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Contracts, 12% of the examination

Bilateral contract

A contract formed by an exchange of promises, with each party obligated to perform.

A signed purchase agreement is normally bilateral because the buyer promises to buy and the seller promises to sell. An option begins as unilateral because only the optionor is bound until the optionee exercises it.

See also

OptionA unilateral contract giving the holder the right, but not the obligation, to buy on stated terms during a stated period.

Primary sources

Use these authorities when a course summary, forum answer, or older flashcard conflicts with the current California rule.

Where this is tested

ContractsAll eight official DRE contract topics in one California-specific guide, from formation and representation agreements to purchase offers, notes, options, remedies, and advance fees.12%Practice Contracts24 questions on this area, every option explained.Practice

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