Mark hires Joe's real estate agency to sell his estate, telling Joe he has lost too much money playing the stock market to afford to keep it up. Then Mark wins the three million-dollar lottery! Joe reads this in the newspaper and that afternoon makes a contract with Sharon to sell the estate. Is the contract valid?

Question

Preston Dalton

Business

5 May, 18:19

Mark hires Joe's real estate agency to sell his estate, telling Joe he has lost too much money playing the stock market to afford to keep it up. Then Mark wins the three million-dollar lottery! Joe reads this in the newspaper and that afternoon makes a contract with Sharon to sell the estate. Is the contract valid?

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Answers (1)

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Brice Hinton · Answer 1

No.

Explanation:

The contract is no longer valid because of changes in the condition of offer. By the operation of law, the occurrence of certain events will automatically terminate an agency relationship. Since Mark expressly stated that the reason he was selling the estate was because he has lost so much money, any significant cash inflow to Mark apart from the sale of the estate will ultimately affect his decision to sell. As such, the lottery he won is a cash flow and since a vital condition for selling the estate has been breached. The contract is to be declared invalid.