contracts

Question 1

SOF requirements for land contract

Answer 1

signed by party charged 
description of property 
price 
description of parties 
any condition of price or payment agreed on

Question 2

part performance at least two of:

Answer 2

(1) possession
(2) payment
(3) making substantial improvements
estoppel is also an equitable remedy: promissory (promise) and equitable (actions)

Question 3

land contracts

Answer 3

legal title remains with seller; buyer has equitable title

that is why majority rule has risk of loss with the buyer

Question 4

Uniform Vendor and Purchaser Act

Answer 4

exception to majority

The risk of loss remains with the seller until the legal title or possession of the property passes to the buyer

Question 5

warranty deed present covenants

Answer 5

do not run with the land and can be breached only at the time of closing
seisin: grantor promises he owns the property
Right to Convey: The grantor promises he or she has the power to convey the property
Covenant against Encumbrances: The grantor promises there are no encumbrances (visible or invisible) on the property

Question 6

warranty deed future covenants

Answer 6

runs with the land so can be at time of closing and after
Quiet Enjoyment: The grantor promises that the grantee will not be disturbed by a third party asserting a valid claim to the land
Warranty: The grantor promises to defend the grantee against any third-party claim
Further Assurances: The grantor promises to do everything reasonably necessary to perfect the grantee’s title

Question 7

Fitness and Suitability

Answer 7

Duty to disclose material latent defects known to the seller but not readily observable and not known to the buyer

Question 8

Implied Warranty of Quality

Answer 8

Applies to the sale of new or remodeled homes by builders and developers (does not apply to
commercial structures)
sig latent defects

Question 9

seller’s agent duty

Answer 9

to disclose

Question 10

buyer’s agent duty

Answer 10

loyalty and obedience

Question 11

part performance, who has to perform?

Answer 11

does not have to be the person signing the agreement, can be the partner acting on the agreement. sufficient relationship and for the benefit of the party to the oral contract.

Question 12

quiet enjoyment damages

Answer 12

recovery of damages that are capped at the amount the covenantor received for the land; so never applicable when no money is spent.

Question 13

earnest money becomes LDs when

Answer 13

specifically spelled out in the agreement

Question 14

expectation damages

Answer 14

when a contract does not have an LD clause, the owner may seek expectation damages.
expectation damages are measured by the difference between the contract price and the market price at the time of the breach

Question 15

restitution

Answer 15

allowed when a breach is not for convenience, willful, and when the purchasers had the owner’s permission to make the improvements.

Question 16

unjust enrichment

Answer 16

occurs when specific performance would inequitable. This happens when the conditions creating the inequity are outside the control of the buyer such as zoning regulations making the property worthless. But seller can still sue for damages

Question 17

assignments and leases

Answer 17

do not rid the original tenant from the obligations under the lease, such as rent or holding the proper insurance

Question 18

sof and right of first refusal

Answer 18

must be in writing to be valid

Question 19

merger

Answer 19

the idea that the deed and contract merge at closing so breaches can only be based on the deed. but there may be coa for fradulent misrep. if the contents are differnet