Question

If fire destroys a home after the contract of sale is signed by both parties, but prior to closing, which is true under the Uniform Vendor Purchaser Risk Act?

a) The party in possession generally bears the risk of loss.
b) The seller bears the risk of loss if in possession and holding legal title at the time of loss.
c) Both A and B.
d) Neither A nor B.

Answer 1

According to the Uniform Vendor Purchaser Risk Act, the party in possession generally bears the risk of loss if a fire destroys a home after the contract of sale is signed but prior to closing.

Step-by-step explanation:

According to the Uniform Vendor Purchaser Risk Act, if a fire destroys a home after the contract of sale is signed by both parties but prior to closing, the party in possession generally bears the risk of loss. This means that if the seller is still in possession and holding legal title at the time of the loss, they would bear the risk of loss. However, it is important to note that the specific terms of the contract may also dictate who bears the risk of loss in this situation.