A contract in which only one party makes a promise, which becomes binding once the other party performs an act.
Why Unilateral Contract matters on the exam
This term belongs to Contracts. The questions below are real items from Freehold's bank that use it - each one cites its source.
Exam questions using Unilateral Contract
Every Freehold question shows why the right answer is right — and cites its source.
In an option contract to purchase real estate, which party is legally bound to perform?
Both the optionor and the optionee
Neither party until closing
The optionee who paid the option fee
Only the optionor who granted the option
Show answer & explanation
Only the optionor who granted the option — An option is a unilateral contract: the optionor must sell at the agreed terms if the option is exercised, while the optionee has the right, but no obligation, to buy during the option period.
Source: PSI National Real Estate Exam Content Outline §7 Contracts
A contract in which the terms are stated in written or spoken words is called a(n):
Implied contract
Express contract
Unilateral contract
Executed contract
Show answer & explanation
Express contract — An express contract has its terms explicitly stated, orally or in writing, as opposed to an implied contract, whose terms are inferred from the parties' conduct.
Source: PSI National Real Estate Exam Content Outline §7 Contracts
A property manager continues collecting a tenant's rent and providing services after a lease expires, with no new written lease, and the tenant keeps paying. The resulting month-to-month arrangement, formed through the parties' conduct rather than express words, is best classified as a(n):
Void contract
Unilateral contract
Implied contract
Voidable contract
Show answer & explanation
Implied contract — An implied contract arises from the conduct of the parties rather than explicit words, such as continuing to accept and pay rent after a lease term ends.
Source: PSI National Real Estate Exam Content Outline §7 Contracts
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