Key Takeaways

  • Quasi contracts are court-imposed agreements that prevent one party from unfairly benefiting at another’s expense when no actual contract exists.
  • These agreements stem from the principle of unjust enrichment, ensuring fairness and equitable outcomes in civil disputes.
  • Courts may grant restitution or quantum meruit to restore the wronged party’s loss.
  • Quasi-contractual obligations differ from implied-in-fact contracts, as they arise from law rather than mutual consent.
  • Common examples include mistaken payments, emergency services rendered without consent, and benefits conferred without payment.
  • Remedies under quasi contracts vary by jurisdiction, but typically aim to restore the plaintiff to their pre-enrichment position.

The term “quasi contract” refers to an agreement that exists between two parties who have not previously had obligations to each other. This agreement is created by the court system, specifically imposed by a judge, in order to correct a situation in which one party owes something to the other party because they are in possession of that person's property. 

People who are involved in a quasi-contract do not create the agreement themselves. Since it is imposed by the court, the individuals do not need to agree to the contract for it to be legally enforceable. Quasi-contracts enforce fairness when one party benefits unjustly through a loss to another. 

Quasi-contracts are also called implied contracts. When they are imposed, the defendant must pay an amount of restitution to the wronged party, or the plaintiff. This repayment is known as quantum meruit and is based on the amount of the money or value of the item that the defendant acquired unfairly.

Another name for a quasi-contract is a constructive contract. It may be created when there is no existing true contract. However, if a real contract exists, which may be implied or in writing, a quasi-contract may not be imposed.

Quasi-Contracts Through History

The first example of quasi-contracts originated in the Middle Ages from a law called indebitatus assumpsit. If the plaintiff had been paid money or been given property by the defendant, with the agreement that the defendant was paying the plaintiff in exchange for a service or other form of property, the court recognized that an implied contract existed and therefore used indebitatus assumpsit to make sure reparations were made. This quasi-contract was most commonly used to enforce agreements regarding restitution.

Modern Applications and Examples of Quasi Contracts

Quasi contracts remain a cornerstone of equitable law in both state and federal courts. They apply in cases where fairness demands compensation, even in the absence of a written or verbal agreement. Modern examples include:

  • Mistaken Payments: When someone accidentally transfers money to another’s account, the law can require repayment under a quasi contract.
  • Emergency Services: If a doctor provides life-saving treatment to an unconscious patient, the law may impose a quasi contract requiring fair compensation.
  • Property Improvements: When a person mistakenly improves another’s property, courts may award reimbursement if the property owner knowingly benefited.
  • Discharged Debts: If a person pays a debt already settled, restitution may be ordered to prevent unjust enrichment.

In New York and other jurisdictions, these cases emphasize that quasi contracts exist to ensure that equity prevails when formal contracts are absent.

Quasi-Contract Requirements

There are several requirements that must be met in order for a quasi-contract to be imposed:

  • The plaintiff must have provided a service or given an item with value to the defendant, with the implied promise that they would receive payment in exchange.
  • The defendant must have agreed to this promise and received the item or service, but failed to pay.
  • The plaintiff must explain to the court why it is unfair that the defendant received the service or item of value without paying the plaintiff. Therefore, unjust enrichment on the defendant's part took place.

Legal Remedies and Court Enforcement

Courts use quasi contracts primarily to ensure restitution—restoring a party to their original position before the unfair benefit occurred. The most common remedies include:

  1. Quantum Meruit: Compensation based on the value of the goods or services provided.
  2. Quantum Valebant: Used for goods supplied without a valid contract, ensuring payment for their reasonable value.
  3. Money Had and Received: A legal action allowing recovery of money paid to another under unjust circumstances.

In civil courts, the plaintiff must demonstrate that the defendant’s enrichment lacked a lawful basis. Once established, the court determines the appropriate monetary restitution to prevent further inequity.

What Is Unjust Enrichment?

When the term “unjust enrichment” is used, it means that one party has received some type of benefit either by accident or because of another person's bad luck. The unjustly enriched party has received a service or item without paying or earning it. Therefore, it is morally incumbent upon him to either return it or pay for it.

There are five things that must be proven in order for unjust enrichment to take place:

  • The defendant has received a service or item from which they have benefited.
  • The plaintiff has been disadvantaged or suffered a loss as a result of this unfair benefit to the defendant.
  • The plaintiff must prove that the benefit was received unfairly.
  • There is no apparent reason for the benefit to have been received, nor for the defendant's disadvantage because of it.
  • The defendant has not made any attempt to provide repayment or restitution.

The restitution that is given to the plaintiff when unjust enrichment has taken place is whatever payment is needed to fairly compensate the plaintiff for the service or item that the defendant received, thereby creating an injustice. This can be either payment for the service or item or the return of the item, whichever is more practical and appropriate.

The Relationship Between Quasi Contracts and Equity

Quasi contracts are rooted in equitable principles, emphasizing fairness over strict legal formalities. While unjust enrichment is the factual basis for such claims, equity provides the legal justification for intervention. Courts rely on these doctrines to prevent exploitation and uphold moral justice.

Unlike standard breach-of-contract cases, quasi contracts focus not on promises or consent, but on restoring balance between parties. The measure of recovery often depends on the benefit unjustly retained rather than on loss suffered by the claimant.

This equitable approach ensures that individuals cannot retain advantages obtained through mistake, coercion, or misrepresentation—thereby reinforcing trust in commercial and personal dealings.

Contracts That Are Implied-In-Law vs. Implied-In-Fact

A contract that is implied-in-law was not intended to be created, at least by one of the parties, but should be created by a judge in order to promote justice. A contract that is implied-in-fact is a contract that is unwritten but still exists between the parties due to a consensual transaction, and may be enforced in court.

The difference between the two may seem complicated, but it is important in terms of legal enforcement. For one thing, courts may not enforce a quasi-contract against the federal government. The doctrine of Sovereign Immunity prevents the federal government from being sued without its consent. 

However, if the contract is determined to be implied-in-fact, a court could rule that consent was given. A quasi-contract does not claim that there was an unwritten agreement in effect and would therefore not be enforceable against the government.

Key Differences and Illustrative Case Law

Courts distinguish quasi contracts (implied-in-law) from implied-in-fact contracts through intent and consent:

  • Implied-in-Law (Quasi Contracts): Created by courts to enforce fairness without the parties’ consent.
  • Implied-in-Fact Contracts: Formed through conduct, conversation, or mutual understanding between the parties.

For example, in Bailey v. West (1969), the court denied recovery because there was no expectation of payment between the parties, illustrating that a quasi contract cannot arise from voluntary, unrequested actions. Conversely, in Britton v. Turner (1834), a worker who quit before completing his contract was granted partial payment under quantum meruit, reinforcing quasi-contract principles.

These cases show how quasi contracts operate as equitable safety nets, ensuring fairness when standard contractual frameworks fall short.

Frequently Asked Questions

  1. What is the main purpose of a quasi contract?
    Its main purpose is to prevent one party from being unjustly enriched at another’s expense when no actual agreement exists.
  2. How is a quasi contract different from a real contract?
    A quasi contract is imposed by law rather than formed by mutual agreement. It arises to ensure fairness, not by consent.
  3. What are common examples of quasi contracts?
    Examples include mistaken payments, services rendered in emergencies, or benefits conferred under error or misunderstanding.
  4. Can a quasi contract be enforced against the government?
    Generally, no. The doctrine of sovereign immunity prevents suits against the government without its consent.
  5. How can I pursue a quasi-contract claim?
    You must show that you provided a benefit, the other party received it unjustly, and you suffered a loss. A qualified attorney can help you file and prove your claim—find one through UpCounsel for professional assistance.

If you need more information or help with a 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.