Q. What do you understand by quasi contract? State its essential features.

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The term Quasi-contract is nowhere defined in the Indian contract act or any other statute. This term was given by the Lord Mansfield. The whole concept of the quasi-contract is based on the principle of “unjust enrichment”, which means, no person should gain any sort of unjust benefit for which he is not legally entitled to avail.


These are not purely contractual obligations, where the elements of a valid contract such as: offer, communication to offer, acceptance, consideration, capacity of parties, free consent etc. must be necessarily present. There are cases where the law implies a promise and imposes obligations on one party while conferring rights to the other, even when the basic elements of a contract are not present, and that is quasi-contract is all about.

An illustration of the same is:

‘A’ contracts with ‘B’ to deliver goods to his residence. ‘B’ accidentally delivers it to ‘C’, who consumes those goods and refused to pay for it.

Now, above is the perfect example of unjust enrichment. If someone received some sort of benefit, for which, he is legally not entitled to enjoy, and refuses to pay for it, then it amounts to the violation of principles of quasi-contract.


Essential Features of Quasi-contract

1.                   The concept of Quasi-contract is based on principles of equity, fairness and justice.

2.                   The underlying principle which governs the quasi-contract is to restore the benefit obtain through unjust enrichment.

3.                   To constitute a quasi-contract, the formula of offer+acceptance = to promise/agreement, is not necessary.

4.                   It is usually considered a right to money and is generally (not always) to a liquated sum of money.

5.                   The right is not an outcome of an agreement but is imposed by law.

6.                   The right is not available against everyone in the world but only against a specific person(s).


Quasi-Contract: Section 68-72 of ICA

The provisions related to quasi-contract are given under sec 68-72 of ICA. We’ll deal each of them.


1.      Section 68: Payment for Necessaries Supplied

Section 68 provides that if one supplies something to any lunatic, incapable or a miner person, who is unable to contract, any necessaries, which is must for his living, is entitled to received reimbursement from the property of such person.

Example: If A provides B, (who is a person of unsound mind), clothes, then he is entitled for to be reimbursed from the property of the B, or his legal heirs.


2.      Section 69: Payment by an Interested Person

Sec 69 deals with the provisions for the reimbursement of person paying money due by another, in payment of which he is interested.

Example: if B does business on the land of the A, which is going for the governmental auctions, in the situation of disability of paying the amount by the A, if B pays for it on the request of A. Here, B becomes entitled to get the set amount from A.


3.      Section 70: Liability to pay for Non-Gratuitous Act

Sec 70 deals with the acts which were done non-gratuitously and provides 3 principles:

I.                     Any lawful act must be there

II.                   That act must be done non-gratuitously,

III.                 Another person must enjoy the benefits,

Example: if a chocolate seller offer a chocolate to B, and B eats it, then the seller is entitled to get his money back.

The important thing to note here is in cases falling under Section 70, the person doing something for another cannot sue for specific performance nor ask for damages for breach, as there is no contract between the parties. All that Section 70 provides for is that if the services or goods are accepted, a liability to pay arises.


Section 71: Duty of Finder of Goods

Sec 71 deals with the responsibility of finder of goods. It states, the finder of goods will be termed as bailee and he has to perform certain duties:

I.                     Take care of the goods as a person of regular prudence,

II.                   No right to appropriate the goods,

III.                 Restore the goods to the owner (if found).

Example: if A finds a mobile phone, it is the duty of the A to put the reasonable efforts to find it’s true owner, and return it to him.


Section 72: Liability in case of Mistake or Coercion

Sec 72 deals with Liability of person to whom money is paid or thing delivered by mistake or under coercion, means, all 3 situations if anything is delivered, then the concern person is entitled to get back it.

Example: if A mistakenly files excessive tax, for which he is not legally entitled to do so, then he can recover his money back.


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