit from the landlord,
(a) the landlord may apply the amount received as a rent deposit in respect of the other rental unit; and
(b) the landlord shall repay only the excess, if any, by which the amount received exceeds the amount of the rent deposit the landlord is entitled to receive under section 106 in respect of the other rental unit.
View this section on the official Ontario e-Laws site →
Reproduced under the King’s Printer for Ontario / Open Government Licence – Ontario. Confirm against the official e-Laws consolidation before relying on it.