Risk of Loss

Question 1

Majority Rule

Answer 1

VA follows this.
1. Follows the doctrine of equitable conversion so buyer must close
2. Does not apply if fraud or misrepresentation or particular inequity.
3. Risk of loss is on the buyer if the seller is willing/able to consummate the deal and possesses/can convey good and marketable title.

Question 2

Minority Rule

Answer 2

1. Risk of loss is on the seller (i.e., based on legal, not equitable title).
2. Buyer won’t be forced to close

Question 3

Uniform Vender and Purchaser Act (small minority)

Answer 3

1. Uniform Vender and Purchaser Act: the purchaser does not take possession before closing (shifts burden to buyer only if the buyer takes possession before closing)
2. The loss is substantial, and the contract makes it clear that the lost property was an important part of the contract (MA approach).