Chapter 11: Contracts

Question 1

A contract is an _____ between 2 or more parties to do or not do a particular thing.

Answer 1

agreement

Question 2

Oral contracts are also known as _____ contracts.

Answer 2

parol

Question 3

true/false: Valid oral and written contracts can be enforced in court.

Answer 3

true

Question 4

The five essential elements of an enforceable real estate contract are (COLIC):

1. _____
2. _____
3. _____
4. _____

Answer 4

Competent parties
Offer and acceptance
Legality
In writing
Consideration

Question 5

An _____ contract is one in which all terms and conditions are specified and agreed to by the parties.

Answer 5

express

Question 6

An _____ contract exists when some or all of the terms or conditions can be assumed by the nature of the agreement.

Answer 6

implied

Question 7

A _____ contract is one in which both of the parties mutually agree to be bound to performance.

Answer 7

bilateral

Question 8

A _____ contract is one in which only one party agrees to be bound to performance.

Answer 8

unilateral

Question 9

When all parties have performed, the contract has been _____.

Answer 9

executed

Question 10

The party making the offer is the _____ and the party receiving is the _____.

Answer 10

offeror

offeree

Question 11

A contract is created when one party accepts the offer of another and the acceptance is ______ to the offeror.

Answer 11

communicated

Question 12

The ________ requires a contract to be in writing to be enforceable.

Answer 12

Statute of Frauds

Question 13

The Statute of Frauds _____ make an oral real estate sales contract invalid or illegal.

Answer 13

does not - only unenforceable

Question 14

An exception to the Statute of Frauds exists when a buyer makes a ______ AND either ______ or ______.

Answer 14

partial payment
takes possession
makes improvements

Question 15

Offers can be terminated by (WILD CARD):

1. _____
2. _____
3. _____
4. _____
5. _____
6. _____
7. _____
8. _____

Answer 15

Withdrawal
Insanity
Lapse of time
Death
Counteroffer
Acceptance
Rejection
Destruction of property

Question 16

true/false: Acknowledgement is necessary if documents are to be recorded in public record.

Answer 16

true

Question 17

A _____ contract is one that is wholly written and under seal.

Answer 17

formal

Question 18

Contracts can be terminated by (BRRLAP):

1. _____
2. _____
3. _____
4. _____
5. _____
6. _____

Answer 18

Breach
Renunciation
Revocation
Lapse of time
Abandonment
Performance

Question 19

If a contract is breached, parties can be sued for _______, _______, or _______.

Answer 19

cancellation
specific performance
damages

Question 20

_____ damages are those agreed upon in the contract.

Answer 20

Liquidated

Question 21

_____ damages are those that are not specified in the contact, that the court has decided upon.

Answer 21

Unliquidated (compensatory)

Question 22

Statute of limitations on contracts is _____ years on parol and _____ years on written.

Answer 22

4

5

Question 23

In an assignment of contracts, the ______ is ultimately responsible.

Answer 23

assignor

Question 24

Listing contracts are between an owner and a _____.

Answer 24

broker

Question 25

Listing contracts _____ contain an automatic renewal provision.

Answer 25

can not

Question 26

The broker must deliver a copy of any written listing agreement to the property owner with ______.

Answer 26

24 hours

Question 27

A(n) _____ listing is a unilateral contract in which the brokers are competing to sell the property.

Answer 27

open

Question 28

A listing contract must contain: definite termination date, legal description of the property, _____, _____, and _____.

Answer 28

price and terms fee or commission signature of the owner

Question 29

The broker who finds a ready, willing, and able buyer is said to be ______ of the sale.

Answer 29

procuring cause

Question 30

A(n) ______ listing is a unilateral contract in which the property owner promises to list the property with only one broker.

Answer 30

exclusive

Question 31

A(n) _____ listing is a bilateral contract in which the property is only listed with one broker, and the broker is paid commission whether they procure cause or not.

Answer 31

exclusive right of sale

Question 32

The only property listing type that must be in writing is the ______ listing.

Answer 32

exclusive right of sale

Question 33

_______ listings presume the broker to have a lien against the seller's net proceeds for their commission.

Answer 33

commercial

Question 34

In a _____ listing, the broker retains all money over the seller's net a commission.

Answer 34

net

Question 35

Two commission types are _____ and _____.

Answer 35

single percentage | sliding scale

Question 36

true/false: A listing contract can be terminated by bankruptcy of either the broker or property owner.

Answer 36

true

Question 37

true/false: A broker can terminate a listing agreement by giving notice of revocation to the other party.

Answer 37

true

Question 38

A(n) _____ contract is a right to buy a specified property during a particular time period.

Answer 38

option

Question 39

A property owner giving a right to option is called an _____ and the other party is an _____.

Answer 39

optionor | optionee

Question 40

In an option contract, which party is the only one with an obligation?

Answer 40

The optionor

Question 41

Once an optionor notifies an optionee of the intent to purchase, the option becomes a _____.

Answer 41

purchase and sale contract

Question 42

true/false: Option contracts must include valuable consideration, otherwise they are considered listings.

Answer 42

true

Question 43

The parties to a purchase and sale contract are the ______ (seller) and ______ (buyer).

Answer 43

vendor | vendee

Question 44

true/false: Enforceable promises are considered valuable consideration.

Answer 44

true

Question 45

Witnesses _____ required an a real estate purchase and sale contract.

Answer 45

are not

Question 46

Upon entering into a purchase and sale contract, the vendor acquires _____ title until closing, even though the vendee retains _____ title. This obligates the vendor to maintain the property.

Answer 46

equitable | legal

Question 47

A ______, also known as agreement for deed, land contract, conditional sales contract, or installment sale contract, is a financing device used in seller financing / PMM.

Answer 47

contract for deed

Question 48

Brokers can legally prepare: 1. _____ 2. _____ 3. _____ 4. _____

Answer 48

listing contracts sales contracts option contracts buyer representation agreements

Question 49

The use of an "as-is" contract ______ relieve the seller of the obligation to disclose material defects in the property.

Answer 49

does not

Question 50

Licensees are allowed to fill in the blanks on a residential lease agreement for a term of up to ______.

Answer 50

1 year