What is an onerous contract in legal terms?

In legal terms, an onerous contract specifically refers to an agreement that imposes a significant burden or disadvantage on one party, often requiring them to perform under more demanding conditions than the other party. The concept is deeply rooted in the idea that one party is subjected to onerous terms that create an imbalance, which could lead to a lack of mutual benefits.

While mutual benefits are present in some contracts, an onerous contract is characterized by the challenges and obligations it places on one party, indicating that the correct answer to the question is actually associated with the disadvantages incurred rather than mutual advantages—a key distinction in understanding onerous contracts. Thus, the most accurate understanding involves recognizing that such contracts often lead to inequality, aligning with the definition that points out the burdensome nature inherent for at least one party involved.