Define Implied in Fact Contract

When it comes to legal agreements, there are several types of contracts that can be formed between parties. One type is the implied in fact contract, also known as an implied contract. Understanding what this type of contract entails can help individuals navigate legal transactions and protect their rights.

An implied in fact contract is a legally binding agreement that arises from the conduct and actions of the parties involved. Unlike an express contract, which is created through explicit written or verbal agreement, an implied in fact contract is formed based on the behavior of the parties. This behavior may include actions, statements, or even silence.

For example, imagine that a person regularly visits a coffee shop and orders a latte every morning. The barista never tells the customer the price of the latte, but the customer continues to pay the same amount every day. Over time, an implied in fact contract is formed between the customer and the coffee shop, even though there was never an explicit agreement made about the price.

There are several key elements to an implied in fact contract. First, there must be an intent to create a contract between the parties. This intent can be inferred from the actions and behavior of the parties involved. Second, there must be a mutual understanding of the terms and conditions of the contract. This understanding can be implied from the conduct of the parties, such as regularly paying a certain price for a product or service. Finally, there must be consideration, or something of value exchanged between the parties. In the example of the coffee shop, the customer is receiving a latte in exchange for payment.

It is important to note that an implied in fact contract is just as legally binding as an express contract. If one party fails to fulfill their obligations under the contract, the other party may be able to take legal action to enforce the terms of the agreement. However, because an implied in fact contract is not explicitly written down, it can sometimes be more difficult to prove the existence and terms of the contract in court.

Overall, an implied in fact contract is a type of legal agreement that can be formed through the behavior and actions of the parties involved. By understanding the key elements of this type of contract, individuals can protect their rights and navigate legal transactions with confidence.