Contracts
What is a novation in contract law?
AA minor modification to an existing contract
BThe substitution of a new party or new obligation in place of an existing one, releasing the original party from liability✓ Correct
CAn oral modification to a written contract
DThe process of renewing an expired listing agreement
Explanation
Novation is the substitution of a new party (or new obligation) for an old one in a contract, with the agreement of all parties, and the release of the original party. For example, if a buyer sells their purchase contract rights to a third party and the seller agrees, the original buyer may be released from obligations through novation.
Related Illinois Contracts Questions
- A real estate contract becomes void if:
- In Illinois, a buyer's right to conduct an inspection of a property is typically established by:
- A 'release clause' in a real estate contract or mortgage allows:
- If a seller defaults on a real estate purchase contract in Illinois, the buyer's remedies may include:
- In Illinois, which of the following is required for a real estate contract to be enforceable under the Statute of Frauds?
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- A bilateral contract in real estate is one in which:
- Which of the following is a 'bilateral contract'?
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