Timing can make or break a real estate deal. Whether you’re buying, selling, or investing, understanding how contractual time clauses work is essential to protecting your rights and ensuring a smooth closing.
In Washington, many agreements use “time is of the essence” (TOE) clauses, which make deadlines strict and enforceable. Others use “on or about” dates, allowing some flexibility. Knowing the difference—and how to negotiate these terms—can mean the difference between a completed sale and a failed deal.
At North City Law, our real estate contract attorneys help clients draft, review, and enforce agreements that protect their interests.
Contact us today to review your contract and ensure your timing terms align with your goals.
Why Do Time Clauses Matter in Real Estate Contracts?
Time related legal clauses and terms can be very important in real estate agreements, such as closing dates, contingency periods, and payment schedules. Missing these deadlines and notice periods can have significant consequences. This is more relevant in regions where time is of the essence dates are commonly used, like Washington. In these markets, dates serve as hard deadlines. But things work differently in other regions.
Another common type of date is an “on or about” date, which is more of an estimate that permits either party to reschedule as needed. Which type of date is the norm is largely a matter of local custom, but the parties are free to specify their own terms. In Washington, time-related provisions carry significant legal weight. Understanding how “time is of the essence” and “on or about” clauses operate can help you avoid unnecessary disputes and protect your investment. In this article, we discuss some of the more significant differences and how they can impact transactions.
What Does “Time Is of the Essence” Mean in a Real Estate Contract?
A “time is of the essence” clause underscores the importance of adhering to contractual deadlines, making the specified dates and times critical to performance. Failure to meet these deadlines can lead to contract termination, penalties, or damages. Since time is considered a material term, there is minimal flexibility to adjust the timeline once the contract is in effect. However, the enforceability of such clauses may depend on the nature of the agreement and the circumstances surrounding any delays. For example, a party cannot cause a delay for the purpose of causing the other to miss a deadline.
Key Features of TOA Clauses
The strictness of deadlines is coupled with additional contractual language to:
- Encourage the parties to respond to correspondence timely.
- Promote certainty in transaction timing.
- Provide an aggrieved party certainty by specifying their remedies for if a date is missed.
That said, courts may refuse to enforce a TOE clause if the delay was caused by the other party or if enforcing it would be inequitable.
What Does “On or About” Mean in a Contract?
Unlike “time is of the essence” clauses, “on or about” clauses assume flexibility treating dates more like targets or estimates rather than as deadlines. Compared with TOE dates, these allow for minor delays with minimal consequences for either party. The parties are always able to agree to extensions, that’s true no matter what type of dates are used. But, if the parties do not agree, then an on or about date can generally be pushed back for a “reasonable” time. What is reasonable can sometimes be disputed and will largely vary based on the specifics of the transaction, delay, and reason for delay.
Key Features of “On or About” Clauses
The flexibility of on or about dates can:
- Allow for minor delays without significant legal consequences for either party.
- Provide more opportunities for curing minor defects.
- Encourage the parties to maintain open lines of communication because both must be prepared to close before a date can be finalized.
What Other Contractual Timeframes Should Landlords and Buyers Watch?
Beyond closing and performance dates, real estate contracts include other critical timeframes:
- Contingency Periods: Deadlines for inspections, financing, or title review.
- Notice Periods: Time required to give advance notice for actions like termination or extension.
- Day Counting Rules: Some contracts count only business days, while others include weekends.
- Holiday Adjustments: If a deadline falls on a holiday or weekend, it may automatically roll to the next business day.
In Washington, forms such as the NWMLS Purchase and Sale Agreement define specific counting rules—so it’s important to read and understand these provisions carefully.
What Practical Steps Can Parties Take to Manage Contract Deadlines?
When choosing or defining dates, here are some things to keep in mind:
Mindful Tracking:
Dates play an important role in contract management, legal matters, and financial obligations. Tracking and recording key dates—such as deadlines, renewal dates, compliance due dates, and notice periods—helps prevent missed opportunities and penalties minimizing risk.
Clear Language:
There should be no ambiguity about dates. Regardless of what types of dates the parties use, the language of the agreement should be clear with only one reasonable interpretation
Risk Mitigation:
Pay careful attention to the impact dates and types of dates have upon bargaining position. A party uncertain about closing takes on more risk with TOE dates while, by contrast, a party relying on the transaction to close takes on more risk with on or about dates.
Notice and Computation:
It is also worth noting what procedural steps are required for notices or other actions to be effective for the purpose of satisfying date requirements—An improperly formatted notice sent on the last day may be invalid, leaving the term the notice sought to exercise no longer available. Likewise, counting days incorrectly and waiting until the last day can also result in missed opportunities
Get Guidance from a Washington Real Estate Contract Attorney
Whether drafting, negotiating, or enforcing a contract, every date matters. The difference between an “on or about” clause and a “time is of the essence” clause can dramatically change your rights and obligations.
At North City Law, our real estate attorneys help clients across Washington structure contracts that are clear, enforceable, and aligned with their business goals.
Contact us today to schedule a consultation with a Washington real estate contract lawyer and protect your interests in every transaction.