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Implied Contract

Ankit0

An implied contract is a legal relationship between two parties that is not explicitly stated in a written document but is inferred from the parties’ actions and the law.

Elements of an implied contract:

  • Two parties: There must be two parties involved in the relationship.
  • Mutual obligation: Each party must have a mutual obligation to perform certain actions or provide certain goods and services.
  • Intention: The parties must have the intention of creating a binding legal relationship.
  • Consideration: There must be something of value exchanged between the parties.
  • Law: The implied contract must be governed by law.

Types of implied contracts:

  • Express warranties: Implied warranties are promises that are made explicitly by the seller or manufacturer.
  • Implied warranties of merchantability: This warranty guarantees that the goods are fit for the intended use.
  • Implied warranties of fitness for a particular purpose: This warranty guarantees that the goods are suitable for a specific purpose.
  • Implied terms of payment: This implied term requires payment for the goods or services provided.
  • Implied terms of delivery: This implied term requires the goods to be delivered in a reasonable manner.

Examples of implied contracts:

  • A landlord and tenant have an implied contract for the rental of property.
  • A seller and buyer have an implied contract for the sale of goods.
  • An employer and employee have an implied contract for employment.

In general, implied contracts are created when:

  • The parties have a mutual understanding and intend to create a legal relationship.
  • The actions of the parties in relation to each other are consistent with the creation of a contract.
  • The law of contract applies to the relationship.

It is important to note that:

  • Implied contracts are not always created.
  • The specific terms of an implied contract will vary depending on the circumstances.
  • If there is any conflict between an implied contract and a written contract, the written contract will prevail.

FAQs

  1. What is meant by an implied contract?

    An implied contract is an agreement inferred from actions, conduct, or circumstances rather than explicit words.

  2. What are implied terms in a contract example?

    Implied terms are unstated provisions assumed in a contract, like an employee’s duty of loyalty to an employer.

  3. What is an example of an implied offer?

    A taxi stopping to pick up a passenger implies an offer to provide a ride for a fare.

  4. What is implied contract under the Indian Contract Act?

    It is a contract inferred from conduct, like ordering food at a restaurant implies payment for the meal.

  5. What is the difference between express and implied indemnity?

    Express indemnity is explicitly agreed upon, while implied indemnity is assumed by law or circumstances.

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