Contracts, Transfer, and Escrow Practice Question
Question
A listing agent notices a potential compliance issue involving contingencies. Which statement best describes contingencies? (Item 28)
Answer choices
- A. It is controlled only by local custom rather than by law, contract, or professional duty.
- B. It is valid only when the buyer pays cash and no lender is involved.
- C. It prevents any later disclosure, even when new facts become known.
- 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