Texas Real Estate State Practice Exam

What must be present for a contract to be considered valid and enforceable under COLIC?

1. Prohibits monopolies

2. Exchange promises which binds two parties ex sales contract

3. Court prevents the principal from denying that agency, agency by estoppel

4. Competent parties, Offer and Acceptance, Legal Purpose, In writing, Consideration

The correct answer is: Competent parties, Offer and Acceptance, Legal Purpose, In writing, Consideration

A contract must include specific elements to be considered valid and enforceable, which are summarized in the acronym COLIC. The components of COLIC stand for Competent parties, Offer and Acceptance, Legal Purpose, In writing, and Consideration. 1. **Competent Parties**: This means that the parties involved in the contract must have the legal capacity to enter into an agreement. They should be of legal age and mentally competent. 2. **Offer and Acceptance**: There must be a clear offer made by one party and an acceptance of that offer by another party. This mutual agreement is essential for establishing the intent of both parties to be bound by the contract. 3. **Legal Purpose**: The contract must be for a lawful purpose. If the contract involves illegal activities, it cannot be enforced. 4. **In Writing**: Certain contracts, especially those that fall under the Statute of Frauds (like real estate transactions), must be in writing to be enforceable. This requirement helps ensure clarity and prevent misunderstandings. 5. **Consideration**: There must be something of value exchanged between the parties, whether money, services, or goods. This element establishes that each party has a stake or interest in the contract. Each of