California First-Year Law Students' Exam (Baby Bar) — MCContractsEasy
A small business owner advertises a $100 reward for the return of their lost dog, 'Buster.' A local resident finds Buster wandering near a park and, unaware of the reward, returns the dog to the owner. Upon receiving Buster, the owner thanks the resident and mentions the $100 reward. Is the owner legally obligated to pay the reward?
- ANo, because the resident was unaware of the offer when performing the act.
- BNo, because the resident did not explicitly accept the offer before returning the dog.
- CYes, because the owner stated their intention to pay the reward after the dog was returned.
- DYes, because the resident returned the dog, fulfilling the terms of the offer.
Show answer & explanationAnswer & explanation
Correct answer: A. No, because the resident was unaware of the offer when performing the act.
For a unilateral contract to be formed, the offeree must have knowledge of the offer at the time they perform the requested act. Here, the resident was unaware of the reward, so no contract was formed.
Why the other options are wrong
- B. In a unilateral contract, performance itself constitutes acceptance; however, knowledge of the offer is still required.
- C. The owner's statement after the fact is not part of the contract formation; it's a gratuitous promise.
- D. Knowledge of the offer is a prerequisite for forming a unilateral contract by performance.
Unilateral Contract Formation
A contract where one party makes a promise in exchange for the other party's performance of a specified act. Acceptance occurs upon completion of the act, and the performing party must have knowledge of the offer.
- Offeror makes a promise.
- Offeree accepts by performing a specified act.
- Offeree must have knowledge of the offer to accept.
Memory trick: Offer, Acceptance, Consideration: The ABCs of a deal.