Hey there, I had a question regarding the deposit. The initial buyer of our old home gave a 2000$ deposit, but forfeited and gave us notice 1 day before the closing date. He had already waived all conditions prior to this, and the last date in contracts for the return of his deposit was January 19th, whereas we got the notice on February 28.
We have sold the house to a new buyer, for more than the original selling price. The lawyer for the initial buyer has recently contacted us asking for the deposit back, however, it is my feeling that because they forfeited on the deal, they should not be entitled to the have the deposit back.
Do I have grounds for this refusal? I'm not sure of the law in Canada as to this situation, so any help would be appreciated.

With 2,000 on the line it might be wise to have an attorney review your contract paperwork to determine the right course of action.

no legal advice

On what basis is that Attorney saying that the original Buyer deserves the Deposit? It certainly appears that the original Buyer reneged on the Contract. The Deposit was there only to dissuade him from doing that, but he still reneged. Forfeiture of a Deposit is a just one consequence of breaching a Contract . . . . there could be others.

Look up the definition of "forfeit"; or have an Attorney do it for you. Seeing as you subsequently sold the property, the original Buyer and his Counsel may have thought they'd give it the "Old College Try", just to see if you're now in a good mood.

Important Notice: This information is provided as basic educational information by the author and is not a substitute for the advice of an expert and/or the advice of a Lawyer. There is NO representation as to legality, accuracy, correctness of the herein information and the reader is strongly urged to consult an Attorney in the relevant jurisdiction to ensure accuracy before acting on this information.

Eonitwat

You may be interested in reading an article titled "Who gets the deposit when house deals collapse?"

This article was written by lawyer Mark Weisleder and published in the Toronto Star on Friday October 29, 2010

This article may give you some insight, as to the issues as may be involved.

The article may be read at:

http://www.markweisleder.com/10moneyvillearticle1029.pdf

IMPORTANT NOTICE: This information is provided as basic educational information by the author and is not a substitute for the advice of an expert and/or the advice of a Lawyer. There is NO representation as to legality, accuracy, correctness of the herein information and the reader is strongly urged to consult a lawyer in the relevant jurisdiction to ensure accuracy before acting on this information.

An Article appearing in this months news letter "Realtors Edge" concerning the "deposit", may be of interest and can be viewed in the Ontario Real Estate Association website (Edge News letter)and is titled:

"Show me the money: The fate of the deposit if the deal falls through"

Which can be viewed at:
http://www.orea.com/index.cfm/ci_id/4846.htm

IMPORTANT NOTICE: This information is provided as basic educational information by the author and is not a substitute for the advice of an expert and/or the advice of a Lawyer. There is NO representation as to legality, accuracy, correctness of the herein information and the reader is strongly urged to consult a lawyer in the relevant jurisdiction to ensure accuracy before acting on this information.