Canada: Avoiding Problems in Waiver and Notice Clauses

Last Updated: November 10 2010
Article by Andrew Salem

This article originally appeared in Focus on Real Estate - November 2010

When parties negotiate and draft agreements of purchase and sale for real property, the provisions relating to how conditions may be waived (including what constitutes effective notice of waiver) are not usually treated as highpriority items. Before examining these seemingly minor details, most parties prefer to deal with the substance of the conditions, such as the scope and length of the due diligence period, or whether the agreement will be conditional on development approvals or new leases.

Even after the parties agree on the substantive matters relating to the conditions, it may be important to focus on what the agreement says about how conditions may be waived once the decision has been made to waive or invoke them. Agreements should be drafted to avoid ambiguities and disputes arising from conflicting interpretations, so that the intentions of the party for whose benefit a condition was inserted are not frustrated. At minimum, a party does not want to spend the last day of a conditional period deciding how to properly notify the other party. In addition, nobody wants to expend time and costs after the last day of a conditional period tied up in a dispute about the status of the transaction because the parties disagree on whether the conditions were properly waived.

The recent Ontario case of McKee v. Montemarano1 provides a helpful reminder that it is important to consider and clarify these details when preparing the contract (or as soon as possible afterwards), in order to avoid possible problems down the road. The case follows a line of decisions where purchasers claiming to have waived conditions find themselves in court with vendors who believe they can treat the deals as having been terminated. Illustrations include cases where conditions were purportedly waived by notice over the telephone, by notices handed to security guards, and in several cases, by notices left with real estate agents who did not have authority to receive them on behalf of vendors.

In the McKee case, there was a provision in Schedule "A" to the agreement of purchase and sale stating that "[u]nless the buyer gives notice in writing delivered to the Seller" by a specified time that the due diligence condition has been fulfilled, the agreement shall be null and void. The Schedule "A" provision went on to say that the condition may be waived by the buyer "by notice in writing delivered to the Seller within the time period stated herein." The pre‐printed portion of the agreement contained a general notice clause which allowed for notice to be hand delivered to the address of the seller set out in the agreement or faxed to the seller, and further identified the "Listing Broker" and the "Cooperating Broker" as agents of seller and Buyer, respectively, for notice purposes, although the court found that these terms were not accurately used in the documentation, noting that a single firm was broker‐agent for both parties.

The evidence indicated that the buyer left a copy of his written notice of waiver at the seller's front door (although he did not call the seller or knock on the door to ensure that seller would be there to receive it) and the buyer had also given a copy to his own real estate agent, who was with the same firm as the seller's agent.

The trial judge found, inter alia, that the specific clause in Schedule "A" required that notice of waiver be brought to the seller's personal attention and held that the agreement of purchase and sale, therefore, became null and void after no effective notice was delivered by the buyer prior to the deadline. The buyer appealed and the Court of Appeal agreed with the trial judge, citing the following reasons:

  • The Schedule "A" provision contained a specific notice requirement that was negotiated and prepared by the parties.
  • The plain language of Schedule "A" contemplated the actual delivery of waiver notice to the seller and there was no mention in Schedule "A" of the possibility of delivery to agents or to the seller's address, nor was there any reference in Schedule "A" to the general notice clause.
  • The context or circumstances surrounding the making of the agreement strongly suggested that the parties intended that any waiver notice must be brought to the seller's personal attention. The trial judge had found that in all matters of substance relating to the formation of the agreement, the parties dealt with each other directly and "the parties themselves drove the deal throughout formation, including Schedule "A"".
  • Schedule "A" was also prepared by the buyer's solicitor who "must be taken to have been aware of the different forms of notice provisions set out in the agreement".

The Court of Appeal disagreed with the buyer's argument that the dual agency role of the real estate firm allowed the effective delivery of the notice to be accomplished by the buyer delivering it to his own broker. Ultimately, the Court of Appeal focused on the words "delivered to the Seller" in Schedule "A" and agreed with the trial judge that notice of the waiver was only sufficient if brought to the seller's personal attention.

In light of McKee v. Montemarano and earlier cases dealing with these issues, parties would be well‐advised to consider the following:

Notice or No Notice?

At the outset, one needs to determine whether an affirmative step is required to waive a condition, or to put it another way: "what happens if nothing happens?" If an agreement is conditional until a specified time and the purchaser does nothing, will this mean that she has waived the condition? Or does the agreement automatically terminate? Alternatively, is the purchaser required to give notice that the condition is not waived or satisfied and, in the absence of such notice, the transaction will go firm?

Consider Your Verbs (and Delivery Methods): In the McKee case, the court was required to interpret the meaning of the phrase "delivered to the seller" in the context of the transaction. Ideally, parties to an agreement of purchase and sale will turn their minds to the issue and agree up front as to what will constitute effective notice, and the details can be included in the contract. For example, commercial agreements will now often include a provision that notices given to the parties' solicitors will be effective, and general notice clauses will typically describe the acceptable methods of delivery. However, in the McKee case, the general notice clause was overridden by the specific provision in Schedule "A" (the McKee agreement also included a provision that the added provisions, such as Schedule "A", supersede the pre‐set portions, like the general notice clause in the event of any conflict or discrepancy). Given the possibility that a fax machine may be off‐line or a party might not be available to receive personal delivery on the last day of a condition period, it is always helpful to obtain acknowledgement of receipt, if available, or to specifically confirm the form of evidence that will be sufficient for the sender to prove that notice was given.

Real Estate Agents: It may not be safe to assume that notice to a real estate agent is effective for waiving a condition after the agreement of purchase and sale has been signed. If parties want their agents to have authority for this purpose, this should be clearly expressed. The trial judge in McKee reviewed the case law on the issue and noted that an agent's authority to receive notice may arise from an express contract or from a course of conduct, or by the authority that a third party reasonably believes is invested in the broker, but the results of the cases will depend on the specific facts.

Write for Clarification: One can make efforts to avoid these situations through careful drafting but there may still be issues. For example, conditional dates might be defined as 30 days after a particular event, the date of which is not obvious. Or, we may need to review terms like "delivered to the seller", which will mean different things in different contexts. In any such case, it would be prudent to write a letter in advance of the deadline in an attempt to clarify potentially ambiguous terms and, if possible, obtain confirmation from the other party ("Yes, notice by fax to my lawyer at the following fax number is acceptable..."). Exchanging letters like this in advance of the deadline date would seem to be in the interest of all parties, as they have an opportunity to confirm their own intentions and expectations, rather than leaving an opening for future disputes. This course of action may be useful in other ways: if no reply is received to a reasonable request for clarification, this could be a warning that the other party may intend to use any ambiguity to its advantage, and steps could be taken to prepare for this.

As cases like McKee v. Montemarano illustrate, a failure to comply with notice and waiver requirements can have significant consequences. These provisions might seem like simple boilerplate clauses, but they should always be reviewed and confirmed or else parties may find themselves dealing with unintended results, which could include inadvertently committing to an unwanted transaction or terminating a good deal.


1 [2009] O.J. No. 1771 (QL); 78 R.P.R. (4th) 54 (Ont. C.A.), amended by [2009] O.J. No. 2641 (QL); 80 R.P.R. (4th) 324; affirming [2008] O.J. No. 2855 (QL), 72 R.P.R. (4th) 48 (Ont. S.C.)

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
23 Oct 2018, Other, Toronto, Canada

Dentons and SheEO are coming together for an evening of #radicalgenerosity on October 23, 2017. Meet Vicki Saunders, Founder of SheEO, and learn about how SheEO is changing the landscape for female entrepreneurs.

23 Oct 2018, Seminar, Montreal, Canada

Dentons is pleased to invite you to join us for a breakfast seminar as part of the Les Matinées Dentons series on issues relevant to you and your business.

24 Oct 2018, Other, Toronto, Canada

If you build it, claims may come. Join the Dentons Construction group for breakfast and an informative discussion on current topics in construction law.

In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions