A buyer in Anniston, Alabama suffers financial harm when a licensed salesperson fraudulently misrepresents the condition of a property in the purchase agreement. The buyer obtains a court judgment against the salesperson for $65,000 but cannot collect because the salesperson is insolvent. The buyer applies to the Alabama Real Estate Recovery Fund. What is the maximum amount the buyer can recover from the Fund for this single transaction?
Correct Answer
D) $50,000, which is the maximum recovery per transaction from the Alabama Recovery Fund
Under Code of Alabama §34-27-31, the Alabama Real Estate Recovery Fund provides a maximum recovery of $50,000 per transaction. Even though the buyer obtained a court judgment for $65,000, the Fund's per-transaction cap limits recovery to $50,000. The buyer must also have first obtained a court judgment before applying to the Fund, which is satisfied here.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An assignment of contract transfers one party's rights and obligations under a contract to a third party called the assignee. The original party, known as the assignor, transfers their contractual position to someone who was not originally part of the agreement.
A bilateral contract is an agreement in which both parties exchange promises and are both obligated to perform, while a unilateral contract is one in which only one party makes a promise and the other party is not obligated to act.
A breach of contract occurs when one party fails to perform their obligations under the contract without a legal excuse. The non-breaching party is entitled to legal remedies including damages, specific performance, or contract rescission.
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