QUASI CONTRACT

A quasi- contract is not a contract at all. It is an obligation which law creates. Amplify and indicate the quasi- contract recognised by the Indian Contract Act, 1872.

According to the provisions of Indian Contract Act, 1872, if parties want to enter into a valid and lawful contract, then they will have to give their free consent and agree that they will perform their contractual obligations. It is a general rule that all agreements are made by parties and if those agreements are enforceable by law, then only these agreements can be considered valid contract.

So, it is clear that contract comes into existence only if both parties are willing to enter into a contract. But sometimes parties do not agree to enter into a contract, then also, they have to perform some obligations. These obligations do not arise because of contract but arise by the law and termed as quasi- contract.

A quasi- contract is not a contract at all but it is a resemblance of a contract. The concept of quasi- contract is based upon the principle of equity, justice and good conscience. In quasi- contract, if an obligation arises resembling those created by contract and a person fails to perform his obligation, then in such a case, another person who suffers damages because of non- fulfilment of an obligation can claim compensation from the wrongdoer in a same manner as if the wrongdoer had contracted to discharge the obligation and had broken the contract.

In quasi- contract, a person who fails to discharge his obligation pays the compensation only because he has received some benefits from another person and after receiving the benefits, fails to discharge his obligation. So, the main aim of quasi- contract is to protect the rights of an innocent person and compel the person to pay compensation who has received an unjust enrichment.

In the leading case of Mahabir Kishore vs. State of M.P., the Hon’ble court held that to arise quasi- contract, following essentials have to be proved: –

  1. The defendant has been enriched by the receipt of a benefit.
  2. The enrichment is at the expense of the plaintiff.
  3. The retention of enrichment is unjust.

Section 68 to 72 of the Indian Contract Act, 1872, deals with the provisions of quasi- contract.

According to section 68 of the Indian Contract Act, 1872, if a person is incapable of entering into a contract and another person is providing necessaries to the former person suited to his condition in life, then in such a case, the person who is providing necessaries can be reimbursed from the property of an incapable person.

In the leading case of Jagon Ram Marwari vs. Mahadeo Prasad Sahu, the Hon’ble court held that what are necessaries may depend upon the status of a person and also his requirements at the time of actual delivery of goods.

According to section 69 of the Indian Contract Act, 1872, if one person is interested to pay the money whereas another person is bound to pay the money and the person who is interested to pay make the payment, then in such a case, he is entitled to recover the money from that person who was bound to pay the money.

In the leading case of Port Trust, Madras vs. Bombay Company, the Hon’ble court held that if a person who is interested to pay the money makes the payment, then he is entitled to get it back from that person who was bound to pay money.

According to section 70 of the Indian Contract Act, 1872, if any person does anything for another person or delivers something to another person and the latter person enjoys those things, then if the former person does anything or delivers something not gratuitously, he is entitled to get compensation from the latter person for any act which has done or to get that thing back which he has given to the latter person.

In the leading case of Indu Mehta vs. State of U.P., the Hon’ble court held that if a person does something or delivers anything not intending to do so gratuitously, then he is entitled to get compensation.

According to section 71 of the Indian Contract Act, 1872, if any person finds anything and he believes that the thing does not belong to him, then in such a case, he cannot utilize that thing and his responsibility will be like bailee and he has to protect that thing from deterioration.

According to section 72 of the Indian Contract Act, 1872, if a person delivers anything to another person by mistake or under coercion, then in such a case, the latter person is bound to return that thing to former person.

In the leading case of U.O.I. vs. Steel Authority of India, the Hon’ble court held that if any money paid or thing delivered to person by mistake or under coercion, then in such a case, the person who has received money or thing is bound to repay that money or return that thing to such person who has given money or thing.

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