Humber/Ontario Real Estate Course 4 Exam Practice

If a buyer’s offer includes a condition based on severance of a lot, what is this condition type?

1. Condition precedent

2. Condition subsequent

3. True condition precedent

4. True condition subsequent

5. Precedent clause

6. Enabling condition

The correct answer is: True condition precedent

A buyer’s offer that includes a condition based on the severance of a lot is a true condition precedent. This type of condition refers specifically to a scenario where the fulfillment of the condition must occur before an agreement becomes binding. In this context, the severance of a lot must take place for the buyer’s purchase to proceed. Until the condition is satisfied, the buyer is not obligated to complete the transaction. This distinction is crucial because it highlights that the buyer has built a protective measure into their offer. If the condition is not met—meaning the lot is not successfully severed—the buyer is not legally bound to follow through with the purchase and can withdraw or renegotiate. Understanding this concept is essential for navigating real estate agreements, as it determines the parties' obligations based on the presence or absence of specific conditions.