What is a quasi contract? Definition, types, and real-world examples
Reviewed by:
Ashley Kemper
SVP of Marketing
What is a quasi contract? Definition, types, and real-world examples
A quasi contract is a legal obligation a court imposes to prevent one party from being unjustly enriched at another’s expense. It arises not from an agreement between parties. Courts use it as a remedy, usually requiring restitution, when no valid contract exists but fairness requires compensation.
The name sounds self-contradictory, but “quasi” signals that a court applies this obligation retroactively rather than forming it through a regular agreement.
A quasi contract isn't a contract in the traditional sense. It’s a legal remedy that only a court can create.
Also called a “contract implied in law” or a “constructive contract,” a quasi contract requires no offer, acceptance, or mutual intent, which distinguishes it from a real contract. Its primary purpose is to prevent unjust enrichment under the principle that no one should be enriched at another’s expense without compensation.
A quasi contract is subject to legal review, and not every situation calls for or requires one.
In fact, they apply when someone gets something from someone else without paying them back in any way, whether with money or through trade.
Only a court may create a quasi contract, meaning they’re official and can’t be ignored without breaking the law.
Key takeaways:
Quasi contracts are imposed by a court to make sure a situation involving multiple parties with conflicting interests is resolved as fairly as possible.
They’re applied retroactively, which can only happen if there was no official contract to begin with.
They’re used when one party obtained something from the other without compensating them for it in some way, so the contract outlines the new terms of repayment or compensation
A quasi contract is a legally binding substitute for an initial contract.
Understanding unjust enrichment
When two parties can't execute an agreement, one may still take something from the other.
For example, an employee might accidentally take a stapler home from the office, or simply because no official rules prohibit it.
In the above example, the employee became one stapler richer, while the employer lost a stapler that belonged to them without gaining anything in return. The employee’s enrichment was, therefore, unjust.
Of course, unjust enrichment usually describes situations on a much bigger scale than this. The general rule, though, is that it involves one party gaining something at another's expense.
The party that lost something is also, crucially, not compensated for the items, services, or other property that they lost. That’s what makes it unjust.
What are the elements of a quasi contract?
While a standard contract can be as simple or complicated as you need, a quasi contract tends to be simpler.
That’s why most contract management software and similar solutions are designed with traditional contracts in mind since they can have many more components and elements.
On the other hand, quasi contracts have only three main elements.
1. The wronged party must show clear evidence of what they should have been compensated for.
This evidence should be substantial and cannot consist only of circumstantial evidence.
It should clearly and unambiguously identify the exact nature and value of what was taken.
2. The other party must have received a real, tangible benefit or advantage.
They can’t just take a single paperclip from an office, for example, because that’s unlikely to have given them any benefit or harmed the office.
3. The benefit was retained without any compensation being given, and without a valid contract having been intended by the parties.
So, the person who was wronged can’t have been compensated at all.
It’s also important to note that quasi contracts can only come into being when it’s clear and evident that the defendant had no intention of entering into a legal contract.
That’s when a court needs to intervene.
See also
Best practices for making your contract management successful
Types of quasi contracts
There’s no universal classification of quasi contracts. In the U.S., the term “quasi contract” is used for claims that courts and scholars often group under restitution and unjust enrichment. These labels can vary by state and court.
Unlike an implied-in-fact contract, where the parties’ conduct shows an actual agreement, a quasi contract is an obligation that the law imposes without one.
These types of claims fall into the following categories:
Services rendered (quantum meruit)
This applies when one party performs work expecting payment, and the other party accepts the benefit without an enforceable agreement on price.
A court can order payment of an amount it considers reasonable to compensate for the services. Courts will often use the term “quantum meruit” inconsistently. Some apply it to implied-in-fact contracts and others to quasi-contract claims. The label used depends on the jurisdiction.
Money paid by mistake (money had and received)
This type of claim applies when one party receives money it doesn’t owe, such as a duplicate payment, a payment to the wrong recipient, or a miscalculated invoice.
The recipient will generally have to return it, but recovery can be limited by certain defenses the recipient may raise. For example, a good-faith change in position would be the recipient relying on the payment without knowing it was a mistake.
Goods or property used without payment (quantum valebant)
One party might receive or use another’s goods and keep the benefit without actually paying for them.
In this case, a court may order payment of the goods’ reasonable value, since not paying for the goods would result in unjust enrichment.
Emergency or necessity
An example is a doctor providing urgent help, such as emergency medical care, to someone who can’t consent at the time.
The provider might recover the reasonable value of the service they provided to the person in need.
Quasi contracts under the Indian Contract Act, 1872
Quasi contracts were created to promote fairness and avoid unjust enrichment when there was no formal agreement made, which is a concept founded in Chapter V of the Indian Contract Act, 1872. This act covers the following sections:
Section 68: Deals with reimbursement, from the incapable person’s property, for necessaries supplied to someone incapable of contracting
Section 69: Covers reimbursement for a person who pays money that another is legally bound to pay, when the payer is interested in the payment
Section 70: Covers compensation for a lawful, non-gratuitous act or delivery whose benefit the recipient enjoys
Section 71: Establishes the responsibility of a finder of goods to return the goods to the true owner
Section 72: Requires the repayment of money or return of goods received by mistake or under coercion
These are only applied under Indian law, not in U.S. courts.
Quasi contract examples
To better illustrate what quasi contracts look like, here are a few hypothetical quasi contract examples.
Emergency medical care
Say a driver is knocked unconscious in a crash, and an emergency physician is at the scene and performs life-saving treatment. The driver never agreed to pay and couldn’t have, given their condition. Courts generally presume the person would have wanted the necessary emergency care, so the provider can recover its reasonable value.
The amount the provider gets is based on the going rate for the services and not the patient’s wealth. This applies mainly to professionals who expect payment for their services. If a stranger helps without expecting payment, they typically have no claim.
Mistaken delivery or payment
A retailer might ship a $1,200 laptop to the wrong address, and the recipient realizes it isn’t theirs but decides to keep it and use it anyway.
Because they never agreed to buy it, no contract exists. However, a court can order them to return the laptop or pay its value.
The same principle applies to money: if a vendor gets paid twice for one invoice, they generally have to return the duplicate payment.
Freelance work used without payment
Say a company asks a freelance designer to create a logo and says that it will “send the contract later.” When the designer delivers the finished logo, the company uses it on its website and packaging but never signs a contract or pays the freelancer.
With no agreed terms to enforce, the designer could claim reasonable value for the work (quantum meruit). Courts generally measure that by the value of the benefit the company received, not by the other work the designer turned down. If the company agreed to a price, even verbally, the designer might have a real contract claim instead of a quasi-contract claim.
Quasi contracts pros and cons
Although they rarely involve the kinds of contract disputes that crop up when two parties draft their own brand-new contract, quasi contracts also carry inherent advantages and drawbacks.
Here’s a quick breakdown of the main ones.
Advantages
First, we’ll look at what quasi contracts do well.
The principle of unjust enrichment is an excellent legal basis because it aims to create a fair solution that undoes an injustice.
This makes quasi contracts, by their nature, a legal step toward fixing what went wrong.
Quasi contracts also help protect vulnerable, especially innocent, parties without formal agreements.
If a small business owner has their products taken without compensation, they can rely on quasi contracts to recover the money they need and deserve.
Also, because courts create quasi contracts, they are legally binding and less subjective.
In principle, this creates a fairer outcome, which is always a benefit.
Disadvantages
Like all things, quasi contracts have disadvantages.
For one, they put the onus on the person who suffered the unfairness to prove it.
If you know your things were taken and you know who did it, but you don’t have proof, it can be very difficult to use a quasi contract to recover damages.
Quasi contracts also have a hard limit on how much the wronged party can be compensated.
They can only recover the value of the goods taken from them—they can’t add costs like legal fees or long-term damages.
Additionally, a quasi contract can’t be negotiated or amended like a traditional one.
That means neither party gets a chance to edit or adjust parts of it to better suit them once the court finalizes the terms.
For the plaintiff, a quasi contract also completely nullifies any benefits, including financial ones, they earned using the goods obtained.
So, they won’t be able to use what they took to keep making money, even if they did so by combining it with their own hard work.
Quasi contract vs. promissory estoppel
The main difference is that promissory estoppel enforces a promise someone reasonably relied on, even if it was informal or unwritten. A quasi contract is an obligation that’s imposed by law with no promise involved.
Both can apply without a formal contract, and both aim to prevent unfairness. But a quasi contract applies even if there was never an expectation of compensation.
Here’s a quick comparison:
Quasi contract | Promissory estoppel | |
What it is | An obligation imposed by law to prevent unjust enrichment | A doctrine that makes certain promises enforceable when someone relied on them |
Promise required? | No. It arises from a benefit received, not from anything the parties said | Yes. A clear promise the promisor should reasonably expect to induce action |
What the court looks at | Whether one party was unjustly enriched at the other’s expense | Whether the other party reasonably relied on the promise and would be treated unfairly if it weren’t enforced |
Typical remedy | Restitution: the reasonable value of the benefit received | At the court’s discretion, often limited to the cost of the reliance, and sometimes more |
Hypothetical example | A company uses a designer’s finished logo and never pays | A company promises a designer a project, the designer turns down other work, and the company backs out |
Reduce the need for quasi contracts with effective contract templates
Quasi contracts are a court remedy when no real agreement exists. A more reliable path is having a clear, mutually signed contract from the get-go.
PandaDoc’s contract templates and library help you document terms, compensation, and scope upfront. This completely eliminates the ambiguity that can lead to disputes and the need for a quasi contract in the first place.
Beyond helping you format your contracts correctly, these templates help you finish them much faster every time.
That means more contracts with less effort, so you’re protected more easily.
That’s why it’s worth using contract management software like PandaDoc, which includes built-in templates.
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Yes. Once a court imposes a quasi contract, it becomes legally enforceable, even though it wasn’t created through a mutual agreement like a traditional contract.
A common example of a quasi contract is when someone receives goods or a payment by mistake and then keeps or uses them without compensating the rightful owner.
In this case, a court can require restitution. See the Examples section above for more.
An implied-in-fact contract is typically inferred from the parties’ conduct and reflects an actual, though unspoken, agreement. A quasi contract involves no agreement at all and is imposed entirely by a court.
Yes. By definition, a quasi contract is created specifically because there is no valid agreement, written or otherwise, that exists between the parties.
Restitution is the usual remedy in quasi-contracts. The party who benefited unfairly generally must repay only the value of what they received, not any additional damages.
What is a quasi contract? Definition, types, and real-world examples
Author
Maggie Brennand
Senior Product Marketing Manager, AI & CLM
Maggie Brennand is the Senior Product Marketing Manager, AI & CLM at PandaDoc, where she helps teams understand how they can use AI to work smarter every day. Away from the office, she’s often found drinking too much coffee and exploring the outdoors with her dog, Pepper.
Reviewed by
Ashley Kemper
SVP of Marketing
Ashley Kemper leads the global Marketing team at PandaDoc. She's built and scaled marketing programs from the ground up at Asana and launched new brands at Double and HyperComply. Before moving into marketing, she spent years as a digital media producer and graphic designer at National Geographic, Agence France-Presse, and Government Executive. Fun fact: Ashley has survived five cross-country moves with her wife, Malorie, and their French Bulldog, Frannie.
