Real Estate Practice Exam 2025 – Complete Prep Guide

A posted reward for returning a missing dog exemplifies a unilateral contract because it involves a promise made by one party in exchange for a specific act by another party. In this scenario, the person offering the reward is making a promise to pay a specific amount upon the successful return of their dog. The contract is formed when an individual performs the act of returning the dog; until that point, there is no obligation on the part of the individual to act.

Unilateral contracts are characterized by the fact that only one party is bound to fulfill their promise on the condition that the other party performs the requested action. In this case, the person who finds and returns the dog does not need to accept the offer beforehand; they simply make the choice to act, which results in the contract being fulfilled once the dog is returned.

In contrast, bilateral contracts involve a mutual exchange where both parties make promises to each other. Implied contracts arise from the behavior of the parties involved rather than explicit terms, while executed contracts refer to agreements that have been fully performed by all parties. Thus, the unique characteristics of a unilateral contract are clearly demonstrated in the situation with the missing dog and the reward offered for its return.