A buyer enters into a TREC contract with a 10-day option period and a $500 option fee. On Day 10 (the last day), the buyer delivers a written termination notice at 5:00 PM. The seller argues that the notice was too late because business hours ended at 4:30 PM. Under the contract, is the termination valid?
Correct Answer
B) Yes, because the option period runs until midnight on the last day unless the contract specifies otherwise
The option period is measured in calendar days, and the last day runs until midnight (11:59 PM) unless the contract specifies a different time. A notice delivered at 5:00 PM on the last day is timely.
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Related Topics & Key Terms
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Related Concepts
Contingencies are conditions written into a real estate contract that must be met before the transaction can close. If a contingency is not satisfied, the buyer can typically cancel the contract without penalty.
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.
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