In a bilateral contract, what is the typical effect of a party beginning performance?

• A. It creates an option to complete
• B. It constitutes a cancellation of the offer
• C. It creates an implied promise to finish the job
• D. It ends the contract automatically

Answer: (C)

In a bilateral contract, two promises bind both sides, and acceptance can occur by promising to perform or by actually performing. When one party begins performance, that conduct is treated as more than just activity—it signals an intention to be bound and creates an implied promise to finish the job. The initiating party has started the performance with the expectation that they will complete it, and the other party can rely on that commitment. If the performance is not completed, the initiator may be liable for breach for not finishing.

This isn’t an option to complete, nor a cancellation of the offer, and it doesn’t automatically end the contract. It’s the implied commitment to see the performance through that comes from having begun work.