Executory Contract

In one sentence

A contract where one or both parties still have obligations to perform in the future.

Plain English

An executory contract is an agreement where the work isn't finished yet. If you sign a lease for an apartment, it's executory because you and the landlord both have ongoing duties—you'll pay rent each month, and they'll maintain the property. The contract remains executory until all promised actions are completed.

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Example

You sign a contract to have your kitchen remodeled over the next three months. Until the contractor finishes the work and you make the final payment, the contract is executory because both parties still have duties to fulfill.

Used in a sentence

“The employment contract remained executory as long as the employee continued working and the company continued paying salary.”

Related terms

Executed Contract

A contract where both parties have fully performed all their obligations.

Performance

The act of doing what a contract requires, such as delivering goods or paying money.

Condition Concurrent

Mutual promises in a contract that must be performed at the same time by both parties.

Express Conditions

Conditions that the parties explicitly state in a contract.

Implied Conditions

Conditions that courts infer must be met even though the parties did not state them.

Frustration of Contract

An unforeseen event makes contract performance impossible or radically different from what was intended.

Offer

A proposal to enter into a binding agreement on specific terms.

Acceptance

Agreeing to the exact terms of an offer, creating a binding contract.

This page is a plain-English reference and is not legal advice. Laws vary by jurisdiction and change over time. For specific situations consult a licensed attorney.