Buyer Tyler submits a written offer to purchase a home in Clarksville, Tennessee. The seller's listing broker calls Tyler's affiliate broker and says the seller is 'very interested' but needs until tomorrow to decide. The next morning, before the seller responds, Tyler emails his affiliate broker revoking the offer. Tyler's affiliate broker immediately notifies the listing broker. Later that afternoon, the seller signs an acceptance and the listing broker tries to deliver it. Is there a binding contract?
Correct Answer
B) No, because Tyler's revocation was communicated to the listing broker before the seller's acceptance was communicated
Under Tennessee contract law, an offeror may revoke an offer at any time before acceptance is communicated. Tyler revoked his offer by notifying his affiliate broker, who immediately communicated the revocation to the listing broker. This revocation occurred before the seller's acceptance was communicated to Tyler or his agent. Therefore, when the seller later signed an acceptance, the offer had already been extinguished by revocation, and no binding contract was formed.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
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.
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