A Florida broker presents a contract to purchase a beachfront condo. The contract states the purchase price as '$500,000 or current market value, whichever is lower, to be determined at closing.' What is the legal status of this contract?
Correct Answer
C) Void for lack of definiteness in material terms
Correct: C - The contract is void because the purchase price is not sufficiently definite. Price is a material term that must be certain or ascertainable by objective standards in the contract. Why not A: Having a maximum doesn't cure the lack of definiteness. Why not B: The contract is void, not voidable, due to indefinite terms. Why not D: An appraisal contingency doesn't cure the fundamental defect of indefinite price terms.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Equitable title is the buyer's interest in a property after a purchase contract is signed but before closing, giving the buyer the right to acquire legal title in the future. The seller retains legal title until the deed is delivered at closing.
A financing contingency makes the purchase contract conditional upon the buyer obtaining mortgage approval within a specified time period. If the buyer cannot secure financing, they can cancel the contract and receive their earnest money back.
An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.
More Real Estate Contracts Questions
All of the following are required elements of a valid Florida real estate purchase contract EXCEPT:
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A buyer signs a Florida purchase contract for a condo and learns during the inspection period about a special assessment of $10,000. The seller knew but didn't disclose this. What are the buyer's rights?
A buyer and seller in Florida agree to extend the closing date by 10 days. The original contract had a 'time is of the essence' clause. What must they do to make this extension valid?
- → A Florida real estate licensee prepares a purchase agreement that includes a financing contingency. The buyer fails to apply for financing within the specified timeframe. What is the legal consequence under Florida contract law?
- → Under Florida law, all of the following would typically survive the closing of a real estate purchase agreement EXCEPT:
- → Broker Sarah receives a $5,000 earnest money deposit from buyer Johnson for a property purchase. The contract states the deposit should be held in escrow. According to Florida law, what must Sarah do with this deposit?
- → A buyer in Fort Lauderdale breaches a residential purchase contract by refusing to close without legal justification. The contract contains a liquidated damages clause equal to the earnest money deposit of $5,000. What is the seller's most likely remedy?
- → A seller in Florida fails to deliver clear title by the closing date due to an unexpected lien. The buyer wants to proceed but needs more time. What is the most appropriate course of action?
- → Under Florida law, a real estate purchase contract may be rescinded for all of the following reasons EXCEPT:
- → Under Florida real estate law, all of the following are acceptable remedies for contract breach EXCEPT:
- → In Gainesville, a buyer discovers that the seller's agent failed to disclose a material fact about flooding history. The buyer wants to cancel the contract before closing. Under Florida law, what is the buyer's strongest legal basis?
- → A 17-year-old inherits a property in Florida and wants to sell it. The minor enters into a sales contract with a buyer. Under Florida law, what is the status of this contract?
- → Audit memo Harbor Case highlights this Florida rule. In a Tallahassee transaction, a closing coordinator wants the Florida rule on offer. Which statement is correct?
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Previous Question
In a Tampa transaction, a buyer wants the Florida rule on as-is versus standard contract structure. Which statement is correct?
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A Florida real estate contract specifies a purchase price of $400,000 with the buyer providing a $25,000 earnest money deposit. The contract requires an additional deposit of 5% of the purchase price within 10 days of the effective date. What is the total deposit amount the buyer must provide?