ContractsIntermediateCalifornia Exam

Which of the following would render a real estate contract void in California?

AThe buyer is 19 years old, under standard California purchase contract terms
BThe contract lacks a notarized signature, as typically drafted in a residential purchase agreement
CThe contract is for the sale of a property to be used for an illegal purposeCorrect
DThe purchase price is below market value, consistent with common contract law principles

Why The contract is for the sale of a property to be used for an illegal purpose Is Correct

Answer C: The contract is for the sale of a property to be used for an illegal purpose

A contract with an illegal object (unlawful purpose) is void — it has no legal effect and cannot be enforced by either party. Contracts entered into by adults (18+) without legal capacity issues, for lawful purposes, with consideration, and mutual consent are valid.

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

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