A buyer and seller execute a purchase agreement for a Waterloo property. The agreement specifies a closing date of March 15. On March 10, the seller informs the buyer that she needs two additional weeks to vacate. The buyer agrees verbally. On March 15, the seller is still not ready to close. The buyer demands closing and the seller refuses. Which of the following best describes the legal situation?
Correct Answer
A) The seller is in breach of contract because a verbal modification to a written real estate contract is unenforceable under Iowa's Statute of Frauds
Under Iowa's Statute of Frauds, modifications to a written real estate contract must also be in writing to be enforceable. A verbal agreement to extend the closing date does not satisfy this requirement. Therefore, the original March 15 closing date remains the binding contractual term, and the seller's failure to close on that date constitutes a breach of the written purchase agreement.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
Offer and acceptance is the process by which one party proposes specific terms for a contract and the other party agrees to those exact terms, creating mutual assent. This mutual agreement, also called a meeting of the minds, is an essential element of every valid contract.
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.
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