Contracts

A Kentucky purchase agreement includes a clause that says 'Seller warrants that all appliances will be in working order at closing.' This clause is an example of a:

AContingency
BRepresentation and warranty✓ Correct
CCovenant of quiet enjoyment
DLiquidated damages clause

Explanation

A representation and warranty is a statement of fact (representation) accompanied by a promise that the fact is true (warranty). The seller is representing and warranting the condition of the appliances, creating liability if they fail to be in working order at closing.

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