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Common Law Governs Contracts for the Sale of Real Estate

When it comes to contracts for the sale of real estate, common law is the governing principle. This means that when two parties enter into an agreement for the sale of property, they are bound by traditional, common law principles.

One of the essential elements of common law as it applies to real estate contracts is the requirement for a “meeting of the minds.” This means that both parties must agree on all essential terms of the contract before it can be binding. These essential terms typically include the identity of the parties, the description of the property, the purchase price, and the closing date.

Another key principle of common law in real estate contracts is the concept of “consideration.” Consideration refers to the exchange of something valuable between the parties. In most real estate contracts, the buyer provides consideration in the form of money, while the seller provides consideration by transferring ownership of the property.

Common law also requires that real estate contracts be in writing and signed by both parties. This is known as the “Statute of Frauds” requirement, which helps to ensure that all parties are aware of the essential terms of the contract and their obligations under it.

In addition to these essential elements, common law also provides guidelines for resolving disputes that may arise in the context of real estate contracts. Generally, common law encourages parties to resolve their disputes through negotiation and mediation, rather than resorting to litigation. However, if necessary, a court may enforce a real estate contract and award damages to the injured party for any breach.

Overall, common law provides a framework for the fair and effective management of real estate contracts. By ensuring that all parties are aware of their obligations and that disputes are resolved quickly and fairly, this system helps to promote trust and stability in the real estate market.

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