RISK of Loss (equitable Conversion) Flashcards Preview

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Flashcards in RISK of Loss (equitable Conversion) Deck (15):

majority rule (eng)

risk of loss by destruction of the property falls not the VENDEE as long as the vendor is
-willing &
-able to perform


Minority Rule (Mass)

the destruction of the property constitutes a failure of consideration and therefore, the vendor absorbs the damage


majority view follow

eqiutable conversion


Maj view + equitable conversion + Risk of loss cases
(modification of eq. conversion)

where the vendor is Not able to perform his obligations at the time of the loss, states modify effect of equitable conversion.
-the earliest the risk of loss can transfer to the vendee is on the closing date set in the contract
**must be 1) ready 2)wiling & 3) able to close
date set for closing=day u have risk


Casaulty insurance can be ______ or _______?

all risk or named risk


all risk

covers everything that is not expressly excluded


named risk

only covers specified problems


what must the insured have before an ins co. will pay??

an Insurable Interest.


insurable interest?

sufficient ownership in the property so that the casualty causes an economic loss to the insured.


whoever has the ___ __ ___ has an insurable interest

risk of loss


Vendee had to get insurance, is he credited that?

most jurisd- req. to apply it to the purchase price if the vendee was REQUIRED to purchase a policy in the contract


Vendor purchased the policy, is he credited that?

vendor keep the proceeds without crediting the purchaser


Does a party without the risk of loss have an INTEREST in the property?

no- not for casualty insurance, only pay if the insured had an interest in the property


risk of loss

who's assuming loss in between Signing.....&.....CLOSING??


so when signing binders

most purchasers of RE need to have insurance! (catches many by surprise)