Purchaser's Failure to Secure Financing Excuses Seller's Delay Penalty

A contract for the sale of a building stipulated that the final closing would occur on a specific date, with a penalty clause imposed for delays beyond that date attributable to the seller, and the purchaser was required to provide proof of the necessary mortgage commitment before the closing date. The purchaser, unable to secure the financing by the deadline, sought to invoke the penalty clause against the seller for non-performance, but the court of appeal rejected the claim, holding that the purchaser's failure to provide the required evidence of financing rendered the seller's obligation to proceed with the sale inexigible, thereby excusing the seller from the penalty clause, a ruling the high court upheld as properly applying the principle that a party cannot invoke the breach of a reciprocal obligation when their own non-performance is the prerequisite for the other party's performance.