What Does "Time is of the Essence" Mean?
Date in contracts are often important. In fact, they are often critical. If someone is going to buy your house and settle on July 11th, you don't want to get a call saying settlement is delayed until August. For that reason contracts will say "time is of the essence." This means the date in the contract are strictly held. The Supreme Court of the United States in Bank of Columbia v. Hagner,26 U.S. (1 Pet.) 455, 7 L.Ed. 219 (1828), citing an old legal treatise and an English judge (remember our divorce from England was still fresh) and said:
"The time fixed for performance, is, at law, deemed of the essence of the contract . . . . In Sudgen's Law of Vendors, 275, it is said: 'The general opinion has always been that the day fixed was imperative on the parties at law. This was so laid down by Lord Kenyon, and has never been doubted in practice. The contrary rule would lead to endless difficulties, if in every case it must be referred to a jury to consider whether the act was done within a reasonable time; and the precise contract of the parties would be avoided in order to introduce an uncertain rule, which would lead to endless litigation . . . .'"