Implied Contract Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Implied Contract, written in plain English, along with examples of how it is used.
What is Implied Contract?
It refers to an agreement which should have been formed formally in writing,and was not formed but still stands as a contract. Such implied contracts are taken into effect by the court so as to safeguard ones payment, money or services which the other party is enjoying by unfair means. For instance is a person A gives the money to person B to give it to C, and if B does not hand it to C but enjoys the money himself, the court can hold B responsible for the breach. A will just have to prove that B was asked to hand money to C and not keep for himself.
History and Meaning of Implied Contract
An implied contract is a type of contract that has not been explicitly agreed upon, but is formed based on the actions and behaviors of the parties involved. Implied contracts are legally binding and enforceable by law, even though they have not been put in writing. The terms of an implied contract are often inferred from the conduct of the parties involved, and the obligations and expectations of the parties can be legally enforced.
The concept of implied contracts dates back to the Middle Ages, where they were used in situations where written contracts were not feasible or necessary. Today, implied contracts are commonly used in situations where the parties have not explicitly agreed to the terms of an agreement, but their actions imply a mutual understanding of what is expected of them.
Examples of Implied Contract
A mechanic performs repairs on a car without the owner's explicit agreement to pay for the repairs. However, the owner of the car inherits a legal obligation to pay for the repairs based on the implied contract formed due to the mechanic's actions.
An employee who works for a company without a written contract is legally required to follow the company's policies and procedures based on the implied contract formed from their actions.
A person who uses a gym or fitness center on a regular basis is often bound by an implied contract to pay membership fees, even if they have not signed a written agreement.
A landlord who accepts rent payments from a tenant without a written lease is still bound by an implied contract to provide the tenant with the benefits of a rental agreement.
Legal Terms Similar to Implied Contract
Express contract: A contract that is explicitly agreed upon by both parties in writing or orally.
Quasi contract: A legal relationship that is created by the court in situations where no contract actually existed, but one party has been unjustly enriched at the expense of another.
Unilateral contract: A contract where only one party makes a promise and the other party is bound to act or refrain from acting based on that promise.