Contracts
What is 'rescission' of a contract and when might it be available in Nevada real estate?
AAn extension of the closing date by mutual agreement
BThe cancellation of a contract, returning both parties to their original positions as if the contract never existed — available in Nevada for mutual agreement, material breach, fraud, misrepresentation, or failure of a contingency✓ Correct
CThe reduction of the purchase price after inspection
DA court penalty against a licensee who breaches a listing agreement
Explanation
Rescission voids the contract and restores the parties to their pre-contract status — the buyer gets their earnest money back and the seller gets their property back. In Nevada, rescission is available when: both parties agree, a material contingency fails (financing, inspection), there is fraud or misrepresentation, there is a mutual mistake about a material fact, or there is a material breach by one party. Rescission differs from breach (where the non-breaching party may seek damages).
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