Jennifer, an Indiana Broker, is representing a seller. A buyer submits a written purchase agreement offering $285,000 for the property. The seller verbally tells Jennifer to accept the offer and that she does not need to sign anything. Jennifer communicates the seller's acceptance to the buyer. Under Indiana law, is this a binding contract?
Correct Answer
C) No, because Indiana's Statute of Frauds requires real estate contracts to be signed in writing by the party to be charged
Under Indiana's Statute of Frauds (IC 32-21-1-1), a contract for the sale of real estate must be in writing and signed by the party to be charged (the party against whom enforcement is sought). A verbal acceptance by the seller does not satisfy this requirement, and the contract is unenforceable against the seller. The seller must sign the written purchase agreement for a binding contract to exist.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Liquidated damages are a predetermined amount of money specified in the contract that the non-breaching party is entitled to receive if the other party breaches. In real estate, the earnest money deposit typically serves as liquidated damages.
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.
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