Contracts
A buyer and seller execute a purchase contract. Before closing, the seller discovers significant structural damage not previously known. The seller must:
AComplete the transaction as agreed without further disclosure
BDisclose the newly discovered material defect to the buyer as soon as it is discovered✓ Correct
CCancel the contract without penalties
DFile a claim with their homeowner's insurance before disclosing
Explanation
Even after a contract is executed, the seller has a continuing obligation to disclose material defects discovered before closing. Concealing newly discovered defects after contract execution can result in fraud liability and contract rescission.
Related Tennessee Contracts Questions
- A real estate purchase contract that is unenforceable due to the buyer's minority (age) is best described as:
- In Tennessee, a purchase agreement's 'closing date' represents:
- The doctrine of part performance can make an otherwise unenforceable oral real estate contract enforceable in equity when:
- In Tennessee, a 'memorandum of contract' is recorded to:
- Rescission of a contract means:
- Under the Tennessee Residential Property Condition Disclosure Act, 'material defects' include:
- In Tennessee, 'anticipatory breach' occurs when:
- A buyer defaults on a purchase contract that includes a liquidated damages clause. The seller's remedy is typically:
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