Under what circumstance does an executory contract exist?

An executory contract exists when part of the contract remains unfulfilled. This means that although the contract has been established and agreed upon by both parties, certain obligations or terms outlined in the agreement have yet to be completed. The essence of executory contracts is that they bind the parties to future performance or delivery of goods, services, or payments, indicating that the agreement is still active and that obligations are pending on one or both sides.

In contrast, if all terms have been completed by both parties, the contract moves to a fully executed status and is no longer considered executory. When only one party has performed their obligations, it underscores that the contract is yet to be fulfilled in its entirety, but the situation is best depicted simply as part of the contract remaining unfulfilled, reinforcing the executory nature. Lastly, if both parties have abandoned the agreement, it indicates a termination of the contract rather than an ongoing executory relationship, rendering the contract void in practice.