What characterizes a unilateral contract?

What characterizes a unilateral contract?

• A. A promise in exchange for a promise
• B. A promise in exchange for an act
• C. A mutual agreement between two parties
• D. A contract that only requires one party to act

Answer: (B)

A unilateral contract is characterized by a promise made by one party in exchange for an act performed by another party. In this type of contract, only one party, the offeror, makes a commitment to fulfill their promise, while the other party, the offeree, only acts in response to that promise. The existence of a unilateral contract becomes enforceable only when the act is completed by the offeree. This concept stands in contrast to bilateral contracts, where both parties exchange promises, and both are obligated to fulfill their respective commitments. In unilateral contracts, the offeror's obligation to perform arises only when the offeree completes the specified act, and there is no mutual agreement at the outset concerning both parties’ duties. Thus, the defining feature of a unilateral contract is that it requires only one party to take action or perform a task to create enforceability.

A unilateral contract is characterized by a promise made by one party in exchange for an act performed by another party. In this type of contract, only one party, the offeror, makes a commitment to fulfill their promise, while the other party, the offeree, only acts in response to that promise. The existence of a unilateral contract becomes enforceable only when the act is completed by the offeree.

This concept stands in contrast to bilateral contracts, where both parties exchange promises, and both are obligated to fulfill their respective commitments. In unilateral contracts, the offeror's obligation to perform arises only when the offeree completes the specified act, and there is no mutual agreement at the outset concerning both parties’ duties. Thus, the defining feature of a unilateral contract is that it requires only one party to take action or perform a task to create enforceability.