Pratice Chapter 10 - The Agreement of Sale Flashcards
Agreement of Sale
A written agreement or contract between seller and purchaser in which they reach a “meeting of the minds” on the terms and conditions of the sale.
Counter Offer
A response to an offer to enter into a contract, changing some of the terms of the terms of the original offer. A counter offer is a rejection of the offer (not a form of acceptance), and does not create a binding contract unless accepted by the original offeror.
Letter of Intent (LOI)
Generally an agreement to agree. It outlines the terms between parties who have not formalized an agreement into a contract. LOIs are generally not binding and unenforceable.
Offer and Acceptance
Elements required for the formation of a legally binding contract. The expression of an offer to contract on certain terms by one person (the “offeror”) to another person (the “offeree”), and an indication by the offeree of its acceptance of those terms.
Statute of Frauds
A state law, based on an old English statute, requiring certain contracts to be in writing and signed before they will be enforced at law, e.g., contract for the sale of real property.
Commingling
The illegal mixing of personal funds with money held in trust on behalf of a client.
Conversion
The unlawful appropriation of another’s property, as in the conversion of trust funds.
Addendum
Additional pages of material that are added to and become part of a contract.
Specific Performance
An action to compel performance of an agreement, e.g., sale of land as an alternative to damages or rescission.
Novation
The substitution or exchange of a new obligation or contract for an old one by the mutual agreement of the parties.
Liquidated Damages
A sum agreed upon by the parties to be full damages if a certain event occurs.
