Ontario Real Estate Licensing Exam Practice · Question
Sarah, a registered salesperson, is assisting her client, David, in preparing an Offer to Purchase a residential property in Burlington. David wishes to include a condition that the agreement is conditional upon him obtaining satisfactory financing within five business days. Which of the following is an essential element for a valid contract to be formed?
Capacity, along with intent, offer, acceptance, consideration, and lawful object, are essential elements for a valid contract. The other options are not univers
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Question: Sarah, a registered salesperson, is assisting her client, David, in preparing an Offer to Purchase a residential property in Burlington. David wishes to include a condition that the agreement is conditional upon him obtaining satisfactory financing within five business days. Which of the following is an essential element for a valid contract to be formed?
Answer options: ✅ Capacity of the parties
- A fixed closing date within 30 days
- Inclusion of a Schedule B outlining chattels
- Pre-approval of the buyer's mortgage by CMHC
Correct answer: Capacity of the parties
Explanation: Capacity, along with intent, offer, acceptance, consideration, and lawful object, are essential elements for a valid contract. The other options are not universally essential for contract formation.
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