A buyer and seller in Portland, Maine have executed a purchase and sale agreement for a single-family home. The agreement includes a home inspection contingency giving the buyer 10 days to conduct an inspection. On day 8, the inspector discovers significant foundation damage. The buyer notifies the seller in writing and requests a $15,000 price reduction. The seller refuses. What is the buyer's most likely legal option under Maine law?
Correct Answer
D) The buyer may terminate the contract and recover the earnest money deposit based on the inspection contingency
When a purchase and sale agreement in Maine includes an inspection contingency and the buyer exercises that contingency within the specified timeframe due to unsatisfactory inspection results, the buyer is entitled to terminate the contract and recover the earnest money deposit. The contingency clause protects the buyer's deposit when the contractual condition is not satisfied.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A bilateral contract is an agreement in which both parties exchange promises and are both obligated to perform, while a unilateral contract is one in which only one party makes a promise and the other party is not obligated to act.
A breach of contract occurs when one party fails to perform their obligations under the contract without a legal excuse. The non-breaching party is entitled to legal remedies including damages, specific performance, or contract rescission.
Consideration is something of value exchanged between parties to a contract, making the agreement legally binding. It can be money, a promise to act, a promise to refrain from acting, or anything else of value.
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