CHAPTER-1

INTRODUCTION

1.1 MEANING-

A ‘quasi contract’ is neither based on a proposal nor an

acceptance- express or implied. Accordingly, it does not depend on a
promise. It is inferred by law from conduct of, for example, A and B
where A renders some service voluntarily in favour of B. In such a case,
it is necessary that the service so rendered by A is lawful, in interest of B
and B must have derived its benefit.

On the other hand, a contract is based on valid promise- express

or implied. In common parlance, a contract may be regarded as a
consensual relationship between at least two parties to do or not to do
something having legally binding effect on them. But formally, the term
contract has been defined under S. 2(h) of the Indian Contract Act,
1872 in the words: “An agreement enforceable by law is a contract.”
That is to say, a valid agreement is a contract. The term agreement has
been defined under S. 2(e) of the Act which runs as follows: “Every
promise and every set of promises, forming the consideration for each
other, is an agreement.”

Thus, when definition of the agreement is analysed, it becomes

obvious that it requires two elements for its formation. These elements
are- 1) Promise, and 2) Consideration of the promise. The term promise
is defined under S. 2(b) of the Act in the words: “A proposal, when
accepted, becomes a promise.” Further, after making an analytical
examination of the definition of promise, we find that proposal and
acceptance of proposal are the two elements which are required to
constitute a promise. The word ‘proposal’ has been defined under S.
2(a) of the Act. It says, “When one person signifies to another his
willingness to do or to abstain from doing anything, with a view to
obtaining the assent of that other to such act or abstinence, he is said
to make a proposal.” Section 2 (b) of the Act states about acceptance in
the words “When the person to whom the proposal is made signifies
his assent thereto, the proposal is said to be accepted.” Again, the term
‘consideration’ has been defined under S. 2 (d) of the Act as follows:
“When, at the desire of the promisor, the promisee or any other person
has done or abstained from doing, or does or abstains from doing, or
promises to do or to abstain from doing, something, such act or
abstinence or promise is called a consideration for the promise.”

Coming again to the definition of contract as enumerated under

S. 2(h) of the Indian Contract Act, 1872, we can say that i) proposal, ii)
acceptance, iii) consideration and iv) force of law behind them are the
four basic elements which constitute a contract. That is to say, when a
proposal is valid, acceptance of such proposal is valid and consideration
of promise is also valid, a contract will be made between the concerned
proposer and acceptor. However, to have a complete idea of a contract,
S. 101 of the Indian Contract Act, 1872 has to be kept in mind. This

1
S. 10 can be completely written as follows- All agreements are contracts if they are made by the
free consent of parties competent to contract, for a lawful consideration and with a lawful
object, and are not hereby expressly declared to be void. Nothing herein contained shall affect
any law in force in [India] and not hereby expressly repealed by which any contract is required to
be made in writing or in the presence of witnesses, or any law relating to the registration of
documents.
2
Section provides that “all agreements are contracts if they are made by
the free consent of parties competent to contract, for a lawful
consideration and with a lawful object, and are not hereby expressly
declared to be void.”

Thus, the following elements are required to constitute a

contract:

1. Agreement2;
2. Competence of parties3;
3. Free consent of both the parties4;
4. Lawfulness of consideration and object5;
5. The agreement must not expressly be declared to be
void6.
On the other hand, quasi contract does not require the
aforementioned elements of a contract for coming into being because it
is inferred from conduct of both the parties, for example, on the basis of
service rendered voluntarily by one person not intending to do so
gratuitously and benefit of such service derived by other party. It
prevents unjust enrichment by the party who enjoys benefit of voluntary
service given by the former.

To explain further, it can be said that the term quasi contract has
been defined under Oxford Dictionary7 in the words, “An obligation of

2
S. 2(e) of the Indian Contract Act, 1872.
3
S. 11 of the Indian Contract Act, 1872.
4
S. 14 of the Indian Contract Act, 1872. S. 15, 16, 17, 18, 20, 21 & 22 of the Indian Contract Act,
1872 are also relevant.
5
S. 23 of the Indian Contract Act, 1872.
6
S. 20, 23 to 30, 36 & 56(Para I) of the Indian Contract Act, 1872.
7
http://www.oxforddictionaries.com/definition/english/quasi-contract?q=quasi+contract
3
one party to another imposed by law independently of an agreement
between the parties”.

In the Cambridge Dictionary8 terms ‘quasi’ and ‘contract’ have

been defined separately. According to it, ‘Quasi’ means used to show
that something is almost, but not completely, the thing described. The
term ‘Contract’9 means “a legal document that states and explains a
formal agreement between two different people or groups, or the
agreement itself”.

According to Chambers Dictionary10 ‘Quasi’ as a Latin term

has been defined in the words- 'as if' and the term ‘contract’11 means an
agreement, especially a legally binding one. Thus, the Chambers
Dictionary may be taken to define the quasi contract in the words ‘as if
contract’ i.e. similar to contract.

The term ‘quasi’ and the term ‘contract’ have been separately
defined in the Random House Webster’s Dictionary. The term
‘quasi’12 has been defined as ‘a combining form meaning resembling’,
‘having some, but not all of the features of contract’. On the other hand,
the term ‘contract’13 is defined in different ways for different purposes.
One of the definitions which can be relevant for this purpose is ‘an
agreement between two or more parties for the doing or not doing of
something specified’.

8
http://dictionary.cambridge.org/dictionary/british/quasi
9
http://dictionary.cambridge.org/dictionary/british/contract
10
http://www.chambers.co.uk/search.php?query=quasi&title=21st
11
http://www.chambers.co.uk/search.php?query=contract&title=21st
12 nd
Random House Webster’s College Dictionary, 2001, 2 Revised and updated Random House
edition, 9876543, April 2003, p. 1083.
13 nd
Random House Webster’s College Dictionary, 2001, 2 Revised and updated Random House
edition, 9876543, April 2003, p. 290.
4
 Thus, on the basis of Random House Dictionary a cumulative
effect of the terms ‘quasi’ and ‘contract’ is a relation resembling to those
created by a contract.

Looking at Random House Webster’s Dictionary it is obvious

that a quasi contract may mean such relation which resembles the
contractual relations.

In Webster’s Dictionary14 we find that a quasi contract is ‘an

obligation similar to that upon contract, enforced by action as upon
contract, and imposed by the person obliged/called also contract quasi,
implied contract’, or ‘an obligation imposed by law to prevent unjust
enrichment of one at other’s expense: Restitution’.

Thus, Webster’s Dictionary also treats quasi contract as if it is a

contract.

Encyclopaedia Britannica15 says that ‘contract’, in the simplest

definition, a promise enforceable by law. The promise may be to do
something or to refrain from doing something. The making of a contract
requires the mutual assent of two or more persons, one of them
ordinarily making an offer and another accepting. If one of the parties
fails to keep the promise, the other is entitled to legal recourse. The law
of contracts considers such questions as whether a contract exists, what
the meaning of it is, whether a contract has been broken, and what
compensation is due to the injured party. Accordingly, on the basis of
definition of contract as given above, a quasi contract may be defined as
a relation similar to contract.

14
Webster’s Third New International Dictionary, Vol. II, p. 1861.
15
http://www.britannica.com/EBchecked/topic/135270/contract
5
 Anson16 is of the opinion that what is restitution today was
known as quasi contract in the past. To support his view he quotes
statements of certain Lord Justices. Bowen L. J.’s has said that
‘liabilities are not to be forced upon people behind their backs 17’ was
profoundly influential. Indeed, Lord Sumner and Sir William
Holdsworth argued that all such claims were founded upon an implied
contract18. If there could not be a contract, there could not be an implied
contract; there was no independent non-contractual claim. Tort liability
was restricted by what was later called the ‘privity of contract’ fallacy,
that duties which originated in a contract were confined to the parties 19.
It was also mainly concerned with the protection of proprietary interests
and with providing a remedy for certain categories of physical injury.
Although a number of economic torts were developed, notably deceit,
injurious falsehood, inducement of breach of contract and conspiracy,
they required wilful misconduct. There was no liability for pure
economic loss which was inflicted negligently.

But in 22nd edition of his book, the term quasi contract has been
defined to cover those situations where a person is held liable to another
without any agreement for money or benefit received by him to which
the other person is better entitled. According to the orthodox view the
judicial basis of the obligation under a quasi-contract is a hypothetical
contract which is implied by law and this is the reason why the subject is
treated alongwith contract. But according to the radical view which is to

16 th
Anson’s Law of Contract, 28 ed., p. 17.
17
Falcke v. Scottish Imperial Insurance Co. (1886) 34 CH. 234, at p. 248.
18
Sinclair v. Brougham (1914) AC 398, at p. 452.
19
Winterbottom v. Wright (1842) 10 M. & W. 109.
6
be preferred, the obligation is sui generis and its basis is prevention of
unjust enrichment.20

Thus, it follows that Anson regards quasi contract as restitution.

But at the same time, his book mentions that a quasi contract is a relation
not created by contract and is based on notion of prevention of unjust
enrichment.

Paton21 while classifying the term obligation, says that it may

arise from 1) contract, 2) quasi-contract, 3) tort or delict, 4) quasi-
delict. He further says that there are many systems which do not know of
such concepts as quasi-contracts or quasi-delict which depend merely
upon historical accidents of particular system. The only logical division
is between rights created directly by the law and rights created by the
consent of another- or to look at the same question from the angle of
duty, to distinguish between duties imposed on a person against his will
and duties which he freely accepts.

Believing the jurist Paton, quasi contract may be said to be a

distinct kind of relationship which is not common to all the legal
systems.

Pollock & Mulla22 is of the opinion that a quasi contract belongs

to an entirely different legal category, having nothing to do with genuine
contracts, express or implied. These are a heterogeneous collection of
cases having little in common than the fact that one person is entitled to
recover money or property from the other in order that a just result

20 nd
Sir William Anson, Principles of English Law of Contract, 22 ed., p. 603; may also be seen in
th
Ratanlal & Dheerajlal’s The Law of Torts, 26 ed. (Rep. 2011), p. 10.
21 th
G.W. Paton, A Text Book Of Jurisprudence, 4 ed., 2007, p. 276.
22 th
Pollock & Mulla, Indian Contract & Specific Relief Acts, 14 ed., Vol. II, p. 1041.
7
should be reached. Such a right does not depend upon agreement or
promise.

A contract implied in law or a quasi contract is not a real contract

or as it is called a consensual contract. A quasi-contractual cause of
action involves an alleged promise to pay, which is purely fictitious. This
promise is imposed by implication of law, apart from and without regard
to the probable intention of the parties, and sometimes even against the
clear expression of dissent. Strictly these ‘constructive contracts’ are not
true contracts at all, since the essential element of contract is absent. The
expression quasi-contract is truly a misnomer; for it has little or no
affinity with contract. The Roman lawyers explained these as misfits.
Justinian refers to ‘those obligations which do not originate, properly
speaking in contract but, which as they do not arise from a delict, seeing
to be quasi-contractual’. A contract implied in law or a quasi contract is
not a real contract or as it is called a consensual contract. the latter are
only implied into an actual contract brought into existence by the
ordinary principles for information of agreements.

If Mulla’s approach on quasi contract is analysed, it is clear that a

quasi contract is such kind of obligation which do not depend on express
of implied promise. It has come into effect to prevent unjust gain by a
person.

According to P.S. Atiyah23, in the ordinary case of claimant who

has paid something under a contract where the defendant subsequently
fails to perform at all, that is to say, where there has been a ‘total failure
of consideration’, the claimant has a right to recover his payment not as

23 th
P.S. Atiyah, Atiyah’s Introduction to The Law of Contract, 6 ed., p. 408.
8
damages for breach of contract but in a quasi-contractual action or, as it
would today be called, a claim for restitution. He has also quoted a case
Lipkin Gorman v. Karpnale Ltd24 wherein it was observed that there
is another sort of monetary claim which is sometimes called a claim to
restitution ‘damages’, though it is not strictly a claim for damages at all.
A claim of this kind can arise if the defendant obtained a benefit as a
result of the breach of contract that he ought to return or hand over to the
claimant. In such a case, the claimant is not asking for compensation for
an injury or loss that he suffered (though he may have suffered an injury
or loss), but, instead, that the defendant simply returned or hand over the
benefit he obtained from the breach. The basis of such a claim is
therefore, that the defendant was unjustly enriched, while the remedy
that is sought is that the enrichment be undone. Historically, such claims
were closely intertwined with the law of contract- until recently some of
them were called claim in ‘quasi-contract’- but it is now recognised that
they are based on the distinct legal ground of unjust enrichment.

An examination of P. S. Atiyah’s view, quasi contractual

obligation is different from contractual obligation. A claim for breach of
quasi contract is a claim against unjust enrichment. It has also been
regarded as restitution.

Avtar Singh25 says that there are many situations in which law
as well justice require that a certain person we required to confirm to an
obligation, although he has neither broken any contract nor committed
any tort. For example, a person in whose home certain goods have been

24
(1991) 2 AC 548. See also Woolwich Equitable Building Society v. I.R.C., (1992) 3 All E.R. 737 (a
similar view was expressed by the Court).
25 th
Law of Contract (A Study of the Contract Act, 1872) and Specific Relief, 10 ed. (Rep. 2010), p.
552.
9
left by mistake is bound to restore them. Such obligations are generally
described for want of a better or more appropriate name, as quasi-
contractual obligations.

By his aforementioned approach, Dr. Avtar Singh accepts

existence of a quasi contract.

According to Dr. R. K. Bangia26 when a person gains some

advantage or benefit to which some other person was entitled to, or by
such advantage another person suffers an undue loss, the law may
compel the former to compensate the latter in respect of advantage so
gained. The law of quasi-contract covers such obligation. In India, they
are known as ‘Relations resembling those created by Contract’.

Dr. Bangia also recognises quasi contract and correlates it with

such obligations which resemble the contractual obligation.

Chitty27 agrees with the definition of quasi contract as given by

Lord Right in Fibrosa Spolka Akeyjna v. Fairbairn Lawson Combe
Barbour Ltd.28. He has described the nature of restitution or quasi-
contract in the following words: “It is clear that any civilised system of
law is bound to provide remedies for cases of what has been called
unjust enrichment or unjust benefit, that is, to prevent a man from
retaining the money of, or some benefit derived from another which it is
against conscience that he would keep. Such remedies in English Law
are generically different from remedies in contract or in tort, and are
now recognised to fall within a third category of the common law which

26 st
The Law of Torts Including Motor Vehicles Act and Consumer Protection Act, 21 ed., 2008, p.
14.
27 th
Chitty on Contracts, 24 ed., Vol. I, 1977, p. 843.
28
(1943) AC 32, 61.
10
has been called quasi-contract or restitution.” But Chitty further says
that the Limitation Act, 1939 does not envisage restitutionary claims as
a third category.

Keeping Chitty’s view in mind, it is evident that a quasi contract

can be treated as restitution in form of remedy against gain received by
one person supplied by another voluntarily.

Williston29 is of the opinion that quasi contractual obligations are

imposed by the law for the purpose of bringing about justice without
references to the intention of the parties.

Thus, Williston forms his opinion regarding quasi contract on the

basis of justice without giving importance to the intention of the parties.

S. Venkatesa Iyer30 while dealing with Ch. 5 (Ss. 68 to 72) of

the Indian Contract Act says that this chapter deals with certain relations
resembling those created by contract. These are called quasi contracts or
constructive contracts in English Law. The feature of these obligations is
that, if without any agreement and without delict or any breach of duty
on either side, a person receives some benefit from another, the law
considers it just that an obligation analogous to that created by contract
should be imposed upon him.

To Subrahmanyan & Singhal31 a quasi-contract means an

obligation to pay a sum of money (liquidated or unliquidated), which
arises independently of any contract, on the ground, that, in the
circumstance of case, it is considered by the law to be a just debt.

29 rd
Williston, A Treatise On The Law of Contracts, 3 ed., Vol. I, 1957, p.13.
30 th
S. Venkatesa Iyer’s Law of Contract and Tenders, 6 ed., Vol. 2, p. 387.
31 rd
The Indian Contract Act, 3 ed., Vol. II, 1989. p. 2.
11
 The view expressed by T. R. Desai32 on quasi-contract is that
implied contracts or quasi-contracts are exceptional kind of contracts by
which one party is bound to pay money in consideration of something
done or suffered by the other party; they are not founded on actual
promises, but arise when one party has so conducted himself that he
must be deemed bound as if he had made a promise although he has not.
No contractual relation whatever exists between the parties; but one
person has done something for another, or paid money on his behalf and
the court comes forward on the ground of equity saying that the person
receiving the benefit must make compensation to the other, i.e. adjust the
relation between them. No express provision was made for such cases in
the old English Common Law; but these duties are now on the theory of
assumed contract dealt with as arising quasi ex contractu. Though no
contract has been made by the parties, law makes out a contract for them,
and such a contract is termed a contract implied in law.

According to Ch. 1 S. 5 of the American Restatement of The

Law of Contracts33 as adopted by the American Law Institute, contracts
are often spoken of as express or implied. The distinction involves,
however, no difference in legal effect, but lies merely in the mode of
manifesting assent. Implied contracts must be distinguished from quasi-
contracts, which also has often been called implied contracts or contracts
implied in law. Quasi-contracts, unlike true contracts, are not based on
the apparent intention of the parties to undertake the performances in
question, nor are they promises. They are obligations created by law for
reasons of justice. Such obligations were ordinarily enforced at common

32 th
T. R. Desai, The Indian Contract Act and The Sale of Goods Act, 20 ed., 2009, p. 388.
33
Restatement of The Law of Contracts, Vol. I, 1932, p. 7.
12
law in the same form of action (assumpsit) that was appropriate to true
contracts, and some confusion with reference to nature of quasi-contracts
has been caused thereby.

When we examine the above mentioned statement, it can be said

beyond any doubt that the English concept of quasi contract has been
recognised by the law of U.S.A. it is an inference drawn from conduct of
parties and is based on the concept of promotion of justice.

Relying on Fibrosa Spolka Akcyjna v. Fairbairn Lawson

Combe Barbour Ltd.34 Lord Wright35 says, “Any civilised system of
law is bound to provide remedies for cases of what has been called
unjust enrichment or unjust benefit, that is, to prevent a man from
retaining the money of, or some benefit derived from, another which it is
against conscience that he should keep such remedies in English Law
are generically different from remedies in contract or in tort, and are
now recognised to fall within a third category of the common law which
has been called quasi contract or restitution”.

Munkman is of the opinion that a quasi-contract may be

described as an obligation to pay a sum of money (liquidated or
unliquidated) which arises independently of any contract or tort on the
ground that in the circumstances of the case, it is considered by the law
to be a just debt36. He goes on saying that the law of quasi-contracts
covers a wide range of cases, for example, money paid under a mistake
of fact, money paid for a consideration which wholly fails, quantum

34
(1943) AC 32, 61.
35 th
Halsbury’s Laws of England, 4 ed., Vol. 9, 1974, p. 434.
36
John H. Munkman, The Law Of Quasi-Contracts, Sir Isaac Pitman & Sons Ltd. (London)- Publisher,
pp. 1 & 2.
13
meruit for services rendered in the absence of binding contract, maritime
salvage, general average contribution.37

1.2 HISTORICAL BACKGROUND-

The concept of quasi-contract came into existence in England

and it was recognised by English Common Law as a category of case
different from contract and tort. It is well known that a contract is based
on mutual consent of parties to it to do or not to something and remedy
for breach of contract is supported by the reason that parties must
perform their contractual obligations. Further, the law of tort provides
remedy to the aggrieved party because the defendant has committed
breach of primary legal duty which extends to public in general. In
process of development of law of contract and law of tort a third
category of law came into existence which covered such cases which are
neither covered by law of contract nor by law of tort. For example,
money is paid by A to B by mistake. B is not liable to refund money to A
under the law of contract because he has no contractual obligation.
Similarly, he is also not liable to refund the money under the law of tort
because he is not guilty of causing breach of legal duty towards public in
general. But at the same time, law cannot reject A’s claim for refund of
money by B because if it is done so injustice will be done to A. The
result is that B will be directed by the court of law to refund money so
received to A so as to prevent illegal gain by B. It is at this stage that the
obligation of B was said to be a quasi-contractual obligation.

Bracton38, a leading lawyer of medieval age was of the opinion

that the quasi-contract was recognised under Roman Law. The quasi-

37
Supra Note 36, p. 2.
14
contractual obligations were called under Roman Law as obligations
quasi ex contractu. On the basis of such obligation money paid under a
mistake of fact was allowed by the Roman Law to be recovered by the
person who paid the money.

To have knowledge of quasi-contract, a recap of remedies

available especially for breach of contract or relations just like contracts
in Medieval Period becomes inevitable. These remedies were- 1) Wager
of law, 2) Covenant 3) Account, 4) Debt, 5) Assumpsit, and 6)
Indebitatus Assumpsit.

1.2.1 WAGER OF LAW-

In the early age the actions for contract and torts were within
jurisdiction of local and manorial courts. Under this action, when the
defendant denied his liability, he was supposed to wage his law. When
the defendant did so he was called upon next day by the Court to swear
his denial in presence of such number of persons which was decided by
the Court. These persons were also called as neighbours. After such
swearing by the defendant those persons were also required to swear to
support denial of the defendant. If the defendant’s oath coincided with
oath of neighbours, the defendant was held not liable. This kind of action
was also called as social action.

But it is to be noted that when the suit was brought into the Royal
Courts rather than in the local Courts, the social sanction behind the

38
See John H. Munkman, The Law Of Quasi-Contracts, p. 2.
15
action of wager of law was lost i.e. in such a case judgment of the Royal
Courts was considered final.39

1.2.2 COVENANT-

The term ‘covenant’ was also an action of medieval period. It

means conventio or agreement. It was also regarded as equivalent to
contract. The action of covenant was brought basically for breach of
contract for services like building for sales or leases of land. Normally,
the Royal Courts ordered for damages and not for specific performance.
But in 14th century when sealed document was required to be produced
by the plaintiff, the action of covenant became of no use.40

1.2.3 ACCOUNT-

The Writ of Account41 was fundamentally concerned with the

land law. It was used against a person who held some office e.g. receiver
or bailiff. When a person was holding certain office as e.g. receiver on
behalf of the plaintiff, he was held accountable to the plaintiff about the
money which he had received acting on behalf of the plaintiff. To
recover such money, the plaintiff was entitled to bring an action of
Account. However, in course of time the action of Account began to be
used to be brought for debt received by any person whether he was
bailiff or receiver of plaintiff or he was not having such authority.
Consequently, the Writ of Account was used in quasi-contractual
obligations e.g. where a person received money on behalf of the plaintiff
even though he was not authorised by the plaintiff, he was liable to the

39 th
Anson’s Law of Contract, 28 ed., p. 10.
40
Supra Note 39, p. 11.
41
John H. Munkman, The Law Of Quasi-Contracts, Sir Isaac Pitman & Sons Ltd. (London)- Publisher,
p. 4.
16
plaintiff to make account of such money under Writ of Account brought
by the plaintiff. Thus, such writ supported quasi-contractual actions.

1.2.4 DEBT-

The Writ of Debt42 developed to enable the plaintiff realise

money i.e. debt from the defendant which he received as a loan or which
he retained as a price of some goods sold to him by the plaintiff. To
illustrate further, where the defendant borrowed certain money from the
plaintiff and did not repay it, the plaintiff was entitled to recover such
money from the defendant by bringing an action of Debt against him.
Similarly, where the plaintiff sold certain goods to the defendant on
certain price and the defendant did not pay the price, the plaintiff was
entitled to recover such price from the defendant by way of action of
Debt. The Writ of Debt was not primarily based on a contract between
plaintiff and defendant but it was basically considered to be depending
on right of the plaintiff against the defendant. It was just on the basis of
Natural Law.

The radical difference between Writ of Account and Writ of Debt

was that in Writ of Account the defendant was held accountable to the
plaintiff for the money held by him. The account was prepared by
Auditor of the Court. After completion of account the plaintiff was told
about it by the Court. Afterwards, the Writ of Debt was brought by the
plaintiff and it was only then that the Court used to direct the defendant
to pay such money to the plaintiff. The weakness of Account was that
Auditor’s account was normally challenged. The result was that the
litigation prolonged. Again, both in action of Account and action of

42
Supra note 37.
17
Debt, there was scope for the defendant to escape liability with the help
of wager of law which was an archaic system whereby the defendant
proved his innocence by swearing that he was not holding such money or
debt and also by bringing before the Court some witnesses who also use
to swear stating that the defendant was innocent.

1.2.5 ASSUMPSIT-

The Writ of Assumpsit was brought when plaintiff suffered loss

due to non performance of a contract. Such remedy was based on the
assumption that when a contractual obligation is undertaken by a party
he must either perform it or pay damages to the other party in case of
breach of such contractual obligation.

1.2.6 INDEBITATUS ASSUMPSIT-

The remedy of Indebitatus Assumpsit43 developed afterwards

which almost replaced Account and Debt though to some extent the
action of Account and Debt were applicable side by side. Since Debt
came within exclusive jurisdiction of Common Pleas and the Account
came within jurisdiction of Court of Chancery, the Writ of Indebitatus
Assumpsit was originated by King’s Bench. It covered the cases of
Account and Debt. Initially, the Writ of Indebitatus Assumpsit originated
in the action of trespass (i.e. a remedy for tort of direct physical injury to
the plaintiff or his property) but subsequently, it was extended to cover
such cases where defendant caused damage to such property of the
plaintiff which he agreed to handle by making a contract with the
plaintiff. Further, this remedy was made available where the defendant
did not perform the contract and thereby the plaintiff suffered loss. This
43 th
Anson’s Law of Contract, 28 ed.,at pp. 13, 14, & 15. See also supra note 36 at pp. 5, 6, & 7.
18
form of action was called as Assumpsit. That is to say, the Assumpsit
was available for non performance of contract. Ultimately, the
Assumpsit was available for all such liquidated sum of money which was
recovered by Account or Debt. Thus, the Assumpsit became the basis for
development of Law of Contract. The action of Indebitatus Assumpsit
developed with the concept that the defendant being indebted to the
plaintiff had promised to pay the sum of money claimed by the plaintiff.
By this action it was thought that the defendant could deny the debt but
not the fictitious promise (which later on became implied promise or
contract implied by law) which was sometimes equated with a quasi
contract. To illustrate, Slade’s Case44 can be quoted. In this case the
matter of realisation of debt was before the Common Pleas which was
having jurisdiction over debt. According to procedure adopted by it, the
Common Pleas directed the jury to find out two things- 1) whether the
defendant owed debt, and 2) whether he had made promise to repay it.
The jury tried to resolve the matter. The jury found out that debt was
borrowed by the defendant but he could not make promise to repay it.
The Common Pleas held that the case was not fit for Indebitatus
Assumpsit. Thereupon the matter was reported to the King’s Bench.
After keeping in view all the aspects of the case, the King’s Bench
observed that when it was proved that the debt was borrowed by the
defendant, an implied promise can be inferred from conduct of defendant
that he had (impliedly promised to repay the debt).

Thus, in Slade’s Case the Writ of (Indebitatus) Assumpsit was

allowed. It is from the judgment delivered in this case that the modern

44
(1602) 4 Co. Rep. p. 91a.
19
law of contract got a definite shape from the standpoint of remedy and
witnessed rapid growth.

It is worth mentioning that during 19th century these forms of

actions were abolished by S. 49 of Common Law Procedure Act, 1852.
The procedure was further simplified by Judicature Act, 1873. With
these Acts the plaintiff is now required to state in the Court of Law only
the facts related to his case and it becomes the duty of the Court to
decide the case on the basis of law ignoring forms of action because
these forms of action caused difficulties from the procedural standpoint.

It is to be noted that in 19th century, the Doctrine of Laissez

Faire developed in England as one of the prominent aspects of economic
changes. The doctrine means freedom of contract. The desirous
competent persons were given freedom to make contract according to
terms and conditions fixed by them in many fields of life. Though the
standard form of contract is considered as an encroachment upon such
freedom of contract in modern age. Nevertheless, the concept of freedom
of contract in various fields of life is still relevant. In modern age the
quasi contractual obligations have been termed as restitutionary
obligations which is based on unjust enrichment of the defendant at the
cost of plaintiff’s expenditure.45

It is well settled that contract is known as Law of Obligation.

Further, Law of Obligations has been classified into three categories- 1)
Contractual Obligations, 2) Tortious Obligations, and 3) Restitutionary
Obligations. It is the Restitutionary Obligation which was originally
known as quasi contractual obligation. Thus, the quasi contractual

45 th
Anson’s Law of Contract, 28 ed.,at pp. 13, 14, & 15. See also supra note 36 at p. 22.
20
obligation as it was called in past days is now called as Restitutionary
Obligation.

When we endeavour to seek further judicial support to quasi

contractual obligations we are obviously attracted to the landmark
opinion expressed by Lord Mansfield in Moses v. Mc. Ferlan46. In the
instant case, it was laid down that an unjust enrichment by the defendant
at the cost of plaintiff has to be prevented on the basis of natural justice
and equity. Lord Mansfield is recognised as founder of quasi contractual
obligations by expressing his opinion in the present case.

However, the aforementioned opinion of Lord Mansfield was not

accepted by House of Lords in Sinclair v. Brougham47. In this case, the
judgment was relied on an implied-in-fact contract theory. The plaintiffs
were allowed to recover money on the basis of this theory (i.e. on the
basis of rateable distribution of the mixed fund) but not on the basis of
quasi contract. Thus, in this case it was settled that the juridical basis of a
quasi contract was an implied contract or notional contract or fictional
contract.

The view of House of Lords equating a quasi contract with an

implied contract expressed in Sinclair v. Brougham as quoted just above
continued to prevail for a long time but again this view was not
considered good in Fibrosa Spolka Akeyjna v. Fairbairn Lawson
Combe Barbour Ltd.48. In the present case implied in fact contract
theory was not relied upon and again the theory of unjust enrichment
was restored. The plaintiff was allowed to recover money paid by him in

46
(1760) 2 Burr 1005, at p. 1012: (1558-1774) All E.R. 581.
47
(1914) A.C. 398.
48
(1943) A.C. 32: (1942) 2 All E. R. 122, H. L.
21
advance for supply of machinery to the defendant because contract was
not performed due to outbreak of war. Lord Wright preferred to ask the
defendant to refund money to the plaintiff so that an unjust enrichment
by the defendant could be prevented. He observed that under the English
Law such remedy is considered as different from remedies for contract
or remedies for tort and are now recognised as third kind of remedy for
quasi contractual obligation or restitutionary obligation.

1.3 SOCIAL JUSTICE-

Fundamentally, Social Justice may be taken to mean justice to all

the members of society irrespective of their personal status, wealth,
property, education, religious leaning, political affinity, ethical values
and so on. Broadly speaking, the concept of social justice can be said to
be based on distributive justice. The noble idea underlying the
distributive justice49 is based on reasonable distribution of wealth,
properties, taxes, opportunities in all the fields of life. It follows
therefore that social justice does not only mean formulation and
implementation of reservation policies for weaker sections of society.
That is to say, the concept of social justice cannot be restricted only up to
extent of implementation of reservation policy to the persons belonging
to schedule castes, schedule tribes and other backward classes but it
should be extended to include, for example, equal opportunity to all the
persons of society for making contracts (after fulfilling certain legal
qualifications), seeking education (primary and higher), going abroad for
any legal purpose, availing facilities of tourism, participating equally in
religious and political activities and so on and so forth. Thus, it is

49
Lingappa Pochanna Appelwar v. State of Maharashtra (1985) 1 S.C.C. 472.
22
obvious that contractual as well as quasi contractual obligations (or
restitutionary obligations) seem to include the concept of social justice.

1.4 QUASI-CONTRACT DISTINGUISHED FROM

CONTRACT, TRUST AND TORT-

It is not out of point to make a brief distinction between quasi

contract and certain other civil obligations. These obligations are
contractual, based on trust and tortuous. An effort to make distinction
seems desirable from the standpoint that these relations are of civil
nature and damages is generally awarded as a remedy for breach thereof.
Examined from this angle these relations have fundamental similarity
that the most common remedy for their breach is the damages. When
quasi contractual obligation is broken reimbursement or restoring the
goods as the case may be is the remedy which is awarded by the Court of
law to the aggrieved party. So, the aspect of distinction between these
relations of obligations can be examined as follows-

1.4.1 QUASI CONTRACT AND CONTRACT-

1. Concept of quasi contract arises when one person does

something voluntarily for benefit of another who derives such benefit or
where a person leaves some goods at the house, office, etc of another by
mistake. On the other hand, according to S. 2(h) of the Indian Contract
Act, 1872 an agreement enforceable by law is a contract.

2. A quasi contract is not based on any promise express or

implied. But a contract is purely based on a promise express or implied.

23
 3. The idea of quasi contract is completely inferred by law. It
means the entire concept of quasi contract depends on legal construction.
It is why it is sometimes, called as a constructive contract. However, a
contract which is depending on an implied promise can be inferred from
conduct of the parties. But a contract which depends on an express
promise i.e. written or oral promise cannot be inferred by law. It is
clearly made by express means. That is, where offer and acceptance are
oral or written the contract is express. Further, where offer is express and
acceptance is depending on conduct or vice versa, the contract may
partly be express and partly be implied.

4. In a quasi contract parties may be competent or may not

even be competent. For example, when necessaries are supplied by a
person to a minor, the minor through his property is bound quasi
contractually to reimburse the person who has furnished such
necessaries. But in a contract both the parties must have all the three
essential qualifications as mentioned in S. 11 of the Indian Contract
Act, 1872. That is to say, both the parties must be major according to the
law to which they are subject, they are of sound mind and neither of
them has been disqualified by law from contracting.

5. In a quasi contract, party accepting the benefit or keeping

the goods under mistake has restitutionary obligation. In other words,
such party has to reimburse or restore the goods as the case may be. The
act of reimbursement and restoration of goods or quasi contractual
obligations or restitutionary obligations. On the other hand, when a
contract is broken despite injunction50 and specific performance51 the

50
Ss. 36-42, The Specific Relief Act, 1963.
51
Ss. 10-12, The Specific Relief Act, 1963.
24
remedy of damages under Ss. 73-75 of the Indian Contract Act, 1872 is
generally awarded by Court of law.

1.4.2 QUASI CONTRACT AND TRUST-

Trust also creates civil obligation as quasi contractual obligation

is considered. Nevertheless, there are certain aspects on which these two
can be said to have distinguishing features. These aspects can be
precisely be examined as follows-

1. Concept of quasi contract arises when one person does

something voluntarily for benefit of another who derives such benefit or
where a person leaves some goods at the house, office, etc of another by
mistake. But according to S. 3 of the Indian Trusts Act, 1882, a trust is
an obligation annexed to the ownership of the property, and arising out
of a confidence reposed in and accepted by the owner, or declared and
accepted by him for the benefit of another or of another and to owner.
Such definition of trust is confined to a private trust and it does not
include a public trust.

2. Quasi contract is inferred by law i.e. it is implied in law

while a trust may be express as well as implied.

3. A quasi contract may be classified basically in four

categories- i) It arises when one person does something voluntarily for
benefit of another, ii) When one person delivers goods to another by
mistake, iii) When a person finds some lost goods belonging to another
person, and iv) When upon breach of a contract after part performance
by the promissor, the promisee refuses to pay price of the goods so
delivered before the breach. When we look at trust, it can be classified
25
into several sub heads- Simple Trust, Special Trust, Private Trust, Public
or Charitable Trust, Express or Declared Trust, Executed and Executory
Trust, Implied or Presumed Trust, Constructive Trust, Resulting Trust,
Precatory Trust, Secret Trust, Trust for Value, Voluntary Trust, Illusory
Trust, Trust in Favour of Creditor, Discretionary Trust, Protective Trust
Purpose Trust, Trust in Favour of Creditors, Trust of Imperfect
Obligation.

4. The edifice of quasi contract is based on the concept of

prevention of unjust enrichment. That is to say, quasi contractual
obligation is enforced by way of law against a person who has taken
some advantage from the other without any consideration. So, he bears
quasi contractual obligation to reimburse the person who has done some
act in his favour voluntarily or has left some goods at house of another
under mistake. On the other hand, trust has its foundation on mutual
confidence which maker of trust reposes in the trustee. In other words, a
trust is created by its maker with confidence and expectation that trustee
will fulfil the obligation annexed to ownership of the trust property.

5. A quasi contractual obligation is imposed by law because

it is neither based on express promise nor implied promise whereas in a
trust the obligation is generally created expressly or impliedly between
maker of trust i.e. settlor and trustee.

6. In a quasi contract the person for example B for whom

some act is done voluntarily or some goods is delivered under mistake to
for example A, these persons A and B are the parties to it. A third person
is not necessarily required to take such benefit. On the other hand,
beneficiary i.e. a third person e.g. C is also necessary for creation of a
26
trust despite maker of trust e.g. A and trustee e.g. B. It means in a trust
beneficiary is a basic requirement. The beneficiary may be totally a
different person or both maker of trust and third person may be
beneficiary.

1.4.3 QUASI CONTRACT AND TORT-

Tort is a civil wrong the remedy for which is generally awarded

in form of unliquidated damages. The obligation of person committing
the tort to pay damages is a civil obligation therefore quasi contract can
be distinguished from tort because quasi contractual obligations are also
regarded as civil obligations. Further, to point out distinction between
these two concepts is also desirable because obligations in both are
imposed by law. The points of distinction between these two concepts
can be discussed as follows-

1. Concept of quasi contract arises when one person does

something voluntarily for benefit of another who derives such benefit or
where a person leaves some goods at the house, office, etc of another by
mistake. On the other hand, by virtue of S. 2(m) of the Limitaion Act,
1963 tort means a civil wrong which is not exclusively a breach of
contract or breach of trust.

2. Quasi contract is not a wrong but it is a good thing having

primarily the idea of human conduct, sympathy and support given by a
human being to another human being. It is breach of quasi contract
which can be regarded as a wrong. But tort is a civil wrong and it can
never be regarded as a good act or genuine act by one person against
another person.

27
 3. Where under a quasi contract one person renders some
good services in favour of another voluntarily, his act deserves
commendation while the act of doer of a tort (i.e. the act of a tortfeasor)
always invites condemnation by right minded persons in society.

4. Quasi contractual obligation which in modern age is called

as restitutionary obligation is generally liquidated but the nature damages
to be paid by the doer of tort to the victim is normally unliquidated. It
cannot be known to the parties to litigation nor to any other person. It
becomes liquidated only when it is ascertained by Court of law at the
stage of final disposal of case.

It follows therefore that the aforementioned civil obligations

based on quasi contract, contract, trust and tort are to some extent
analogous to one another but when they are examined minutely they
have number of aspects to establish clear distinction among them.

1.5 HYPOTHESIS-

The hypothesis of my thesis is to establish whether a quasi

contract should be called as quasi contract or restitution as a modern
name given to quasi contract. Further, whether the idea of social justice
is an undercurrent of quasi contract is also a notion to be examined and
explored here. Similarly, the provisions of S. 68 to 72 of the Indian
Contract Act, 1872 are within the domain of examination under the
present thesis inter alia, also from the stand point as to whether they are
complete in all the respect or they are deficient on some counts. In other
words, it is inevitable to submit that our study under the thesis has
focused primarily on two propositions- whether the term should be

28
called as quasi contract or restitution and secondly the concept of quasi
contract is also based on social justice in addition to be based on
economic justice and distributive justice. The concept of quasi contract
has been coming into existence for a long time and in modern age it has
been renamed as restitution. Therefore, we receive inspiration from all
the developments in this regard to formulate my hypothesis so that I can
reach a definite conclusion on the matter with the help of my present
thesis.

1.6 OBJECTIVE-

It is well known as every work, may be it is manual or academic

has got certain objectives to be fulfilled. So, is the idea underlying my
present mental work. An obligation can either be created by law or by
mutual consent of the parties. When an obligation is created by law, it is
obviously called as a legal obligation. However, when it is created by
mutual consent of the parties it is popularly known as a contractual
obligation. That is to say a contract is a category of law of obligation. It
is evident, therefore, that a contractual obligation comes into being by
mutual consent of parties to it. It’s breach is remediable by specific
performance or injunction or damages. On the other hand another kind of
obligation is a tortuous obligation. It arises when a duty towards public
in general and primarily fixed by law is broken. Such breach is
redressible generally by an action for unliquidated damages. In this
respect it is further to say that despite, contractual obligation and
tortuous obligation, there is third category of obligation which is known
as quasi contractual obligation or restitutionary obligation. It is such

29
obligation which aims at preventing an unjust enrichment derived by one
person at the cost of another.

So, to undertake the responsibility of writing the present thesis, I

have devoted to fulfil the following objectives:

1. As we know, research is to think what others have not,

therefore we have made an honest effort to examine quasi contract or
restitution and the provisions incorporated under Sections 68 to 72 of the
Indian Contract Act, 1872 from a different standpoint. Such standpoint is
related to as to whether the relation so inferred maybe termed as quasi
contract or restitution and to discover as to whether the idea of social
justice is implied in such relation.

2. Another objective is to affirm the appropriate

nomenclature of the term quasi contract in modern age.

3. Our next object centres on an effort to examine the social

justice by widening its scope so as to establish that the idea of social
justice is also an undercurrent of the quasi contract.

4. Lastly, the object of my present thesis is to make an

endeavour to convince the academic galaxy all the world over about my
approach that quasi contract lies also on the concept of social justice.

The aforementioned objectives have been attempted to be

achieved with the help of my present work.

1.7 RESEARCH METHODOLOGY-

An academic work like the present one needs some specific

methodology to complete. In this stride, I submit that I have adopted

30
primarily the Doctrinal method to complete my thesis with meticulous
attention for presenting it to the academic field. No doubt the thesis is
conventional but it has been written from a fresh outlook so that the
work becomes sense bearing acceptable and convincing. Besides the
materials of high standards have been consulted and relevant matters
have been taken from them in course of writing and giving a finishing
touch to the thesis. Valuable views and suggestions from my supervisor
and teachers have been given proper attention while giving a finishing
touch to the present work. The matters collected, existing principles and
the case laws have been critically examined to write the thesis. Proper
care has also been taken to arrange and present the thesis in a systematic
manner.



31