A Minnesota purchase agreement for a lakefront property in Brainerd includes a well inspection contingency. The well test reveals arsenic levels exceeding Minnesota Department of Health safe drinking water standards. The buyer notifies the seller within the contingency deadline. The seller argues the well can be treated with a filtration system and refuses to cancel. Under Minnesota contract practice, what is the buyer's most appropriate course of action?
Correct Answer
A) The buyer may cancel the contract and recover earnest money by properly invoking the well contingency
Under Minnesota law, well disclosure and water quality are significant issues, particularly for rural and lakefront properties. A well inspection (water quality) contingency gives the buyer the right to cancel the contract if the water test results are unsatisfactory—including if contaminant levels exceed Minnesota Department of Health standards for safe drinking water. The existence of a potential treatment solution does not eliminate the buyer's right to cancel under the contingency. The buyer properly invoked the contingency within the deadline, entitling them to a full earnest money refund.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Specific performance is a court-ordered remedy that compels the breaching party to fulfill their obligations under the contract rather than simply paying monetary damages. It is an equitable remedy used when monetary damages would be inadequate.
The Statute of Frauds is a legal requirement that certain types of contracts must be in writing and signed to be enforceable. In real estate, all contracts for the sale of land or interests in land must be in writing.
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.
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