A purchase agreement in Butte, Montana contains a clause stating 'time is of the essence.' The closing was scheduled for March 15, but the buyer failed to appear and did not close until March 22. The seller had been ready and willing to close on March 15. Under Montana law, what is the most likely consequence of the buyer's failure to close on the specified date?
Correct Answer
D) The seller may treat the buyer's failure to close as a material breach and pursue available remedies
When a Montana purchase agreement contains a 'time is of the essence' clause, the specified closing date is a material term of the contract. The buyer's failure to close on March 15 constitutes a material breach, entitling the seller to pursue remedies including retaining the earnest money, seeking specific performance, or pursuing damages. The 'time is of the essence' language eliminates any implied grace period for late performance.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Equitable title is the buyer's interest in a property after a purchase contract is signed but before closing, giving the buyer the right to acquire legal title in the future. The seller retains legal title until the deed is delivered at closing.
A financing contingency makes the purchase contract conditional upon the buyer obtaining mortgage approval within a specified time period. If the buyer cannot secure financing, they can cancel the contract and receive their earnest money back.
An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.
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