A buyer and seller in New Hampshire have entered into a fully executed purchase and sales agreement. Several contingencies were included in the agreement. Which of the following is NOT a legally recognized effect of a properly exercised contingency in a NH purchase agreement?
Correct Answer
C) The buyer automatically receives a monetary damages award from the seller equal to the cost of the unsatisfied condition.
A properly exercised contingency in a NH purchase agreement gives the buyer the right to terminate and recover the earnest money deposit, or allows the parties to negotiate a resolution. However, exercising a contingency does NOT automatically entitle the buyer to a monetary damages award from the seller. Monetary damages would require a separate legal action based on breach of contract or misrepresentation — they are not an automatic consequence of a contingency being unsatisfied.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A purchase agreement is a legally binding contract between a buyer and seller that outlines the terms and conditions for the sale of real property. It is also commonly called a sales contract, purchase and sale agreement, or earnest money agreement.
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.
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