CH 7 - Contracts

Question 1

Express means agreement done ___________.

Answer 1

in writing or orally

Question 2

What does the Statute of Frauds require?

Answer 2

all contracts to be in writing to be enforceable

Question 3

Executory

Answer 3

when a contract has not yet been completely fulfilled

Question 4

Contract Reformation

Answer 4

when a contract isn’t written as the actual agreement is setup, the court will reform the writing in accordance with the actual agreement

Question 5

hand-written > ________

Answer 5

pre-printed

Question 6

letters > ______

Answer 6

numbers

Question 7

Name the 4 essential elements of a valid contract

Answer 7

1. Offer and acceptance
2. Legal consideration
3. Competent parties
4. Legal purpose

Question 8

How should multiple offers be handled?

Answer 8

in the manner in which the property owner and listing agent agree

Question 9

Rescission

Answer 9

the right of an individual to return to the identical state as before they entered into the agreement, due to courts not recognizing the contract as legally binding

Question 10

Novation

Answer 10

substitution of a new contract for an old one, or of one party in a contract with another party

Question 11

Regarding dates, what should all contracts have?

Answer 11

a definite start and end date

Question 12

Multiple Listing Clause

Answer 12

a clause requiring members of the MLS to put all listings on the MLS.

Question 13

When is commission earned?

Answer 13

when a contract is ratified

Question 14

What’s the primary responsibility of a property manager?

Answer 14

To maintain a client’s property and to maximize returns.

Question 15

What kind of agent is a property manager?

Answer 15

General Agent

Question 16

Demise

Answer 16

Conveyance by lease agreement

Question 17

Net lease

Answer 17

tenant pays a portion of operating expenses

Question 18

A void contract is one that _________________.

Answer 18

was never legally enforceable.

Question 19

When a prospective buyer makes a written purchase offer that the seller accepts, then the buyer __________________.

Answer 19

has received equitable title to the property.

Question 20

The provision in a listing agreement that gives additional authority to the broker and obligates the broker to distribute the listing to other brokers:

Answer 20

multiple listing clause

Question 21

True or False: Before an offer is accepted, the offering party can withdraw the offer without penalty.

Answer 21

True

Question 22

When does a contract (offer accepted by offeree) become legally binding?

Answer 22

When the acceptor places the acceptance in the mailbox, even if the acceptee never receives it.