Contracts, Transfer, and Escrow Practice Question
Question
An escrow officer requests clarification from the broker involving rescission. Which statement best describes rescission? (Item 131)
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. Recognize cancellation that returns parties to their pre-contract positions.
- D. It removes the need for written disclosure if the licensee believes the client already knows.
Correct Answer
C. Recognize cancellation that returns parties to their pre-contract positions.
Explanation
The correct answer is C because rescission requires candidates to recognize cancellation that returns parties to their pre-contract positions. 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: easy
- Domain: Contracts, Transfer, and Escrow
- Objective: rescission