What is the effect of starting performance in a unilateral contract?

What is the effect of starting performance in a unilateral contract?

• A. Starting performance is an acceptance that binds the offeree to finish.
• B. Starting performance is an acceptance that marks irrevocability.
• C. Starting performance has no effect until completion is accepted.
• D. Starting performance terminates the offer.

Answer: (C)

In a unilateral contract, acceptance occurs by completing the requested performance, not by merely starting it. Starting the performance does not bind either party and does not form a contract yet. The contract only arises when the act is fully completed and the offeror accepts that completed performance. That’s why starting performance has no effect until the act is finished and accepted. The other notions would imply that beginning performance immediately creates an acceptance or some irrevocability or termination, which isn’t correct for unilateral offers. Starting performance doesn’t terminate the offer either; it doesn’t bind the offeree to finish, nor does it automatically make the offer irrevocable.

In a unilateral contract, acceptance occurs by completing the requested performance, not by merely starting it. Starting the performance does not bind either party and does not form a contract yet. The contract only arises when the act is fully completed and the offeror accepts that completed performance. That’s why starting performance has no effect until the act is finished and accepted.

The other notions would imply that beginning performance immediately creates an acceptance or some irrevocability or termination, which isn’t correct for unilateral offers. Starting performance doesn’t terminate the offer either; it doesn’t bind the offeree to finish, nor does it automatically make the offer irrevocable.