unilateral contract by MaryJeanMenintigar


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									                  Unilateral Contracts and Firm Offers

Problem:    Doctrinal common law rule is that offer can be revoked before
            acceptance. Even a firm offer – a promise not to revoke – is not
            binding without consideration.

            How can reliance on offer be protected?

Resolution: Need seal or good consideration.

1.    Court can imply a promise not to revoke the bargain (Errington v

      Two contract approach

      Contract #1: pay mortgage and house will be yours

      Contract #2: so long as you pay the mortgage you may remain in
      possession (an implied promise not to revoke Contract #1)

2.    Court can find that there is a bilateral contract (an exchange of mutual
      promises) (Dawson v Helicopter Exploration Co. Ltd.)

3.    Difference between unilateral and bilateral contract

      (a)   I will pay you $500, if you find my dog.
            (unilateral contract - offer accepted upon performance)

      (b)   I promise to find your dog. In exchange you promise to pay
            me $500.
            (bilateral contract - exchange of promises)

      Note: In (a), the unilateral contract, there is no binding obligation to
      find the dog. In (b), the bilateral contract, there is a binding obligation
      to find the dog. If I fail to find the dog, you can sue me for breach of

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