Force Majeure?

Force Majeure

Force Majeure

A “force majeure” clause (French for “superior force”) is a contract provision that relieves the parties from performing their contractual obligations when certain circumstances beyond their control arise, making performance inadvisable, commercially impracticable, illegal, or impossible.

Home buyers, sellers and Canadian real estate investors wondered whether a pandemic is considered force majeure (unforeseeable circumstances or “acts of God”), which could free them of their obligations in case housing prices were to plummet in the next few weeks. Others may be facing other liquidity issues.

A force majeure clause typically operates to absolve the non-performing party of liability for its failure to meet contractual obligations as a result of the extenuating circumstance, but its precise effect will depend on the language of the provision.

Quebec usually have this clause in their contracts.
Historically, force majeure events were recognized as forces of nature or acts of God events. However, the clause can and has been expanded to include events which are industry or transaction specific. Certain events created by extraneous human intervention can also fall under the category of force majeure events.

Example: fire, flood, earthquake, storm, hurricane, other nature disasters, war, invasion, act of foreign enemies, hostilities, civil war, rebellion, revolution, insurrection, military or usurped power or confiscation, terrorist activities, nationalization, government sanction, blockage, embargo, labor dispute, strike, lockout or interruption or failure of electricity or telephone service.

Data from the Canadian Real Estate Association (CREA) indicates that 65,494 homes were sold across Canada in the first two months of 2020, meaning that as many as 130,000 families may be in limbo, waiting for their transactions to close.
In the province of Ontario, Canada buyers, sellers and Canadian real estate investors are bound by their obligations under the Ontario Real Estate Association’s (OREA) Agreement of Purchase and Sale.

The only way a deal cannot close is if the government registration system closes down or lenders cannot fund loans, which is not the case right now.

Real estate businesses have been deemed an essential service in Ontario. Thus, real estate brokerages and law firms are allowed to function but with new guidelines to observe social distancing. At the same time, financial institutions are working and extending mortgage credit.

While buyers’ remorse is real, it is no ground to back out of the deal. During and after the Great Recession in 2008-09 and when the foreign home buyers’ tax was imposed first in British Columbia in 2016 and later in Ontario in 2017, many buyers tried to avoid closings after housing prices declined.

Courts, though, have found in favor of sellers in cases where buyers reneged on a signed deal.

An Ontario couple who reneged on a firm offer to buy was ordered by the court to pay $470,000 to make up for the difference in the price they agreed to pay and the subsequent sale price paid by a different buyer.

force majeure is not covered in OREA’s Agreement of Purchase and Sale, parties can include additional clauses in Schedule A of the Agreement. However, such terms must be entered at the execution of the agreement and not after the fact.

In some circumstances, parties may invoke frustration of contract when unforeseen circumstances make it impossible to perform their obligations under a contract. However, the bar to prove the frustration of contract is very high.

If a deal hits a snag, the best way forward is to work it out collegially. Instead of trying to nullify a contract, the parties could agree to a postponement until such time that the transaction can be completed. It is up to the parties to demonstrate that they have made reasonable, good faith efforts to fulfill their obligations.

Given the current pandemic and recent uptick in flooding and severe weather, which can cause severe damage to homes, it might be time to review standard buyer and seller agreements, which are province-specific.

Much can transpire during a sale and its closing. Introducing new standard clauses to protect both sides while providing opportunities for insurers to price risk will offer greater stability in uncertain times.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.



The potential impacts of COVID-19 for buying, selling,
flipping or entering of their property with your clients,
investors, contractors, property inspection, appraisal
and review the options that are available to them.

These options could include:

Having you request health and recent travel information
from the potential buyers, seller, investor or renter
and their professionals before any showing to give the
property owner an indication of any risk.

The potential buyers, seller, investor or renter are
obligated to either be truthful or simply decline to
answer. Inform the property owner that they have no
duty to show the property if they are uncomfortable
with any presented risk*

Creating a marketing video showing a tour of the house
to reduce the number of viewings to the potential buyers,
seller, investor or renters.

By offering a virtual video tour, the property owner could
then consider only allowing viewings for the serious
potential buyers, seller, investor or renters who make
an offer to purchase subject to a viewing.

Make viewings conditional on the potential buyers, seller,
investor or renters and their representatives wearing
nitrile gloves or the use of anti-microbial,
alcohol-based hand sterilizer.

A plan to clean doorknobs, cupboard hardware, light switches,
as well as surfaces in areas like bathrooms and kitchens
before and after each showing of the property.

Traveling in separate vehicles to viewings to limit the
amount of time spent in close proximity to each other.

Taking all precautions necessary, including cleaning and
sanitizing the home before and after an open house or
any home inspections.

The property owner may also have the option to temporary
pull their property off the market. Where applicable,
check with your real estate board to determine whether
they have relaxed their listing rules to allow viewings
to be suspended.

The property may also be pulled off the market by terminating
the listing entirely and entering into, and signing,
a new agreement to re-list the property at a future date.
Buyers could also choose to postpone the purchase
process until a later date.

Any clause included in a contract to address circumstances
surrounding COVID-19 should be drafted and reviewed
by legal counsel to ensure enforceability and to
ensure the clause addresses the specific scenarios adequately.

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Industry professionals should seek legal advice based on their
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Off market real estate deals

Off Market Deals

An off-market property is a home that is not listed on the multiple listing service (MLS) with a Realtor in Canada. Both Canadian professional real estate investors and home sellers often think that an off-market property provides a more “exclusive” transaction.

Off market usually means that the property has been taken off of the market for some reason. This means that the property could be back on the market at some later date. If the property was on the market and sold, then the property should reflect “sold” not off the market. 

There are several ways to find off market real estate deals for Canadian professional real estate investors. One can learn from Canadian real estate experts by attending Canadian real estate investment strategy apprenticeship.

Top 20 Sources for Off Market Real Estate deals in Canada

  1. Direct Mail
  2. Online Resources Kijjiji & Craigslist
  3. Real Estate Networking
  4. Realtors
  5. Expired listings
  6. Contractors
  7. Wholesalers
  8. Bird Dogs
  9. Word Of Mouth
  10. Real Estate auctions
  1. Driving for Dollars
  2. Social media
  3. Tired landlords
  4. Branding
  5. Lawyers and Accountants
  6. Real estate investors
  7. Vested properties
  8. Civil enforcements
  9. For sale by owners (FSBO)
  10. Fellow local investors

Some Canadian home sellers may opt for an off-market listing to test the waters while others want a more private sales process to save the commission. Certain Canadian home sellers even think a pocket listing creates an allure that will get them an even higher price. After all, if the home is listed and ends up sitting on the market for more than 30 days, there’s a good chance potential Canadian home investors or buyers may try to make lowball offers. Without the “days on the market” ticker going off, there isn’t a chance that a seller will be undercut.

Off-market real estate listings are properties that are for sale, but aren’t listed on the (MLS) multiple listing services. Many of these properties are exclusive, prestigious listings that a realtor keeps in their back pocket. Off-market listings give Canadian home investors exclusive access to inventory, and a better chance at closing a deal at deep discounted prices. To get access to these listings, Canadian home investors can approach agents or Canadian home sellers directly, or try going online. 

A house-hunting means competing with hundreds of other prospective Canadian home investors and buyers. Properties that are for sale off-market means that the buyer is competing with only one or two other people, increasing their chances of closing on the property.

Off-Market Deals

In the highly competitive market of Toronto, Montreal, Ottawa and Windsor – home sellers expect a quick sale. In off-market deals, Canadian home sellers are typically not in a rush to sell, driving the competition down and allowing prospective Canadian home investors to look over the proper thoroughly before making an offer.

As a result of no time pressure, a sweet deal can be made that would never be possible in the open market including vendor take back mortgages at reasonable rates. 

Sellers who are thinking of selling in the near future have the option to use an off-market deal to test the buying waters. There is the option to accept an offer if one comes in, or don’t accept and not upset any tenants, family members or neighbors. 

Canadian home investors who are looking to gain a competitive advantage and Canadian home sellers looking to keep a sale private should consider the off-market option.

Then again, not all “off-market” deals are worth buying. In fact, a huge portion of off-market deals aren’t on the market because… you guessed it, they want more than the property is worth.

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Be a game changer and become a Canadian real estate virtual Wholesaler

Be a game changer and become a Canadian real estate virtual Wholesaler

Virtual real estate wholesaling in Canada means having a property under contract using online references, computers and smartphones. Similar to virtual jobs and remote virtual assistants, virtual real estate wholesaling is wholesale real estate transacting that is done mainly through a variety of electronic means in Canada.

Why FlippingWholesale real estate involves entering into a contract for Canadian real estate and then assigning that real estate contract to a different end buyer or fix and flip investor in their local area. It is worth mentioning that investing in wholesale real estate differs from other types of real estate investments, mainly because the wholesaler does not close any deal. Canadian real estate wholesalers do not need money, qualification or an excellent credit score.

Keep in mind that the wholesaler identifies potential panic motivated sellers with properties that they want to move quickly and who do not want to use real estate agents. There are several other reasons where virtual real estate wholesalers find the greatest bargains, such as

  1. Civil reinforcements
  2. Redemptions
  3. Seizures
  4. Evictions
  5. Panic home sellers
  6. Run down properties
  7. Estate sales
  8. Haunted homes
  9. Fire sale


  1. Liens
  2. Judgements
  3. Repossessed properties 
  4. Power of sale
  5. Foreclosures 
  6. Public auctions
  7. Surplus properties
  8. Vacant homes
  9. Abandoned homes

Two steps to start Virtual Real Estate Wholesaling in Canada

Canadian professional real estate investors ready and eager to learn how to start virtual real estate wholesaling will be glad to know that the process is not as complicated as they may believe. Also, keep in mind that wholesaling real estate is often a short-term investment strategy. 

Wholesaling Houses

Use Online Marketing To Flip Real Estate. All Done 100% Virtually Without Owning Any Property. The new model of “virtual” real estate investing that’s the perfect opportunity to start a part time “hustle” or full time career (without any prior experience, in any market, from anywhere in the Canada) The Canadian real estate investment strategy apprenticeship is perfect for anyone looking to get started in Canadian real estate OR experienced investors looking to boost their existing real estate business.

The process of wholesaling real estate does not change from one market to another. If you can find and analyze a good real estate deal in Ottawa, you should be able to do the same in Toronto, Montreal or Vancouver. 

Step one will be to get proper training and education form local Canadian real estate experts with proven track record of success. Canadian real estate investment strategy apprenticeship will the right place to start.

It will provide you with the tools, strategies and know how training in real life trenches. Apprenticeship have five components

  1. Preparation
  2. Marketing on steroids
  3. Training in class
  4. LIVE field training in Canadian courts
  5. Virgin deep discounted leads from panic sellers

Second step is to be a member in Canada’s elite REI club which has over 17,000 real estate members. Professional real estate investor group (PREIG) Canada group was launched in April 2005 to conduct network meetings in Toronto every month. It has been running ever since every month, no matter what. Success have few ingredients of persistence, consistence, commitment, discipline and dedication.

If you want to become a Canadian virtual real estate wholesaler, then the apprenticeship is the best weapon in your arsenal — it opens your opportunities up to whole world and all the relevant training and education.

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