Key Takeaways

  • A quasi contract is not a true contract but a legal substitute imposed to prevent unjust enrichment.
  • It typically arises when one party benefits at another’s expense without a formal agreement.
  • Courts use quasi contracts to enforce fairness, especially when no enforceable contract exists.
  • Examples span personal and commercial contexts—like services rendered or mistaken deliveries.
  • Claims depend on elements like unjust enrichment, absence of agreement, and equitable remedies.
  • Quasi contracts differ from implied-in-fact contracts, which are based on the conduct of parties.
  • There are limitations to when a quasi contract claim can succeed, such as the presence of an actual contract or gratuitous acts.

A quasi contract example involves an agreement between at least two parties who had no prior obligation to each other. It is a contract that's legally recognized in a court of law. More specifically, this type of contract is created by court order, not between the parties in question. 

Quasi contracts arise when a dispute exists over payment for goods and services. What's difficult about these circumstances is that no official agreement has been created between the parties involved. The court steps in to prevent what's known as unjust enrichment. In essence, it's trying to correct a situation where one party has acquired something to the detriment of the other party. If you are facing this situation, makes sure you hire a contract review attorney to assist.

Quasi contracts are also referred to as implied-in-law contracts. They're a special kind of contract, lacking mutual assent, but ordered by the court to avoid an injustice. When these were first instituted into the American legal system, they were typically used to enforce an obligation to restitution. 

Unjust Enrichment

You will hear the term "unjust enrichment" mentioned throughout quasi contract proceedings. This term refers to the individual who received a benefit unfairly. It doesn't matter if he or she enjoyed that benefit by chance or as a result of someone else's misfortune. 

When someone has been unjustly enriched, they've escaped paying for the benefit they've enjoyed. This makes their benefit ethically and morally inappropriate, and it must be returned somehow. 

To prove unjust enrichment, five elements are required. 

  • The defendant must have experienced some type of enrichment.
  • The claimant must have suffered some type of disadvantage, due to the defendant's enrichment.
  • The enrichment must be proven unjust.
  • There must be a lack of explanation surrounding the enrichment and disadvantage.
  • There must be no other way to remedy the disadvantageous enrichment, except through legal recourse. 

In summary, the defendant must have acknowledged receipt of, or accepted, something of value while making no effort to pay. Then, the plaintiff must explain why it was unjust for the defendant to accept the item of value, thereby receiving unjust enrichment. 

Differences Between Quasi Contracts and Traditional Contracts

Understanding how quasi contracts differ from traditional contracts is essential to grasp their legal role. A quasi contract is not an agreement made between parties, but rather a legal construct created by courts. Here are some distinguishing factors:

  • Mutual Consent: Traditional contracts are based on mutual agreement and clearly defined terms. Quasi contracts arise without mutual consent.
  • Formation: Contracts are voluntarily formed by the parties involved. Quasi contracts are imposed by law to correct an inequity.
  • Legal Purpose: The primary aim of a quasi contract is to prevent unjust enrichment. A traditional contract, in contrast, is designed to formalize an agreed-upon exchange.
  • Enforceability: Courts enforce quasi contracts not to uphold promises but to enforce fairness when no actual promise was made.

By establishing these distinctions, courts can uphold equity even when no binding agreement exists.

Restitution

Throughout the proceeding, the claimant will be seeking restitution. More specifically, the claimant will want payment in compensation for what was originally promised. All this is done in an effort to correct an injustice. If payment cannot be achieved, then the defendant may be ordered to return the item they received in enrichment. 

Legal Basis and Key Elements of a Quasi Contract

Courts apply quasi contracts based on the doctrine of equity, ensuring one party does not unfairly benefit at the expense of another. To establish a quasi contract, the following elements typically must be demonstrated:

  1. Benefit Conferred: The plaintiff must have conferred a measurable benefit to the defendant.
  2. Knowledge of Benefit: The defendant must have knowledge or awareness of the benefit.
  3. Acceptance and Retention: The defendant must accept or retain the benefit under circumstances making it unjust not to pay for it.
  4. No Enforceable Contract: There must not be an existing contract that covers the same subject matter.

Courts assess these conditions to determine whether restitution should be granted under the principle of quantum meruit (“as much as deserved”).

Quasi Contract Examples

Let's take the most basic example first. Let's say you pay for a pizza to be delivered. If that pizza is delivered to another house, and someone else enjoys your three-topping special, a quasi contract could be initiated. Now, the pizzeria could be court ordered to reimburse you for the amount you paid for that pie. 

Here's another example. Let's say a school district hires a roofing company to complete a specific task. As that task is being completed, the roofing company uncovers a leak that needs to be fixed. The roofing company fixes that leak and, when it comes time for payment, the school district only pays the roofing company for that initial, specific task, and not the work surrounding the leak in the roof. In this instance, the roofing company may have a case for a quasi contract, in order to seek restitution for the added work to fix the leak. 

Here's a more grandiose example. Let's say Mary tells Alex that she will hire him to work as a web developer if he moves to be closer to her business. They forego any sort of formal agreement, as Mary assures Alex they'll work out the details when he arrives. 

Alex proceeds to quit his current job, move a thousand miles away, and rent a new apartment. When he meets with Mary, she tells him she doesn't have a job for him. In this situation, Alex might want to go to court, showing that Mary's statements caused him to rely on her word and move halfway across the country. Then, Mary would be estopped from denying her statements and pay some sort of restitution to Alex. 

Real-World Quasi Contract Example Scenarios

In addition to the examples already discussed, here are more practical instances where quasi contract claims may arise:

  • Emergency Medical Care: A physician provides life-saving treatment to an unconscious person. Even without a prior agreement, the patient may be required to pay under a quasi contract theory once stabilized.
  • Mistaken Improvements: A contractor mistakenly renovates the wrong property. If the property owner knowingly accepts the improvements without correcting the mistake, they may owe compensation.
  • Erroneous Payments: A bank deposits money into the wrong account. If the recipient refuses to return it, a court may enforce repayment through a quasi contract.

Each of these reflects how the law steps in to prevent a party from benefiting unfairly due to mistake or miscommunication.

Quasi Contract Claims

Each of these examples epitomizes a quasi contract claim. An official offer and acceptance may be lacking, but that shouldn't stop one of the parties from admitting the essence of a contract-like relationship. In the end, equity may prevent one of the parties from denying the existence of a contract-like existence. 

Quasi Contracts vs. Implied-in-Fact Contracts

It’s important not to confuse quasi contracts with implied-in-fact contracts. While both lack written terms, they differ significantly:

  • Implied-in-Fact Contracts are formed through the conduct or circumstances of the parties, showing mutual intent to form a contract (e.g., regular services rendered with prior payment).
  • Quasi Contracts, by contrast, are imposed by the court regardless of intent, purely to prevent unjust enrichment.

Courts distinguish between the two to ensure that the correct legal doctrine is applied based on the facts of the case.

Limitations of Quasi Contract Claims

While quasi contracts serve a valuable role in promoting fairness, they are not universally applicable. Courts will often dismiss such claims under the following circumstances:

  • Existence of an Express Contract: If a valid contract already governs the dispute, a quasi contract cannot override it.
  • Volunteerism or Gifts: If the plaintiff acted without expectation of compensation (e.g., a gift or voluntary act), they generally can't claim restitution.
  • No Benefit Retained: If the defendant did not benefit or was unaware of the benefit, the claim may not stand.

Additionally, damages in quasi contract cases are typically limited to the reasonable value of services or goods provided—not punitive damages.

Frequently Asked Questions

  1. What is a quasi contract in simple terms?
    A quasi contract is a legal remedy imposed by the court to prevent unfair gain by one party at another's expense when no actual contract exists.
  2. Can you sue someone under a quasi contract?
    Yes, if you've provided a benefit without an agreement and were not compensated, you may sue under a quasi contract for restitution.
  3. What’s the difference between a contract and a quasi contract?
    A contract involves mutual agreement and enforceable promises, while a quasi contract is imposed by law to ensure fairness and prevent unjust enrichment.
  4. When might a quasi contract be denied?
    If a valid express contract already exists or if services were provided voluntarily without expectation of payment, a court may reject a quasi contract claim.
  5. Do quasi contracts require written documentation?
    No, quasi contracts do not require any written or verbal agreement. They exist solely through court recognition based on the circumstances.

If you need help with your quasi contract, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.