Contracts, Transfer, and Escrow Practice Question
Question
A buyer and seller disagree about a transaction term involving contingencies. Which statement best describes contingencies? (Item 8)
Answer choices
- A. It requires the licensee to favor the other party over the licensee’s own client.
- B. It is primarily a tax rule with no effect on brokerage practice.
- C. It removes the need for written disclosure if the licensee believes the client already knows.
- D. Identify conditions that must be satisfied or waived for performance to continue.
Correct Answer
D. Identify conditions that must be satisfied or waived for performance to continue.
Explanation
The correct answer is D because contingencies requires candidates to identify conditions that must be satisfied or waived for performance to continue. The other options overstate the effect of custom, oral agreement, escrow, or independent salesperson action and do not reflect safe California exam practice.
Question details
- Difficulty: medium
- Domain: Contracts, Transfer, and Escrow
- Objective: contingencies