ACCORDING TO PARTIES

4. According To Parties : By Chartered Accountant

According to parties a contract may be of the following two kinds:

a) Unilateral Contract :

In a unilateral contract only one party makes a commitment. In other words, it is a contract where only one party is bound but the other party chooses to be bound by it.
EXAMPLES :

A promises to pay Rs. 1,000 to any one who finds his lost bag. B finds the bag and returns. A . It is a unilateral contract which comes into existence when the bag is found.

b) Bilateral Contract :

It is a contract where as soon as the contract is made, both parties are bound by it. In other words it is a contract in which both the parties have yet to perform their obligations.

EXAMPLES :

A promises to paint the picture for B and B promises to pay Rs. 5,000 to A.