Marcus, a licensed Missouri salesperson affiliated with Heartland Realty, is representing a buyer. He presents a purchase offer to the listing broker on Monday at 10 a.m. The listing broker calls Marcus at 3 p.m. the same day and verbally states that the seller has accepted all terms. However, the signed acceptance document is not delivered to Marcus until Tuesday morning. Under Missouri law, when was the contract formed?
Correct Answer
B) Monday at 3 p.m., when the listing broker verbally communicated the seller's acceptance
Under Missouri law, a contract is formed at the moment acceptance is communicated to the offeror or the offeror's agent. Because Marcus is the buyer's agent, communication to Marcus constitutes communication to the buyer. The verbal communication by the listing broker on Monday at 3 p.m. effectively communicated the seller's acceptance, forming the contract at that moment. Missouri's Statute of Frauds requires real estate contracts to ultimately be in writing and signed to be enforceable, but the moment of contract formation is when acceptance is communicated, not when the written document is exchanged.
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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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