Can a party withdraw a settlement offer after it has been made in Ontario?

Yes, in Ontario a settlement offer can generally be withdrawn at any time before it is accepted, unless the offer states that it is open for acceptance until a specific date or is otherwise irrevocable by its terms. Under Rule 49 of the Rules of Civil Procedure, withdrawal must be done by serving a written notice of withdrawal on the other party.

The timing of withdrawal matters. If an offer is withdrawn before the other side accepts it, there is no binding agreement and no cost consequences flow from it. However, if the other side accepts the offer before it is withdrawn, a binding settlement exists even if the offering party has second thoughts. Courts take settlement agreements seriously and will generally enforce them.

If an offer includes an expiry date, it cannot be accepted after that date — so the offering party does not need to formally withdraw it once the deadline passes. Keeping clear records of when offers are made, the terms, and any withdrawals is important. If there is any confusion about whether an acceptance or withdrawal happened first, the dispute itself may end up before the court.