Legal Definitions - Unilateral Contract

A Unilateral Contract is a type of agreement where one party makes a promise, and the other party accepts that promise *only* by performing a specific action, rather than by making a return promise.

In essence, the offeror (the one making the promise) is bound to fulfill their part of the agreement only if the offeree (the one to whom the promise is made) completes the requested act. The offeree is not obligated to perform the action, but if they do, the contract is formed, and the offeror must then uphold their promise.

Here are some examples illustrating a Unilateral Contract:

• Example 1: Home Improvement Task

  A homeowner tells a local handyman, "I will pay you $300 if you completely repaint my garden shed by the end of the week." The handyman does not need to verbally agree or sign anything beforehand. If the handyman successfully repaints the shed by the deadline, they have accepted the offer through their performance, and the homeowner is then legally obligated to pay the $300.

• Example 2: Sales Performance Bonus

  A company announces to its sales team, "Any salesperson who exceeds $50,000 in new client sales this quarter will receive an additional $1,000 bonus." Individual salespeople do not need to formally accept this offer. However, if a salesperson achieves the $50,000 target, they have accepted the company's offer through their performance, and the company is then contractually bound to pay the $1,000 bonus.

• Example 3: Conditional Product Trial

  An electronics store advertises, "Test drive our new smart home device for 30 days, and if you write a detailed review on our website within that period, we'll give you a $25 store credit." A customer takes the device home. If they complete the 30-day trial and publish the detailed review as requested, they have accepted the offer by performing the specified action, and the store must then provide the $25 store credit.