ContractsIntermediateDelaware Exam

What is a 'voidable' contract in Delaware real estate law?

AA contract with a void clause that can be removed

BA contract that is valid unless and until one party (typically the injured party) chooses to rescind itCorrect

CA contract that becomes void if the property is condemned

DA contract that expires unless renewed

Why A contract that is valid unless and until one party (typically the injured party) chooses to rescind it Is Correct

Answer B: A contract that is valid unless and until one party (typically the injured party) chooses to rescind it

A voidable contract is valid and enforceable unless the party with the right to avoid (typically the injured party — a minor, a person under duress, or a victim of fraud) chooses to void it. The other party cannot void a voidable contract.

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

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.

Earnest Money

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

Contingency

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

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