72213278 Quasi Contract

QUASI CONTRACT Main objective of Quasi Contract may be discussed in the following manner. What is a Quasi Contract? What are various type of Quasi contract How law treats such contract? What is Quasi Contract?

A Quasi-contract is not a contract at all because one or the other essentials for formation of a contract are absent. It is an obligation imposed by law upon a person for the benefit of another even in the absence of a contract. It is based on the principle of equity. Law in such cases, places the parties in same position as they would have been if there was a contract. Anson has explained Quasi Contract in the following words: " Circumstances must occur under any system of law in which it becomes necessary to hold a person to be accountable to another, without any agreement on the part of the former to be so accountable on the ground, that otherwise he would be retaining money or some other benefit which has come into his hands to which the law regards the other personas better entitled or on the ground that contract exist provides remedies in circumstances of the kind" The salient features of Quasi contract in terms of the above definition are as under: a) Law impose imposess it and such such does does not not arise arise from from any any agreement agreement..  b) The duty duty of a party and not not the promise promise of any party party is the the basis of such such contract. contract. c) The right right under it is is always a right right to money money and generally generally,, though though not always, always, to liquida liquidated ted sum of money. d) The right right under it is available available against against specific specific person(s person(s)) and not against against the world. world. e) A suit for for its breach breach may may be filed in the same same way as as in case of of a complete complete contract contract.. Similarity between Quasi-contract and Contract •

The outcome of quasi-contract resembles that created by a contract. So far damages are concerned, thee is similarity between Quasi-contact and contract

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Section 73 provides for the same remedies as provided in case of breach of contract.

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Kinds of Quasi-contracts a) b) c) d) e)

Right to to recover recover the price of of nece necessaries ssaries supplied (Sec. 68) 68) Right to to recover recover money money paid paid for another person (Sec.69) Right Right to recove recoverr for non-gra non-gratuit tuitous ous act act (Sec. (Sec. 70) Responsi Responsibili bility ty of finder finder of goods goods (Section (Section)) 71) Right Right to recover recover from a person person to whom whom money money is paid or thing thing is delivered delivered by mistake or under coercion (Sec. 72)

(a) Right to recover the price of necessaries supplied- Sec.68- “ If a person is incapable of entering into a contract or anyone whom he is legally  bound to support, is supplied by another person with necessaries suited to his conditions in life, the person who has furnished supplies is entitled to  be reimbursed from the property of such incapable person.” Illustration- 1. A supplies B a lunatic with necessaries suited to his conditions in life. A is entitled to be reimbursed from B’s property. Illustration 2- A supplies the wife and children of B, a lunatic with necessaries suited to their conditions in life. A is entitled to be reimbursed from B’s property.

(b) Right to recover money paid to another person (Sec. 69) “ A person who is interested in the payment of money which another is bound to pay and who therefore pays it, is entitled to be reimbursed by the other.” Illustration B holds land in Bengal, on lease granted by Zamindar. The revenue payable by A to Zamindar is in arrears. The Government has advertised in the news paper that in case the revenue is not paid within a stipulated period, the related land is to be sold out. The action may result in annulment of lease in favour of B. To prevent annulment of lease and sale of land, B pays the revenue as due to A. A is bound to make payment of the amount of revenue which B has paid.

( c ) Right to recover for non-gratuitous act (Sec.70) ,”Where a person lawfully does anything for another person or delivers anything to him not intending to do so gratuitously and such another person enjoys the benefit thereof, the later, is bound to make compensation to the former in respect of or to restore the thing so done or  delivered.” Illustrations:A. A tradesman leaves goods at B’s house by mistake. B treats the goods as his own. B is bound to pay A for them.. B. A saves C’s property from fire. A is not entitled for compensation from B, if  the circumstances show that he intended to act gratuitously. C. K a government employee was ordered to compulsorily retire forthwith. He filed a petition and obtained an order from High Court staying the government directives. The Government paid salary, but did not give any work. The Writ Petition was finally dismissed. The Govt. recovered the salary, which was  paid to K after stay order. It was challenged by A. The High Court held that in terms of Section 70 of the Indian Contract Act, 1872 K is bound to return the salary received during the said period. D. Responsibility of finder of goods (Section 71).” A person who find goods  belonging to another and take them into his custody, is subject to the same responsibility as bailee.”

Duties of finder of goods • • • •

He must find out the owner  Must not use for his benefit When real owner is found, he should return. He must take care while the goods are in his possession.

Rights of finder  • • •

He can retain it till the owner is found He can claim expenses incurred for taking care of goods He has a lien on goods till he paid.

The finder of goods is entitled to sell the goods if the owner is not traceable or it he refuses to pay the lawful charges to the finder, when in the following situations:1. When the thing is in danger of perishing or losing greater part of  its value. 2. When the lawful charge of the finder amounts to two third value of the goods. f) Liability of money paid or thing delivered by mistake or under coercion (Section 72)- “A person to whom money has been paid or anything delivered by mistake or  under coercion, must pay or return it.” Example 1. A and B jointly owe Rs.5000/- to C. A pays the total amount to C. B not knowing the fact, pays Rs.5000/- tp C. C is bound to repay this amount to B. Example 2. A railways company refuses to deliver certain goods to consignee except upon payment of illegal charges. The consignee pays the charges. He is entitled to recover this sum from the Railway Company .