What type of contract is formed when one party makes a commitment without receiving any performance from another party?

What type of contract is formed when one party makes a commitment without receiving any performance from another party?

• A. Bilateral Contract
• B. Unilateral Contract
• C. Reciprocal Contract
• D. Implied Contract

Answer: (B)

A unilateral contract is a type of agreement where one party makes a promise in exchange for an act or performance by another party, without any obligation for the second party to respond with a performance. In simpler terms, it involves a one-sided commitment. For example, if someone offers a reward for a lost pet, the person offering the reward is making a unilateral contract. The offeror (the person who promises something) is bound to pay the reward if someone finds the pet and performs the act of returning it, but the finder is not obligated to search for the lost pet. This contract is distinct from bilateral contracts, where both parties exchange promises and create mutual obligations. In cases like reciprocal contracts or implied contracts, obligations are more integrated and depend on the actions or promises of both parties in some manner, which is not the case for unilateral contracts. Thus, the definition of a unilateral contract directly aligns with the premise of one party making a commitment without receiving any performance from the other.

A unilateral contract is a type of agreement where one party makes a promise in exchange for an act or performance by another party, without any obligation for the second party to respond with a performance. In simpler terms, it involves a one-sided commitment. For example, if someone offers a reward for a lost pet, the person offering the reward is making a unilateral contract. The offeror (the person who promises something) is bound to pay the reward if someone finds the pet and performs the act of returning it, but the finder is not obligated to search for the lost pet.

This contract is distinct from bilateral contracts, where both parties exchange promises and create mutual obligations. In cases like reciprocal contracts or implied contracts, obligations are more integrated and depend on the actions or promises of both parties in some manner, which is not the case for unilateral contracts. Thus, the definition of a unilateral contract directly aligns with the premise of one party making a commitment without receiving any performance from the other.