contracts
Breanna signs a contract offering to purchase Kathy's home for $150,000. Kathy replies, "No way," but offers to sell it to her for $200,000. Breanna agrees to these terms and they add their signatures. Which of the following statements is correct? A. The contract is valid, but unenforceable.B. The contract is invalid.C. Breanna accepted the offer Kathy made.D. Kathy accepted the offer Breanna made.
Breanna accepted the offer Kathy made
amendment
a change to an existing contract between parties. it changes one or more of the original contract terms. for example if the closing date must be changed, or the buyer decides she wants the curtains to remain and the seller agrees, the parties can execute an amendment outlining the additional agreement between them
void contract
contract isn't a contract at all because it lacks one or more of the requirements for a valid contract
Tawna agrees to sell her small plot of land to Morris for $5,000 cash. They don't write up a contract, but otherwise all the necessary elements for a valid contract are in place. What's the status of this contract? A. It's void.B. It's valid and enforceable.C. It's valid but not enforceable.D. It's illegal.
its valid but not enforceable an oral contract for the transfer of real estate isn't enforceable in a court of law, but its a valid contract. so the transfer could still take place, but neither party would be able to sue for completion of the contract
breach of contract
occurs when on party fails to meet contract obligations this is also known as unilateral recession
valid contract requirements
offer and acceptance consideration legally competent parties legal purpose made voluntarily
Kendra made an offer on Sam's property. Sam rejected Kendra's offer, but made a counter-offer. Kendra is now considering the counter. What is Kendra in this scenario? A. ExecutorB. OfferorC. OffereeD. Trustor
offeree
executed contract
one in which all parties to a contract have met all contract terms
unilateral
only one party makes a promise
sever ability
refers to the concept that if a court deems a term in the contract to be unenforceable, the remainder of the contract remains enforceable
Seller Gina feels awful that Martha, who was going to buy Gina's property, lost her job. Gina decides to ______ Martha from her obligation to pay earnest money, so that money is returned to Martha. A. RescindB. ReleaseC. ReformD. Assign
release recession is when both parties mutually agree that it makes sense to terminate the contract. release is when one party wants out and the other agrees to release that party from any obligations.
statute of frauds
requires that certain types of contracts, such as for a property ownership transfer, be in writing to be legally enforceable and to prevent injury from fraudulent conduct
Jerry and Simon signed a contract so that Jerry could purchase all of Simon's restaurant equipment for one price after Simon closes his restaurant next month. The contract contains a provision that states Jerry has one year from the purchase date to file a suit relative to the purchase. After the year is up, Jerry forfeits the right. What kind of contract clause is this? A. Specific timeB. Statute of limitationsC. Time is of the essenceD. Time of performance
statute of limitations
specific performance
suit seeks to force a party to make good on the promises made in some way
Kenneth enters into a contract to sell his home to Valerie, who puts down a $5,000 earnest money deposit. At the last minute, Valerie backs out of the deal. Kenneth keeps the earnest deposit. This is an example of ______. A. Accepting liquidated damagesB. Accepting partial performanceC. Suing for damagesD. Suing for specific performance
accepting liquidated damages
Camille, a buyer, wants to change the price already agreed to in a sales contract. She should use a(n) ______. A. New contractB. AmendmentC. AddendumD. Bill of sale
amendment an amendment changes existing contract terms. once signed by both parties it becomes part of the contract, with the same legal weight as the original contract. the remaining terms in the original contract remain the same.
addendum
an addition to an existing document, such as an offer to purchase. it adds terms not addressed in the main Boyd of the contract form
Tristan's offer has been signed by all parties and delivered back to the seller. This means that ______ has occurred. A. AcceptanceB. Binding acceptanceC. Personal deliveryD. Notarization
binding acceptance this happens when a signed contract is delivered according to the delivery procedures and deadline outlined in the contract
bilateral contract
both parties have obligations. most real estate contracts are bilarter.
notices clause
describes how contract-related notice may be made when notice is considered to have been received. for example a purchase or listing contract may permit contract parties to select whether notices may be delivered electronically.
Jerry and Lewis have entered into a sales contract. They're about three weeks into the transaction, with several terms of the agreement yet to be met. What type of contract do Jerry and Lewis have? A. UnilateralB. ExecutoryC. OptionD. Executed
executory A valid contract that is in progress is an executory contract, which means that one or more terms of the agreement remain undone.
Katelyn really wants to include an inspection contingency in her purchase offer. Her agent explains that the inspection contingency only documents which of the following? A. How much money the sellers will spend on fixing inspection issuesB. The inspector who Katelyn will useC. Whether Katelyn will ignore some of the inspection issuesD. The date by which all inspection issues must be addressed
the date by which all inspection issues must be addressed Good job. An inspection contingency is a way of signaling to the seller that if the inspector finds property condition issues, the buyer may require the sellers to fix those issues or may even terminate the contract. The one thing that the inspection contingency must do is document the date prior to closing by which all inspection issues must be fixed.
Gail was supposed to close on her new home by the end of May, but she kept asking the sellers if they could push the closing back. Even after the summer was over the transaction still hadn't closed. Gail was guilty of not adhering to which aspect of the contract? A. AssignmentB. NovationC. Reasonable timeD. Time is of the essence
time is of the essence
executory contract
until all of the promises in the contract have been completed.
voidable contract
valid, but may not be enforceable in a court of law one that appears valid, but one or both parties have a legal right to disaffirm it.
Ken signed a contract to purchase Debra's condo. Ken signed the contract two weeks prior to turning 18, which is the age of majority in their state. Debra found out about his age prior to the closing but honored the contract and they closed on the condo a month after Ken's birthday. What was the status of the contract when Ken and Debra entered into it? A. ExecutedB. IllegalC. VoidD. Voidable
voidable The contract COULD have been cancelled, because it was missing one of the essential elements: a legally competent party (Ken was a minor when he entered into the contract). However, parties to a voidable contract may choose to follow through with—or execute—it, which is what happened here.
novation
when a contract is substituted for another
partial performance
when one party meets some, but not all, of the terms in the contract
Sondra thinks the new business contract she's signed with her business partner is valid. Both parties are legally competent, the purpose is a business transaction so it's a legal purpose, an offer was made and accepted, and a fee has been negotiated and documented. Which essential element of a valid contract has Sondra not yet considered? A. Whether the contract is in writing.B. Whether the parties are over 21.C. Whether consent was voluntary.D. Whether the contract has been translated into all possible languages.
whether consent was voluntary
