A South Carolina buyer and seller sign a purchase agreement for a residential property in Charleston. The agreement contains a clause stating that the property will be used as a location to operate an unlicensed gambling operation. The seller later refuses to close and the buyer sues for specific performance. How will a South Carolina court most likely rule?
Correct Answer
D) The court will refuse to enforce the contract because its purpose is illegal
One of the essential elements of a valid contract under South Carolina law is that the contract must have a lawful object — its purpose must be legal and not contrary to public policy. A contract whose stated purpose is to facilitate an illegal activity (operating an unlicensed gambling operation) violates the lawful object requirement. South Carolina courts will not enforce such a contract, and the buyer cannot obtain specific performance or damages based on an illegal agreement.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Contract termination occurs when a contract is ended or discharged, releasing both parties from their obligations. A contract can be terminated through performance, mutual agreement, operation of law, or breach.
A counteroffer is a response to an original offer that changes one or more terms of the offer, effectively rejecting the original offer and creating a new offer. The party who makes the counteroffer becomes the new offeror.
Earnest money is a deposit made by the buyer at the time of the offer or shortly after to demonstrate good faith and serious intent to purchase the property. It is also called a good faith deposit.
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