BC Contract of Purchase and Sale: Complete Guide for Realtors (2026)
The Contract of Purchase and Sale (CPS) is the foundation of every BC real estate transaction. Understanding its critical clauses, common drafting errors, and the legal implications of every section is essential for every realtor — and directly affects your E&O exposure.
The BC Contract of Purchase and Sale: structure overview
The standard BC Contract of Purchase and Sale is a BCREA-approved form used for residential real estate transactions in BC. It is a legally binding agreement once signed by both parties and any subject conditions are removed. Key sections:
| Section | Key content and realtor obligations |
|---|---|
| Parties | Full legal names of buyer(s) and seller(s) — must match title exactly |
| Property description | Legal description from title — not just civic address. Verify against BC land title search. |
| Purchase price | Amount agreed, deposit amount and timing, financing details if applicable |
| Completion date | Legal ownership transfer date — must allow adequate time for financing, legal work |
| Possession date | Physical access to property — same as or after completion |
| Subject conditions | Time-limited conditions that must be removed for the contract to become firm |
| Included/excluded items | Fixtures included by default; chattels and exclusions must be explicitly listed |
| Adjustments | Pro-rated property taxes, strata fees, prepaid rents to be adjusted at completion |
| Representations and warranties | Seller representations about property condition, no undisclosed tenancies, etc. |
Subject conditions: drafting them correctly
Subject conditions are among the most consequential elements of a BC real estate contract. A poorly drafted subject can create ambiguity about whether it was satisfied — leading to disputes, collapsed deals, and E&O claims.
Well-drafted subject conditions specify: who the condition is for (buyer or seller — "for the sole benefit of the buyer"), what must happen to satisfy it (specific and objective), and when it must be removed (specific date and time, not "within X days").
Subject condition examples: poor vs. well-drafted
Financing subject
“Subject to buyer obtaining financing”
“Subject to the buyer obtaining financing satisfactory to the buyer, in the buyer's sole discretion, on or before [specific date]. This condition is for the sole benefit of the buyer.”
Why it matters: The word 'satisfactory' combined with 'buyer's sole discretion' makes the condition truly subjective — the buyer's lender declining is sufficient grounds, without having to prove the financing was objectively unsatisfactory.
Home inspection subject
“Subject to home inspection”
“Subject to the buyer reviewing and approving a home inspection report prepared by a qualified home inspector, satisfactory to the buyer in the buyer's sole discretion, on or before [specific date]. This condition is for the sole benefit of the buyer.”
Why it matters: Specifies who conducts the inspection (qualified inspector), what must be reviewed (the report), and that approval is at the buyer's discretion — preventing seller from claiming the buyer 'found nothing wrong.'
Strata documents subject
“Subject to strata document review”
“Subject to the buyer reviewing and approving the Form B Information Certificate, current budget, last two years AGM minutes, current bylaws, and depreciation report, satisfactory to the buyer in the buyer's sole discretion, on or before [specific date]. This condition is for the sole benefit of the buyer.”
Why it matters: Specifies exactly which documents must be reviewed — prevents seller from arguing the condition was met with only partial document production.
Common contract drafting errors
These are the errors that most frequently appear in E&O claims and BCFSA complaints arising from contract preparation:
Wrong legal description
Contract may be void or describe a different property. Always copy from the BC land title search, not from a previous contract or MLS listing.
Incorrect party names
If title is held by a corporation or in multiple names, contract must match exactly. John Smith vs. John R. Smith vs. J. Smith are legally different.
Unrealistic completion date
Insufficient time for financing approval, appraisal, or legal work causes default. Minimum 21–30 days is typical for conventional financing; 45+ days for insured or complex transactions.
Vague subject deadlines
"3 business days" is ambiguous about which business day counting starts. Use specific calendar dates: "on or before 11:59 PM on [date]."
Missing or incomplete fixture/chattel list
Disputes at possession about what stays and what goes. At listing intake, document exactly what is included and excluded.
No adjustment for tenanted properties
Prepaid rents, last month's deposit, and security deposit must all be addressed in the contract for tenanted properties. Missing these creates completion day disputes.
Commission clause errors
Commission percentage, payable-on, and split between brokerages must be correct and match the listing contract. Errors cause commission disputes at closing.
Price adjustment clauses
Price adjustments ensure that costs accrued to the completion date are fairly allocated between buyer and seller. The statement of adjustments — prepared by the lawyers or notaries on both sides — handles these calculations, but the realtor must ensure the contract addresses them correctly.
| Adjustment type | How it works | Who pays |
|---|---|---|
| Property taxes | Pro-rated to completion date. If seller prepaid annual taxes, buyer owes portion. | Buyer pays from completion date forward |
| Strata fees | Pro-rated to completion date. Monthly fees often prepaid by seller. | Buyer pays from completion date forward |
| Prepaid rent (tenanted) | If tenant prepaid rent for period after completion, seller credits buyer. | Seller credits buyer the prepaid portion |
| Security/damage deposit | Seller holds tenant deposit — must transfer to buyer at completion. | Seller credits buyer full deposit amount |
| Home warranty | Remaining warranty on new construction homes transfers to buyer. | Value credited — included in price |
Contract review checklist before submission
Every contract should pass this checklist before being presented or submitted:
Legal description matches BC title search
Buyer/seller names match legal documents
Purchase price written correctly (numerals + words)
Deposit amount and due date specified
Completion date allows sufficient time
Possession date specified (same as or after completion)
All subjects have specific removal dates
Each subject states who it benefits
Included chattels listed (fridge, W/D, etc.)
Excluded fixtures noted
Strata information complete (if applicable)
Commission clause correct and complete
Adjustments section addresses tenanted status
GST new home considerations addressed
Property Transfer Tax exemptions noted if applicable
Both parties have signed and initialled all pages
How Magnate360 reduces contract errors
Magnate360's Forms Agent pre-fills all 12 standard BCREA forms — including the Contract of Purchase and Sale — from the listing record. Legal description, seller details, property characteristics, commission rate, and key dates are populated automatically from the CRM data, eliminating manual transcription errors.
The compliance audit trail tracks when forms were generated, what data was used, and when they were sent for signature — providing complete documentation for any E&O dispute that might arise.
Frequently asked questions
What is the difference between completion date and possession date?
The completion date is the date legal ownership transfers from seller to buyer — the day the buyer's lawyer or notary pays the purchase price and the title is transferred at the Land Title Office. The possession date is when the buyer gets the keys and physical access to the property. In BC, these dates are often the same, but they can be different. If possession is after completion, the seller remains in the property after legal ownership has transferred and typically pays an occupancy fee (agreed in the contract) to the buyer for that period. Common scenarios for split dates: sellers who need extra time to move out, or buyers who want to take possession immediately on a weekend when title transfer is technically on a weekday.
What happens if a buyer removes subjects and then can't close?
When a buyer removes subject conditions, the contract becomes firm and binding. If the buyer then fails to complete (cannot pay the purchase price at closing), the seller can keep the deposit as liquidated damages — this is the standard remedy for buyer default under BC's Contract of Purchase and Sale. The seller can also sue for additional damages if their actual loss exceeds the deposit amount, though this requires litigation. The buyer who defaults loses their deposit and may be liable for the seller's additional costs (relisting fees, carrying costs, reduced sale price if the property sells for less). For sellers, ensure the deposit is substantial enough (typically 5% of purchase price) to provide meaningful protection.
What does 'time is of the essence' mean in a real estate contract?
'Time is of the essence' means that all dates in the contract — completion, possession, subject removal — are strict deadlines that must be met precisely. Missing a date by even one day can be treated as a breach of contract by the other party. This is why deadline management is critical in BC real estate: if a buyer's subject removal deadline passes without written removal or extension, the contract can be treated as terminated by the seller. Extensions to any time-is-of-the-essence date must be agreed in writing by both parties before the deadline passes — oral extensions are not enforceable.
Can a seller accept a better offer after accepting the first offer?
Generally no — once a seller has accepted an offer and it has been communicated to the buyer, a binding contract exists. The seller cannot simply accept a better offer from a different buyer while a firm contract is in place. However, if the contract has subject conditions (such as a financing subject), the seller may include a '72-hour escape clause' or 'first right of refusal' clause that allows the seller to continue marketing and, if a better offer comes in, give the buyer 72 hours to remove their subjects or lose the deal. This clause must be explicitly included in the contract — it is not automatic. Without this clause, a seller who accepts a second offer while a conditional contract is in place may face legal action for double-selling.
What is included in the purchase price by default (what are 'fixtures')?
In BC real estate law, fixtures are items that are permanently attached to the property and are included in the purchase price by default unless specifically excluded. Common fixtures include: built-in appliances (dishwasher, built-in range, wall oven), ceiling light fixtures, window coverings (blinds, curtain rods), built-in shelving, fireplace inserts and mantels, garden sheds on foundations, and attached TV wall mounts (but not the TV). Chattels are movable personal property that are NOT included unless specifically listed. The Contract of Purchase and Sale includes a section for explicitly including chattels (fridge, stove, washer, dryer — if they are movable) and excluding fixtures the seller wants to take. Disputes over fixtures and chattels are among the most common post-closing complaints — clarity at listing intake prevents problems.
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