Dear Forms Committee: What does “Time is of the essence” mean in OREF Sale Agreements?

Every OREF Sale Agreement includes a provision in the Miscellaneous section that says: “Time is of the essence of this Agreement.” This provision means that the deadlines throughout the Sale Agreement and any addenda are material to the contract. If either party does not meet an agreed-upon deadline, that party bears the consequences: depending on the nature of the deadline, they may be in breach of contract, they may lose the right to exercise a contingency, they may lose the right to object to a condition, etc.  Unless the other party caused them to miss the deadline, the “time of the essence” clause means that the other party is not obligated to give them more time.

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