Quasi Contract – Meaning and Nature
The Indian Contract Act, 1872 also follow the same elements which are followed by the English Contract Act. There is no definition given for quasi-contract in the Indian Contract Act. But the Act states that it in the case of a quasi-contract, certain relations are created which are very similar to contracts. But quasi-contract can be defined as a set of rights and liabilities between the parties even when there is no formal contract. The law creates this obligation to maintain justice and fairness between the parties.
The law does not allow one person to enrich himself at the expense of the other. If the rights and obligations are not created (quasi-contract) one party would be unjustly enriched. Going by this, it can be said that a quasi-contract is kind of a remedy instead of being a pure contract. Formation of a quasi-contract allows the aggrieved party to recover the benefit which the enriched party has taken at his expense. Since a quasi-contract is a law made by law, there is no statement of consent between the parties. The obligation and rights which are placed on the shoulder of the parties are rather by law than by assent.
Quasi-contracts follow the principle of unjust enrichment, which came from the Roman Maxim, “nemo debet locule tari ex aliena jactura“ which in simple language means that no man must grow rich because of one’s personal loss.
The concept of quasi-contract was first discussed in the case of Moses v MacFarlane (an English case). In this case, Lord Mansfield stated that such obligation was based upon the law as well as justice to prevent undue advantage to one person at the cost of other.
In the case of Spolka Akeyjna v. Fairbairn Lawson Combe Barbor Ltd., the Court stated that the obligations which arise in such situations where one person are enriched at the expense of another- the obligation does not fall purely either under torts law or contracts law. They fall under the concept of “restitution or quasi-contracts.”
By – Shradha Arora
(Editor @ Legal Bites)