Glossary · Legal
Condition precedent
A clause that makes the effects of a commitment subject to the occurrence of a future and uncertain event. In a property transaction, it protects the buyer by allowing them to withdraw if the agreed event does not occur. The most common case is obtaining mortgage financing. It may also relate to the authorisation to acquire where the LFAIE applies, to the review of the co-ownership documents or to the prior sale of another property. Its scope depends entirely on how it is drafted. An effective condition specifies who makes the decision, within what time limit, in what form it is communicated and what the consequences of a refusal are. Vague wording offers no real protection.
