In California real estate transactions, what is the legal distinction between an executed contract and an executory contract?
Correct Answer
A) An executed contract has been fully performed by all parties, while an executory contract has remaining obligations yet to be fulfilled
Under California contract law, an executed contract is one where all parties have fully performed their obligations. An executory contract is one where one or more obligations remain to be fulfilled. A typical California purchase agreement is executory from signing until closing, when it becomes fully executed.
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Previous Question
A California real estate agent drafts a purchase agreement that includes a clause stating: 'In the event of a dispute, the prevailing party shall be entitled to reasonable attorney's fees.' The agent is later asked whether this clause is standard in California residential real estate transactions. Under California law, what is the MOST accurate response?
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A buyer in California includes an escalation clause in her offer on a home in Walnut Creek, stating she will pay $5,000 more than any competing offer up to a maximum of $800,000. The listing agent receives another offer for $760,000. Under California law, what obligation does the listing agent have regarding the escalation clause?