Time Is of the Essence
What does “time is of the essence” mean? We are so glad you asked! “Time is of the essence” is a legal provision generally applied in various contracts. A “time is of the essence” clause signifies that time is material to the performance of the contract. Consequently, a party to the contract has a specific time period to complete its contractual obligations to the other party. Contingent upon the industry or substance of the contract, it is crucial for a “time is of the essence’’ provision to be included in the contract.
For instance, this specification is essential in reference to contracts for the sale of real property. Harris v. Stewart, 666 S.E.2d 804, 193 N.C. App. 142 (N.C. App. 2008) indicates that the absence of a "time is of the essence" clause, concerning contracts for the sale of real property, means that time is not of the essence. As a result, the dates spelled out in an offer to purchase and contract agreement function only as parameters, and such dates are not obligatory on the parties. Hence, the application of the "reasonable time to perform" rule will apply.
When a “time is of an essence” provision is correctly applied to contracts, a party’s failure to satisfy the time-sensitive contractual obligation(s), provided there is no legal justification for failure to do so, will result in a breach of the contract. Therefore, the non-breaching party may seek legal remedies such as specific performance or monetary damages.
This is one of the many reasons why it is key to consult an attorney before entering into a contract. You should always be aware of your legal obligations, and the legal remedies available in the event contractual obligations are not satisfied. Please contact one of our trusted and experienced attorneys at Peace & Squires Law before entering into any contract.