An Oregon purchase and sale agreement for a Eugene property specifies a closing date of March 15. On March 10, the buyer's lender informs the buyer that the loan will not be ready until March 22 due to appraisal delays. The seller refuses to sign a written extension addendum. Which of the following best describes the legal situation under Oregon law?
Correct Answer
D) The seller may declare the buyer in default if the buyer cannot close by March 15 as specified in the contract
In Oregon, the closing date specified in a purchase and sale agreement is a contractual obligation. If the buyer cannot close by the agreed date and the seller does not agree in writing to extend the deadline, the seller has the right to declare the buyer in breach of contract. Unless the contract contains a specific force majeure clause or the parties mutually agree in writing to a new closing date, the original date is binding. The seller's refusal to sign an extension means the March 15 date remains in effect, and the seller may exercise remedies for the buyer's failure to perform.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
Offer and acceptance is the process by which one party proposes specific terms for a contract and the other party agrees to those exact terms, creating mutual assent. This mutual agreement, also called a meeting of the minds, is an essential element of every valid contract.
An option contract gives one party the exclusive right, but not the obligation, to purchase or lease a property at a specified price within a specified time period. The buyer pays option consideration to keep the option open.
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