What If the House Is Not in the Same Condition on Possession Day in Alberta?

What If the House Is Not in the Same Condition on Possession Day in Alberta?

Short answer: if the house is not in the same condition on possession day, the buyer may have remedies — but the response depends on what changed, how serious it is and what the purchase contract says.

In Alberta, a seller is generally expected to deliver the property in the condition required by the contract. Many residential purchase agreements require the property to be in substantially the same condition on possession as it was when the agreement was accepted, except for ordinary wear and tear.

If something has changed before possession, the buyer may be able to ask for:

• repairs;

• replacement of missing or damaged items;

• a holdback;

• a price adjustment;

• compensation;

• delayed closing; or

• in serious cases, termination or a legal claim.

The important point is simple:

possession day problems should be raised immediately, before closing funds are released if possible.

What Does “Same Condition” Mean?

“Same condition” does not mean the home must be perfect.

It usually means the seller should not materially damage the property, remove included items or leave the home in a condition that is different from what the buyer agreed to purchase.

For example, problems may arise if:

• appliances included in the contract are missing;

• fixtures have been removed;

• walls or flooring are damaged during move-out;

• the basement floods before possession;

• the seller leaves garbage or unwanted items behind;

• the seller does not provide vacant possession;

• the property is vandalized before closing;

• agreed repairs were not completed;

• keys, remotes or access devices are missing;

• tenants or occupants remain in the property; or

• the property has suffered fire, water, storm or other damage.

Not every issue is serious enough to stop closing.

But the seller cannot usually deliver a materially different property from the one the buyer agreed to buy.

Start With the Purchase Contract

The purchase contract is the first document to review.

It may address:

• the condition of the property on possession;

• included appliances and unattached goods;

• fixtures and attached goods;

• excluded items;

• seller repair obligations;

• risk of loss before closing;

• possession time;

• vacant possession;

• Real Property Report obligations;

• remedies for default;

• whether time is of the essence; and

• whether a holdback or adjustment is available.

In one Alberta case, the contract required the property to be in substantially the same condition on possession as it was when the agreement was accepted. The court considered that wording when dealing with items removed or left behind before possession: Kolochuk v. Beattie, 2004 ABPC 184.

The practical rule is simple:

do not decide the issue from the condition alone — read the contract.

Common Possession Day Problems

Possession day disputes often fall into a few categories.

Common examples include:

• missing appliances;

• missing garage door openers or remotes;

• removed light fixtures;

• removed mirrors, shelving or built-ins;

• damage from the seller moving out;

• holes in walls;

• scratched floors;

• broken doors or locks;

• damage to cabinets or countertops;

• property left full of garbage;

• seller belongings left behind;

• yard or garage items removed when they were included;

• water in the basement;

• furnace, hot water tank or appliance failures;

• damage from tenants;

• unpaid utilities or access problems; and

• the seller failing to move out on time.

The legal response depends on whether the issue is minor, material or serious enough to affect closing.

Minor Issues vs. Serious Issues

A minor issue usually does not justify refusing to close.

Examples may include:

• small wall scuffs;

• minor nail holes;

• small cleaning issues;

• ordinary wear and tear;

• a missing garage remote;

• minor move-out damage;

• small appliance issues; or

• low-value items that can be easily replaced.

These issues may be handled through a small credit, repair, replacement or holdback.

Serious issues are different.

Examples may include:

• major water damage;

• fire damage;

• significant mould;

• structural damage;

• missing major fixtures;

• removed built-ins;

• unsafe electrical or heating issues;

• serious damage affecting occupancy;

• a seller who has not moved out;

• tenants still occupying the property;

• substantial property left behind; or

• a condition that affects financing or insurance.

The practical point is this:

the more serious the change, the stronger the buyer’s position may be.

What If the Seller Removed Fixtures?

Fixtures are generally items attached to the property in a way that makes them part of the home.

Examples may include:

• light fixtures;

• built-in shelving;

• attached mirrors;

• built-in cabinets;

• attached TV mounts, depending on the contract;

• built-in appliances;

• attached pergolas or yard structures; and

• other items physically connected to the property.

The line between a fixture and a removable item can sometimes be disputed.

Courts consider factors such as how attached the item was and why it was attached. The Alberta Court of Appeal has described fixture status as a factual question involving the degree and purpose of attachment: AMIC Mortgage Investment Corporation v. Investors Group Trust Co. Ltd., 1985 ABCA 173.

The practical rule is simple:

if an item was attached to the property or specifically included in the contract, the seller should be careful before removing it.

What If Included Appliances or Items Are Missing?

The purchase contract usually lists unattached goods included in the sale.

These may include:

• fridge;

• stove;

• dishwasher;

• washer and dryer;

• microwave;

• window coverings;

• garage remotes;

• shed;

• hot tub;

• security equipment; or

• other specifically listed items.

If an included item is missing on possession day, the buyer may request:

• return of the item;

• replacement;

• repair;

• compensation;

• a credit on closing; or

• a holdback.

In Kolochuk v. Beattie, the court awarded the buyer the replacement cost for a cemented rain barrel that had been removed even though it should have remained with the property.

The practical point is this:

check the inclusion and exclusion clauses before deciding whether the seller was allowed to take something.

What If the Seller Damaged the House While Moving Out?

Move-out damage is common.

Examples include:

• scraped walls;

• damaged floors;

• broken doors;

• damaged stairs or railings;

• damaged garage doors;

• broken light fixtures;

• holes from removed items;

• damaged landscaping;

• broken appliances; or

• damage caused by movers.

Minor move-out damage may be resolved with a modest repair credit.

More serious damage may require a holdback, repair agreement or legal claim.

The buyer should document the damage immediately with photos and video.

The practical rule is simple:

do not wait days or weeks to raise move-out damage. Timing matters.

What If the House Is Dirty?

A house that is not clean on possession day can be frustrating.

Whether it creates a legal issue depends on the contract and the severity of the condition.

Minor cleaning issues may not justify major remedies.

But more serious problems may arise if the seller leaves:

• garbage throughout the property;

• hazardous materials;

• abandoned furniture;

• animal waste;

• food waste;

• construction debris;

• hoarding conditions;

• belongings in the garage, basement or yard;

• tenant property; or

• items that prevent the buyer from using the home.

If the issue is serious, the buyer may request cleaning costs, junk removal costs, a holdback or other compensation.

The practical point is this:

ordinary untidiness is different from failing to provide usable possession.

What If There Is Water Damage on Possession Day?

Water damage should be taken seriously.

Examples include:

• basement flooding;

• sewer backup;

• burst pipes;

• roof leaks;

• appliance leaks;

• water entering through foundation cracks;

• mould;

• damaged drywall or flooring; or

• moisture discovered during the final walkthrough.

If water damage is discovered before funds are released, the buyer should immediately contact their lawyer and realtor.

Possible solutions may include:

• delaying closing;

• requiring repairs;

• negotiating a holdback;

• involving insurance;

• obtaining a contractor or engineering assessment;

• reducing the purchase price; or

• terminating in serious cases.

Water damage can also raise hidden defect issues if it appears the seller knew about a prior problem and concealed it.

The practical rule is simple:

document water damage before repairs begin.

What If the Seller Has Not Moved Out?

If the seller has not moved out by the agreed possession time, that may be a serious issue.

The buyer may not be receiving vacant possession as required.

Possible responses may include:

• a short written extension;

• a holdback;

• compensation for movers, storage or hotel costs;

• delayed release of funds;

• an occupancy agreement;

• a claim for damages; or

• in serious cases, termination or enforcement steps.

The buyer should not try to force access or handle the dispute at the door.

The practical point is this:

if the seller is still in the property, contact the lawyer immediately.

What If the Problem Is Found During the Final Walkthrough?

A final walkthrough is often when condition problems are discovered.

The buyer should use the walkthrough to check:

• appliances are present;

• fixtures remain;

• included items are still there;

• the seller has moved out;

• the property has not suffered obvious new damage;

• agreed repairs were completed;

• garbage and belongings are removed;

• keys and access devices are available; and

• the property is generally in the expected condition.

If a problem is found, the buyer should take photos and video immediately.

The buyer should also tell their realtor and lawyer right away.

The practical rule is simple:

if you find a serious issue during the walkthrough, raise it before closing whenever possible.

Can the Buyer Refuse to Close?

Possibly, but not for every problem.

Whether a buyer can refuse to close depends on:

• the seriousness of the issue;

• the wording of the purchase contract;

• whether the problem can be fixed quickly;

• whether the seller offers a reasonable solution;

• whether the issue affects occupancy;

• whether the issue affects financing or insurance;

• whether the buyer is ready to close;

• whether time is of the essence; and

• whether the seller’s breach is fundamental.

A buyer should be careful before refusing to close over a minor issue.

If the issue is not serious enough to justify refusal, the buyer may create their own default risk.

The practical rule is simple:

do not refuse to close unless the contract and the seriousness of the issue support that position.

Can the Buyer Ask for a Holdback?

Yes, a holdback is often a practical solution.

A holdback means part of the seller’s sale proceeds is held back until the issue is resolved.

For example, a holdback may be used if:

• repairs are incomplete;

• damage needs to be assessed;

• an appliance must be replaced;

• junk removal is required;

• cleaning is required;

• an insurance claim is pending;

• an included item must be returned; or

• a contractor estimate is needed.

A good holdback agreement should say:

• how much is held back;

• who holds the money;

• what must happen before release;

• who decides whether the work is complete;

• what happens if costs exceed the holdback;

• what deadline applies; and

• what happens if the parties disagree.

The practical point is this:

a holdback can solve a closing problem, but only if the terms are clear.

What If Closing Has Already Happened?

If closing has already happened, the buyer may still have a claim.

But the practical leverage may be reduced.

After closing, the buyer should preserve evidence and determine whether the seller:

• removed an included item;

• damaged the property before possession;

• failed to disclose damage;

• concealed a defect;

• breached the purchase contract;

• failed to provide vacant possession; or

• made a false representation.

The buyer should gather:

• photos and videos;

• walkthrough records;

• listing photos;

• inspection reports;

• the purchase contract;

• inclusion and exclusion clauses;

• realtor communications;

• lawyer communications;

• repair estimates;

• invoices;

• expert reports; and

• proof of when the issue was discovered.

The practical rule is simple:

after closing, evidence becomes even more important.

What If the Seller Says the Damage Happened After Possession?

Timing can become a major dispute.

The seller may say the property was fine when possession was given.

The buyer may say the damage was present before possession.

Evidence may include:

• final walkthrough photos;

• timestamped videos;

• realtor notes;

• contractor opinions;

• neighbour observations;

• weather records;

• utility records;

• insurance records;

• moving company evidence; and

• communications from possession day.

The buyer should document issues immediately after getting keys.

The practical point is this:

if you discover a problem right away, record it right away.

What If the Seller Left Personal Property Behind?

Personal property left behind can be a possession problem.

Examples may include:

• furniture;

• garbage;

• renovation materials;

• paint cans;

• appliances not included;

• yard debris;

• broken equipment;

• tenant belongings;

• hazardous waste; or

• items in the garage, shed or basement.

Depending on the seriousness, the buyer may seek:

• removal;

• junk disposal costs;

• cleaning costs;

• storage costs;

• a holdback;

• compensation; or

• another written arrangement.

In Lawes v. Bell, 2010 ABPC 187, the court considered obligations relating to property left behind and vacant possession issues.

The practical rule is simple:

vacant possession usually means more than handing over keys.

What If the Seller Replaced an Item With a Cheaper Version?

Sometimes sellers remove an item and replace it with something inferior.

Examples may include:

• replacing appliances with cheaper appliances;

• removing high-end light fixtures and installing basic ones;

• replacing window coverings;

• swapping out a newer appliance for an older one;

• removing smart-home equipment;

• replacing built-ins with lower-quality items.

Whether this is allowed depends on the contract.

If the original item was included or was a fixture, replacing it with an inferior item may breach the agreement.

The buyer may seek the cost difference, replacement or compensation.

The practical point is this:

a seller should not assume they can swap included items unless the contract allows it.

What If the Problem Affects Financing or Insurance?

Some possession day problems may affect the buyer’s ability to finance or insure the property.

Examples include:

• fire damage;

• serious water damage;

• mould;

• structural problems;

• major roof damage;

• unsafe electrical issues;

• heating system failure;

• occupancy problems; or

• missing essential systems.

If the property no longer matches what the lender approved, the lender may need to be notified.

If insurance cannot be placed, closing may be affected.

The practical rule is simple:

serious condition issues can create lender and insurance problems, not just buyer-seller disputes.

What Should Buyers Do?

If the house is not in the same condition on possession day, buyers should act quickly.

Practical steps include:

• take photos and videos;

• compare the condition to the inspection report and listing photos;

• review the purchase contract;

• identify included and excluded items;

• notify the realtor and lawyer immediately;

• avoid relying on verbal promises;

• ask whether closing funds have been released;

• request repairs, replacement, compensation or a holdback;

• obtain estimates if needed;

• keep receipts for emergency costs; and

• preserve all communications.

The buyer should also avoid escalating over minor issues without understanding the contract.

What Should Sellers Do?

Sellers should also be careful.

Before possession, sellers should:

• avoid removing fixtures unless excluded;

• leave all included appliances and items;

• repair damage caused during move-out;

• disclose any pre-possession damage;

• remove personal belongings unless agreed otherwise;

• leave keys and access devices;

• keep the property insured until closing;

• keep receipts for agreed repairs;

• document the property condition before leaving; and

• communicate through the proper channels if a problem arises.

The practical point is this:

a seller should deliver the property the buyer contracted to receive.

Common Mistakes to Avoid

There are several common mistakes in possession day condition disputes.

Do not assume every issue lets the buyer cancel. Minor issues usually call for practical remedies.

Do not ignore serious damage. Major damage should be raised immediately.

Do not release funds without addressing known problems. Once closing is complete, leverage may be reduced.

Do not rely on verbal promises. Repairs, credits and holdbacks should be in writing.

Do not remove fixtures unless clearly excluded. The seller may be responsible for replacement or compensation.

Do not forget about included goods. Appliances, remotes and window coverings should be checked against the contract.

Do not destroy evidence. Photos, videos and reports may decide the dispute.

What This Means Practically

Three rules are worth remembering.

Not every possession day issue is a deal-breaker. Minor damage or missing low-value items may be resolved with repair, replacement or compensation.

Serious changes are different. Major damage, missing fixtures, water issues, lack of vacant possession or failure to deliver included items can create significant legal issues.

The contract and evidence matter most. The purchase agreement, inspection report, listing photos, walkthrough evidence and communications will usually determine the buyer’s options.

Speak With an Alberta Real Estate Lawyer

If the house is not in the same condition on possession day in Alberta, the issue should be addressed quickly.

A proper review should consider:

• the purchase contract;

• included and excluded items;

• fixtures and unattached goods;

• the possession date and time;

• whether closing funds have been released;

• whether the seller caused the problem;

• whether the issue affects occupancy;

• whether financing or insurance is affected;

• whether a holdback is appropriate;

• whether the buyer can claim compensation; and

• whether the issue is serious enough to delay or refuse closing.

This article provides general information about possession day condition disputes in Alberta. The buyer’s rights depend on the purchase contract, the seriousness of the issue and the evidence showing what changed before possession.

Berjak Law

10080 Jasper Avenue, Suite 301
Edmonton, Alberta

780-879-0200