Understanding Implied-in-Fact Contract: Definition and Examples

Definition & Meaning

An implied-in-fact contract is an agreement between parties that is established through their actions and circumstances, rather than through explicit verbal or written communication. This type of contract arises when one party accepts a benefit in a situation where they could have chosen to decline it. Essentially, the agreement is inferred from the conduct of the parties involved.

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Real-world examples

Here are a couple of examples of abatement:

Here are a couple of examples of implied-in-fact contracts:

  • Example 1: If a person regularly takes care of a neighbor's pet while they are away without being asked, and the neighbor later pays them for this service, an implied-in-fact contract may be established.
  • Example 2: (hypothetical example) A contractor begins work on a home renovation after the homeowner expresses interest but does not sign a formal contract. If the homeowner pays for the work completed, an implied-in-fact contract may be inferred.

State-by-state differences

Examples of state differences (not exhaustive):

State Notes
California Implied-in-fact contracts are recognized and can be enforced based on the conduct of the parties.
New York Similar recognition as California, with specific case law supporting the enforcement of these contracts.
Texas Implied-in-fact contracts are enforceable, provided there is clear evidence of acceptance and benefit.

This is not a complete list. State laws vary, and users should consult local rules for specific guidance.

Comparison with related terms

Term Definition Key Differences
Express Contract A contract where the terms are stated clearly, either orally or in writing. Unlike implied-in-fact contracts, express contracts have explicit terms agreed upon by the parties.
Quasi-Contract A legal construct to prevent unjust enrichment, not based on an agreement. Quasi-contracts are imposed by law, while implied-in-fact contracts arise from the parties' conduct.

What to do if this term applies to you

If you believe an implied-in-fact contract applies to your situation, consider the following steps:

  • Document any relevant interactions or conduct that support your claim.
  • Review any potential benefits accepted and whether there was an opportunity to decline.
  • Consult legal templates on US Legal Forms to draft a formal agreement if needed.
  • If the situation is complex or disputed, seek advice from a legal professional.

Quick facts

  • Typical fees: Varies by state and complexity of the contract.
  • Jurisdiction: Generally applicable across all states.
  • Possible penalties: Enforcement of the contract may lead to damages for breach.

Key takeaways

Frequently asked questions

An implied-in-fact contract is an agreement inferred from the actions and circumstances of the parties involved, rather than from explicit words.