What type of contract is defined as a one-sided agreement?

A unilateral contract is defined as a one-sided agreement where one party makes a promise or commitment to perform a certain action, while the other party is not obligated to do anything in return until the first party's conditions are fulfilled. This type of contract becomes binding when the second party performs the requested action, thereby accepting the offer.

For instance, a common example of a unilateral contract is a reward offer; if someone promises to pay a reward for the return of a lost pet, the obligation lies solely with the person making the offer until the pet is returned. This highlights the one-sided nature of the agreement, as only the offeror is offering a promise contingent upon the action taken by the offeree.

In contrast, a bilateral contract involves mutual obligations where both parties make promises to one another, creating reciprocal responsibilities. A formal contract typically requires specific formalities to be enforceable, and an implied contract is formed based on the actions or conduct of the parties involved, rather than through explicit agreement. Understanding these distinctions clarifies why a unilateral contract is characterized as a one-sided agreement.