Note:
this post is a part of our important question answer series on Contract Law. You can read other questions by clicking here.
Answer
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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