Mutuality of Obligation

A contractual requirement that both parties promise to do something; i.e., each party must be bound to do something for the other party. If a contract requires only one party to perform, it is not valid. For example, if a contract requires Party A to pay Party B $10,000.00, but nothing is required of Party B, then only party A has an obligation. That means the contract lacks mutuality and is, therefore, invalid. This is part of the consideration requirement. For a contract to be valid, there must be an offer, acceptance, and consideration–i.e., both parties must have an obligation they must fulfull under the contract.