Gordon Nelson Inc. v. Cameron: 2018 BCCA 304
Financing conditions appear in almost every BC real estate contract. But how hard does a buyer actually have to try to secure financing before they can walk away? A landmark BC Court of Appeal decision makes clear there is no single answer — it depends entirely on what the specific contract says, read as a whole.
Imagine you’ve signed a contract to purchase a commercial property for $7 million. The contract includes a financing condition allowing you to walk away if suitable financing cannot be arranged. You engage two mortgage brokers, prepare a detailed information package, test the market, and receive indications that lenders will advance only around $4.5 million. Facing a shortfall that would require a significant equity contribution, you honestly conclude that suitable financing is not available. You decline to remove the financing condition and expect your deposit to be returned.
The vendors refuse. They argue you didn’t try hard enough — that you were legally required to use your best efforts to find financing, and that consulting two brokers falls short of that standard. Who’s right?
The BC Court of Appeal addressed exactly this question in Gordon Nelson Inc. v. Cameron, and its answer has important implications for anyone entering a real estate transaction in this province.
The Case
Gordon Nelson Inc. v. Cameron, 2018 BCCA 304
Financing conditions appear in almost every BC real estate contract. But how hard does a buyer actually have to try to secure financing before they can walk away? A landmark BC Court of Appeal decision makes clear there is no single answer — it depends entirely on what the specific contract says, read as a whole.
What Is the Difference Between Best Efforts and Honest Efforts in BC Financing Conditions?
In BC real estate contracts, best efforts and honest efforts are two distinct legal standards that apply to financing conditions. Best efforts requires a buyer to pursue every reasonable financing option before walking away. Honest efforts requires only that the buyer act genuinely and in good faith—honestly assessing whether suitable financing is available, without maximizing every possible option.
Best efforts
A best efforts standard requires a party to take all reasonable steps available to them — exhausting realistic options before concluding that something cannot be done. It is a high bar. Courts have found it falls short of an absolute obligation but clearly demands more than a minimal attempt. A buyer subject to this standard must actively pursue every reasonable financing avenue before concluding the condition cannot be met.
Honest efforts
An honest efforts standard is lower. It requires the party to act genuinely and in good faith — to actually try, and to honestly assess the result. It does not require maximizing every possible avenue. If a buyer honestly concludes that suitable financing is not available after a reasonable inquiry, that is sufficient. The buyer’s judgment, exercised honestly, is what the law asks for.
The Court of Appeal in Gordon Nelson confirmed that which standard applies is not determined by any fixed rule — it is determined by reading the contract as a whole, giving effect to what the parties actually agreed to.
Why BC Courts Don't Impose a Universal 'Best Efforts' Rule
BC courts do not automatically require best efforts in all financing conditions. Instead, each contract is interpreted on its own terms. In Gordon Nelson Inc. v. Cameron (2018 BCCA 304), the BC Court of Appeal explicitly rejected the idea that financing conditions inherently demand best efforts, holding that the specific language of the contract—read as a whole—determines the buyer’s obligation.Financing Condition — Contract Addendum, Clause 4
The Buyer finding, in their sole discretion, suitable financing for the property within 45 business days of receipt of a satisfactory Phase I environmental report for the subject property. This condition is for the sole benefit of the Buyer.
How Does Gordon Nelson v. Cameron Differ from Griffin v. Martens?
While the earlier BC Court of Appeal decision in Griffin v. Martens (1988) suggested financing conditions might require best efforts, the 2018 Gordon Nelson decision clarified that Griffin is not a universal rule. Instead, Griffin applies only to contracts with specific language. Each financing condition must be read in context.
The vendors relied heavily on Griffin v. Martens (1988 BCCA), a well-known BC Court of Appeal decision, for the proposition that financing conditions inherently require best efforts. In Griffin, Justice Lambert considered a condition worded as the purchaser “being able to arrange satisfactory financing” and concluded the purchaser was obliged to use best efforts to do so.
Notably, Justice Lambert identified four possible interpretations of what “satisfactory financing” could mean in any given contract — ranging from an objective reasonable person standard all the way to a purely subjective standard based on the particular buyer’s honest assessment. Which interpretation applies depends on the contract’s own terms.
The court in Gordon Nelson clarified that Griffin is not a general rule of law. It was a decision about a specific contract with specific wording. It does not impose a universal best efforts requirement on all financing conditions regardless of how they are drafted. The court was explicit: courts should strive to give effect to the agreement the parties made for themselves — not construct a new one.
The court stated plainly that the principle of good faith, as articulated by the Supreme Court of Canada in Bhasin v. Hrynew (2014 SCC 71), imposes a general duty of honest performance in all contracts. Whether the contract requires anything beyond that depends on its own language and context.
Courts may imply a best efforts term into a financing condition only if:
- The express contract language does not already address the standard, and
- An implied term is necessary for business efficacy.
In Gordon Nelson v. Cameron, the BC Court of Appeal found neither condition was met, refusing to imply a best efforts obligation where the contract did not require it.
First, implying a best efforts term would directly contradict what the contract already said. Courts will not imply a term that conflicts with the express agreement of the parties — doing so would mean rewriting the contract, not interpreting it. Parties are free to negotiate and contract as they wish, and courts must respect that freedom.
Second, the contract was perfectly workable without any implied term. A buyer who genuinely tests the market, honestly concludes that suitable financing is not available, and acts accordingly — that is a commercially sensible and complete arrangement. There was no gap to fill.
When Is a Term Implied?
What This Means for BC Buyers and Sellers
Key Takeaways
- There is no general rule in BC law that financing conditions always require best efforts. Each contract is interpreted on its own terms.
- The standard of effort required — best efforts or honest efforts — depends on the specific language and structure of the contract as a whole.
- Good faith and honest performance are the baseline in every contract, regardless of how a financing condition is worded.
- Courts will not imply a best efforts obligation where the contract's express terms point the other way or where no implied term is needed for business efficacy.
- Sellers who want stronger protection should negotiate the level of effort required into the contract explicitly — before signing.
- Buyers who honestly test the market and honestly conclude financing is unavailable will generally satisfy their contractual obligation.
A Note for Sellers: Negotiate Before You Sign
The time to negotiate is before signing. The wording of a financing condition — and the contract as a whole — will determine what a buyer is legally required to do. Assuming a best efforts obligation exists when it has not been bargained for is a risk that can cost a vendor their deal and their deposit claim.
A Note for Buyers: Honesty Is Still Required
An honest efforts standard is not a licence to manufacture an excuse for backing out of a deal you’ve changed your mind about. The court in Gordon Nelson was careful to note that the buyer had genuinely concluded that suitable financing was not available after actually testing the market. A buyer who uses a financing condition as a pretext — when financing was available but the property was no longer wanted — would not be acting honestly and would risk forfeiting their deposit.
Good faith is the floor. The honest efforts test lives just above it, and the courts will look at what the buyer actually did and why.
The Bottom Line
Gordon Nelson Inc. v. Cameron is a clear reminder that financing conditions are not governed by a one-size-fits-all rule. BC courts will not automatically import a best efforts obligation into every subject to financing clause. Instead, they will read the contract as a whole, give effect to what the parties actually agreed to, and ask whether the buyer acted honestly.
Whether you are a buyer relying on a financing condition or a seller counting on a deal closing, the words in your contract matter — and understanding them before you sign is far better than arguing about them after the deal falls apart.
For a free 30-minute consultation about any British Columbia real estate financing conditions or concerns, contact the team at Legalbird today.
Date Modified:
- May 28, 2026
Reviewed By:
Kawal Atwal
Business Litigation Expertise You Can Trust
Kawal S. Atwal is a civil litigation lawyer in Surrey, Abbotsford, & Vancouver British Columbia with extensive experience in trial and appellate advocacy. He was called to the Bar of Punjab and Haryana in 2013 after completing his legal education in India and practiced for over 8 years before the Punjab and Haryana High Court and the Supreme Court of India. During that time, he drafted and argued hundreds of appellate matters across civil, criminal, constitutional, and family law, building a strong foundation in complex litigation and strategic legal analysis.
After relocating to Canada, Kawal completed his articles at a top-rated construction and civil litigation firm in Surrey and established a practice focused on appellate advocacy before the British Columbia Court of Appeal, as well as foreclosure, bankruptcy, construction, contract, and civil disputes. With early exposure to courtroom advocacy and a background rooted in a family of litigators, Kawal brings disciplined preparation, sharp legal reasoning, and practical litigation strategy to every matter. He also mentors law students and emerging lawyers, contributing to the development of effective courtroom advocacy in British Columbia.
