ContractsIntermediateArizona Exam

In Arizona, can a seller accept an offer from a backup buyer while the primary contract is still in effect?

AYes, unconditionally, with both contracts fully enforceable and the seller closing whichever reaches its date first

BOnly as a backup contract, effective if and when the primary contract is terminatedCorrect

CNo, because Arizona law prohibits accepting additional contracts once one is fully executed

DOnly if the primary buyer provides written consent to accept backup offers

Why Only as a backup contract, effective if and when the primary contract is terminated Is Correct

Answer B: Only as a backup contract, effective if and when the primary contract is terminated

A seller may accept a backup offer as a contingent backup contract that becomes effective only if the primary contract is terminated. The seller cannot close two sales on the same property simultaneously.

Exam Tip: Contracts

Contract questions frequently test the essential elements required for a valid contract. Remember: competent parties, mutual consent, lawful object, and sufficient consideration. Watch for void vs. voidable distinctions.

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Key Terms to Know

Earnest Money

A deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.

Option Contract

A contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.

Right of First Refusal

A contractual right giving a party the opportunity to match any offer received before the owner can accept it from a third party.

Contingency

A condition in a purchase contract that must be satisfied before the sale can proceed to closing.

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