Table of Contents
Introduction
A valid contract must contain certain essential elements, such as offer and acceptance, capacity to contract, consideration, and free consent.
Quasi contract-But sometimes the law implies a promise imposing obligations on one party and consulting right in favor of the other even when there is no offer, no acceptance, no genuine consent, lawful consideration, etc., and in fact neither agreement nor promise. Such cases are not contracted in the severe sense, but the Court recognizes them as relations resembling those of contracts and enforces them as if they were contracts. Hence the term quasi-contracts.
What is a Quasi Contract?
Quasi-contracts are based on principles of equity, justice, and good conscience.
A quasi-contract is an ex post facto agreement between two parties who have no prior contractual commitments. A judge develops it to correct a situation in which one side acquires something at the disadvantage of the other.
Quasi-contracts specify one party’s obligation to another where the end is in control of the property of the original party. Such parties could not actually have had an understanding with each other earlier.
The agreement is imposed by law through a judge as a remedy when Person A owes something to another person because they come into possession of 1st Person’s property indirectly or by mistake. The contract becomes enforceable if the 2nd Person decides to keep the item in question without paying for it.
Subsequently, the agreement is being established in a court of law, it is legally enforceable; neither of the parties has to provide consent. The quasi-contract’s aim is to make a fair outcome in a situation where one party has an advantage over another.
For Example
A, a tradesman, leaves goods at B’s house by mistake. B treats the goods as his own. B is bound to pay for the goods.
A pays some money to B by mistake. It is really due to C. B must refund the money to A
These relations are called as quasi-contractual obligations. In India it is also called as ‘certain relation resembling those created by contracts.
Salient features of quasi-contracts
- Such a right is always a right to money and generally, though not always, to a liquidated sum of money.
- It does not arise from any agreement of the parties concerned, but is imposed by the law; and
- It is a right that is available not against all the world, but against a particular person or persons only so that in this respect it resembles a contractual right.
Types of Quasi Contracts
Claim for necessaries supplied to persons incapable of contracting (Section 68)
An individual who is legally incapable of entering into any agreement, or if the person is unable to support themselves, then another individual who is legally responsible for supporting the former, then the latter will be reimbursed from the estate of the dependent. Instances of Quasi-contract cases include, If Z supports the family of his friend D, who is mentally incompetent, then Z should be provided with reimbursement from D’s property.
Payment by an interested person (Section 69)
A person who is interested in the payment of money that another is bound by law to pay, and who therefore pays it, is entitled to be reimbursed by the other
Obligation to Pay for a Non-Gratuitous Act (Sectionn 70)
In terms of section 70 of the Act “where a person lawfully does anything for another person or delivers anything to him not intending to do so gratuitously and such other person enjoys the benefit thereof, the latter is bound to pay compensation to the former in respect of, or to restore, the thing is so done or delivered”.
It thus follows that for a suit to succeed, the plaintiff must prove:
(i) that he had done the act or had delivered the thing lawfully;
(ii) that he did not do so gratuitously; and
(iii) that the other person enjoyed the benefit.
Finder of Goods (Section 71)
‘A person who finds goods belonging to another and takes them into his custody is subject to the same responsibility as if he were a bailee.
A person who comes across any item belonging to another individual, and takes it under his custody, then he must take proper care of the thing as much as he or she would take care of an item of the same value, bulk, and quality until the appropriate owner is found. If the owner is not found, then the finder can retain the item as their own according to Quasi-Contract.
A finder of lost goods has:
(i) to take proper care of the property as a man of ordinary prudence would take
(ii) no right to appropriate the goods and
(iii) to restore the goods if the owner is found
A mistake of Coercion (Section 72)
“A person to whom money has been paid or anything delivered by mistake or under coercion must repay or return it”.