An implied contract is a legally-binding agreement that is established by the actions, behavior, or circumstances of the parties involved, rather than by written documentation or explicit words. These contracts rely on the factual context to create obligations similar to those outlined in express contracts.
Definition and Nature of Implied Contracts
Implied contracts are formed when the conduct or circumstances of the parties indicate that a mutual agreement exists. These contracts hinge on the principle of fairness and common understanding.
Types of Implied Contracts
Implied contracts can be divided into two main types:
Implied-in-Fact Contracts
An implied-in-fact contract arises from the conduct of the parties. For example, visiting a doctor implies consent to pay for the consultation based on the action of seeking medical advice.
Implied-in-Law Contracts (Quasi-Contracts)
An implied-in-law contract or quasi-contract is not a true contract but is imposed by a court to prevent unjust enrichment. For instance, if a person receives emergency medical treatment while unconscious, they are typically required to pay for those services afterward.
Key Features and Rules
Implied contracts share several critical features:
- Mutual Intent: Both parties must demonstrate intent to form an agreement through their actions or conduct.
- Reasonableness: The implied contract must be considered reasonable by standard legal interpretations.
- Enforceability: Courts can enforce implied contracts similarly to express contracts, provided clear evidence of mutual agreement is presented.
Examples of Implied Contracts
- Service Payment: When you sit down at a restaurant and order a meal, there is an implied contract that you will pay for the food.
- Employment Agreements: If an employee continues to work after the expiration of a formal contract, an implied contract may exist, assuming similar terms.
Historical Context
The concept of implied contracts dates back to ancient legal systems where formal documentation was scarce, and mutual conduct served as a basis for legal obligations. Over centuries, courts have refined definitions and applications to fit contemporary legal environments.
Applicability and Comparisons
Implied vs. Express Contracts
Express Contracts explicitly state the terms and conditions, often in writing. In contrast, implied contracts derive from actions or circumstances where the terms are inferred.
Related Terms
- Express Contract: An agreement with clearly stated terms, either written or verbal.
- Unjust Enrichment: A legal principle preventing one individual from being unjustly benefited at another’s expense.
Frequently Asked Questions (FAQs)
Can an implied contract override a written contract?
Generally, implied contracts cannot override written contracts unless specific conditions or amendments are mutually agreed upon and documented.
What happens in case of a dispute over an implied contract?
Courts will examine the conduct, circumstances, and reasonable expectations of the parties involved to determine the existence and terms of an implied contract.
References
- Restatement (Second) of Contracts
- Uniform Commercial Code (UCC)
- Case Law: “Martin v. Little, Brown & Co.”
Summary
Implied contracts play a crucial role in various legal and business scenarios, forming binding agreements based on the actions and circumstances of the involved parties. Understanding their types, rules, and applications is essential for navigating the complexities of contract law.
