Unit 11

Question 1

STATUTES OF FRAUDS

Answer 1

The statute of frauds require that contracts conveying an interest in real property and all contracts that are not performed within 1 year from the date they become effective must be in writing and signed to be enforceable. An enforceable contract is a contract that the courts will recognize as legally binding. Contracts covered by Florida’s statute of fraud include the following
1) purchasing sales contracts,
2) option contracts,
3) deeds, and mortgage instruments,
4) lease agreements for a turn longer than 1 year.
5) listing agreements for a term longer than 1 year,
6) buyers representation agreements for a term longer than one year.

Question 2

Unilateral Contract

Answer 2

A unilateral contract obligates only one party to an agreement. One party makes an obligation to perform without receiving in return any promise of performance from the other party. There is no obligation on the part of the other party involved.

Question 3

Executory Contract

Answer 3

Executory contracts are an agreement between parties that involve promises to be completed at a future date. A purchase and sale real estate contract, between the time of signing the contract and the time that the title is conveyed from the grantor to the grantee, is an executory contract because the parties have not fully performed.

Question 4

Remedies for Breach
Specific performance

Answer 4

Specific performance. If awards of money damages do not afford sufficient relief, the wrong party may sue for specific performance to have the court’s force the other party to perform as the contract specifically states.
This action is termed Relief in Equity because the party bringing the lawsuit is not seeking money damages. Instead, the party is asking the court for a remedy to create a fair outcome. If the party bringing the lawsuit is successful, the court will order the breaching party to do what the party promised to do in the contract. Typically, specific performance is sought by a buyer against a breaching seller.

Question 5

Types of listings
Open Listing

Answer 5

In an open listing, the owner reserves the right to sell the property and to list it with any number of brokers. The first broker to secure a buyer who is ready, willing, and able to purchase at the terms of the listing earns the commission. If the owner sells the property, no broker is entitled to a commission. Open listing agreements are unilateral contracts because the only promise made is that the seller will pay a commission if the broker causes a transaction to be consummated.

Question 6

Lead-Based Paint Disclosure
EPA Pamphlet

Answer 6

An EPA pamphlet regarding the danger of lead-based paint be given to buyers and tenants before the sale or lease of residential property built before 1978.

Question 7

Homeowners Association Disclosure

Answer 7

Homeowners associations may pose assessments that, if unpaid, may become a lien on the parcel. Florida statue 720 requires sellers of property subject to a mandatory homeowners association to provide buyers with a disclosure summary regarding the association.

Question 8

In addition to the Homeowners Association Disclosure Summary, the contract for sale and purchase must state that:

Answer 8

1) The buyer should not sign the contract without first receiving and reading the homeowners’ disclosure summary;
2) If the disclosure summary is not provided to the buyer before executing the contract for sale and purchase, the contract is voidable;
3) To void the contract, The buy must give the seller or the seller’s agent written notice of the buyer’s intention to cancel the contract within three calendar days after receipt of the disclosure summary or before closing, which ever occurs first; and,
4) The right to void the contract can not be waived by the buyer. ( The right terminates at closing.)