A seller in Sparks, Nevada accepts a buyer's offer in writing and the buyer is notified. Two days later, the seller discovers the buyer has a poor credit history and wants to cancel. The seller has not yet signed the formal purchase agreement, only the acceptance of the offer. Which of the following most accurately describes the seller's legal position under Nevada law?
Correct Answer
C) The seller is bound by the accepted offer and cannot unilaterally cancel without potential liability for breach of contract
Under Nevada contract law, a binding contract is formed when an offer is accepted and that acceptance is communicated to the offeror. The seller's written acceptance, communicated to the buyer, created a binding contract regardless of whether a separate 'formal purchase agreement' document was later prepared. The seller cannot unilaterally cancel without breaching the contract and facing potential legal liability, including a claim for specific performance or damages by the buyer. The buyer's credit history is not a condition that was part of the original offer terms.
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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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