In contract law, there are situations where a person is legally bound to another, not because of a mutual agreement, but because the law sees it as fair and necessary. These types of obligations are called quasi-contracts. They are not real contracts formed by offer and acceptance, but they resemble contracts because they impose duties as if a contract existed. In Indian law, this concept is covered under Sections 68 to 72 of the Indian Contract Act, 1872, and is officially termed as “Certain Relations Resembling Those Created by Contract.”
What is a Quasi-Contract?
The term quasi-contract comes from Roman law (“Obligatio quasi ex contractu”), and it essentially refers to situations where one person should be held accountable to another even without any actual agreement because otherwise, it would be unfair or unjust. In simple words, a quasi-contract is a pseudo-contract or implied contract by law which exists not due to a mutual understanding, but because justice and equity require it.
According to legal scholars like Pollock, these are obligations that are “contracts in law but not in fact.” Salmond also explained that while they are not true contracts, the law treats them as such to ensure fairness. Sir William Anson stated that sometimes the law must intervene to prevent a person from wrongfully keeping money or benefits that rightly belong to someone else.
You can also read the blog of Civil Law Vs Common Law: Key Differences and Implications.
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Legal Basis and Principles
The main reason behind these provisions is the Latin maxim: "Nemo debet locupletari ex aliena jactura" – meaning, no one should be unjustly enriched at the cost of another’s loss.
A key case explaining this principle is Moses v. Macferlan, where Lord Mansfield emphasized that the law exists to prevent unjust enrichment.
In India, quasi-contractual obligations are recognized under the Indian Contract Act from Section 68 to Section 72, which cover various situations such as:
- Supplying necessities to someone incapable of contracting (like a minor or a mentally unsound person)
- Payment by an interested party
- Recovery of money paid by mistake or under coercion
- Benefits received without intention to pay but with a moral or legal obligation
Importance of Quasi Contract
Quasi-contracts are based on justice, equity, and good conscience. They protect individuals from being unfairly treated and ensure that no one gains at another's expense without a lawful reason. Even though these are not actual contracts with mutual consent, the law imposes similar obligations because allowing one party to retain benefits would be unjust.
Conclusion
In conclusion, quasi-contracts help the legal system address situations where enforcing a formal contract isn't possible, but where fairness demands a legal remedy. These provisions fill the gaps in law and prevent exploitation or unfair gain. While they are not actual contracts formed by mutual agreement, quasi-contracts ensure that equity and justice prevail where unjust enrichment must be prevented. Through Sections 68 to 72 of the Indian Contract Act, the Indian legal system ensures accountability even in the absence of formal contractual relationships.
