What is an “Implied Contract” in Florida Business Litigation?
An “implied contract” is a principle of law in which the court will treat an implied agreement between parties as an enforceable contract. This is true, even if the formal elements of what makes a binding contract are not all otherwise met.
Implied contracts are not widely understood, but they are a fundamental principle of law that business owners are wise to know more about. While it is good business sense for business owners to always ensure that they do everything they can to protect themselves and get legally binding contracts set out in writing – life happens. And the legal principle of implied contracts exists to help protect parties who had intended on entering into a legally binding agreement. An implied contract cannot supplant an express contract – however, an implied contract can exist when the parties to that express contract act in a way that exceeds the scope of the contract.
What is an Implied Contract?
An implied contract (aka implied-in-law contract or quasi-contract) establishes liability under an agreement even when that agreement does not fit all of the requirements of a traditional contract. While not every non-contracted agreement is enforceable as an implied or quasi-contract: some are.
The elements that establish a cause of action under what is known as an implied or quasi-contract are
- the plaintiff conferred a benefit on the defendant;
- the defendant had knowledge of the received benefit;
- the defendant has accepted the benefit, and
- it would be inequitable for the defendant to keep the benefit without paying fair value for it.
A recent case before the Fourth District Court of Appeal provides some examples, and some clarity.
Case Law
In the recent Florida case of F. H. Paschen, S.N. v. B&B Site Development, Inc., 4D19-3839, 2021 WL 359487 (Fla. 4th DCA Feb. 3, 2021), Florida’s Fourth District Court of Appeal considered whether a plaintiff should be allowed to recoup compensation for out-of-scope work that was conducted on a job, but the work had not been addressed in the express contract that had been created between the parties.
The plaintiff was a subcontractor with an express contract to replace asphalt for the general contractor. As the project neared its end, the general contractor directed the subcontractor to expand the area for which asphalt was being poured. The subcontractor asserted that this was outside of the scope of the work spoken to in the contract, but did complete the work in order to ensure the job was timely completed. In the business litigation suit that followed, the general contractor tried to claim that it could not be held liable for the additional cost of the work, since the express contract spoke to asphalt replacement: the defendant asserted that, as such, an implied contract could not exist.
The court disagreed with the defendant, holding that an implied contract was created when additional work, outside of the contract scope, was conducted. The key to look for – is whether the work that was done in conjunction with the express contract is work that is outside of the scope of the express contract.
Contact Suncoast Civil Law
If you have questions on implied or quasi contracts in your own business litigation issues, contact the experienced Sarasota business litigation attorneys at Suncoast Civil Law.
Sources:
thedailyrecord.com/2024/06/14/md-pickleball-manufacturer-sues-sports-governing-body-alleging-breach-of-implied-contract/
media.floridabar.org/uploads/2020/12/416-7.rtf