Quasi Contract

A “quasi contract” is a court-mandated agreement between two people who don’t have a legal contract with one another. Its purpose is to make sure that one party doesn’t unfairly benefit at the financial expense of the other. To see how this works in real life, let’s take a sneak peak into the lives of Paul and Simon, next-door neighbors and BFFs for life. At least, Paul thought they were BFFs for life…until the incident with the fence.

Paul learned way back in a high school English class that good fences make good neighbors, so he's always done his part to make sure that the fence between his yard and Simon’s yard is properly maintained. But they had a really bad storm season this year, and now it looks like the fence is going to have to be replaced in its entirety. Simon is out of town, so Paul takes it upon himself to hire a fence builder and get ‘er done, confident that Simon will cover half of the cost when he gets back. But to Paul’s surprise, when he shows Simon the bill, he refuses to pay for his part. With a heavy heart, Paul decides to take him to court.

Even though there is no written contract between Paul and Simon regarding the fence, the court decides that Simon is, in fact, liable for half the cost of the fence replacement. This is a quasi contract. Since Simon benefitted from the expenditure—he’s got a snazzy new fence along one side of his backyard—the court feels like he should pay for that benefit, and so they rule that he now legally owes Paul for half of the bill.