Course 1 Module 6 ACTUAL QUESTIONS
AND CORRECT ANSWERS
Contract - CORRECT ANSWERS A legally binding agreement between
two or more people who are legally capable, involving an exchange of value
(consideration) to do or not do something lawful.
It's a promise that the law will enforce, creating a duty for one party to fulfill it
and a right for the other to demand it.
Enforceability:
Mutual understanding to create a legal obligation.
One party promises to do/not do something, and the other can demand it be
fulfilled.
Contracts can be oral, written, or in other forms, but *agreements for
buying/selling land must be in writing for enforceability*.
Example:
A snow clearer promises Harry to clear snow for $100/month (November-
April), either verbally or in writing.
In both cases, a contract exists.
Requirements per the Statute of Frauds - CORRECT ANSWERS For real
estate sales or leases, the agreement must be written and signed by the parties
involved.
,No specific form is required for the written contract—just that it's written and
signed.
Exception: A verbal contract may be enforceable if the parties start performing
it (e.g., exchanging money or taking actions).
Example:
A buyer and seller verbally agree to a $200,000 property sale with a $5,000
deposit.
The buyer gives the seller a $5,000 cheque, which the seller cashes.
Even without a written contract, the buyer may enforce the agreement because
performance (payment) started.
Requirements per the Vendors and Purchasers Act - CORRECT ANSWERS
For a real estate contract to be enforceable, it must clearly describe the
property and the parties' intentions.
Every contract is deemed to include:
Sellers only need to provide title documents they already have or control.
Buyers must check the property title at their own expense and raise any issues in
writing within 30 days of the contract.
Sellers have 30 days to fix title objections. If they can't or won't fix them (and
the buyer won't waive them), the seller can cancel the contract, return the
deposit, and face no further liability.
,Taxes, local improvements, insurance, rent, and interest are adjusted as of the
closing date.
Seller prepares the conveyance (transfer of ownership) and pays for mortgage
discharge (if any).
Buyer prepares the mortgage (if any) and pays for registering the transfer/deed.
Buyers get possession of the property or any rental income on the closing date.
Requirements per the Real Estate and Business Brokers Act - CORRECT
ANSWERS Written and signed by the brokerage as soon as possible.
The seller or buyer must also sign the agreement.
Include specific details required by the Code of Ethics.
Copies of representation agreements must be given to the seller or buyer
immediately after signing.
Registrants must ensure agreements for transferring property (e.g., purchase and
sale agreements) are written and legible.
Copies of these agreements must be provided to all parties as soon as possible.
Ensure deposits and related documents (e.g., notices removing conditions)
delivered according to the terms of the agreement of purchase and sale.
Agreement types - CORRECT ANSWERS *Representation Agreement*
Brokerage and the seller or buyer.
, Outlines the brokerage's role in representing the client (e.g., listing or helping
buy a property).
*Seller or Buyer Customer Service Agreement*
Brokerage and the seller or buyer.
Defines services provided by the brokerage when the client is not under full
representation (e.g., limited services for non-represented parties).
*Agreement of Purchase and Sale*
Signed between the seller and buyer.
Details the terms of the property sale, including price, conditions, and closing
date.
*Agreement to Lease*
Signed between a landlord and tenant.
Outlines the terms of leasing a property, such as rent, duration, and
responsibilities.
Parol Evidence Rule - CORRECT ANSWERS Oral statements cannot be
used in court to change or contradict a written contract, except in cases of fraud
or mistake.
All important terms, conditions, or promises must be included in the written
contract to be enforceable.
AND CORRECT ANSWERS
Contract - CORRECT ANSWERS A legally binding agreement between
two or more people who are legally capable, involving an exchange of value
(consideration) to do or not do something lawful.
It's a promise that the law will enforce, creating a duty for one party to fulfill it
and a right for the other to demand it.
Enforceability:
Mutual understanding to create a legal obligation.
One party promises to do/not do something, and the other can demand it be
fulfilled.
Contracts can be oral, written, or in other forms, but *agreements for
buying/selling land must be in writing for enforceability*.
Example:
A snow clearer promises Harry to clear snow for $100/month (November-
April), either verbally or in writing.
In both cases, a contract exists.
Requirements per the Statute of Frauds - CORRECT ANSWERS For real
estate sales or leases, the agreement must be written and signed by the parties
involved.
,No specific form is required for the written contract—just that it's written and
signed.
Exception: A verbal contract may be enforceable if the parties start performing
it (e.g., exchanging money or taking actions).
Example:
A buyer and seller verbally agree to a $200,000 property sale with a $5,000
deposit.
The buyer gives the seller a $5,000 cheque, which the seller cashes.
Even without a written contract, the buyer may enforce the agreement because
performance (payment) started.
Requirements per the Vendors and Purchasers Act - CORRECT ANSWERS
For a real estate contract to be enforceable, it must clearly describe the
property and the parties' intentions.
Every contract is deemed to include:
Sellers only need to provide title documents they already have or control.
Buyers must check the property title at their own expense and raise any issues in
writing within 30 days of the contract.
Sellers have 30 days to fix title objections. If they can't or won't fix them (and
the buyer won't waive them), the seller can cancel the contract, return the
deposit, and face no further liability.
,Taxes, local improvements, insurance, rent, and interest are adjusted as of the
closing date.
Seller prepares the conveyance (transfer of ownership) and pays for mortgage
discharge (if any).
Buyer prepares the mortgage (if any) and pays for registering the transfer/deed.
Buyers get possession of the property or any rental income on the closing date.
Requirements per the Real Estate and Business Brokers Act - CORRECT
ANSWERS Written and signed by the brokerage as soon as possible.
The seller or buyer must also sign the agreement.
Include specific details required by the Code of Ethics.
Copies of representation agreements must be given to the seller or buyer
immediately after signing.
Registrants must ensure agreements for transferring property (e.g., purchase and
sale agreements) are written and legible.
Copies of these agreements must be provided to all parties as soon as possible.
Ensure deposits and related documents (e.g., notices removing conditions)
delivered according to the terms of the agreement of purchase and sale.
Agreement types - CORRECT ANSWERS *Representation Agreement*
Brokerage and the seller or buyer.
, Outlines the brokerage's role in representing the client (e.g., listing or helping
buy a property).
*Seller or Buyer Customer Service Agreement*
Brokerage and the seller or buyer.
Defines services provided by the brokerage when the client is not under full
representation (e.g., limited services for non-represented parties).
*Agreement of Purchase and Sale*
Signed between the seller and buyer.
Details the terms of the property sale, including price, conditions, and closing
date.
*Agreement to Lease*
Signed between a landlord and tenant.
Outlines the terms of leasing a property, such as rent, duration, and
responsibilities.
Parol Evidence Rule - CORRECT ANSWERS Oral statements cannot be
used in court to change or contradict a written contract, except in cases of fraud
or mistake.
All important terms, conditions, or promises must be included in the written
contract to be enforceable.
