Lesson 9: Real Estate Contract Law

Question 1

contract

Answer 1

A contract is an agreement or promise between two or more people to do, or not do, certain things.

A valid contract is legally binding, and can be enforced by a court if a party fails to comply with the terms of the contract.

Question 2

severable

Answer 2

unlawful provisions can be severed and the rest of the contract is enforced

Question 3

assignment

Answer 3

One party may want to transfer some of her contractual rights to another person. She can do this by assignment.

A common example of assignment involves someone taking over another person’s lease.

Question 4

novation

Answer 4

Contract parties can use a novation if they want to substitute a different contract for the existing one, or if they want to substitute a new party for one of the original parties.

A novation requires the consent of all the parties involved.

Question 5

accord and satisfaction

Answer 5

Sometimes, one party agrees to accept less than full performance from the other party.

This is called accord and satisfaction.

Question 6

injunction

Answer 6

An injunction is another equitable remedy. An injunction is a court order to do, or not do, something.

An injunction is used when a breach of contract would cause irreparable harm, and monetary damages would be an inadequate remedy.

Question 7

land contract

Answer 7

Basically, a land contract is a financing agreement between a buyer and a seller.

The buyer pays the purchase price in installments over a period of time, instead of paying the seller the full price at closing.