Can a Contract Be Implied

Contract law can be complex, and one area that can be particularly confusing is the concept of an implied contract. An implied contract is a contract that is not written down or clearly stated but is based on the actions or conduct of the parties involved. In this article, we will explore the concept of an implied contract, how it can be formed, and what it means for businesses and individuals.

What is an implied contract?

An implied contract is a contract that is inferred from the actions, words, or conduct of the parties involved. In other words, it is not explicitly stated but is implied by the behavior of the parties. This can occur in a variety of circumstances, such as when a person works for someone else without a written agreement, but with the expectation of being paid for their work.

Most common law systems recognize the existence of implied contracts, including the United States. Generally speaking, an implied contract arises when there is an expectation of performance, and one party has relied on that expectation to their detriment.

Types of implied contracts

There are two main types of implied contracts: implied in fact and implied in law.

Implied in fact contracts arise when the conduct of the parties suggests that they intended to create a contract, even though it was not explicitly stated. For example, if a person hires someone to work for them and pays them a regular salary, an implied contract may exist.

Implied in law contracts, also known as quasi-contracts or constructive contracts, are not true contracts but are created by the law to prevent unjust enrichment. For example, if a person mistakenly pays someone for services that were not performed, the law may imply a contract where the person who received payment must return it.

How is an implied contract formed?

Implied contracts are formed when the parties involved act in a way that suggests they intended to create a contract. This can include things like continuing to work for someone without a written agreement, accepting payment for goods or services, or performing a service for someone who has a history of paying for similar services.

To determine if an implied contract exists, courts will look at the behavior of the parties involved and consider whether there was a mutual understanding or agreement to perform specific tasks or exchange goods or services.

What does an implied contract mean for businesses and individuals?

For businesses and individuals, an implied contract can be both beneficial and troublesome. On the one hand, an implied contract can protect a person’s rights and help ensure that they are fairly compensated for their work or services. On the other hand, businesses and individuals can unwittingly create implied contracts that may bind them to obligations that they did not intend to make.

In conclusion, an implied contract is a contract that is not explicitly written down but is inferred from the actions or conduct of the parties involved. They can be beneficial or troublesome for both businesses and individuals, depending on the circumstances. If you are unsure about the existence of an implied contract, it’s best to seek legal advice to understand your rights and obligations.