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Details Title: Chapter 7 Description: Chapter 7 Vocab Total Flash Cards: 44 Created: 08/26/2006 15:50:56	To study from this set of flash cards, or to create your own your own study flash cards, register HERE. If you are already a registered user, CLICK HERE.
Cards Term contract Definition a legally enforceable promise or set of promises between legally competent parties, supported by legal consideration, to do (or refrain from doing) a legal act that must be performed and for which the law provides a remedy if a breach of promise occurs. Term express contract Definition the parties state the terms and show their intentions in words to that effect. Term implied contract Definition the agreement of parties is demonstrated by their actions or conduct Term bilateral contract Definition both parties promise to do or refrain from doing something; one promise is exchanged for another Term unilateral contract Definition one party makes a promise to induce a second party to do something. Second party not legally obligated. Term executed contract Definition one in which all parties have fulfilled their promises and thus fully performed the contract Term executory conrtact Definition when something remains to be done by one or both parties Term valid contract Definition complies with all essential elements of a contract Term voidable contract Definition one that has no legal force or effect. It does not meet the essential elements of a contract. May be fully executed unless one of the parties disaffirms it. Term void contract Definition has all legal elements, may be rescinded or disaffirmed by one or both parties based on some legal principal Term unenforceable contract Definition has all the elements of a valid contract; however, neither party can sue the other to force performance. Term Legally competent parties Definition both parties to the contract must be of legal age and have sufficient mental capacity. 18 years of age and not senile Term Mutual assent Definition an offer of one party is accepted by the other. Term offer and acceptance Definition must be a meeting of the minds. the terms of agreement must be fairly definite and understood by both parties. Acceptance must be actually communicated to the offeror Term legality of object Definition a contract must not contemplate a purpose that is illegal or against public policy Term consideration Definition something of legal value. Promise to perform that has been bargained for and exchanged is legally sufficient to satisfy the consideration element Term reality of consent Definition every contract must be signed as the free and voluntary act of each party to be valid Term counteroffer Definition any attempt by the offeree to change any of the terms proposed by the offeror Term statute of frauds Definition requires that certain types of contracts be in writing to be enforceable in a court of law Term parole evidence rule Definition a rule of evidence that dictates that no oral agreements that contradict the terms of a written contract may be considered in a lawsuit based on the written agreement. Handwriting takes presedence over typing. Typing takes precedence over oral agreement. Term auction Definition auctioneere accepts the offer on a house Term time is of the essence Definition the contract must be performed within the time limit specified, and any party who has not performed on time is liable for breach of contract. Term assignment Definition refers to a transfer of rights or duties under a contract. Term novation Definition substitution of a new contract for an existing agreement with the intent of extinguishing the old contract. Term breach of contract Definition a violation, without legal excuse, of any of the terms or conditions of a contract Term liquidated damages Definition the amount of money that will compensate the injured party for breach, an amount agreed to by the parties at the time they enter into contract. Term earnest money deposit Definition liquidated damages in the event the buyer breaches the contract Term consequential damages Definition special damages that might be obtained if the breaching party had intentions of breaking the contract at the time of making the contract Term specific performance Definition to force the other party to perform the contract as agreed Term recission Definition when facts were misrepresented or one party entered the contract under duress the contract is declaired invalid and both parties return to the position they were in before they entered into the contract Term listing agreement Definition creates a special agency releationship between the principal (the seller) and the broker/firm (the agent), wherein the agent is authorized to represent the principal and the principal's property to third parties, including securing and submitting offers for the party. Term employment contract Definition the broker/firm is hired to represent the principal, but real property is not transfered. Term procuring cause Definition the broker has taken action to start (or cause) a chain of events that resulted in a sale Term retainer fee Definition a small amount of compensation usually paid upfront by the buyer/client when a buyer-agency agreement is signed Term success fee Definition due and payable by the buyer/principal on the signing and acceptance of an offer to purchase property found by the buyer's agent. Term open listing Definition the right to employ any number of brokers as agents; the seller is obligated to pay a commission only to the broker who successfully produces a ready, willing, and able buyer. If the seller personally sells the property withouth the aid of any of the brokers, the seller is not obligated to pay any broker a commission. Term exclusive-agency listing Definition one broker is specifically autorized to act as the exclusive agent of the principal. seller retins right to sell property by his or herself without obligation to the broker. Only obligated to pay commission if the broker is the cause of procuring cause of sale or if any broker sells the property with or without the autority of the exclusive listing broker Term exclusive-right-to-sell listing Definition one broker appointed as sole agent of seller and is given exclusive right, or authorization, to represent to property in question. Term protection agreement Definition guarantee broker a commission if that particular property is sold to a specific buyer Term Multiple Listing Service (MLS) Definition members pool their listings. provision gives additional authority to the listing broker to distribute the listing to other brokers who belong to the MLS. Term net listing Definition the amount of money the seller will receive if the property is sold Term broker protection clause Definition protects the broker who introduces two parties and thus is the procuring cause of a sale; the protection clause states that if the parties complete the transaction after the listing expires the broker is required compensation. Usually lasts 6 months after contract expiration Term competitive (or comperative) market analysis (CMA) Definition compares the prices of recently sold or listed properties that are similar in location, style, and amenities to the subject property Term Statute of limitations Definition North Carolina law allows a specific time limit during which parties to a contract may bring legal suite to enforce their rights. Varies for different legal actions, and any rights not enforced within the applicable time period are lost