Can I Back Out of Selling My House After Accepting an Offer in Ontario?

Accepting an offer can feel final, and sometimes sellers have second thoughts. A better offer arrives, plans change, or the move feels too fast.

This article explains in general terms how binding an accepted offer is in Ontario and what can follow if you refuse to close. It does not replace advice on your agreement, which a lawyer should read.

An accepted offer is a serious commitment

Once you accept an offer that becomes an agreement of purchase and sale, you are generally bound to complete it. Changing your mind is not usually a reason that lets you walk away without consequences.

Whether you have any way out depends on the wording. A condition in the agreement may let a party end the deal, but conditions are read carefully. For example, a condition giving the buyer sole and absolute discretion is still read together with any duty in the agreement to act in good faith and with due diligence.

What can happen if you refuse to close

If a seller refuses to close, the buyer can ask for specific performance, meaning an order forcing the sale. The court asks whether the land, rather than money, better serves justice between the parties. It weighs the nature of the property, whether damages would be an adequate remedy, and how the parties behaved. Uniqueness is only one factor.

In Dhatt v. Beer, specific performance was ordered against residential sellers who refused to close. The court upheld the findings that the property had unique qualities and that damages were inadequate because the sellers lacked the funds to pay a damages award.

Each case turns on its own facts.

Situations that can change the answer

Some situations involve more than your own decision. If the home is a matrimonial home, a spouse may not sell or mortgage an interest in it unless the other spouse joins in or consents, the other spouse has released their rights in a separation agreement, a court order authorizes it, or another property is registered as the matrimonial home by both spouses.

A court may authorize a sale if the spouse whose consent is needed cannot be found, is not capable of consenting, or is unreasonably withholding consent. A sale made without the required consent can be set aside, unless the current holder bought for value, in good faith, and without notice that the property was a matrimonial home.

These rules cover married spouses. The matrimonial home consent rule does not protect unmarried partners. If other owners are involved, all joint tenants, tenants in common and coparceners may be compelled to partition or sell the land.

Lawful ways to end the deal

If you truly cannot proceed, the safest route is an agreement with the buyer. When buyer and seller disagree over a deposit, a brokerage can pay it out only under a mutual consent or release signed by both sides, or under a court order. The buyer may ask for something in return, and any release should be drafted or reviewed by a lawyer.

Also remember that a failure to close has money consequences, and a disputed deposit can stay tied up for a long time. If a brokerage has held a disputed deposit for two years with no determination, the deposit is transferred to RECO, which holds it in trust. What a seller who refuses to close could owe depends on your agreement and your situation, so it is worth confirming with a lawyer before you decide.

What to do next

• Read the agreement and every amendment, especially any conditions.
• Do not announce that you will not close before getting advice.
• Check whether a spouse's consent or signature was needed.
• Gather your mortgage details, since a payout may involve penalties and fees.
• Speak with a real estate lawyer before you accept or negotiate a release.

Frequently asked questions