13.3 AREA Residential Purchase Contract Structure
Key Takeaways
Use clause 1 to identify the property, include named unattached goods and exclude any attached goods the seller will retain.
Under the unmodified form, clause 2.3 sets noon on Completion Day for full payment and vacant possession. Clauses 10.10 and 10.11 handle specified delays separately.
Clause 4 identifies the trustee, sets delivery and banking terms, and directs disbursement on the stated facts. Clause 5 defines which title registrations the buyer accepts.
Clause 6 covers surviving representations. Clauses 7 and 8 give different notice and ending mechanisms for Dower and ordinary conditions.
Clause 10.3 calls for the Conveyancing Protocol when appropriate or allows a specified alternative. Completion and registration can occur at different times.
Identify what is being sold
Use the January 2026 Alberta Real Estate Association (AREA) Residential Purchase Contract for the clause references in this lesson. Review the executed version and schedules because the parties may agree to written changes. Clause 1 gives fields for the civic address and the legal description. Match the description to title, including the plan and lot or other identifier where applicable. Identify included unattached goods by description, and list any excluded attached goods.
When classification is disputed, consider both how and why the item was attached. A hardwired ceiling light that provides the room’s lighting is ordinarily part of the building, while a freestanding plug-in floor lamp is ordinarily movable. Physical attachment alone may leave doubt about a particular item. If the seller will take a light fixture, identify it and any agreed replacement in the contract. Describe a removable appliance explicitly if it is to stay.
Confirm the buyer’s legal identity
Ask whether the buyer intends to purchase personally, through an existing corporation or through another party. For a corporate offer, verify the exact registered name, the person’s signing authority and the documents required by the lender and lawyer. Follow the brokerage’s FINTRAC procedures for identity, beneficial ownership and any applicable third-party determination. Someone signing for a corporation and someone directing or funding a purchase can raise different questions.
If a buyer proposes adding “and/or nominee” or substituting a corporation after the offer, ask what the buyer wants to achieve and involve their lawyer before drafting. Check the actual contract for restrictions, consent or notice requirements and assess financing and tax implications with the relevant professionals. A proposed nomination, assignment or direction for title can affect the parties differently. Have counsel confirm the proper instrument and whether any liability would remain with the original buyer. Keep the parties, permitted changes and signing authority clear in the written documents.
AREA guidance on nominee wording · Alberta Land Titles corporate signing forms · FINTRAC real estate sector guidance
Select, adapt and check the documents
Use RECA’s Guide and Rule 60.1/Schedule 1 when choosing relationship documents. For a sale, use the brokerage’s current authorized transaction forms. AREA publishes purchase contracts, schedules, amendments and other instruments for authorized users. Obtain the applicable current version through the brokerage or form publisher. Use the signed purchase agreement and incorporated attachments to check the bargain. Use Land Titles forms for registration and obtain counsel’s wording when a special clause or authority falls outside the licensee’s competence.
| Client instruction | Document and review decision |
|---|---|
| Set the brokerage’s mandate | Use the written service agreement that fits the role. Confirm the brokerage and client signatures, required content and immediate true-copy delivery under Rule 43. |
| Include terms with the initial offer | Select the relevant schedule or addendum under clause 9.1 and identify agreed additional terms under clause 9.2. For a tenanted home, check leases and deposits and specify what the buyer will assume and receive. |
| Change an unaccepted offer | Identify the offer and prepare a clear counteroffer with the changed terms and acceptance deadline. Review all carried-forward terms. Use the signature and acceptance process in the applicable form. |
| Change a binding contract | Prepare a written amendment that identifies the existing contract, exact changes and any attachment. Obtain agreement and signatures from the relevant parties, and deliver the signed change. For more time to review a tenancy schedule, obtain the signed extension while the agreement is still live. |
| Satisfy, waive or decline a condition | Identify the condition and use the effective written notice the agreement requires. An amendment changing the deadline is a different act. |
Review the completed package with the client before signing. Check names, authority, property, terms, times, attachments and signature or initial fields. Ask the client to explain the financial and practical consequences of a material clause. Allow time for legal review when the client wants it or the terms call for it. Under clauses 16 and 17, complete acceptance and communicate it under the agreed method and deadline. Rule 61 separately requires timely true copies. Record the actual transmission and check the executed version against the agreed instructions.
RECA Rules 43, 60.1 and 61 · AREA form source and permissions · AREA amendment and addendum guidance
Price, deposits and possession
Clause 2 states the purchase price including any applicable GST and provides for payment in full and vacant possession at noon on the agreed Completion Day. It also addresses the property's condition at Completion Day. The contract can be modified in writing. A financing condition or attached financing schedule addresses specific financing arrangements, and the buyer works with the lender and lawyer to assemble funds.
Clauses 4.1–4.8 appoint a trustee and describe the terms of trust. The buyer delivers each deposit by the agreed method and deadline. A seller may void for a missing deposit by written notice under clause 4.5. That option expires if the seller accepts the deposit. Clause 4.6 requires banking within three Business Days of receipt. Ministerial Regulation section 22 provides statutory defaults, including a separate clock for money received in trust for an offer to purchase. Act section 25(1)(b) recognizes a period agreed in writing. Under RECA Rule 53(f) an associate reports a missing deposit to the broker. Rule 51(1)(l)–(m) requires immediate notice to all parties for a missing or dishonoured deposit, in writing or confirmed in writing.
Under clause 4.8 the trustee follows the applicable disposition branch once funds are confirmed. A condition that ends the contract under clause 8.4 leads to return to the buyer. After the conditions are satisfied or waived, buyer nonperformance can trigger disbursement to the seller. The completion branch can apply the deposits to the brokerage fee and send the excess in trust to the seller’s lawyer. The contract provides for these instructions without a new notice. Escalate disputed facts or competing demands to the broker and legal counsel. Under clause 4.9 the disposition does not preclude further remedies under clause 12.
Title, disclosure and spousal rights
| Clause | What to check |
|---|---|
| 5. Land title | Identify registrations implied by law, ordinary non-financial obligations covered by clause 5.1(b) and any item the buyer expressly assumes. Arrange discharge of non-permitted registrations. Review their actual effect with counsel. |
| 6. Representations and warranties | Check authority to sell, tax residency, rights to included goods, municipal use, restrictive covenants, improvement location, known material latent defects and known notices or missing permits. These representations are to be true at Completion Day and survive within applicable limitation periods. |
| 7. Dower | If dower rights apply, the form calls for the non-owner spouse’s signature and the completed Consent and Acknowledgement by the stated deadline. For late delivery, the buyer may void by written notice until the form is delivered. |
| 8 and 9. Conditions and attachments | State the Condition Day, identify attachments and terms and give the written notice specified in clause 8.4. |
The Dower Act can restrict a sole titled spouse’s disposition of a qualifying homestead. For consent, the spouse acknowledges separately from the owner before someone authorized to take proof of execution under the Land Titles Act. Use the appropriate conveyancing documentation for the facts, including any statutory release or court order. Ask the lawyer to confirm what is required when facts are uncertain.
Check the seller’s tax residency
Clause 6.1(b) of the unmodified form includes a seller representation about Canadian income-tax residency. Ask the seller to confirm the facts early and alert the broker and lawyers if the representation cannot be made or the answer is uncertain. A Canadian mailing address or citizenship alone does not decide tax residency. Under Income Tax Act section 116, a purchase from a non-resident can create purchaser liability and a right to withhold. The outcome depends on reasonable inquiry, the property category, any applicable exception and the compliance certificate. Counsel can advise on the contract wording, evidence, any holdback and release terms. A tax adviser can help the seller with the certificate and reporting.
Income Tax Act section 116 · CRA compliance certificate guidance
Closing and notices
Clause 10.2 calls for a current Real Property Report with the specified evidence, except where there are no structures on the land. The closing documents move between lawyers on reasonable trust conditions. Clause 10.3 provides for the Western Law Societies Conveyancing Protocol if appropriate, or an alternative chosen by the buyer at their cost for early release of funds. Lawyers check the conditions for the method. Under clause 10.6, proceeds can pay existing obligations and evidence of discharge may follow Completion Day. Clause 10.5 allocates the specified adjustment items to the seller for the entire Completion Day. Clause 11 allocates casualty risk until the price is paid.
On a normal closing under the unmodified form, plan for possession at noon on Completion Day after payment, and confirm key release through the parties’ arrangements. If closing is delayed, clauses 10.10 and 10.11 distinguish delayed seller documents from the buyer being unable to close. Ask the lawyers to confirm the applicable arrangements before releasing keys.
Clause 3.1(c) makes time essential. Apply the consequence attached to the particular missed deadline. Under clauses 13–14, send a written notice by the specified method to the proper party or authorized representative. The form recognizes electronic or digitized signatures for documents requiring signature under clause 13.4. Check separate Land Titles requirements for registrable instruments. Clause 16 states when the parties become bound after acceptance, including where conditions remain.
January 2026 AREA contract · RECA Rules · Alberta Dower procedures · Law Society of Alberta conveyancing guidance
An AREA purchase contract lists the washer and dryer as included unattached goods and shows no excluded attached goods. The seller removes the hardwired dining room chandelier that provides the room’s light. Which response best applies clause 1?
The seller may remove it because the buyer did not list it with the washer and dryer.
The seller may remove any light that can be detached with ordinary tools.
The chandelier is an attached lighting fixture on these facts. It was included under clause 1 because the seller did not exclude it.
The chandelier belongs to the seller if they leave the wiring in place.
The unmodified January 2026 AREA form sets July 15 as Completion Day. At 8:30 a.m. the buyer asks for keys, but payment is still pending. No special possession or closing-delay arrangement applies. When is vacant possession due in the ordinary course?
At midnight on July 15 because the date has begun.
At the Land Titles Office’s closing time regardless of payment.
When the buyer signs the mortgage documents.
At noon on July 15 under clause 2.3, with the price fully paid.
The title shows a mortgage, a builder’s lien, an ordinary utility right-of-way and an ordinary subdivision drainage covenant. The unmodified AREA form applies, and the buyer has agreed to assume no additional items. Which registrations must the seller arrange to discharge?
All four before any funds can be released.
The mortgage and builder’s lien. The ordinary non-financial right-of-way and covenant can remain under clause 5.1(b).
Only the mortgage, because the buyer automatically assumes the lien.
None, because a shortage of sale proceeds overrides clause 5.
Sections you finish are checked off in the contents.