General Terms

Good Faith, Agency, and the Framework of the Agreement (a)

Clause (a) confirms two critical concepts:

1. Both the buyer and seller agree to act reasonably and in good faith in fulfilling the contract; and

2. Unless otherwise documented, each party is represented by their own sole agent, and those agents owe no agency duty to the other party.
   
   

For clients, this means cooperation does not equal obligation. Acting in good faith does not require either party to accept changes, extensions, or concessions they do not agree with. Representation is determined by documentation — not by friendliness, shared interests, or informal conversations.

If representation changes (for example, transaction brokerage or customer status), that change must be documented in writing. It cannot be implied or assumed.

Which Law Applies and Where Disputes Are Resolved (b)

Clause (b) establishes that Alberta law governs the contract, and any disputes will be resolved in Alberta.

This applies regardless of:

• where the buyer or seller lives,

• where documents are signed, or

• whether electronic signatures are used.
  
  

Clients should understand that legal advice, if needed, must be based on Alberta law, not another jurisdiction.

Time, Deadlines, and Alberta Time (c)

Clause (c) confirms two things:

• Alberta time applies to the contract; and

• Time is of the essence, meaning dates and times are strictly enforced.
  
  

This has significant implications for clients. Missing a deadline — even by hours — can result in lost rights, waived conditions, or default.

Electronic signing platforms may display timestamps in another time zone (such as EST). This does not change the contract. The written terms still follow Alberta time. Where discrepancies appear, they should be corrected if possible, but the contract remains enforceable under Alberta time regardless.

What Counts as a Business Day (d)

Clause (d) defines a business day as every day except Saturdays, Sundays, and statutory holidays, including all hours of the day.

This affects:

• condition deadlines,

• deposit timing,

• financing approvals,

• possession planning.
  
  

Clients often underestimate the impact of weekends, holidays, and bank closures. REALTORS® must help clients count business days accurately when drafting offers.

Interpretation of Language (e)

Clause (e) clarifies that references include singular and plural forms, and masculine and feminine references.

This clause prevents technical arguments over wording and does not require further action by the parties.

Material Latent Defects and Disclosure (f)

Clause (f) requires the seller to disclose known material latent defects — defects that:

• are not discoverable through a reasonable inspection, and

• materially affect the use or value of the property.
  
  

This is not a warranty of perfection. It is a duty to disclose what the seller knows.

For buyers, this clause does not guarantee compensation if defects are later discovered. Claims relating to material latent defects are complex, fact-specific, and often resolved after possession with legal advice.

For sellers, failure to disclose known defects may expose them to legal risk. Written disclosure is always safer than verbal disclosure.

Due Diligence and Assumption of Risk (g)

Clause (g) places responsibility for due diligence on both parties.

This means buyers and sellers agree to:

• conduct their own investigations, and

• assume the risk if they choose not to do so.
  
  

For buyers, this includes inspections, document review, title searches, and neighbourhood research. Waiving inspections or conditions does not shift responsibility to the REALTOR® or the seller.

For REALTORS®, this clause reinforces the importance of identifying risk and recommending investigation — not guaranteeing outcomes.

Seller Representations and Warranties (h)

Clause (h) confirms that the seller will ensure their representations and warranties are true by taking reasonable steps, including:

Reviewing Documents (h)(i)

The seller confirms they have reviewed documents such as the Real Property Report, land title, and registrations.

If these documents are not available or have not been reviewed, sellers should not warrant their accuracy. Improper warranties can create problems later if issues such as encroachments or easements are discovered.

Non-Resident Status and Dower (h)(ii)

The seller confirms they have addressed non-resident status and dower rights. These matters can affect taxes, spousal consent, and closing.

REALTORS® identify these risks and recommend legal advice — they do not determine status.

Other Necessary Research (h)(iii)

The seller confirms they have not ignored relevant information affecting the transaction.

Buyer’s Independent Advice and Inspections (i)

Clause (i) confirms that the buyer may obtain independent inspections and professional advice on matters such as:

• title and registrations,

• property condition,

• insurance,

• measurements and use.
  
  

This reinforces that REALTORS® are not inspectors or legal advisors. When buyers decline inspections or advice, they assume the risk. Have them sign a Decline of Condo Doc Review, Decline of Home Inspection or Decline of Financing.  

Written Changes Override Pre-Printed Clauses (j)

Clause (j) confirms that written changes supersede pre-printed clauses.

Legally, written terms control even if printed clauses remain. However, best practice is to:

• strike out conflicting printed clauses,

• initial all changes,

• ensure the contract reads clearly on its face.

Clarity reduces disputes and protects clients from misunderstanding.

Reading the Contract and Seeking Advice (k)

Clause (k) states that both parties will read the contract and seek relevant advice before signing.

In practice, many clients do not read every clause carefully. This makes it essential that REALTORS® understand the contract well enough to explain practical implications, while still encouraging legal advice when appropriate.

Collection and Publication of Transaction Information (l)

Clause (l) authorizes brokerages, boards, and MLS® systems to collect, maintain, and publish transaction information such as sale price and date for reporting and statistical purposes.

This is standard and unavoidable.

Providing Documents to Lawyers (m)

Clause (m) authorizes the brokerage to provide the contract and related documents to the appointed lawyers for closing.

This enables the legal transfer of ownership and does not give REALTORS® control over the legal process.

Why Section 3 Matters to Your Client

Section 3 defines:

• who carries risk,

• how deadlines are enforced,

• what happens when assumptions fail,

• and how disputes are interpreted.
  
  

Clients who understand this section make better decisions about inspections, conditions, and timelines. REALTORS® who explain it well reduce risk, complaints, and surprises after possession.