Basic Law of Rewards

The basic law on rewards is clear – they're contracts. You might not be familiar with this kind of contract, but it's not new. There are two kinds of contracts: bilateral (in which a promise is exchanged for a promise) and unilateral (in which a promise is exchanged for an act). A famous U.K. case involving a unilateral contract is Carlill v Carbolic Smoke Ball Co. (1893). In that case the defendant offered a £100 reward to anyone who purchased and used its special "carbolic smoke ball" as directed and still got the flu. The plaintiff used the ball and got the flu. When she claimed the money, the defendant tried to back out of the deal. The court found the advertisement was a valid offer to enter into a unilateral contract, and that the plaintiff had accepted it by performing the acts requested.

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