Manag., July-2018 – Q20
- Option : C
- Explanation : A sweetheart contract is a contract made through collusion between management and labour representatives which contains terms
beneficial to management and unfavourable to union workers. It is also referred to as a “sweetheart agreement”.
To form a bilateral contract, both parties to the contract promise to perform an act or to refrain from performing an act. In this case,
one party’s promise is the consideration that’s exchanged for the promise of another party. A unilateral contract exists if only one party makes a promise to perform. In this case, the offeror promises to perform an act if the offeree performs an act that he knows to be the foundation of an enforceable contract.
Aleatory Contract: The occurrence of an uncertain event—a contingency—triggers the execution of an aleatory contract.
Void and Voidable Contracts: A void contract is not an enforceable contract in that it does not grant rights to any party to the contract, not does it impose obligations. In turn, a voidable contract is an enforceable contract that the courts treat as one that does not bind one party to its terms because that party was a victim of fraud at the execution of the contract.
For example, one party to the contract may fail to disclose a material fact to the other party to the contract.
