The designation of time as ‘of the essence’ means that performance by a specific date is a critical part of the contract, and failure to meet the deadline can result in a material breach. Courts consider the explicit language of the contract, the intentions of the parties, and the context or nature of the agreement when determining if time is indeed of the essence.
For example: In real estate transactions, closing dates are often strictly enforced due to market volatility and financing arrangements, thus making timing a quintessential element.