Final Exam 11
Within what period of time must the seller be given a copy of a written listing agreement?
24 hours
Which contract is NOT Covered under the statue of frauds?
6-month lease agreement
homeowners association (HOA)
A Florida corporation responsible for the operation of a community or a mobile home subdivision in which the voting membership is made up of parcel owners and membership in the HOA is a mandatory condition of parcel ownership. An HOA is authorized to impose assessments that, if unpaid, may become a lien on the parcel.
voidable contract
A contract that because of the manner or method in which it was brought about, one of the parties is allowed to avoid contractual duties.
unenforceable contract
A contract that was valid when made but either cannot be proved or will not be upheld by a court.
Misrepresentation
A false or misleading statement of a material fact; concealment of a material fact.
enforceable contract
A legally binding contract that the law will recognize.
Competent
A party to a contract who possesses the legal capacity to enter into a binding contract.
good consideration
A promise that cannot be measured in terms of money, such as love and affection.
option contract
A right or privilege to purchase or lease real property at a specified price during a designated period based on a sufficient consideration.
Which element is NOT required of a valid real estate contract?
Acknowledgment
statute of frauds
An act requiring that certain real estate instruments and contracts affecting title to real property be in writing in order to be enforceable.
statute of limitations
An act that prescribes specific time restrictions for enforcement of rights by action of law.
Contract
An agreement between two or more competent parties to do, or not do, some legal act for a legal consideration.
valid contract
An agreement binding on both parties and legally enforceable against all parties to the agreement.
unilateral contract
An agreement in which only one party promises to perform without receiving a reciprocal promise to perform from the other party.
net listing
An agreement or contract to sell or rent a property for a specified minimum net amount for the owner.
void contract
An agreement that does not meet all the required elements of a valid contract and has no legal effect.
parol contract
An agreement that is not in writing.
bilateral contract
An agreement wherein both parties are legally obligated to each other to perform.
Which element is NOT essential in a valid real estate sale contract?
An earnest money deposit
open listing
An employment contract given to any number of brokers who work simultaneously to sell the owner's property.
Exclusive right of sale listing
An employment contract given to one real estate broker as the sole agent for the sale of an owner's property, with the commission going to that broker regardless of who actually sells the property during the employment contract period.
buyer brokerage agreement
An employment contract with a purchaser.
community development district (CDD)
An independent special district created pursuant to Florida law to service the long term specific needs of its community. A CDD constructs, operates, and maintains communitywide infrastructure and services for the benefit of its residents. CDDs provide an alternative way to fund and construct capital infrastructure to service projected growth.
Which information must NOT be included in a listing agreement?
Automatic renewal clause
A buyer has breached a real estate sale contract. The seller wants to recover damages in excess of the earnest money deposit. Which remedy for breach should the seller use?
Compensatory damages
A seller receives an offer from a buyer to purchase a property for $300,000. The seller changes the price to $320,000 and submits it to the buyer. Which term describes the price change?
Counteroffer
Which statement is TRUE regarding the Florida Building Energy
Efficiency Rating Act? -Buyers must be given an information brochure notifying the buyer of the right to conduct an energy efficiency rating on the structure.
Exclusive agency listing
Employment contract given to one real estate broker as the sole agent for the sale of an owner's property.
When the parties to a contract state the terms of the contract and show their intentions in words, either orally or in writing, what type of contract classification has been created?
Express
A seller and a buyer negotiated the sale and purchase of the seller's condominium over a two week period. Finally, they reached a meeting of the minds regarding the purchase price and terms of the sale. What type of contract exists at this point
Express contract
Which court case made clear that material defects affecting the value of residential property must be disclosed to prospective buyers?
Johnson v. Davis
A contract specifies the amount of money that must be paid if the buyer defaults. Which remedy for breach does this describe?
Liquidated damages
Which reason would NOT make a valid contract to purchase and sell real estate unenforceable?
No earnest money was pledged
Attorney in fact
One who is authorized to perform certain acts for another under a power of attorney.
Which written instrument authorizes a person to act for and on behalf of another person?
Power of attorney
What does Florida's homeowner associations law require of sellers who own property subject to a mandatory homeowners association?
Sellers must provide buyers with a disclosure summary regarding the association.
Which remedy for breach of contract asks the courts to force the other party to proceed as the contract states?
Specific performance
Q:Who must receive the lead based paint disclosure?
Tenants and buyers of all residential property built before 1978
liquidated damages
The amount of valuable consideration specified in an agreement as a penalty for default. See also damages.
Which statement is TRUE regarding an "as is" provision in a sale contract?
The as is provision does not eliminate the duty to disclose all know material
An investor wanted to build a motel. A broker showed him three choice sites zoned hotel motel. The investor promised to decide on a site in three weeks, so the broker took a two week vacation. When the broker returned, the investor bought one of these sites. The broker sold the site, not knowing that the zoning on that site had been changed to industrial. Which is correct?
The broker is guilty of culpable negligence.
A property owner and broker decide to sell $20 lottery tickets to prospective customers for a chance to win the owner's property. They announce that if 1,000 tickets are sold, the winning ticket will get the property free and clear. However, if less than 1,000 tickets are sold, the winning ticket will get the property for a price of $200,000 minus the value of the tickets sold. Which statement is TRUE?
The broker may be charged with fraudulent and dishonest dealing by trick
Vendee
The buyer or purchaser of real property under an agreement of sale.
Fraud
The intent to misrepresent a material fact or to deceive in order to gain an unfair advantage or to harm another person.
valuable consideration
The money or a promise of something that can be measured in terms of money.
procuring cause
The person whose efforts are the cause of an executed sale contract, regardless of who actually writes the contract.
meeting of the minds
The point when two people, thinking of the same thing, reach an agreement through an offer and acceptance.
Vendor
The seller of real property in an agreement of sale.
A counteroffer will extend an offer.
The statement is false
A real estate licensee must give the owner a copy of a written listing agreement within 48 hours
The statement is false
An option contract is a bilateral contract.
The statement is false
The person making an offer is the offeree.
The statement is false
The use of an "as is" provision in a contract for sale eliminates liability for failure to disclose all known material defects that affect the value of residential property.
The statement is false
When a wronged party in a breached contract sues for compensatory damages, it is to have the courts force the other party to perform as the contract specifically states.
The statement is false
A buyer brokerage agreement is an employment contract between the brokerage and a buyer.
The statement is true
A key element of a cause for action for fraud is that the party to whom a misstatement was made was damaged as a result of the misstatement.
The statement is true
A real estate sale contract is an example of a bilateral contract.
The statement is true
An implied contract is one in which some or all of the obligations or conditions of a contract are NOT stated expressly.
The statement is true
Brokers and sales associates should NOT prepare deeds, mortgages, or promissory notes.
The statement is true
In a net listing agreement, the broker retains the proceeds in excess of the seller's net as commission.
The statement is true
In an option contract, the optionor has an exclusive right to buy the property within a specified period.
The statement is true
Misrepresentation is the misstatement of fact or the omission of a factual matter.
The statement is true
Regarding the parties in a contract, novation is the substitution of a new party for the original one.
The statement is true
Novation
The substitution of a new party and/or new terms to an existing obligation.
A broker mailed a signed purchase offer to a property owner. Instead of signing the purchase offer contract, the owner sent the broker a telegram accepting the offer. Which is correct?
There is a valid offer and a telegraphic acceptance but not an enforceable contract
Assignment
Written instrument that serves to transfer the rights or interests of one person to another.
Any contract that obligates both parties to perform in accordance with the terms of the contract is
a bilateral contract
A listing to sell property and obtain a specified amount for the owner-principal is called
a net listing
A 17-year-old high school student has entered into a contract to purchase an adult's car. This is
a voidable contract
The phrase "time is of the essence" means
actions are required by dates set forth in the agreement
If a broker is given the right to sign a real estate contract that will be binding on the seller, the broker is
an attorney in fact
A parol contract is also called
an informal contract
To be valid, a real estate sale contract MUST contain
an offer and acceptance
Failure to comply with the statute of frauds will result in
an unenforceable contract.
In an assignment of a real estate contract, the person assigned the legal rights is the
assignee
A real estate sale contract becomes valid or in effect when it has been signed by the
buyer and seller
A licensee makes a statement that is material to the transaction as though it were a fact when the licensee does not know whether the statement is true or false, and the buyer relies on the statement. As a result of the statement made by the licensee, the buyer suffers damages. This situation constitutes
fraud.
A real estate licensee is interested in obtaining an option on property as the true optionee. Which statement is FALSE regarding a real estate licensee's obligation?
in the option contract, the licensee must pledge a nominal consideration
In a valid option contract to purchase real estate, the optionee
is limited to a refund of the option consideration if the option is exercised
A real estate licensee is NOT authorized to draw which contract
lease
The statue that requires an injured party to bring an action within a specific period of time after the injury is the statute of
limitations
In case of breach by the buyer, most real estate sale contracts include a provision that the earnest money be regarded as
liquidated damages to the seller
A buyer signs a contract to purchase a property that is subject to mandatory homeownership association. The buyer did not receive a disclosure concerning the association before signing the sale and purchase contract. Which statement is TRUE?
no contract exist
A buyer signs a contract to purchase a seller's home for $307,000 The listing broker submits the contract to the seller, but the seller insists on the listed priced of $380,000. The broker prepares a new contract for $380,000 that the buyer refuses to sign. The seller then instructs the broker to take the buyer's original offer of $370,000 back to the buyer because the seller has decided to accept the offer. The buyer has changed his mind and refuses to accept the contract. The result
no valid contract exists
The term procuring cause is most significant in which type of listing?
open
The statute of limitations is the authority that outlines the
period of time during which a contract may be enforced.
Essential elements of a real estate contract include all EXCEPT
recordation
When an offeror withdrawn an offer before acceptance, the offeror has
revoked the offer
A seller and a buyer enter into a real estate contract. The seller defaults. The buyer sues the seller to go through with the contract. This action is known as a suit for
specific performance
A buyer and seller make an oral agreement regarding the sale of the seller's property. This contract normally would be unenforceable in a court of law based on the
statue of frauds
A seller who wishes to recover a monetary damages equal to the extent of loss suffered in excess of the earnest money deposit may
sue for compensatory damages
A community development district (CDD) is an independent special district created, pursuant to Florida law, to service the long
term specific needs of its community. -The statement is true
When a real estate sale contract has been signed by the purchaser and given to the seller's broker along with an earnest money check,
the buyer has given a written offer
A broker promises to give a $20,000 bonus to the first sales associate who sells 20 homes
unilateral contract
A properly executed contract that has as its purpose an illegal objective is
void
A broker MUST give a copy of the written listing agreement to the seller
within 24 hours of execution