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!

Rennichan Mani and Seeniya Joseph signed a deal to buy a custom home in Exeter. Then they went quiet for six months, skipped the pre-delivery inspection, and pulled out two weeks before closing.

They figured the deal was already dead because the builder had missed a deadline early on.

It wasn't. And the court made that very clear.

The Case: A Custom Home Nobody Wanted to Finish

On January 13, 2022, Mani and Joseph signed an agreement of purchase and sale with VanderMolen Homes Inc., a custom builder, for a single-family home at 26 Triebner Street in Exeter, Ontario. The purchase price was $937,400. They paid a $5,000 deposit at signing, with another $88,740 due once their conditions were waived.

The agreement was conditional on solicitor approval and financing. Conditions had to be confirmed by 6:00 pm on January 20. On that deadline, instead of confirming, the buyers offered a one week extension, irrevocable until 11:59 pm on January 21.

VanderMolen missed it. The builder signed the acceptance on January 22, a day late.

Then something interesting happened. Rather than walking away, Mani and Joseph waived their conditions on January 26. The second deposit cheque cleared without a word of protest.

VanderMolen got to work.

Through the spring, the builder reached out repeatedly. Emails about decor selections. Texts to the phone number on the agreement. No response. A third-party contact emailed about countertop selections. Still nothing. The buyers would later claim they assumed the deal was off.

But they never asked for their deposits back. They never told the builder they were done.

On August 12, 2022, less than three weeks before closing, VanderMolen spoke to Mani about the pre-delivery inspection. Mani said he needed to check with his wife, who was in India. He gave no sign anything was wrong.

Five days later, the buyers cancelled the inspection. Same day, their lawyer confirmed they would not be closing.

VanderMolen listed the home with Century 21 at $849,000. No offers. Three price cuts followed. Two conditional deals collapsed. The home finally sold on October 11, 2023, for $705,000, more than a year after the buyers walked.

The buyers wanted their $93,740 in deposits back. VanderMolen wanted damages.

The Court Showdown: Did the Missed Deadline Kill the Deal?

The buyers argued:

• VanderMolen missed the January 21 deadline in a contract with a "time is of the essence" clause

• That missed deadline voided the agreement entirely

• No valid contract meant no breach, and the buyers were owed their deposits back

VanderMolen argued:

• The buyers kept performing after the missed deadline. They waived conditions, cleared the second deposit, discussed the pre-delivery inspection right up until August

• That conduct confirmed the contract was still alive

• On August 17, 2022, the buyers anticipatorily breached a binding agreement and caused real, measurable losses

The Decision: What You Do Matters More Than What You Say

Justice E. ten Cate had no trouble resolving this one.

The "time is of the essence" argument

A "time is of the essence" clause gives the innocent party the right to exit when a deadline is missed. It doesn't automatically void the contract. The innocent party has to actually make that choice — and then act on it.

The contract was alive

The court found the agreement became binding on January 26, 2022, when the conditions were waived and the second deposit was received. The missed emails and disputed texts were beside the point. By August 17, the buyers' own lawyer sent a message asking VanderMolen to list the property to reduce damages — an open acknowledgment the contract was valid.

The mitigation argument

The buyers argued VanderMolen misrepresented the home as having three bedrooms instead of four, which they claimed hurt the resale price. The court rejected it. No appraisals. No market comparisons. Just an allegation. The burden of proving a failure to mitigate falls on the party who walked, and a theory without numbers does not meet it.

What the court awarded

• Loss on resale ($937,400 minus $705,000)$232,400.00

• Less deposits retained($93,740.00)

• Property taxes$1,164.97

• Utilities$2,932.92

• Total: $142,757.89

Key Takeaways (Without the Legalese)

1/ A "time is of the essence" clause is a right

Lesson: If your client wants out because the other side missed a deadline, that decision needs to happen immediately and in writing. The moment they continue performing — paying, signing, showing up — they have made their choice.

2/ If you're going to argue the seller didn't mitigate, bring evidence

Lesson: Challenging a seller's resale efforts takes actual evidence. A broker opinion of value, an appraisal, something concrete. A theory without support gets dismissed.

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