A Wisconsin purchase agreement for a lakefront property includes a provision stating the sale is contingent upon the buyer obtaining a DNR permit for a new pier. The DNR denies the permit application. The seller argues the buyer should have investigated permit availability before making the offer and refuses to release the earnest money. Under Wisconsin law, what is the most likely outcome?
Correct Answer
A) The buyer may void the contract and recover earnest money because the contingency was not satisfied.
Under Wisconsin contract law, a clearly stated contingency that is not satisfied — such as failing to obtain a required DNR permit — entitles the buyer to void the contract and recover earnest money. The contingency was an express condition of the contract; its non-fulfillment through no fault of the buyer triggers the right to rescind. The seller's argument that the buyer should have investigated beforehand does not override the express contractual contingency. Wisconsin's DNR regulates shoreline alterations and pier permits under the public trust doctrine, making such contingencies common and legally enforceable in lakefront transactions.
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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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