Suing Under the 'Good Working Order' Warranty in an Ontario Agreement of Purchase and Sale

Three weeks after closing, your furnace stops working. Or the dishwasher that seemed fine at the final walk-through turns out to have never drained properly. Your Agreement of Purchase and Sale said included chattels and systems would be in good working order on closing day — so does that mean the seller has to fix it?

Sometimes, yes. Often, it’s more complicated than the clause makes it sound, and timing is almost everything.

Where This Warranty Comes From

Most Ontario Agreements of Purchase and Sale include a clause stating that included chattels, such as appliances, and certain building systems, such as heating, plumbing, and electrical, will be in good working order on the completion date. It’s a standard, widely used clause, but "standard" doesn’t mean unlimited, and its practical value depends heavily on timing and proof.

The Big Limitation: It’s a Snapshot, Not Ongoing Insurance

The warranty speaks to the condition of the item on closing day, not for some period afterward, unless the agreement specifically says the warranty survives closing for a stated time. Many agreements are silent on survival, which raises a separate legal question: under the general doctrine that contractual terms merge into the closing once a transaction completes, a warranty that doesn’t expressly survive closing may not be enforceable afterward at all. Whether your specific agreement’s warranty survives, and for how long, depends entirely on its wording — read that clause closely rather than assuming it protects you indefinitely.

What a Buyer Actually Needs to Prove

Even where the warranty does apply, a buyer generally needs to show that the item wasn’t in good working order at the time of closing, not simply that it stopped working sometime after possession. That distinction matters because:

• A furnace that worked fine at the final walk-through and then failed weeks later from ordinary wear may not show a closing-day breach at all.
• A dishwasher that never worked properly, which the buyer only discovered after moving in, is a stronger case that the condition existed at closing.
• The passage of time between closing and the failure works against the buyer — the longer the gap, the harder it becomes to show the problem existed on closing day rather than arising afterward.

What the Warranty Doesn’t Cover

• Normal wear and tear that develops after closing
• Items not listed as included chattels or fixtures in the agreement
• Cosmetic issues, unless the agreement specifically addressed them
• Problems the buyer already knew about and accepted before closing

Practical Steps If Something Fails Right After Closing

1. Document the problem immediately — photos, dates, and, where practical, a technician’s assessment of how long the issue appears to have existed.
2. Check your agreement’s exact wording on the warranty and whether it includes any survival period.
3. Review your final walk-through notes, if you have them, since they’re your best evidence of the item’s condition close to closing.
4. Contact the seller through your lawyer promptly. Delay works against you both practically and in terms of the argument that the problem existed at closing.
5. Weigh the cost of the claim against the cost of pursuing it. For a lower-value item, a direct negotiated resolution is often more practical than formal proceedings; for a major system failure, legal advice on your options is worth getting early.

Frequently asked questions