Unnecessary Deposit Clause in Schedule “B”

Definition of Deposits and A Concerning Matter

Here’s a mandatory schedule “B” that states:

“The Buyer (s) acknowledges that by execution of this Agreement of Purchase and Sale, they are creating a binding Agreement, whether or not they have submitted the deposit, and that they are under strict obligation to remit the deposit as per the deposit requirements and timeline contained herein. Failing which, the parties to this Agreement irrevocably acknowledge and agreethat the Seller shall be at liberty to offer the property for sale, without the requirement for a Mutual Release, noting that notwithstanding the aforementioned, failure to remit the deposit as specified herein, may still be deemed an anticipatory breach of this Agreement of Purchase and Sale, with the Seller reserving the right to seek damages and any other remedies available to them.”

Let’s break it apart and look at it more carefully:

“The Buyer (s) acknowledges that by execution of this Agreement of Purchase and Sale,

they are creating a binding Agreement,

whether or not they have submitted the deposit, and that

they are under strict obligation to remit the deposit

as per the deposit requirements and timeline contained herein.

Failing which,

the parties to this Agreement irrevocably acknowledge and agree

that the Seller shall be at liberty to offer the property for sale,

without the requirement for a Mutual Release,

noting that notwithstanding the aforementioned,

failure to remit the deposit as specified herein,

may still be deemed an anticipatory breach

of this Agreement of Purchase and Sale,

with the Seller reserving the right to seek damages and any other remedies available to them.”

Now, let’s add some commentary:

“The Buyer (s) acknowledges that by execution of this Agreement of Purchase and Sale,

they are creating a binding Agreement, (that’s true, and straightforward and completely unnecessary)

whether or not they have submitted the deposit, and that (that’s true, and straightforward and completely unnecessary)

they are under strict obligation to remit the deposit

as per the deposit requirements and timeline contained herein. (that’s true, and straightforward and completely unnecessary)

Failing which, (bad grammar here, there should not have been an end to that previous sentence)

the parties to this Agreement irrevocably acknowledge and agree (this is legal gobbledegook over the top)

that the Seller shall be at liberty to offer the property for sale, (that’s true, and straightforward and completely unnecessary)

without the requirement for a Mutual Release, (that’s true, and straightforward and completely unnecessary)

noting that notwithstanding the aforementioned, (strange wording)

failure to remit the deposit as specified herein,

may still be deemed an anticipatory breach (no, it’s not an anticipatory breach, the drafter doesn’t understand the law here)

of this Agreement of Purchase and Sale,

with the Seller reserving the right to seek damages and any other remedies available to them.” (that’s true, and straightforward and completely unnecessary, however, there is no reservation of this right, it’s already there, in law, clause or no clause)

All in all, this is quite strange and someone paid a lawyer “good money” to draft this up.

Brian Madigan LL.B., Broker

www.OntarioRealEstateSource.com

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