No matter where you live in North America, you must have seen some humorous vignettes shows a not so trustworthy Realtor intent on selling a house to an innocent-looking couple. My favorite vignette that still makes me laugh today goes back to a few years ago, when I practice at United Realty real estate. It was a real estate agent from Pompeii Realty, briefcase in hand, in the process of selling a house on an old Roman couple times about 100 BC. The house overlooking Mt. Vesuvius. It is a black, menacing, threatening the smoke plume from the upper edge of the volcano, and the Roman couple little frightened when the real estate agency - smile on his face - delivers the punch line "" Plus, with the aim, as what could go wrong "!

What is it exactly that you do when you have a "contract". The term "contract" means a promise or a set of commitments, which have one person to another, which the courts enforce. A contract can be a series of promises, or "concepts", supported by both parties. The person making the promise is called the "promissor" and the person who can enforce that promise, is known as "promissee". If the contract contains several mutual promises, each party will be a promissor and promissee. Contracts of sale and purchase of land and interests in land in general, many of the mutual promises. The contracts are an important part of any business transaction, but not nearly as much as in Real Estate. For example, some contracts are verbal, others are simply through the exchange of letters or even e-mails. This is not the case in real estate, where there is a requirement of the law, that contracts are usually lengthy legal forms to avoid uncertainty, ambiguity and change.

A contract has seven major elements:

Offer.

Acceptance.

Test

Terms of Intent.

Capacity.

Legal object.

Genuine consent.

Each of these elements must be present for a contract as binding and enforceable. Let us take a look at them individually.

OFFER

An offer is a promise by one party to another. Save and except in Real Estate, where the offer must be in written form, an offer can be made in any form. In any case, a bid must clearly a unambigous terms. If more than one interpretation may apply to a job, neither interpretation is supported by the courts. There are "unilateral" and "bilateral" offers. Offers to purchase real estate is bilateral, ie, with the exchange of mutual promises.

An offer is not forever. Offers can be completed when all the mutual promises are fulfilled. Or they will end, unless approved. Or they can be released if any of the parties can not - or not - fulfill the promise. Offers can be withdrawn after acceptance, unless a term that the offer provides that the revocation is not permitted .- as is now the case in British Columbia offers for the country. A "Counter-offer" is simply an offer from the company back to the manufacturer. The legal effect of a counter-offer is on the ending of the original bid and the offer to replace the target company. What this means in practice is that if the counter-offer is not accepted, the offer can not try to accept the first offer, unless it is re-tendered by the offeror. This is a point that is often times neglected in Real Estate, which has several to tears spilled.

ACCEPTANCE

The assumption, as the offer must be in clear conditions. There must be a positive act. For example, an offer can not state ":" If I do not hear from you, I assume you have ". Nothing to do, is not considered legal recognition. The rule is that the law in which an offer is by law to be in writing, then the acceptance must be in written form in order for the offer, a contract is binding on both parties. This is the case in Real Estate. An assumption has no effect until it is addressed to the manufacturer. Communication can be done by the "instantaneous means" as in the case of telephone or telex or fax or e-mail or hand-delivery and non-current funds, "as post. The law gives the responsibility of the bidder to specify how he wants to accept the offer. If the bidder chooses a method, how slow mail, then he assumes the risks associated with this type of service (such as misdelivery).

EXAMINATION

For an offer and acceptance to a contract, or the contract must be sealed. It is defined as "some right, benefit or profit of promissor or forebearance, damage, loss or other responsibility that the promissee". This means that the party attempting to enforce the contract obligations must be "paid" something in return for the promise of the other party. The examination must be the real value, but it does not need his money. For example, a mutual exchange of promises is an examination per se

LEGAL INTENDING

For a person to be bound to a contract, he must seriously to create legal obligations. For example, a guest for dinner is generally not regarded as an agreement to create legal obligations. The law assumes that it is legal, with the intention of a transaction, the total stranger. On the other hand, if the contract between the family members, the law assumes that there is no intention to be bound in this way (non-arm-length transaction). But this presumption can be reversed if it is evidence of something else.

CAPACITY

Even if all the above essential elements are present, may still have a contract void, voidable or illegal. A void contract is one which never existed as a lawyer. A voidable contract is something else: it exists until it is rejected by one of the parties. A contract is an illegal, for illegal purposes, and therefore always void. Examples of contracts are voidable if one of the parties is a child, ie a low or under the majority age. In this case, the contract may be invalidated by the child. Similarly, if one party is legally insane, the contract is voidable. A special case is a contract, if any of the parties is a limited liability company or corporation. Three questions must first be answered before the contract may be enforceable: 1) whether the company actually exists and 2) whether it is capable, in the contract and 3) whether the person acting on behalf of the company is, in fact, the clerk.

LEGAL OBJECT

Quite apart from obviously illegal contracts, such as, for example, contracts to commit a crime or tort, until recently, here in British Columbia with certain other types of contracts, which is illegal. For example, until the mid-80s contracts with the sale of land, which on a Sunday was considered a violation of S.4 of the Lord's Day Act (now repealed) and therefore illegal and void. Since then, the Supreme Court of Canada has ruled that the application of S.4 - in fact, the whole Lord's Day Act - is unconstitutional because it violates the freedom of conscience and religion by the Canadian Charter of Rights and Freedom .

GENUINE CONSENT

If one of the parties to a lie, or if the contract is an inherent error, the contract may still not be binding. A deception is, by definition, a statement which is false, and the need to induce one of the parties in the contract. Misrepresentation can be innocent, negligent or fraudulent, and various resources available to the party claims due to the nature of deception. If the representation is innocent, the party may be responsible for the cancellation of the contract. In the case of negligent or fraudulent information, the interested party and sue for damages. It requires a statement be made false statements in Real Estate silence could lead to some of the deception. Disclosure of hidden defects, is one such example: hidden defects not disclosed on the part of the seller is not solely on the agreement of the parties, but have similar consequences, such as deception.

In the case of the inherent error, true consent of the parties does not exist. The logic behind this idea is that the parties were negotiating directives for a subject other than those included in the contract. A certain type of error is sometimes referred to as "non factum est", Latin for "this is not my act." This error occurs when a person performs a form of the document, the document is thinking something else. Coercion and undue influence both the real part of a consent agreement. Coercion occurs when a person is forced into the contract against his will. As a result, the courts will find the contract voidable at his option. Undue influence, on the other hand, is more subtle. How they forced into a party loses its free will to contract. It occurs more frequently when a person in a superior or dominant position in relation to the others and uses this influential position to the other, in order in the treaty. Although undue influence is found, the contract voidable at the option of the innocent party.

Luigi Frascati

luigi@dccnet.com

www.luigifrascati.com
Real Estate Chronicles

Luigi Frascati is a Real Estate Agent based in Vancouver, British Columbia. He is the author of the Real Estate Chronicle, his weblog published online. Luigi holds a BA in Economics and has been practicing real estate in the past eighteen years