Contracts
What is 'consideration adequacy' in Hawaii real estate contracts?
AA. Courts will void contracts where the consideration is inadequate or unfair
BB. As a general rule, courts do not review the adequacy of consideration—any legal consideration, no matter how small, is sufficient to support a contract (though gross inadequacy may be evidence of fraud or duress)✓ Correct
CC. Hawaii requires minimum consideration of $1,000 for real estate contracts to be enforceable
DD. Consideration must be proportional to the property's fair market value in Hawaii
Explanation
Contract law generally does not require 'adequate' consideration—even $1 can support a valid contract if it is a genuine exchange. Courts will not rewrite contracts because one party made a bad deal.
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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.
Fiduciary DutyThe highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
Listing AgreementA contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
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