Time of the Essence Clause Law and Legal Definition
Time of the essence means that the performance by one party to the contract at a specified location, date and time is required for the performance by the other party to the contract, and a failure to perform by the time specified will be a breach of the contract. This clause requires that all references to specific dates and times of day noted in the contract should be interpreted exactly in the same manner. Generally, the date set forth in a contract for closing of title is an estimated date and may often be delayed by either party without penalty. Time of the essence clauses can work to the advantage as well as disadvantage of both the parties.