A buyer and seller have a ratified contract in Frederick County. The contract contains a financing contingency with a 21-day period and a home inspection contingency with a 10-day period. On day 8, the buyer completes the inspection and submits a repair addendum. On day 15, the seller rejects all repair requests. On day 18, the buyer's lender issues a full mortgage commitment. On day 22, the buyer attempts to void the contract citing the seller's refusal to make repairs. Which of the following best analyzes the buyer's legal position under Maryland contract principles?
Correct Answer
C) The buyer cannot void the contract based on the inspection contingency because that contingency period expired and was not properly invoked to terminate the contract
The home inspection contingency period was 10 days. The buyer submitted a repair addendum on day 8 (within the period), but when the seller rejected repairs on day 15, the inspection contingency period had already expired on day 10. The buyer did not take affirmative action to void the contract within the 10-day inspection contingency period — submitting a repair request is not the same as voiding the contract. By day 22, both the inspection contingency (day 10) and the financing contingency (day 21) had expired, and the buyer received a mortgage commitment on day 18. The buyer is now bound by the contract and cannot void it based on the inspection contingency.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Contingencies are conditions written into a real estate contract that must be met before the transaction can close. If a contingency is not satisfied, the buyer can typically cancel the contract without penalty.
Contract termination occurs when a contract is ended or discharged, releasing both parties from their obligations. A contract can be terminated through performance, mutual agreement, operation of law, or breach.
A counteroffer is a response to an original offer that changes one or more terms of the offer, effectively rejecting the original offer and creating a new offer. The party who makes the counteroffer becomes the new offeror.
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