Common Misunderstandings About Bilateral and Unilateral Contracts
There are some common beliefs about bilateral and unilateral contracts that can be confusing. Let’s clear them up!
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What Kind of Promises Are Made:
- Bilateral Contracts: Some people think these contracts only need one promise. That’s not true! In a bilateral contract, both the buyer and the seller make promises. For example, when you buy a car, the buyer promises to pay, and the seller promises to give the car.
- Unilateral Contracts: Others believe these contracts involve multiple people. Actually, only one person makes a promise here. A good example is when someone offers a reward for finding a lost pet. Only the person offering the reward is making a promise.
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Examples and How They Work:
- It can be hard to tell the difference between a service agreement (a bilateral contract) and a reward offer (a unilateral contract). Many students get mixed up about who is responsible and how these contracts can be enforced.
Understanding these differences is really important for learning about contract law!