Question:
I am the Listing agent. I just did a deal with Status as the only condition. Status is fine. Buyers are backing out. They did not drop deposit cheque off.
Answer:
Condition: There is an obligation to proceed in good faith and perform the contract. Assuming something wrong with the Status Certificate, then, the Buyer would have the opportunity to withdraw. If there is nothing wrong, then the Buyer must proceed with the contract. The law on this point changed a few years ago.
Deposit: There is an obligation to deliver the deposit cheque on time. Failure to do so, places the Buyer in breach of contract. It does not vitiate the contract or bring it to an end. The Seller may elect to terminate the contract and sue for damages. The amount of the deposit would be the minimum amount that a Court would award.
Brian Madigan LL.B., Broker
Comments 4
Is this post current?
Author
Curent enough. It was published 24 July 2023 and up to date at that time. Do you think there is some significant change in the law since then? If so, please post the case.
The condition of sale re SC states the following:
“This offer is conditional upon the Buyer’s lawyer reviewing the Status Certificate and Attachments and finding the Status Certificate and Attachments satisfactory in the Buyer’s Lawyer’s sole and absolute discretion.”
If the lawyer finds the SC is in order, this should not give the buyer an escape route to abort the contract by simply not waiving the condition of the sale, since the agreement relies on the Buyer’s lawyer review. The review being positive meets the only condition of the sale.
Am I wrong in the above understanding of a Condo Sale in Mississauga Ontario?
Author
The law on this point changed with the Bhasin v. Hrynew decision. There is an obligation of “good faith contractual performance”.
The Buyer would need to find at least one lawyer who was of the opinion (reasonably) that the Statuse Certificate was not satisfactory.