What Is A Quasi-Contract?

A quasi-contract is a legal concept where the court imposes an obligation on a party to prevent unjust enrichment, even in the absence of a formal agreement between the parties. While not a true contract, a quasi-contract aims to provide fair compensation for services or goods received by one party at the expense of another.

Characteristics of a Quasi-Contract

No Actual Agreement:

Unlike express or implied contracts, a quasi-contract is not formed by the mutual consent or conduct of the parties involved. It is created by the court to address situations where one party would be unjustly enriched without compensation.

Legal Remedy for Unjust Enrichment:

A quasi-contract is often used when one party receives a benefit at the expense of another without any formal agreement. The court steps in to ensure that the party benefiting from the situation compensates the other party.

Obligation Imposed by the Court:

The court imposes the obligation to avoid unfairness or to prevent one party from benefiting without compensating the other. This legal remedy does not depend on the intentions or actions of the parties but on the principle of fairness.

Not a True Contract:

A quasi-contract is not a true contract because it lacks mutual consent, offer, and acceptance. It is a legal construct created to avoid unjust situations.

When is a Quasi-Contract Used?

Mistaken Payment:

If someone mistakenly pays for goods or services they didn’t receive, the court may impose a quasi-contract to ensure the party who received the payment returns it.

Goods or Services Received Without a Formal Agreement:

If a person unknowingly benefits from someone else's services or goods, the court may order compensation for the value of what was received.

Emergency Situations:

If a person is unconscious and receives medical treatment, the court may enforce a quasi-contract requiring them to pay for the services, even though there was no formal agreement.

Example

Suppose a person accidentally receives and uses a package of goods that were delivered to their address by mistake. The recipient did not order the goods, but they used them. In this case, a quasi-contract may be imposed by the court to ensure that the recipient compensates the seller for the value of the goods, as retaining them without payment would result in unjust enrichment. The court may require the recipient to pay the fair market value for the goods received, even though no formal contract was made between the two parties.