(Ch. 9) Vocab (Contracts) Flashcards
Voluntary expression by the offeree to be bound by the exact terms of the offer; must be unconditional
Acceptance
The method or manner by which a right or contract such as a lease or mortgage is transferred from one person to another
Assignment
A contract in which both parties have reciprocal obligations toward each other
Bilateral Contract
An agreement to cover a down payment for the purchase of real estate as evidence of good faith on the part of the purchaser; shows the receipt of a deposit and outlines the basic term of the transaction
Binder
Violation of any of the terms or conditions of a contract; default; non-performance
Breach Of Contract
The time when a transaction is consummated, or the actual signing over the documents and delivery of the deed; the time after signing when the documents are recorded
Closing
The amount of money actually lost; the amount that will be awarded by a court in the event of default
Compensatory Damages
Those who are qualified or mentally competent to enter into a contract
Competent Parties
a promise or an act of legal value bargained for and received in return for a promise; good consideration, love and affection
Consideration
A condition in a contract which could void it, or otherwise change its terms, if not met
Contiguous
A legal agreement between competent Parties for a consideration to perform or refrain from performing certain acts
Contract
sufficient mental capacity to make legally binding agreement
Contractual Capacity
A new offer made in response to an earlier offer
Counteroffer
The indemnity recoverable by an injured party as compensation for the loss suffered through the act or default of another
Damages
Failure to meet an obligation or promise when due
Default
Money given by one to another as evidence of good faith; evidence or security for performance of a contract
Deposit
A contract drawn for an illegal purpose. For example, where a buyer and seller enter into a second contract with different terms than those original contract to benefit fraudulently from the arrangement.
DUAL CONTRACT
Unlawful constraint or action against a person, forcing him to perform some act against his will.
DURESS
Initial payment made by a purchaser of real estate as evidence of good faith.
EARNEST MONEY
Title of a purchaser under a contract of sale or agreement of sale
Equitable Title
A contract that is fully signed or performed
EXECUTED CONTRACT
A contract not yet fully signed or performed
EXECUTORY CONTRACT
Written agreement in which buyer agrees to buy certain realty and seller agrees to sell upon terms and conditions set forth therein. Title remains with the seller until terms and conditions are fulfilled; buyer has equitable title.
LAND CONTRACT
An amount predetermined by the parties to an agreement that will be forfeited as compensation for breach of contract.
LIQUIDATED DAMAGES
Title free and clear of objectionable liens or encumbrances; title which is free from reasonable doubts or defects, which can be readily sold or mortgaged.
MARKETABLE TITLE
A condition that must exist for the formation of a valid contract
MEETING OF THE MINDS
A three-party agreement under which one party is released and another is substituted
NOVATION
A promise by one party to act in a certain manner provided the other party would act in the manner requested. In a real estate sales contract, the offer to purchase realty according to certain stipulated terms and conditions
OFFER
A right given for consideration to purchase or lease a property upon specific terms within a specific time.
OPTION
The one obtaining the option right.
OPTIONEE
The one granting the option to another
OPTIONOR
A rule of law that specifies that oral or parol evidence may not be introduced in court to contradict what has already been stated in writing, unless such statements are intended to show that a fraud has been perpetrated, that a mistake was made, or to clarify what was meant by the words contained in a contract.
PAROL EVIDENCE RULE
Not accepting an offer
Rejection
The annulling, revocation or repealing of a contract by mutual consent of the parties, or for cause by either party to the convention contract, and returning the parties to their original position (the “status quo”)
RESCISSION
The right of the Real Estate Commission to deactivate a broker or salesperson license for wrongdoing.
REVOCATION
Addendum to cover supplemental changes to an agreement
RIDER
A remedy which the court will grant in certain cases, compelling the defendant to perform or carry out the terms of a valid, existing agreement or contract.
SPECIFIC PERFORMANCE
State law which requires, among other things, that certain contracts relating to real estate must be in writing to be enforceable at law.
STATUTE OF FRAUDS
Laws setting forth the period of time in which suit can be brought for a particular act.
STATUTE OF LIMITATIONS
In a contract, a requirement of punctual performance
TIME OF THE ESSENCE
A contract whereby only one party is obligated to perform his obligation to another.
UNILATERAL CONTRACT
A contract that is binding, is legally sufficient and authorized by law
VALID CONTRACT
To have no force or effect; that which is unenforceable
VOID CONTRACT
A contract which is capable of being adjudged void, but is not void unless action is taken to make it so. Able to be made void
VOIDABLE CONTRACT
