Tenancy at Will versus Late Closing

 

What Happens When You Cannot Close on the Original Day of Possession?

In the context of the Alberta Residential Purchase Contract, a Tenancy at Will and a late closing refer to different situations and have different implications for the buyer and seller. Here's an explanation of each, including the late closing details written on the Alberta Residential Purchase Contract:

 

1. Tenancy at Will:

  • A Tenancy at Will occurs when the buyer occupies the property before the closing date as a tenant with the seller's permission. This arrangement is typically temporary and allows the buyer early access to the property.

 

  • The Alberta Residential Purchase Contract does not specifically address a Tenancy at Will provision. If the parties agree to a Tenancy at Will arrangement, it should be outlined in a separate agreement or addendum to the contract.

 

Effects on the buyer:

  • The buyer gains early access to the property and can occupy it before the official closing.

 

  • The buyer typically pays rent to the seller during the Tenancy at Will period.

 

Effects on the seller:

  • The seller retains ownership of the property during the Tenancy at Will period.

 

  • The seller receives rent from the buyer for the duration of the agreed-upon Tenancy at Will.

 

2. Late Closing:

  • A late closing refers to a situation where the actual closing date is delayed beyond the originally agreed-upon closing date specified in the Alberta Residential Purchase Contract.

 

  • The Alberta Residential Purchase Contract does address the possibility of a late closing. Section 4.1 of the contract states that if the Completion Date is delayed beyond the agreed-upon date, the parties must negotiate an amendment to the contract or otherwise resolve the matter.

 

Effects on the buyer:

  • The buyer may experience delays in taking possession of the property.

 

  • The buyer's financing arrangements may need to be adjusted or extended to accommodate the delayed closing.

 

  • If the late closing is due to the seller's default, the buyer may have rights to terminate the contract or seek legal remedies as outlined in the contract.

 

Effects on the seller:

  • The seller retains ownership of the property until the closing is completed.

 

  • If the late closing is due to the buyer's default, the seller may have rights to terminate the contract or seek legal remedies as outlined in the contract.

 

  • If the late closing is due to circumstances beyond either party's control, the contract provides flexibility to negotiate an amendment or resolution.

 

It's important to note that the specific terms and conditions related to a Tenancy at Will or a late closing should be documented in separate agreements or addendums to the Alberta Residential Purchase Contract. Consulting with a real estate lawyer or legal professional is recommended to ensure compliance with applicable laws and regulations and to protect the rights and interests of both the buyer and the seller.