A buyer submits a written offer on a home in Bethesda with an expiration time of noon on Thursday. The seller signs the offer at 11:30 AM Thursday and the listing agent immediately faxes a copy of the signed acceptance to the buyer's agent's office. The buyer's agent is out of the office and the fax is not retrieved until 1:00 PM Thursday. The buyer claims no contract was formed because acceptance was not received before noon. The seller claims a contract was formed. Under Maryland law, who is most likely correct?
Correct Answer
D) The seller, because fax transmission constitutes delivery to the buyer's authorized agent when sent to the correct number
Under Maryland law and standard real estate practice, when acceptance is transmitted to the buyer's authorized agent (the buyer's agent's office fax) before the offer deadline, it constitutes effective communication of acceptance. The buyer's agent acts as the buyer's authorized representative for receiving communications. Transmission of the signed acceptance to the correct fax number of the buyer's agent's office before noon constitutes delivery to the buyer's agent, even if the agent was not physically present to retrieve it. The seller is most likely correct that a binding contract was formed.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A time is of the essence clause in a contract means that all deadlines and dates specified in the agreement are strictly enforceable, and failure to meet them constitutes a material breach.
An appraisal contingency allows the buyer to cancel or renegotiate the contract if the property's appraised value comes in lower than the agreed-upon purchase price. This contingency protects buyers from overpaying.
An assignment of contract transfers one party's rights and obligations under a contract to a third party called the assignee. The original party, known as the assignor, transfers their contractual position to someone who was not originally part of the agreement.
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