If a seller deferred development charges through an agreement, does that obligation bind the new owner?

It can, depending on how the deferral was structured, which is exactly why a buyer needs to check rather than assume either way. Development charge deferral agreements let a developer or owner delay paying charges normally due at building permit stage, often in exchange for security or an agreement registered against the property. Where the obligation is tied to the land itself, rather than being a purely personal promise from the original owner, a new owner can end up responsible for outstanding deferred amounts after closing.

This is easy to miss because a deferral agreement isn't always something a buyer would think to ask about unless prompted, and it may not show up clearly without a specific search of municipal records and title. An unpaid deferred development charge tied to the land can turn into an unexpected cost for a new owner who had no involvement in the original development.

Because the outcome depends entirely on the specific agreement's wording and how it was registered, a buyer's lawyer should search for any development charge deferral agreements affecting the property as a standard part of due diligence, and confirm what, if anything, remains outstanding before closing.