Can a Seller Back Out of an Accepted Offer in Nova Scotia?

You made an offer, the seller accepted it, and you may have started planning around the move. Then you hear the seller has changed their mind, or that another buyer has offered more. It is a stressful moment, and it is natural to wonder whether the seller is allowed to do this.

There is no one-line answer, because the outcome turns on the wording of your agreement, whether its conditions were met, and what each side has done. This article explains how to think about your position, what to gather, and when to involve a lawyer. It does not replace advice on your own deal.

This article covers the law of Nova Scotia.

Start with your signed agreement

An accepted offer in a home sale is usually written up as an agreement of purchase and sale. In plain terms, it is a contract. What each side promised, and what must happen before the sale is final, is set out in that document, so read it closely before reacting.

Look at the details that tend to matter most when a seller wants out. Some of them are listed below.

• Is the agreement signed by every seller and every buyer, and is it dated?
• Does it list conditions, such as financing or a condo document review, and who they protect?
• Have the conditions been met, waived, or allowed to expire?
• What are the closing date and other deadlines?
• Does it clearly describe the property being sold?

A seller who simply prefers a higher offer is in a different position from a seller whose agreement was never properly completed, or one who has a condition in their favour. Which one you face depends on the wording and the facts, and a lawyer can confirm it.

Conditions can change the picture

Many offers are made conditional on something. For a resale condo unit, for example, the province advises making the offer conditional upon receiving an estoppel certificate. Condo buyers are also told to get documents such as the declaration, bylaws, reserve fund status certificate and audited financial statements before buying.

If your agreement has conditions, it matters who can rely on them. A condition written for your benefit works differently from one written for the seller's. Do not assume either way. Have the exact wording reviewed.

New condo units bought from the developer are a special case. The buyer has ten days to rescind if the documents materially affect enjoyment of the property and the vendor will not fix or waive the issue, and that rescission must be in writing and in the vendor's hands within the ten-day cooling-off period. That right belongs to the buyer, not the seller.

Possible remedies if the seller will not close

When a seller refuses to complete a sale, people usually ask about two outcomes. One is damages, meaning money to make up for the loss the buyer suffers. The other is specific performance, meaning a court order that the seller actually go through with the sale.

Neither is automatic. Whether either is available, and how much a buyer could recover, depends on the agreement, on how the property is unique to you, on what steps you took, and on how quickly you act. A court decides on the facts, and no outcome can be promised. This is the point at which a lawyer's review of your documents is most useful.

It also helps to know what you stand to lose if the deal collapses. Costs you have already committed to, such as inspections, mortgage arrangements, or moving plans, may be part of the discussion. Keep receipts and records of each one.

Taxes and registration are not the real issue yet

Buyers sometimes worry about transfer costs in the middle of a dispute. Municipal deed transfer tax is a separate municipal tax with rates set by each municipality, and it is collected through Land Registry when the deed is registered and recorded. The purchaser completes a Municipal Deed Transfer Affidavit of Value form when the deed is registered.

If you are not a resident of Nova Scotia, a separate provincial non-resident deed transfer tax may also apply to residential property with 3 dwelling units or less. If you plan to move here, the tax may not be payable at transfer, but you must later prove residency. These costs come into play only if the sale actually closes.

Registration depends on identifying the right parcel. A document may describe the land by full text, a short form legal description, or the PID, which is the parcel identification number. The province recommends a lawyer for real property transactions, including identifying the correct PID and matching the legal description to the parcel.

What to do next

Move calmly but quickly. Delay can make matters harder to sort out, and what you say in writing can matter later.

• Gather the signed agreement, every amendment, and all messages with the seller and the agents.
• Note the dates: acceptance, condition deadlines, and closing.
• Write down exactly what the seller or their agent has told you.
• Keep records of money spent in reliance on the purchase.
• Avoid signing any release or cancellation document until you have had it reviewed.
• Speak with a Nova Scotia real estate lawyer about your options.

Frequently asked questions