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Ontario Real Estate Licensing Exam Practice · Question

A buyer includes a home inspection condition that states the inspection must be 'satisfactory to the buyer in the buyer's sole and absolute discretion.' If the buyer later decides the inspection is not satisfactory, even if only for subjective reasons, what is the buyer's right?

When a condition specifies 'sole and absolute discretion,' the party for whose benefit the condition was included has broad leeway to determine satisfaction. If

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Question: A buyer includes a home inspection condition that states the inspection must be 'satisfactory to the buyer in the buyer's sole and absolute discretion.' If the buyer later decides the inspection is not satisfactory, even if only for subjective reasons, what is the buyer's right?

Answer options:

  • The buyer must provide objective reasons for dissatisfaction to the seller. ✅ The buyer can declare the agreement null and void, provided they give timely notice.
  • The seller can challenge the buyer's subjective opinion in court.
  • The buyer is obligated to negotiate repairs with the seller.

Correct answer: The buyer can declare the agreement null and void, provided they give timely notice.

Explanation: When a condition specifies 'sole and absolute discretion,' the party for whose benefit the condition was included has broad leeway to determine satisfaction. If the buyer is genuinely dissatisfied, they can declare the agreement null and void by providing proper notice within the stipulated timeframe without needing to justify their subjective reasons.

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