Onerous Contracts Law and Legal Definition
Onerous contracts are those contracts in which the costs involved with fulfilling the terms and conditions of the contract are higher when compared to the amount of economic benefit received. In onerous contracts something is given or promised as a consideration for the engagement or gift, or some service, interest, or condition is imposed on what is given or promised, although unequal to it in value. Onerous contracts can occur when a company has a contract to supply a material which costs more to produce than actually determined by the provisions of the contract.
