Real Estate Law. Real-World Lessons.

Every week, Ontario courts deliver decisions that reshape how real estate deals play out - impacting your closings, commissions, and client relationships. But who has time to sift through 50+ pages of legalese?

We do.

Clause & Effect breaks down Ontario’s biggest real estate cases into clear, practical takeaways for realtors, mortgage advisors, and investors. No fluff. No Latin. Just sharp lessons you can actually use.

Let’s dive in!

What happens when buyers try to renegotiate, and then bail, just weeks before closing?

That’s what unfolded in Grkavac v. Basnet, where a Markham couple watched their $1.6M sale evaporate over a last-minute demand for a $150K discount. The fallout? A six-figure hit and a cautionary tale for sellers, agents, and buyers alike.

The Case

In March 2022, Milan Grkavac and Despina Iliadis agreed to sell their home at 192 Oakridge Drive, Markham to Bimal and Saraswati Basnet for $1,608,000. The buyers paid a $90,000 deposit. Closing was set for June 27, 2022.

Two weeks before closing, the Basnets’ lawyer emailed the sellers’ lawyer asking for a price reduction, as the home appraisal had come in low, and the buyers were short on the down payment. They asked for a $150,000 price cut. The sellers refused.

On closing day, the buyers asked for an extension to August 15 to secure financing. Negotiations fizzled. The deal died.

The sellers re-listed for $1,499,000. After a month, they accepted an offer at $1,325,000, closing September 7, 2022. That meant a $290,677.51 loss, plus interest costs and legal fees.

The sellers sued for damages and the return of the deposit.

The Court Showdown: No money, no closing…

The buyers argued:

• The sellers were unreasonable not to grant an extension or price cut

• The sellers didn’t tender on closing, so they couldn’t sue

• The resale price was too low, and the sellers could’ve gotten more.

The sellers countered:

• They had no obligation to agree to an amendment or extension.

• Tender wasn’t required - because the buyers made it clear they couldn’t close.

• They reasonably mitigated their loss by accepting the only offer they got in a declining market.

The Decision: Seller Wins

Justice Morgan ruled for the sellers.

No obligation to renegotiate. The APS was firm, with “time of the essence.” The sellers were entitled to hold the buyers to it.

Tender not needed. The buyers had clearly repudiated the deal. As the Court of Appeal has said, no tender is required when a party makes it clear they won’t close (Di Millo v. 2099232 Ontario Inc.).

Resale price was reasonable. The court accepted that the market had declined. One offer in 30 days in a slumping market was sufficient effort.

Damages awarded: $314,759.98, minus the $90K deposit. Plus pre- and post-judgment interest.

Key Takeaways (Without the Legalese)

1/ Buyers can’t use a bad appraisal to walk away.

Lesson: Once you sign the APS, you’re locked in! Market dips or financing gaps aren’t a free pass.

2/ Sellers don’t have to renegotiate to be “reasonable.”

Lesson: Firm deals mean firm. Buyers can ask—but sellers don’t have to say yes.

3/ Mitigation doesn’t mean magic.

Lesson: Sellers don’t need to chase top dollar - they just need to act reasonably in a tough market.

Questions or advice needed on your next closing? Reach out at [email protected] or call 519-997-3775.

Solid contracts ensure seamless closings.

Until next time.

-Christian