Contracts
What does the 'time is of the essence' clause in a Pennsylvania real estate contract mean?
AThe parties must close as quickly as possible regardless of financing contingencies
BAll deadlines in the contract are strictly enforced; failure to meet them constitutes a material breach✓ Correct
CThe seller must accept the first offer received within a reasonable time
DThe title search must be completed within 24 hours of contract execution
Explanation
'Time is of the essence' means all dates and deadlines in the contract — inspection periods, mortgage contingency dates, closing date — are strictly binding. Missing a deadline can constitute a material breach, potentially allowing the non-breaching party to declare the contract void and pursue remedies including retention of earnest money or specific performance.
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