Mercantile Limited,a corporation in Toronto,enters into an agreement with Jackson to advance $300 000 to Jackson for the purchase of farming equipment.Jackson agrees to give Mercantile Limited a mortgage over his home as security for the advance of the money.The terms of the agreement contain an appraisal provision that the commitment to make the loan is subject to an appraisal of Jackson's home of at least $350 000.The appraisal provision is known as
A)an implied term.
B)a warranty.
C)a condition term.
D)a condition precedent.
E)an appraisal warranty.

Question

Quizplus · Accepted Answer

A condition precedent is a contractual condition that must be met before the parties are required to perform their respective obligations. In this scenario, the agreement to advance the money is contingent upon an appraisal of Jackson's home being at least $350,000, making it a condition that must be satisfied before Mercantile Limited is obligated to provide the loan.

Mercantile Limited,a Corporation in Toronto,enters into an Agreement with Jackson