In the recent Ontario Court of Appeal decision in VanderMolen Homes Inc. v. Mani, 2025 ONCA 45, the appellants, a couple seeking to purchase a newly constructed home in Exeter, Ontario, entered into an agreement of purchase and sale with the respondent on January 13, 2022. The agreement was conditional, with a second deposit required upon removal of all conditions by January 20, 2022. The appellants requested an extension of the condition fulfillment deadline to January 26, 2022, with their offer set to expire at 11:59 p.m. on January 21, 2022. However, the respondent accepted this extension one day late, on January 22, 2022. Despite this, the appellants signed a waiver of conditions and provided the second deposit on January 26, 2022.
Subsequent communications between the parties were minimal, with the appellants later alleging that they had assumed the deal was not proceeding. On August 17, 2022, just weeks before the scheduled closing, the appellants informed the respondent that they would not be completing the purchase. The respondent ultimately resold the property at a loss and sought damages for the breach of contract.
The motion judge ruled in favor of the respondent, finding that the appellants breached the agreement of purchase and sale. The key issues addressed were whether a binding contract existed, whether the respondent’s failure to meet the extension deadline was fatal to the contract, and the appropriate measure of damages. The judge held that the agreement became binding when the appellants removed all conditions and paid the second deposit on January 26, 2022. The appellants’ failure to close the transaction was deemed an anticipatory breach, warranting damages.
At appeal, the Court rejected all of the appellants arguments. Notably, the Court reaffirmed that the appellants’ own conduct—namely, their waiver of conditions and payment of the second deposit—demonstrated their intention to be bound by the contract. Furthermore, the Court ruled that while the extension deadline was missed, the appellants’ continued performance indicated they had not treated the contract as terminated. The Court also upheld the motion judge’s reliance on subsequent conduct as evidence that the parties treated the agreement as ongoing due to the ambiguous nature of the contract.
This decision in VanderMolen Homes Inc. v. Mani reinforces that parties to a real estate transaction must adhere to contract terms, particularly when dealing with conditions and deadlines. While strict compliance with timing clauses remains important, subsequent conduct can influence whether a contract remains enforceable.
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