Contingent and Quasi Contract

Unit I

Contingent Contract
When the performance of a contract is not immediately due but it becomes so only after the happening or non-happening of some contingency (ie some uncertain event) it is known as Contingent Contract. It is a conditional contract. Eg. Contract of Insurance.

Rules regarding performance of Contingency Contract

The happening of a future uncertain event
If impossible, contract is void

The non-happening of a future uncertain event

Until event is impossible, contract cannot be enforced

The happening of a future uncertain event within fixed time The non-happening of a future uncertain event within fixed time Impossible events - void contract

Quasi Contracts
Obligations imposed by law similar to those which are created by contract in the absence of any contract is called Quasi Contract.

Kinds of Quasi Contracts

Necessaries supplied to person incapable of contracting
Reimbursed from the property

Payment by an Interested person

A person who is interested in the payment of money in which another is bound by law to pay and who therefore pays it, is entitled to be reimbursed by the other. Essentials
Should be for protection of ones interest Payment should not be voluntary Payment must be such as the other party was bound by law to pay

Kinds of Quasi Contracts

Liability for Non-Gratuitous Act
Conditions
Thing must be done lawfully It must have been done by a person not intending to act gratuitously The person for whom the act is done must have enjoyed the benefit of the act

Action for money paid on thing delivered by mistake or under coercion

The person must repay or return it

Kinds of Quasi Contracts

Responsibility of Finder of Lost goods
Take care of the goods as a man of ordinary prudence would under similar circumstances Trace the true owner Finder of goods can sell if
Things is in danger of perishing or losing the greater part of its value Owner cannot be found out Owner refuses to pay lawful charges of the finder Lawful charges of finder amounts to two thirds of the value of the thing found

Kinds of Quasi Contracts

Claim for Quantum Meruit
As much as the party doing the service has deserved In case of void agreement or contract that becomes void (any person who has received any advantage under such agreement / contract is bound to restore or make compensation) In case of non-gratuitous act : obligation to pay In case of act preventing the completion of contract : compensation for work done

Kinds of Quasi Contracts

Claim for Quantum Meruit
In case of divisible contract
If the party not at default has enjoyed benefits of part performance compensation for work done has to be given

In case of indivisible contract

If contract is indivisible If contract is for lump-sum If contract is completely performed But performed badly Lump-sum can be received less deduction for bad work