ContractsIntermediateCalifornia Exam

A contract that is 'executory' is one that:

AHas been fully performed by all parties, consistent with common contract law principles
BIs still in the process of being performed — not yet completeCorrect
CWas signed by an executor of an estate, per standard contingency and disclosure practice
DHas been cancelled by court order, under standard California purchase contract terms

Why Is still in the process of being performed — not yet complete Is Correct

Answer B: Is still in the process of being performed — not yet complete

An executory contract is one where performance is still pending — the terms have not been fully carried out by one or both parties. Most purchase agreements are executory from signing until the close of escrow, when the contract becomes executed.

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.

Key Contracts Terms in This Question

Contingency

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

Purchase Agreement

A legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.

Escrow

A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.

People Also Study

Related California Questions

Practice More California Real Estate Questions

1,500+ questions covering all exam topics. Start free — no signup required.

Take the Free California Quiz →