Implied Contract

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Implied Contracts: Definition, Types, Examples, and Rules

Key takeaways
* An implied contract is legally binding and arises from parties’ actions, conduct, or circumstances rather than an explicit written or oral agreement.
* Implied contracts carry the same legal force as express contracts but can be harder to prove.
* Two main forms exist: implied-in-fact (based on conduct and mutual intent) and implied-in-law (quasi-contracts created to prevent unjust enrichment).

What is an implied contract?

An implied contract is an agreement inferred from behavior, surrounding circumstances, or past dealings between parties. Unlike express contracts, nothing needs to be written or spoken; the parties’ conduct creates rights and obligations that a court may enforce.

Common examples
* Buying food in a restaurant or ordering a pizza — the diner expects to receive food and the restaurant expects payment.
* Implied warranty — when you buy a product (e.g., a refrigerator), it is expected to perform its basic function.
* Repeated informal exchanges — a neighbor who regularly gives movie tickets in exchange for dog-walking may create an implied obligation to continue that exchange.
* Emergency assistance — a doctor who treats a choking diner may later bill for services under a quasi-contract theory.

Types of implied contracts

  1. Implied-in-fact
  2. Formed by the parties’ conduct and circumstances that demonstrate mutual assent.
  3. Requires the same core contract elements as express contracts: offer, acceptance, consideration, and mutual agreement (a “meeting of the minds”).

  4. Easier to justify in court when past dealings or clear conduct indicate intent.

  5. Implied-in-law (quasi-contract)

  6. Not created by the parties’ intent; instead, imposed by courts to prevent unjust enrichment.
  7. Arises when one party receives a measurable benefit from another and it would be unfair to allow retention without payment.
  8. Relief is typically restitution or quantum meruit (payment for the reasonable value of services), not enforcement of a bargained agreement.

Legal requirements and proof

  • Implied-in-fact: Courts look for evidence of offer and acceptance by conduct, mutual agreement, and consideration. Repeated performance, customs, industry practices, and communications can support existence of a contract.
  • Implied-in-law: Courts examine whether a benefit was conferred non-gratuitously and whether retaining that benefit without compensation would be unjust.
  • Burden of proof: Because there’s no written agreement, the claimant must rely on circumstantial evidence—behavior, prior course of dealing, invoices, receipts, witnesses, and contemporaneous records.

Enforceability limits and considerations

  • Implied contracts are enforceable, but proof can be more difficult than with express contracts.
  • Statute-of-frauds rules may require certain agreements (e.g., real estate sales) to be in writing; implied arrangements cannot override those formal requirements.
  • Remedies vary: specific performance is rare for implied contracts; typical remedies include monetary damages or restitution.
  • Jurisdictions vary in doctrine and interpretation—local precedent and statutory law matter.

Practical tips

  • When possible, document agreements—even brief written confirmations or receipts reduce disputes.
  • Businesses should establish clear terms and consistent practices to limit ambiguity about obligations.
  • If you rely on repeated informal exchanges, keep records of performance and any reciprocal benefits to support an implied-in-fact claim if needed.

Conclusion

Implied contracts let courts recognize and enforce obligations that arise from real-world conduct rather than explicit promises. Understanding the difference between implied-in-fact (intent-based) and implied-in-law (equity-based) is crucial: the former depends on mutual assent shown by behavior, while the latter protects against unjust enrichment. Documentation and consistent practice reduce the risk of costly disputes.