Two buyers submit competing written offers on the same property in Somerville, Massachusetts on the same day. The seller's listing agent informs both buyers that there are multiple offers. Buyer A offers $510,000 with no contingencies. Buyer B offers $495,000 with a home inspection contingency. The seller verbally accepts Buyer A's offer but has not yet signed anything. The next morning, the seller decides to accept Buyer B's offer instead and signs Buyer B's written offer. Under Massachusetts law, which statement is most accurate?
Correct Answer
D) Buyer B has an enforceable contract because real estate contracts must be in writing under the Statute of Frauds
Under the Massachusetts Statute of Frauds (MGL Chapter 259, Section 1), contracts for the sale of real estate must be in writing and signed by the party to be charged. The seller's verbal acceptance of Buyer A's offer is unenforceable as a real estate contract. When the seller signed Buyer B's written offer, that created the only enforceable contract. Buyer A may have a claim based on the seller's conduct, but the enforceable real estate contract belongs to Buyer B.
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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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