An Arkansas purchase agreement contains a 'kick-out clause' allowing the seller to continue marketing the property and accept another offer if the buyer does not remove a home sale contingency within 72 hours of written notice. The seller receives a second offer and sends the buyer written notice on a Friday at 5:00 PM. The buyer's agent is out of town and does not relay the notice until Monday morning. The buyer removes the contingency on Monday at noon. Under Arkansas contract law, did the buyer timely remove the contingency?
Correct Answer
D) No, because the buyer's agent's failure to relay the notice is the buyer's responsibility, and the 72-hour period began when the seller's agent delivered notice to the buyer's agent
Under Arkansas agency law, a buyer's agent is the authorized representative of the buyer. Notice delivered to the buyer's agent constitutes notice to the buyer. Therefore, the 72-hour clock began when the seller delivered written notice to the buyer's agent on Friday at 5:00 PM. Monday noon is approximately 67 hours later, which appears within 72 hours, but the buyer's agent's failure to promptly relay the notice is the buyer's risk — the clock started upon delivery to the agent. The buyer bears the consequence of their agent's delay in communication.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An option contract gives one party the exclusive right, but not the obligation, to purchase or lease a property at a specified price within a specified time period. The buyer pays option consideration to keep the option open.
A purchase agreement is a legally binding contract between a buyer and seller that outlines the terms and conditions for the sale of real property. It is also commonly called a sales contract, purchase and sale agreement, or earnest money agreement.
Specific performance is a court-ordered remedy that compels the breaching party to fulfill their obligations under the contract rather than simply paying monetary damages. It is an equitable remedy used when monetary damages would be inadequate.
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