Larkin Willis
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Real Estate Contracts

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Larkin Willis
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Superior School Chapter 9

Question 1 of 13

1

All of the following are essential to the formation of a contract, EXCEPT:

Select one of the following:

  • offer

  • acceptance

  • consideration

  • earnest money deposit

Explanation

Question 2 of 13

1

Which of the following statement(s) is/are true? 1. In a breach of a sales contract, the earnest money deposit is considered liquidated damages. 2. In a breach of a sales contract, liquidated damages are an agreed upon amount of money the parties agree to accept in the event of breach.

Select one of the following:

  • 1 only

  • 2 only

  • Both 1 and 2

  • Neither 1 nor 2

Explanation

Question 3 of 13

1

Which of the following document(s) would be covered by the NC Statute of Frauds? 1. Listing agreement 2. Buyer agency agreement

Select one of the following:

  • 1 only

  • 2 only

  • Both 1 and 2

  • Neither 1 nor 2

Explanation

Question 4 of 13

1

Which of the following documents must be written under the Statute of Frauds in order to be enforceable in a court of law?

Select one of the following:

  • Offer to purchase and contract

  • Exclusive right to sell listing agreement

  • Exclusive right to represent buyer

  • Short-term leases of less than three years

Explanation

Question 5 of 13

1

A listing broker schedules an appointment to present a purchase offer to the seller. The seller has serious health problems and her son is attending to her health care. When the broker arrives, he finds the seller's son and daughter-in-law present. In the broker's presence, both persistently urge the seller to accept the offer. The seller is reluctant to accept since the offer is substantially less than the list price. If the seller accepts the offer under these circumstances, she may later claim that:

Select one of the following:

  • the broker should not have brought such a low offer for her property

  • she was under undue influence from her son and daughter-in-law, and therefore, the contract is voidable

  • the broker defrauded her by allowing her son and his wife to see the offer he brought to her

  • her consumer protection rights under anti-trust laws were violated by her son and daughter-in-law

Explanation

Question 6 of 13

1

A man has posted a $100 reward for anyone who returns his missing dog. This is an example of:

Select one of the following:

  • a unilateral contract

  • a bilateral contract

  • an implied contract

  • an executed contract

Explanation

Question 7 of 13

1

The seller unintentionally misrepresented that the soil of a lot was suitable for the construction of a building at the time the buyer was negotiating the purchase of the lot for the site of a new home. After entering into a contract to purchase, the buyer learned that contrary to the seller's statement, the soil was unsuitable for construction. This is an example of a contract that is probably:

Select one of the following:

  • binding on the buyer due to the doctrine of caveat emptor

  • voidable by the buyer because of the seller's mistake

  • voidable by the seller because of the mistake

  • voidable by neither party because this was a harmless error

Explanation

Question 8 of 13

1

The law requiring real estate options to be in writing in order to be enforceable is the:

Select one of the following:

  • law of agency

  • statute of frauds

  • statute of limitations

  • parol evidence rule

Explanation

Question 9 of 13

1

The legal remedy to enforce the terms of a contract is known as:

Select one of the following:

  • an injunction

  • a lis pendens

  • a writ of attachment

  • specific performance

Explanation

Question 10 of 13

1

The term "rescission" is best defined as:

Select one of the following:

  • change

  • nullification

  • substitution

  • subordination

Explanation

Question 11 of 13

1

An executory contract is one in which:

Select one of the following:

  • all of the terms and conditions have been performed

  • there are still essential elements to be performed

  • one or more of the parties is in breach of the agreement

  • the contract has expired

Explanation

Question 12 of 13

1

A buyer makes an offer to purchase a home and states in the offer that the offer will remain open for the seller's acceptance until April 6th. On April 4th the buyer changes their mind and notifies the seller that they are withdrawing their offer. On April 5th the seller accepts the original offer. Which of the following statements is correct?

Select one of the following:

  • The buyer is not bound because they withdrew their offer prior to being notified of the seller's acceptance.

  • The buyer is bound because they stated that the offer would remain open until April 6th.

  • Once an offer is made it cannot be withdrawn.

  • The acceptance by the seller on April 5th created a binding and enforceable contract.

Explanation

Question 13 of 13

1

Mary made an offer to purchase John's property for $295,000. John replied in writing to Mary that he would sell the property for $300,000. Mary refused to pay the $300,000 and did not respond to John. After reconsidering, John notified Mary that he was accepting the $295,000 offer. Which of the following is correct.

Select one of the following:

  • Mary and John have a valid and binding contract for $295,000.

  • Mary's offer remains open indefinitely and can always be accepted by John unless she included a deadline for acceptance in her offer.

  • John's response of $300,000 constituted a counteroffer which terminated Mary's original offer and therefore there is no agreement between the parties.

  • Because Mary failed to take any action regarding John's initial reply her original offer remained open.

Explanation

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