Business Law Review

Topics: Contract, Contract law, Real estate Pages: 1 (380 words) Published: October 28, 2008
ABC Warehouse entered into a contract to purchase a large piece of vacant land from Dave Developer.
Land is usually characterized as real property. Real property is part of the six enforceable written types of contracts; meaning land contracts do need to be written contracts. Oral contracts are not enforceable, are hearsay, and are bad ideas to begin with. For the best interest of both parties a legal written contract is the right contract for land selling. When oral real-estate contracts are used, if in fact they are used, a person can not be sued for breaching a contract but a person can sometimes get the value of time spent and expenses in money but not the price of land; known as quantum valuit.

In the contract, terms will be expected. The specific for terms that should be expected in the contract are legality, capacity, consideration, and agreement. Legality should be presumed. Capacity should be presumed, meaning a person must be over the age of 18 and one month and have mental capacity. Consideration is not presumed but should be known; both parties must understand that they need to both give up something with out necessarily getting something in return. Agreement should be known, meaning both parties need to know what the contract entitles and that ads, bids, and auctions are not the solid agreement.

If the contract was claimed to never have been made by Dave Developer, Dave could claim the defense of insanity; mental incapacity, or that he is not of the rightful age of 18 and one month. Although is the contract was made but Dave Developer declines to perform it, he could use the defense of the contingency condition. This defense just means he can get money and get out of the contract. This defense is common in real-estate.

If the contract could not be breached, ABC Warehouse still has rights and remedies. The company could still get money for their loss of the contract due to a personal defense. The personal defense means that they could breach...
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