Under Arkansas real estate practice, when a licensee presents a purchase offer to a seller, at what point does a binding contract generally come into existence?
Correct Answer
B) When the seller signs the offer accepting all terms and that acceptance is communicated to the buyer
A binding contract is formed when the seller accepts the offer on its exact terms and that acceptance is communicated back to the buyer (or the buyer's agent). Under Arkansas contract law, both acceptance and communication of that acceptance are required. A seller's signature alone is insufficient if the buyer has not been notified.
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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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- → A Rhode Island licensee encounters a listing contract is drafted. What should the licensee remember?
- → In Rhode Island, a licensee submits a written purchase or lease offer to an owner. Which statement is correct?
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- → A Hawaii licensee is reviewing the commission asks to inspect escrow and trust records. What is the best answer?
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