A letter from the builder's lender arrived two months after closing on a Goderich build

The situation

The letter came from the builder's lawyer, addressed to Dustin and Jordan, two months after they had already moved into the finished house on their rural lot outside Goderich. It described an interest adjustment of just under 14,000 dollars, calculated from a date the couple did not recognize, tied to something called a 'final mortgage advance' that had, according to the letter, been delayed through no fault of Kajan's.

Dustin, an investment advisor, and Jordan, a dentist who owns a practice, had purchased the lot and contracted the build with a local builder, Kajan, through a single agreement of purchase and sale for a custom home priced in the low 2,000,000s once the lot and construction costs were combined. Closing had happened on schedule that spring, adjustments had been calculated and paid at the time, and the couple had understood the file to be closed. The letter treated it as still open.

The core of Kajan's claim was this: the construction financing he had used to fund the final stages of the build was itself drawn down in stages from a construction lender, and the last advance, the one that covered final inspections and the release of the last holdback, had been delayed by roughly six weeks. During that delay, Kajan's own lender had continued to charge interest on the full committed loan amount rather than only the amount actually advanced, and the builder's lawyer was now passing that interest cost on to Dustin and Jordan as part of the final closing adjustment, on the theory that the delay had been caused by a late document from the buyers' own mortgage lender.

Dustin and Jordan had no memory of causing any delay. Their own mortgage had funded on time, their lawyer at the time had confirmed closing was unconditional, and nobody had mentioned an outstanding document in the weeks after they moved in. What they had, instead of a memory of the problem, was a letter asserting one, backed by a construction lender's document they had never seen and a lawyer acting for Kajan who was confident enough to bill them for it.

The couple brought the letter to our office rather than paying it, mostly because the number was too large to write off on the strength of an assertion, and because nothing about the story matched their own recollection of a closing that had gone smoothly.

What the other side was relying on

Kajan's claim rested entirely on one document: an internal statement from Kajan's construction lender showing the date the final advance was released and a note attributing the delay to 'buyer-side documentation.' Kajan's lawyer had not generated this explanation. He was relying on it, passed along from the lender's own file, and treating it as conclusive because it came from a financial institution rather than from Kajan himself.

The construction lender in this arrangement was a third party to the dispute between Dustin, Jordan, and Kajan. It had no stake in who ultimately paid the interest cost; its only interest was in getting its own advance file closed and its own interest charged correctly against whoever Kajan said was responsible. That mattered, because it meant the document Kajan was relying on had been written by someone with no first-hand knowledge of what Dustin and Jordan's own mortgage lender had or had not sent, and no reason to investigate further once a plausible-sounding note went into its file. A construction lender managing dozens of active files at once has every incentive to close a stalled advance quickly and little incentive to trace the precise cause of a six-week gap once a plausible label is available.

Kajan's position, in effect, asked Dustin and Jordan to accept a stranger's file note as proof of a fact about their own closing, a fact that the couple's own closing lawyer at the time had never flagged as an issue. If the construction lender's note was wrong, generated from an internal miscommunication or a mislabelled delay that had nothing to do with the buyers, Kajan had no independent basis for the claim at all. And there was reason to doubt it: nothing in Dustin and Jordan's own closing correspondence showed any outstanding request from anyone, and their mortgage funded without incident on the scheduled date, months before the letter arrived.

The six-week gap Kajan was pointing to was real; the final advance had genuinely been delayed. The question was never whether the delay happened. It was whether the cause the construction lender's note assigned to that delay was accurate, and whether a document written by a third party for its own internal purposes could be relied on, without more, to assign a 14,000-dollar cost to people who had never seen it and had no chance to correct it before it was written. A one-line internal note is not the same thing as a reconciled record, and the two are easy to confuse when the note comes from an institution that sounds authoritative.

Until that document was tested against the actual paper trail, Kajan had a plausible story and a real number. What he did not yet have was proof, and the gap between a plausible story and a proven one was exactly where the dispute needed to be fought.

What we did

1. Requested the full construction lender file, not just the summary note. Rather than accepting Kajan's characterization of the advance delay, we asked his lawyer for the complete disbursement file from the construction lender, including the advance request, any conditions attached to it, and all correspondence around the six-week gap, so the claim could be checked against primary records instead of a one-line internal note.
2. Pulled Dustin and Jordan's own closing file for a competing timeline. We obtained the file from the lawyer who had handled their original closing, including their mortgage lender's funding confirmation, the undertakings exchanged between the two closing lawyers, and every document exchanged in the weeks before and after closing, to establish exactly what had and had not been sent, by whom, and when.
3. Compared the two timelines side by side. Once both files were in hand, laid out in date order against each other, the mismatch became clear: the construction lender's advance request had been held up by a condition Kajan himself had not yet satisfied, an updated occupancy inspection report, which had nothing to do with anything from Dustin and Jordan's own mortgage lender.
4. Identified the actual source of the delay in the construction lender's own records. The disbursement file showed the construction lender's advance request was marked pending on an inspection sign-off Kajan was responsible for arranging, not on any document attributed to the buyers; the 'buyer-side documentation' note appeared to have been a mislabelled internal shorthand rather than an accurate description of the hold, likely written by a file administrator working from a checklist rather than an underwriter with direct knowledge of the file.
5. Wrote to Kajan's lawyer with the documented timeline, not just a denial. Instead of simply disputing the claim in general terms, we set out the construction lender's own advance request and inspection condition side by side with the mortgage funding confirmation, date by date, so the letter argued from Kajan's own paper trail rather than our clients' word against his, showing the delay traced to Kajan's own inspection scheduling rather than to Dustin and Jordan.
6. Requested written confirmation from the construction lender directly. To remove any doubt about what the file note actually meant, we asked Kajan's lawyer to obtain a written clarification directly from the lender's file administrator confirming, in plain terms and on the record, what had actually caused the hold, rather than continuing to rely on the ambiguous internal note that had started the dispute in the first place.
7. Negotiated a full withdrawal once the lender confirmed the cause. When the construction lender's clarification came back confirming the delay was tied to Kajan's own inspection condition, we pressed for a complete withdrawal of the adjustment rather than a reduced or split amount, on the basis that the documentary record no longer supported any claim against the buyers at all. A partial reduction would have been the easier settlement to offer and accept, but we held that line rather than splitting a claim that had no remaining basis.

The outcome

The construction lender's written clarification, once obtained, was unambiguous: the final advance had been held pending an occupancy inspection sign-off that was Kajan's responsibility to schedule, not a document the buyers' mortgage lender had failed to provide. Faced with its own lender's confirmation contradicting the original claim, Kajan's lawyer withdrew the interest adjustment in full within two weeks of that clarification arriving, and confirmed in writing that no further claim would be made on the file.

Dustin and Jordan paid nothing beyond the legal cost of investigating and responding to the letter, a fraction of the roughly 14,000 dollars Kajan had originally sought. The closing file, reopened by the builder's letter two months after the fact, was closed again with a written confirmation that no further adjustment would be sought, and the couple kept copies of the full exchange in case the same claim were ever raised again by a different party down the line.

The dispute is a useful illustration of how a post-closing adjustment claim can rest entirely on a document neither side to the actual dispute originally controlled. The construction lender's internal note was not written with Dustin and Jordan's interests, or even Kajan's, specifically in mind; it was a shorthand entry in a third party's file that happened to assign blame in a direction nobody had verified. Getting the underlying disbursement records, rather than accepting the summary, was what turned an assertion the couple could not easily disprove into a claim that collapsed once the paper trail was actually checked.

What made the outcome a clean result rather than a negotiated compromise was that the couple never had to argue their version of events against Kajan's; they only had to trace Kajan's own supporting document back to its source and let it speak for itself. Once the construction lender confirmed, in its own words, what had actually caused the delay, there was no remaining basis for Kajan to press the claim, and the file closed on the strength of that single piece of independent confirmation.

What you can learn from this