Please parse the phrase "time is of the essence"

Working many years in the legal field, I've seen the phrase, "time is of the essence," many times; I fully understand its meaning. What has always bothered me, though, is that the phrase doesn't seem to parse.

How can time be "of" anything? This phrase invokes time, itself, as a concept, in a way that "time of day" or "time of your life" does not.

And how can anything be "of the essence" of something else?

Thanks

Solution 1:

Only a prepositional phrase can substitute for an adjective:

• Time is highly important -> Time is of great importance.

• Time is essential -> Time is of the essence.

As for how "of the essence" should be interpreted, within the context of a contract I understand the sentence in question as meaning:

• Time is essential to this contract.