A Numbered Company Purchase Nearly Derailed by a Missing Consent

The situation

By the time Deniz and Arben came to our office, they had already spent almost three weeks trying to resolve the problem themselves. Deniz, an optometrist, and Arben, a pharmacist, had agreed to buy a three-unit building in Sault Ste. Marie as a long-term rental investment, with a purchase price in the upper six figures, financed with a substantial down payment from their combined savings and a mortgage they had already been approved for. Their accountant had recommended holding the property through a newly incorporated company rather than in their personal names, mainly for liability separation between the rental business and their own professional practices, and to keep the eventual sale of the property cleaner from a tax standpoint years down the road.

They set up the company through an online incorporation service in the weeks after their offer was accepted, gave it a numbered name, and asked their real estate agent to let the seller's side know that title would be taken in the company's name rather than their own. Nobody on either side treated this as a major event at the time. Deniz and Arben assumed, reasonably enough, that buying through a holding company was a routine piece of paperwork that any experienced seller would recognize, since it is common practice among landlords purchasing rental buildings across Ontario. The agents exchanged a few emails confirming the change, and both sides moved on to arranging inspections and financing conditions as if the matter were settled.

It was not settled. The seller's own circumstances had shifted in the weeks after the agreement was signed, and that shift would turn a routine structural choice into a genuine threat to the deal.

Neither Deniz nor Arben had bought a property this way before. Their previous home purchase, made years earlier as a young couple, had gone through in the ordinary way, in their own names, with none of the complexity a rental building brings. This time there were tenants already in place, a mortgage lender who wanted assurance that the borrowing entity matched the entity on title, and an accountant pressing them to get the corporate structure right from day one rather than fix it later at greater cost. They were, in short, doing several new things at once, and it was easy to assume that as long as the paperwork was correct on their end, the transaction would simply move forward.

The problem

Two weeks before closing, the seller's lawyer sent a letter taking the position that the agreement of purchase and sale had been signed by Deniz and Arben personally, and that the numbered company was a separate legal person entirely. On that reading, the buyers had no automatic right to hand the deal off to a corporation without the seller's express, formal consent, and consent had never been given in writing by anyone with authority to give it. The letter raised the possibility that the seller, a man named Fatmir who had in the meantime received a substantially better offer from another buyer once the local market moved upward, might treat the change in structure as a breach that let him walk away from the original sale altogether and relist the property.

Deniz and Arben tried to handle it themselves first, which is understandable given how straightforward the issue had seemed until that point. They had their real estate agent call Fatmir's agent to explain that using a holding company for an investment purchase was common practice and had never been treated as a secret between the two sides. They forwarded copies of the incorporation documents to prove the company was a real, properly registered entity and that they were its only directors and shareholders. None of it moved the position on the other side. Fatmir's lawyer held firmly to the argument that the written agreement said what it said, and that nothing in the informal email exchanges between two real estate agents amounted to a binding, enforceable amendment to that written contract.

With the closing date only weeks away and a five-figure deposit already sitting in trust, the couple needed someone who could test that legal argument properly, on the actual terms of the contract, rather than continuing to restate the same practical facts to a lawyer who was under no obligation to accept them informally. Every day that passed without a resolution increased the risk that financing conditions, moving arrangements, and tenant notices already underway on their side would all have to be unwound. Their lender had already conditionally approved a commercial mortgage in the numbered company's name, and a collapse of the deal at this stage would have meant reapplying for financing from scratch, at rates that had already begun to rise, on top of losing a property they had spent months finding.

What we did

1. Pulled the original signed agreement rather than relying on anyone's summary or recollection of it, because a dispute about what a contract permits has to be resolved against its actual printed wording, not against what either side remembers having discussed with an agent weeks earlier. Reading the whole document again from the first page, instead of jumping straight to the clause everyone assumed was the problem, showed within the first hour that the agreement contained no shortcut around Fatmir's consent, which told us exactly what kind of letter to write instead of losing days chasing an argument that was never going to be there.
2. Confirmed that the agreement still bound Fatmir personally, regardless of how title was eventually held. The standard successors-and-assigns language was there, as it is in most agreements of this kind, but it gave the buyers no right to redirect title to a corporation without his consent; it only bound whoever eventually stood in their place. That told us the seller's underlying point was correct as far as it went, and that the real task was persuading him to give consent, not proving he had no right to ask for it.
3. Confirmed the company's ownership structure against the incorporation records filed with the province, rather than accepting the couple's own description of who controlled it, establishing clearly that Deniz and Arben were the company's sole directors and shareholders. That closed off any argument that the numbered company was some unrelated third party stepping into the deal, rather than simply a vehicle the same two buyers who had signed the agreement fully owned and controlled.
4. Wrote a formal letter to the seller's lawyer requesting written consent to direct title to the company, setting out plainly that the agreement bound Fatmir regardless of who ended up on title, and that withholding consent would not let him out of the deal: Deniz and Arben would simply close personally under the original agreement and transfer to the company afterward. Making clear that refusing consent bought him nothing but a more complicated closing, not an exit, changed the conversation from a fight he might win to a request that cost him little to grant.
5. Confirmed in writing that the buyers would remain personally liable under the agreement alongside the company if consent were given, which addressed the seller's real underlying concern, that the company might disappear leaving nobody to answer for the deal, and gave him a genuine reason to say yes rather than just a reason not to fight.
6. Set a short, specific deadline for the seller's lawyer to confirm consent, rather than leaving the timeline open-ended while the closing date crept closer. This gave Deniz and Arben a fixed point to plan around instead of waiting indefinitely through the final weeks before closing without knowing whether they needed to prepare to close personally or could expect the deal to proceed as originally structured.
7. Prepared closing documents on two parallel tracks at the same time, one with title going to the numbered company if consent came through, and one with Deniz and Arben closing personally under the original agreement if it did not, so that either way the deal would close on schedule rather than stalling on an answer from the seller's side.
8. Kept the lender informed throughout so that the conditional mortgage approval already in place would not lapse while the consent question with the seller was being resolved. A financing condition quietly expiring in the background, unnoticed while everyone's attention was fixed on the seller's letter, can undo a deal just as effectively as the dispute itself, and checking in with the lender directly meant that risk never had a chance to become a second, separate problem.

The outcome

The seller's lawyer confirmed Fatmir's written consent to the corporate title within four days of receiving our letter. Once it was clear that refusing consent would not let Fatmir out of the deal, only force it to close in Deniz and Arben's own names with the transfer to their company handled afterward regardless, there was very little practical reason left to hold out. Fatmir's newer, better offer from another buyer was not, on its own, a legal basis to unwind a sale that remained valid on its original terms, and consenting to the nominee cost him nothing he had not already given up the moment he signed.

The purchase closed on schedule, with title flowing directly into the numbered company exactly as Deniz and Arben had planned from the outset. They did not need to renegotiate the purchase price, extend the closing date, or make any concession of substance to keep the deal alive through to closing.

What ultimately decided the matter was not a clause hiding in the fine print; the standard-form agreement never gave Deniz and Arben an automatic right to substitute a corporation for themselves. It was the fact that the underlying agreement, signed by them personally, remained binding on Fatmir no matter how title was eventually held, which meant his consent, once asked for plainly and backed by a deadline, cost him far less to give than his lawyer's first letter had suggested.

For Deniz and Arben, the practical lesson was less about the numbered company itself and more about how a deal can wobble over a point that both sides genuinely believed was settled by a casual conversation between agents. They kept the property, kept the structure their accountant had recommended, and closed within days of the original date without having to explain to their lender why the transaction had slipped.

What you can learn from this