Bilateral & Unilateral contracts Forum

[Hyder]

I understand that in a unilateral contract offer:
-the offeror can revoke at anytime before the offeree completes the performance(classical view)
-on the other hand, the offeror is precluded from revoking the offer if there has been substantial performance done by offeree(modern view)

In a bilateral contract: Promise in exchange for a promise

What if... A says to B, I promise to give you 1k if you promise to cross the bridge, B starts to walk across bridge. He is halfway there and A says to B, i revoke my offer..but B continues to walk and crosses the bridge.

---can A revoke an offer at anytime even when B is in the process of performing his promise?

edit: in unilateral you can't revoke an offer if the performance has begun.

[A'nold]

I understand that in a unilateral contract offer:
-the offeror can revoke at anytime before the offeree completes the performance(classical view)
-on the other hand, the offeror is precluded from revoking the offer if there has been substantial performance done by offeree(modern view)

In a bilateral contract: Promise in exchange for a promise

What if... A says to B, I promise to give you 1k if you promise to cross the bridge, B starts to walk across bridge. He is halfway there and A says to B, i revoke my offer..but B continues to walk and crosses the bridge.

---can A revoke a bilateral contract offer at anytime even when B is in the process of performing his promise?

Did B promise to walk across the bridge? If not, it is an unilateral contract.....

[Hyder]

I understand that in a unilateral contract offer:
-the offeror can revoke at anytime before the offeree completes the performance(classical view)
-on the other hand, the offeror is precluded from revoking the offer if there has been substantial performance done by offeree(modern view)

In a bilateral contract: Promise in exchange for a promise

What if... A says to B, I promise to give you 1k if you promise to cross the bridge, B starts to walk across bridge. He is halfway there and A says to B, i revoke my offer..but B continues to walk and crosses the bridge.

---can A revoke a bilateral contract offer at anytime even when B is in the process of performing his promise?

Did B promise to walk across the bridge? If not, it is an unilateral contract.....

Okay so lets say B says "okay I promise to cross the bridge for your 1k"...and he starts to walk..and A says "i revoke" can A do that? or is he bound when B says "i promise"

[loro-rojo]

I understand that in a unilateral contract offer:
-the offeror can revoke at anytime before the offeree completes the performance(classical view)
-on the other hand, the offeror is precluded from revoking the offer if there has been substantial performance done by offeree(modern view)

In a bilateral contract: Promise in exchange for a promise

What if... A says to B, I promise to give you 1k if you promise to cross the bridge, B starts to walk across bridge. He is halfway there and A says to B, i revoke my offer..but B continues to walk and crosses the bridge.

---can A revoke a bilateral contract offer at anytime even when B is in the process of performing his promise?

Did B promise to walk across the bridge? If not, it is an unilateral contract.....

Okay so lets say B says "okay I promise to cross the bridge for your 1k"...and he starts to walk..and A says "i revoke" can A do that? or is he bound when B says "i promise"

Once work begins to be performed in a bilateral contract, the promisor can't simply revoke the contract. The promisor must allow for reasonable time for the promisee to complete his end of the deal. If the promisor wants to revoke while the promisee is in the middle of his work, the promisee can recover damages for the work already completed.

Is this what your asking?

[Hyder]

I understand that in a unilateral contract offer:
-the offeror can revoke at anytime before the offeree completes the performance(classical view)
-on the other hand, the offeror is precluded from revoking the offer if there has been substantial performance done by offeree(modern view)

In a bilateral contract: Promise in exchange for a promise

What if... A says to B, I promise to give you 1k if you promise to cross the bridge, B starts to walk across bridge. He is halfway there and A says to B, i revoke my offer..but B continues to walk and crosses the bridge.

---can A revoke a bilateral contract offer at anytime even when B is in the process of performing his promise?

Did B promise to walk across the bridge? If not, it is an unilateral contract.....

Okay so lets say B says "okay I promise to cross the bridge for your 1k"...and he starts to walk..and A says "i revoke" can A do that? or is he bound when B says "i promise"

Once work begins to be performed in a bilateral contract, the promisor can't simply revoke the contract. The promisor must allow for reasonable time for the promisee to complete his end of the deal. If the promisor wants to revoke while the promisee is in the middle of his work, the promisee can recover damages for the work already completed.

Is this what your asking?

yea exactly! as far as acceptance goes, does B have to say "i accept/promise", or does him acting on behalf of his promise(walking across the bridge) sufficient

[loro-rojo]

yea exactly! as far as acceptance goes, does B have to say "i accept/promise", or does him acting on behalf of his promise(walking across the bridge) sufficient

Depends on the contract. If the contract says "I'll pay you $500 to cut my grass on Friday, let me know by Thursday if you accept", then the promisee must respond with an accept/reject. If the contract says "I'll pay you $500 to cut my grass, just have it cut by the time I get back from vacation", then the acceptance of the offer is the performance itself. THe promisee doesn't need to notify the promisor with an "accept/reject" letter. Him cutting the grass before the promisor shows up form vacation is an acceptance of the offer.

[A'nold]

Did B promise to walk across the bridge? If not, it is an unilateral contract.....

Okay so lets say B says "okay I promise to cross the bridge for your 1k"...and he starts to walk..and A says "i revoke" can A do that? or is he bound when B says "i promise"

Once work begins to be performed in a bilateral contract, the promisor can't simply revoke the contract. The promisor must allow for reasonable time for the promisee to complete his end of the deal. If the promisor wants to revoke while the promisee is in the middle of his work, the promisee can recover damages for the work already completed.

Is this what your asking?

yea exactly! as far as acceptance goes, does B have to say "i accept/promise", or does him acting on behalf of his promise(walking across the bridge) sufficient

Bilateral, from what I understand, seems to be based on promises from both sides that are pretty much instantly binding as a contract. If dude never gave any promise in return, that looks more like a unilateral contract to me.

[surenough]

In a bilateral contract an offer creates the power of acceptance in the offeree Offer (Restatement 24)

So once the offeree decides to accept, the offeror is bound. So if both parties exchanged promises and there is proper consideration, they are bound, no one can just back out.

HOWEVER, in a unilateral contract the offer is accepted by performance ( no-one is bound until performance at least began).

However, I think you have a very valid question. Here's why. Some contracts are clearly unilateral. For instance, if you promise someone to help him find his dog, you are definitely not committing yourself to this, because whether you will find the dog or not is outside of your control. However, something like "I'll give you $50 bucks to mow my lawn" is ambiguous. Is this an exchange of promises? Or is this a unilateral offer, and I'll give you $50 when you are done.

In that case you should look at Res. § 32. Invitation Of Promise Or Performance, for exactly what Courts do in the case when there is doubt if this is a bilateral or a unilateral offer. Make sure to read the illustrations, because they really clarify it.

[m311]

What if... A says to B, I promise to give you 1k if you promise to cross the bridge, B starts to walk across bridge. He is halfway there and A says to B, i revoke my offer..but B continues to walk and crosses the bridge.

---can A revoke a bilateral contract offer at anytime even when B is in the process of performing his promise?

Did B promise to walk across the bridge? If not, it is an unilateral contract.....

No, 2R 62 deals with this:

(1) Where an offer invites an offeree to choose between acceptance by promise and acceptance by performance, the tender or beginning of the invited performance or a tender of a beginning of it is an acceptance by performance.

(2) Such an acceptance operates as a promise to render complete performance.

An offer that asks for a promise can be accepted by performance unless it's made clear that only a promise can suffice. So if B starts walking, a bilateral (two promises) contract is formed.

And to answer the poorly-worded OP, no, a contract cannot be revoked. Offers can be revoked.

yea exactly! as far as acceptance goes, does B have to say "i accept/promise", or does him acting on behalf of his promise(walking across the bridge) sufficient

Depends on the contract. If the contract says "I'll pay you $500 to cut my grass on Friday, let me know by Thursday if you accept", then the promisee must respond with an accept/reject. If the contract says "I'll pay you $500 to cut my grass, just have it cut by the time I get back from vacation", then the acceptance of the offer is the performance itself. THe promisee doesn't need to notify the promisor with an "accept/reject" letter. Him cutting the grass before the promisor shows up form vacation is an acceptance of the offer.

Additionally in the second scenario the offeree can lock up the contract by saying "I accept."

[Snooker]

I read the farnsworth HB on contracts recently saying there's no legal difference between whether a bilateral or unilateral contract is binding, and that the modern rules attempt to avoid using these distinctions in the language.

As to the OP question, we haven't really covered this yet but getting to maybe says something about the traditional common law rule allowing revocation any time before completion, and the restatement rule makes the contract binding once performance has begun.

[RudeDudewithAttitude]

We covered a similar hypo in class on the first day. If this were a question on my professor's exam I would probably say:

Consideration is something of value bargained for. A's promise to give B $1000 if he walked across the bridge is supported by consideration if the walk across the bridge is what A bargained for. The facts do not tell us why A would want B to walk across the bridge or why this is worth $1000 to A, but if the walk is consideration then A cannot revoke once B begins performance by starting his walk across the bridge.

However, there is a stronger argument that A's promise to give be $1000 is an unenforceable gift promise because the walk across the bridge is not something A bargained for, but a condition incidental to receive the gift. So if A revokes the offer while B is halfway across the bridge B cannot enforce the promise.

This has a lot of my professor's buzz words, but I think the substance is correct.

[m311]

However, there is a stronger argument that A's promise to give be $1000 is an unenforceable gift promise because the walk across the bridge is not something A bargained for, but a condition incidental to receive the gift. So if A revokes the offer while B is halfway across the bridge B cannot enforce the promise.

Good argument, but only applicable if A is on the side of the bridge he wants B to cross over to.

[RudeDudewithAttitude]

However, there is a stronger argument that A's promise to give be $1000 is an unenforceable gift promise because the walk across the bridge is not something A bargained for, but a condition incidental to receive the gift. So if A revokes the offer while B is halfway across the bridge B cannot enforce the promise.

Good argument, but only applicable if A is on the side of the bridge he wants B to cross over to.

Thank you for pointing that out. I was thinking this as I formed the argument then I left it out. Good thing this was only an exercise or I am at the median.

[Hyder]

What if... A says to B, I promise to give you 1k if you promise to cross the bridge, B starts to walk across bridge. He is halfway there and A says to B, i revoke my offer..but B continues to walk and crosses the bridge.

---can A revoke a bilateral contract offer at anytime even when B is in the process of performing his promise?

Did B promise to walk across the bridge? If not, it is an unilateral contract.....

No, 2R 62 deals with this:

(1) Where an offer invites an offeree to choose between acceptance by promise and acceptance by performance, the tender or beginning of the invited performance or a tender of a beginning of it is an acceptance by performance.

(2) Such an acceptance operates as a promise to render complete performance.

An offer that asks for a promise can be accepted by performance unless it's made clear that only a promise can suffice. So if B starts walking, a bilateral (two promises) contract is formed.

And to answer the poorly-worded OP, no, a contract cannot be revoked. Offers can be revoked.

yea exactly! as far as acceptance goes, does B have to say "i accept/promise", or does him acting on behalf of his promise(walking across the bridge) sufficient

Depends on the contract. If the contract says "I'll pay you $500 to cut my grass on Friday, let me know by Thursday if you accept", then the promisee must respond with an accept/reject. If the contract says "I'll pay you $500 to cut my grass, just have it cut by the time I get back from vacation", then the acceptance of the offer is the performance itself. THe promisee doesn't need to notify the promisor with an "accept/reject" letter. Him cutting the grass before the promisor shows up form vacation is an acceptance of the offer.

Additionally in the second scenario the offeree can lock up the contract by saying "I accept."

wouldn;t the fact that A says "if you promise" make it a bilateral contract, only if B says "I promise" or I accept. In other words, a unilateral offer would say, "if you walk across the bridge, I will give you 500"- a promise for performance. A bilateral would say, "I will give you 500, if you promise to walk across bridge" and it will be binding once B says '"i accept", if he doesnt say "i accept" and starts walking, there is no contract... because A is specifically asking for a promise.

Edit: and yes, my question is poorly worded. I'll fix it

[m311]

wouldn;t the fact that A says "if you promise" make it a bilateral contract, only if B says "I promise" or I accept.

No, because as the quoted Restatement section says, the beginning of performance is a promise as well.

In other words, a unilateral offer would say, "if you walk across the bridge, I will give you 500"- a promise for performance.

Unilateral contracts are contracts that can be fulfilled by instant performance (like, give me $500). Contracts that require performance that can't be done instantly involve a return promise (a promise to finish the work) and are therefore bilateral.

A bilateral would say, "I will give you 500, if you promise to walk across bridge" and it will be binding once B says '"i accept", if he doesnt say "i accept" and starts walking, there is no contract... because A is specifically asking for a promise.

As I said, offers requiring promises can be fulfilled by performance unless it is clearly stated that only a promise would suffice- not a performance. Besides, the beginning of a performance is a promise.

However notification must be given within a reasonable time that performance has been started, and performance must be completed within a reasonable time.

[Learning Hand]

m311, why does it matter whether A is at the right end of the bridge?

[m311]

Because if A is saying "come to my side of the bridge and I'll give you $500" what he's really looking for is not the act of crossing the bridge. Well, probably not. He's looking to give away the $500, and the crossing is just something incidental. It's not the thing being sought after.

However if A is making B cross to the side of the bridge away from him, it's obvious he's not just looking to give money, but instead looking to make B cross the bridge. So not a gift. A contract.

[Hyder]

wouldn;t the fact that A says "if you promise" make it a bilateral contract, only if B says "I promise" or I accept.

No, because as the quoted Restatement section says, the beginning of performance is a promise as well.

In other words, a unilateral offer would say, "if you walk across the bridge, I will give you 500"- a promise for performance.

Unilateral contracts are contracts that can be fulfilled by instant performance (like, give me $500). Contracts that require performance that can't be done instantly involve a return promise (a promise to finish the work) and are therefore bilateral.

A bilateral would say, "I will give you 500, if you promise to walk across bridge" and it will be binding once B says '"i accept", if he doesnt say "i accept" and starts walking, there is no contract... because A is specifically asking for a promise.

As I said, offers requiring promises can be fulfilled by performance unless it is clearly stated that only a promise would suffice- not a performance. Besides, the beginning of a performance is a promise.

However notification must be given within a reasonable time that performance has been started, and performance must be completed within a reasonable time.

I believe it doesn't have to be an instant performance. C, cook v coldwell banker. This was a unilateral that was performed overtime, not instantly
- this is the case that established substantial performance precluding offeror from revoking.

I believe that is true on the grounds where Promissor doesn't care whether the promisee performs, or promises to perform. However, in this situation, A is clearly looking for a promise, not just a performance, but a promise to the performance, that is why he says "if you promise" then I will give you 500.


moreover, if he was just looking to create a unilateral contract..or a contract for performance, then he would have just said- "if you walk across the bridge, I will give you 500(A is the only one promising in this situation, and bound if B begins to walk, but B is not obligated to walk)

[m311]

But for the third time, if you ask for a promise, performance counts as acceptance as well, unless you make it very clear that all that will suffice is a promise. Asking for a promise is not enough to do that. See Restatement sections 32, 62. As applied you have to expressly say that performance will not do- because the reasonable assumption is that what you actually want at the end of the day is the performance.

And the banker case you mention (I couldn't find it in google) is a bilateral agreement unless there's more to it. There are promises on both sides, are there not? The distinction is promises- not the substance of the consideration- be it money, work, forbearance, etc. All could be promises. Giving someone $500 for the promise of $600 is unilateral- only one promise. Promising to build someone a house if they work for you for a year is bilateral- two promises.

Perhaps the reason the case refers to it as unilateral is because the offer was unilateral and it was only after the decision in the case that it was made clear that such a unilateral offer can result in either a unilateral or bilateral contract depending on whether the performance was done instantaneously, or was effectively a promise.

[surenough]

But for the third time, if you ask for a promise, performance counts as acceptance as well, unless you make it very clear that all that will suffice is a promise. Asking for a promise is not enough to do that. See Restatement sections 32, 62. As applied you have to expressly say that performance will not do- because the reasonable assumption is that what you actually want at the end of the day is the performance.

And the banker case you mention (I couldn't find it in google) is a bilateral agreement unless there's more to it. There are promises on both sides, are there not? The distinction is promises- not the substance of the consideration- be it money, work, forbearance, etc. All could be promises. Giving someone $500 for the promise of $600 is unilateral- only one promise. Promising to build someone a house if they work for you for a year is bilateral- two promises.

Perhaps the reason the case refers to it as unilateral is because the offer was unilateral and it was only after the decision in the case that it was made clear that such a unilateral offer can result in either a unilateral or bilateral contract depending on whether the performance was done instantaneously, or was effectively a promise.

I don't agree with your interpretation of bilateral and unilateral contract. I think promising someone a bonus, if they work for you for a year could be considered a unilateral contract, if the Court thinks it is. Just like in Cook, an employer's promise to pay out a bonus to employee in the end of the year, was considered a unilateral contract. It really had nothing to do with whether performance began instantly or not, just how the Court saw this agreement.

[m311]

You're still missing that Cook established that commencement of performance is a promise. They had to refer to it as unilateral because the law proving otherwise wasn't made until they submitted their judgment.

I think you're doing the same thing as the other guy- equating action with performance. They are completely different things.

Edit: here, first link that came up in google for "bilateral contract": http://law.jrank.org/pages/4745/Bilateral-Contract.html

Suppose you promise to pay someone $500.00 to paint your house. The promise sounds like an offer to enter a unilateral contract that binds only you until the promisee accepts by painting your house. But what constitutes lawful "performance" under these circumstances? The act of beginning to paint your house or completely finishing the job to your satisfaction?

Most courts would rule that the act of beginning performance under these circumstances converts a unilateral contract into a bilateral contract, requiring both parties to fulfill the obligations contemplated by the contract.

[surenough]

You're still missing that Cook established that commencement of performance is a promise. They had to refer to it as unilateral because the law proving otherwise wasn't made until they submitted their judgment.

I think you're doing the same thing as the other guy- equating action with performance. They are completely different things.

Edit: here, first link that came up in google for "bilateral contract": http://law.jrank.org/pages/4745/Bilateral-Contract.html

Yes, a unilateral contract is a promise in exchange for performance of an act. Like in Petterson v. Pattberg: D offered to discount P‘s mortgage if paid in full by certain date. D sold mortgage prior to another party. When P arrived at door, D refused to accept payment stating that offer was revoked. Court said that this was a unilateral offer. In fact, for complete performance you need P to pay the $ and D to accept payment and until that happens D is free to revoke. ( Then the restatements were enacted to deal w/ this harshness)

So here, it has nothing to do with WHEN D begins performance, instantly or at a later date. The whole point is what the offeror is expecting a return promise or performance of an act.

[m311]

offer != contract. As has been shown, a unilateral offer turns into a bilateral contract if the promisee gives a return promise in the form of beginning performance. Your case is off point. Plaintiff never began performance. He prepared to begin performance- it is a significant distinction made clear in common law which I guess you haven't covered yet.

[surenough]

omg. offer != contract. Read the thread. A unilateral offer turns into a bilateral contract if the promisee gives a return promise in the form of beginning performance. Your case is completely off point. Plaintiff never began performance. He prepared to begin performance- it is a distinction made clear in common law.

I don't agree with you yet again. I think in this case, P was there with the $ and ready to give it to the offeror. That can easily constitute beginning of performance or even substantial performance. The Court just felt like being harsh and said that unless the offeror accepts the $ this is not a complete performance. The modern Courts do not require this, and if the Court was relying on a Restatement P would win.

Anyway, this debate is pointless. If your Prof. said that "a unilateral offer can result in either a unilateral or bilateral contract depending on whether the performance was done instantaneously, or was effectively a promise," you should definitely stick to knowing it like that. Because ultimately he/she will grade you, so you should follow the interpretation of the law that you are presented in class.

I just learned something very different.

[reasonable_man]

Sometimes I don't miss law school at all..