Which term describes a contract that has not been completely performed by one or both of the parties?

Which term describes a contract that has not been completely performed by one or both of the parties?

• A. Implied contract
• B. Void contract
• C. Unilateral contract
• D. Executory contract

Answer: (D)

An executory contract describes a contract that has not been fully performed by one or both parties because some duties remain to be done. If a construction project is underway and payments or work remain, or a sale is agreed but closing and transfer of title are still to occur, those obligations are still pending, so the contract is executory. Once all promised performance is completed, the contract becomes executed. Implied contracts are formed by conduct rather than explicit terms and may be in any stage of performance; a void contract is unenforceable from the start; a unilateral contract involves one party’s promise contingent on the other party’s performance and is not complete until that act is performed.

An executory contract describes a contract that has not been fully performed by one or both parties because some duties remain to be done. If a construction project is underway and payments or work remain, or a sale is agreed but closing and transfer of title are still to occur, those obligations are still pending, so the contract is executory. Once all promised performance is completed, the contract becomes executed. Implied contracts are formed by conduct rather than explicit terms and may be in any stage of performance; a void contract is unenforceable from the start; a unilateral contract involves one party’s promise contingent on the other party’s performance and is not complete until that act is performed.