Legal Definitions - quasi contract (or quasi-contract)

Quasi Contract

A quasi contract, also known as a "contract implied in law" or a "constructive contract," is not a true agreement between parties. Instead, it is a legal obligation imposed by a court to prevent one party from unfairly benefiting at the expense of another. The primary purpose of a quasi contract is to prevent unjust enrichment, meaning that no one should be allowed to keep a benefit they received without paying for it, especially when it would be unfair to do so.

Unlike a traditional contract, a quasi contract does not require mutual agreement or intent from the parties involved. A court can create this obligation even if the parties never intended to form a contract, and it typically applies when there is no existing express or implied contract covering the same situation. When a court imposes a quasi contract, the usual remedy is restitution, which means the unjustly enriched party must return the benefit or pay its reasonable value.

For a quasi contract to be established, generally, three conditions must be met:

• One party must have conferred a benefit upon another.
• The party receiving the benefit must have been aware of it and appreciated it.
• It would be unfair or inequitable for the party to retain the benefit without compensating the other party for its value.

Here are some examples illustrating how a quasi contract might apply:

• Example 1: Mistaken Home Renovation

  A construction company is hired to renovate a specific house on a street. Due to a mix-up in addresses, the crew mistakenly begins extensive renovations on the identical-looking house next door. The owner of the mistaken house sees the work progressing daily, realizes the error, but says nothing, enjoying the free improvements. When the construction company discovers its mistake, it can sue the homeowner under a quasi contract. Even though there was no agreement between the company and the homeowner, the homeowner received a significant benefit (renovations), was aware of it, and it would be unjust for them to keep the improved value of their home without paying for the work done.

• Example 2: Emergency Medical Services

  Imagine a person collapses unconscious in a public place and requires immediate medical attention. A doctor who happens to be nearby provides life-saving first aid and calls for an ambulance. The unconscious person is then taken to the hospital and makes a full recovery. The doctor can later seek reasonable compensation for the emergency services provided, even though the patient was unable to agree to a contract at the time. The patient received a critical benefit (their life saved), appreciated it upon recovery, and it would be unfair for them to receive such vital services without paying for their reasonable value.

• Example 3: Unrequested Delivery of Goods

  A furniture store accidentally delivers a high-value, custom-made dining set to the wrong address. The recipient, realizing it's not what they ordered and that it must be a mistake, decides to keep the furniture anyway and begins using it without notifying the store. When the furniture store discovers the error and demands the return of the dining set or payment, the recipient might be held liable under a quasi contract. The recipient received a valuable benefit (the dining set), was aware it was not theirs, and it would be unjust for them to retain and use the furniture without paying its fair market value.