Chapter 14: Real Estate Contracts Flashcards
Bilateral Contract
A contract in which both parties enter into mutual promises
Competent
Having the mental and age capacity to enter into a contract
Contract
An agreement between two or more competent parties, supported by consideration, to do, or not to do, a certain legal act
Exclusive Agency Listing
Listing agreement whereby the seller may find a buyer without owing a commission, although the seller agrees not to list the property with any additional brokers
Exclusive Right of Sale
Listing agreement whereby the broker earns a commission no matter who procures the buyer
Liquidated Damages
A specific dollar amount of damages to be paid by a breaching party as specified in the contract
Meeting of the Minds
An agreement and understanding between the parties concerning the intent of their contractual terms
Net Listing
A listing agreement whereby the broker keeps any funds over a definite net amount to be received by the seller
Novation
Substitution of a contract and a party for another contract and another party
Open Listing
Listing agreement whereby the seller promises to pay a broker a commission if that broker procures a buyer. The seller may sell the property itself without owing a commission, and the seller may enter an open listing with several different brokers simultaneously.
Option
A right, given as a continuing offer, to purchase real property upon specific terms within a given period of time
Statute of Frauds
Body of law that states that certain types of contracts must be in writing to be enforceable
Statute of Limitations
Establishes time limits for filing litigation
Unenforceable
Status of a contract when it violates the Statute of Frauds
Unilateral Contract
A contract whereby only one party undertakes a promise or obligation
Valid
When a contract satisfies all legal requirements
Void
A contract the law will not recognize under any circumstances
Voidable
Contract involving a minor or other incompetent party wherein the incompetent part has a choice to enforce or rescind the contract
The type of listing that is most beneficial to a real estate licensee is the:
Exclusive Right of Sale listing
Which type of listing is disfavored in Florida and should be avoided:
Net listing
An option contract is a type of:
A Unilateral contract B Bilateral contract C Voidable contract D Unenforceable contract
Unilateral contract
All of the following are essentials of a valid contract except:
A Capacity of the parties B Legality of subject matter C Consideration D In writing
D In writing
Which of the following is an example of a voidable contract?
A An oral lease for 6 months
B A real estate contract signed by a 17 year old
seller.
C A verbal contract wager on the Super Bowl
D A contract to pay a kickback
A real estate contract signed by a 17 year old seller.
Which of the following conditions must have occurred if an oral real estate sale and purchase contract is enforceable under the partial performance doctrine?
A Part of the purchase price must be paid B The buyer must take possession C The buyer must make improvements D Both B and C
A Part of the purchase price must be paid
