A sanctuary sale in Dundas got more complicated after the offer was signed

The situation

By the time our office got the call, Seo-yeon and Jerome had already been living with an unusual problem for three weeks: they had a signed agreement to buy a large stone building in Dundas, a former sanctuary being sold by its shrinking congregation, and they still did not know when they would actually get to move in. The congregation wanted to keep using the main hall for Sunday services for an unspecified period after closing, and nobody had put a number on how long that period would be.

Seo-yeon works as a technology executive; Jerome owns several units of a multi-unit franchise operation. Between them they had the means to buy comfortably within the $1,200,000 to $2,800,000 range the property fell into, and they had chosen this specific building - high ceilings, stone construction, a large hall that could become a family living space - over several more conventional homes precisely because of its unusual character. What they had not anticipated, when they signed the offer, was that buying a building from a religious charity comes with a layer of process an ordinary residential purchase does not.

The congregation, a small charitable corporation with a handful of remaining active members, had voted to sell the building rather than continue carrying its upkeep, but had not wanted to give up its worship space immediately. The agreement Seo-yeon and Jerome signed included a leaseback clause: the congregation would continue to use the hall on Sunday mornings and for a small number of other dates each month, for a period the listing agent had described only as short-term. No end date had been fixed. No rent, insurance responsibility, or access schedule had been spelled out. The family had signed on the understanding those terms would be worked out before closing - and then the person representing the congregation on the file, a longtime trustee named Jomar, was hospitalized.

With Jomar unavailable and no clear description of who else on the small congregation board had authority to finalize terms, the file stalled. Seo-yeon and Jerome had already given notice on their current home. They came to us needing to know two things: whether the leaseback terms as loosely described were even enforceable, and whether the sale could close at all while the one person who had been negotiating it was out of contact. They had already given notice on their apartment and lined up movers, and every week of delay meant another week of paying for storage and a short-term rental while the file sat unresolved.

What the documents showed

A sale by a charitable corporation is not simply a matter of the board agreeing among themselves. A charitable corporation like this one is governed by the not-for-profit corporations legislation as well as its own letters patent and by-laws, and the statute can impose its own requirements no matter what the internal documents say - a sale of all or substantially all of a corporation's property, for instance, normally needs member approval by special resolution, not just a board resolution. We asked for the congregation's governing documents and the resolution authorizing the sale before doing anything else, because if the sale itself had not been properly authorized, nothing that followed would matter.

The documents showed the sale had been properly approved by a special resolution of the membership as well as the board, which was reassuring, but the leaseback arrangement had not been. It had been discussed at a board meeting and mentioned in the minutes only as a general intention, without the resolution itself addressing a leaseback at all. That gap explained why the terms in the purchase agreement were so vague - the congregation's own board had never actually finalized what it wanted, and Jomar had been negotiating the details informally, expecting to bring a firmer proposal back to the board before closing.

His hospitalization meant that plan never happened. Two other board members had signing authority under the corporation's own rules, but neither had been closely involved in the leaseback discussions and were reluctant to commit the congregation to terms they had not personally negotiated. What had looked, on paper, like a simple sale with an informal leaseback attached turned out to be a sale where the leaseback - the part of the deal Seo-yeon and Jerome cared about most, since it determined when they could actually move in - had never been decided by anyone with authority to decide it.

We also checked, in reviewing the letters patent and by-laws, whether the sanctuary building was held on any trust for a specific religious purpose beyond the corporation's general charitable objects. Ontario doesn't require a charity to notify the Public Guardian and Trustee before selling or leasing its property, and there's no general size threshold that triggers one - the real constraints come from the corporation's own governing documents and the not-for-profit legislation, and from any trust attached to the land itself, since property held for a specific charitable purpose can need court approval before it's dealt with, and that is when the Public Guardian and Trustee becomes involved. Here the letters patent didn't earmark the building for worship beyond the corporation's general objects, so no court approval applied on that basis - which meant the leaseback's validity turned entirely on whether the board itself had properly authorized it.

What we did

1. Separated the sale's validity from the leaseback's validity as two distinct legal questions rather than treating the file as one tangled problem, because conflating them was creating unnecessary panic on top of an already stressful delay. The sale resolution held up under review, so we could tell Seo-yeon and Jerome immediately that the purchase itself was not at risk. That confirmation let the family focus their attention on the harder, still-unresolved question - the leaseback - without also fearing the entire deal might collapse.
2. Worked directly with the two board members who held signing authority rather than waiting for Jomar to recover, because there was no way to predict how long his hospitalization would last and the family's own housing timeline could not pause indefinitely. We asked the board to convene and pass a resolution addressing the leaseback specifically, separate from the sale resolution that already existed, so there would be no ambiguity later about what the congregation had actually authorized.
3. Confirmed the building carried no trust for a specific religious purpose that would call for court approval or Public Guardian and Trustee involvement before the board finalized anything, since getting that wrong could have left the leaseback exposed to a later challenge only after the family had already moved in. Ruling that out early, while the board was still finalizing terms, meant it never became a last-minute complication at closing.
4. Pushed the board to set concrete, enforceable leaseback terms rather than let another informal understanding stand, because the family needed a fixed date they could actually plan a move around. Working without the trustee who had built the relationship with the family, the remaining board members were more conservative than he might have been: they agreed to a fixed four-month period, a defined schedule of two mornings a month rather than every Sunday, and the congregation carrying its own liability insurance for the hours it used the hall.
5. Negotiated a rent credit for the family to offset the inconvenience of sharing their own new home with a congregation for four months, and confirmed the board's leaseback resolution had actually been passed and signed before treating the amended terms as final, rather than relying on the board's stated intention to pass it. That sequencing mattered: an unpassed resolution would have left the new leaseback vulnerable to the same authority gap that had undone the original informal arrangement.
6. Kept the timeline realistic with Seo-yeon and Jerome throughout rather than promising a quick resolution, because a small board working through a colleague's medical emergency was never going to move at the pace of an ordinary negotiation. Setting that expectation early, and explaining why each step was taking longer than a routine file would, prevented the frustration that comes from an open-ended wait with no explanation attached to it.
7. Put the final terms in writing for the family in plain language not only for the board's own records, so Seo-yeon and Jerome knew precisely which mornings the hall would be in use, what the congregation's insurer covered if something went wrong during a shared-use Sunday, and exactly when the four months would end. Having it in writing meant nobody was relying on memory once move-in day finally arrived.

The outcome

The sale closed roughly two months later than Seo-yeon and Jerome had originally hoped, with a leaseback that was shorter and better defined than what they had signed onto initially, but still meant living around a congregation's Sunday mornings in their own home for four months after taking title. It was not the clean handover either side had pictured when the original offer was signed, and the family had to extend a bridge arrangement on their prior home to cover the delay, at a modest added carrying cost measured in the low thousands of dollars rather than anything that threatened the purchase itself.

For the congregation, the outcome meant a slower, more cautious process than Jomar had been steering toward, but one that gave the remaining board members - now operating without their most experienced member for an uncertain stretch - a leaseback they had actually approved themselves rather than one negotiated informally on their behalf. Jomar was not able to return to an active role on the file before closing, and the congregation's board has continued to operate with two authorized signers rather than reassigning his responsibilities in the interim.

Seo-yeon and Jerome moved into the building at the end of the leaseback period as scheduled, with the shared-use arrangement ending on the date the resolution specified rather than drifting the way the original informal understanding might have. The rent credit the family negotiated offset part of the added carrying cost from the delay, though not all of it, and they entered the arrangement knowing exactly what four months of shared Sunday mornings would look like rather than an open-ended guess.

Neither side got exactly the deal they had first imagined - the family waited longer than planned, and the congregation gave up the flexible, undefined arrangement Jomar had been working toward - but both ended up with terms that were actually binding, which the original agreement never was. That is the measure by which this file counted as a workable outcome rather than a clean win: nobody got what they had first hoped for, but the deal that finally closed was one both sides could actually rely on.

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