Humber/Ontario Real Estate Course 3 Exam Practice

In regards to a true condition precedent, which statement is accurate?

1. It is binding if fulfilled by another party

2. It is not typically used in property splits

3. It cannot be waived under any circumstance

4. It must be fulfilled for the agreement to remain binding

The correct answer is: It must be fulfilled for the agreement to remain binding

A true condition precedent refers to a condition that must be fulfilled before a contract becomes binding or goes into effect. In this context, option D is the correct answer because it accurately states that a true condition precedent must be fulfilled for the agreement to remain binding. This means that until the specified condition is met, the contract is not enforceable. Options A, B, and C are not accurate in the context of a true condition precedent. Option A is incorrect because the fulfillment of the condition should not rely on another party but rather on the occurrence of a specified event. Option B is incorrect because true conditions precedent are commonly used in real estate transactions and other contractual agreements to ensure that certain requirements are met before the contract becomes valid. Option C is not accurate because in some cases, parties may choose to waive a condition precedent under certain circumstances, although this would need to be explicitly stated in the contract.