There used to be a time when agreements of purchase and sale provided that transaction must be completed prior to 4:30 pm on the date scheduled for closing. Now that we have an electronic registration system in place, that time should say “5:00 pm”, because that’s the last time permitted for registration.
Let’s have a look at the standard form agreement in use in Ontario:
“2. COMPLETION DATE: This agreement shall be completed by no later than 6:00 pm on the 4th day of July 20xx. Upon completion, vacant possession of the property shall be given to the Buyer unless otherwise provided for in this Agreement.”
So, there’s a time and a date and in the second sentence there are consequences. The purchaser basically has until 6:00 pm to complete the deal. The electronic registration system is still open, but just for searches; and as mentioned previously, 5:00 pm for registrations.
Obviously, this places a reluctant purchaser in a rather “crafty position”, by insisting upon closing after 5:00 pm but before 6:00 pm as specified in the agreement.
Litigation is expensive, and is not the appropriate avenue to determine the rights of the parties. The standard form should clearly be amended to say 5:00 pm. That will eliminate a possible objection by a crafty purchaser who simply wants to back out of the deal. It will also save the realtor the expense of litigation arising by reason of the “oversight”.
The OREA position appears to be the this extra hour now permits a closing to take place in “escrow”. But, if that is the case, where are the escrow references and instructions? There are none. That’s why I think it was just an oversight or mistake.
And, back in the day, vendors could always close in escrow after the Registry office closed at 4:30 pm. They made their own arrangements, there was no “one hour time limit. So, anytime up to midnight would work, and after that, it was the next day.
Brian Madigan LL.B., Broker