Implied Contract Terms


DEFINITION of 'Implied Contract Terms'

Items that a court will assume are intended to be included in a contract, even though they are not expressly stated. Businesspeople generally do not want to rely upon a court's interpretation of implied terms, so a good contract will often be very lengthy so that as many material items as possible are written into the contract. However, when it is not possible to cover every possible detail, a lawyer may appeal that such terms were implied in order to give force to the intent of the contract.

BREAKING DOWN 'Implied Contract Terms'

Contract terms can be implied in a number of ways. For example, in many transactions involving the purchase of goods or services, there is an implied warranty of merchantability. That is, it is implied that what you are buying will serve the purpose that would be reasonably expected. This contract term is implied even when there is no written or oral contract. In other cases, contract terms may be implied where the intent of a contract obviously necessitates the inclusion of certain items. Even stating express terms to the contrary may not be sufficient to negate certain terms implied by the law.

  1. Implied Contract

    A legal substitute for a contract. An implied contract is an ...
  2. Implied Authority

    An agent with the jurisdiction to perform acts which are reasonably ...
  3. Oral Contract

    A type of business agreement that is spoken, not memorialized ...
  4. Breach Of Contract

    Violation of any of the agreed-upon terms and conditions of a ...
  5. Assignable Contract

    A futures contract with a provision permitting the contract holder ...
  6. Ex Works (EXW)

    An international trade term requiring the seller to make goods ...
Related Articles
  1. Insurance

    Understanding Your Insurance Contract

    Learn how to read one of the most important documents you own.
  2. Home & Auto

    Exploring Advanced Insurance Contract Fundamentals

    Understanding your contract can help you protect our family's financial security.
  3. Home & Auto

    Attention Home Buyers! Why You Need A Lawyer

    Property transactions are complex and subject to specific state/local rules. A professional can simplify the process.
  4. Personal Finance

    How To Pick The Right Lawyer

    Find out what factors to consider before hiring an attorney.
  5. Options & Futures

    The History Of Options Contracts

    Options and futures didn't originate with Wall Street power brokers. In fact, it all started with rice.
  6. Budgeting

    Extended Warranties: Should You Take The Bait?

    Avoid shelling out for these policies and you could save hundreds of dollars.
  7. Economics

    The 5 Countries That Produce the Most Carbon Dioxide (CO2)

    Learn about the top five countries, China, the United States, India, Russia and Japan, that are the largest contributors to carbon dioxide emissions.
  8. Economics

    Explaining the Tier 1 Leverage Ratio

    The Tier 1 leverage ratio measures a bank’s core capital against its total assets.
  9. Investing Basics

    What Is Schedule 13G Used For?

    Schedule 13G is an SEC form an investor must file upon taking ownership of 5% or more of a company’s outstanding shares.
  10. Insurance

    Airbnb Insurance: Will It Cover Enough?

    If a paying guest trips over a rug in your home, breaks an ankle and sues for damages, here's how to make sure your coverage protects you.
  1. What happens to a 529A account when the beneficiary dies?

    According to the Achieving a Better Life Experience Act of 2014 (ABLE Act), when the designated beneficiary of a 529A account ... Read Full Answer >>
  2. Can you have more than one 529A account?

    According to the Achieving a Better Life Experience Act of 2014 (ABLE Act), a disabled person can generally set up only one ... Read Full Answer >>
  3. How often do mutual funds report their holdings?

    The Securities and Exchange Commission (SEC) requires mutual funds to report complete lists of their holdings on a quarterly ... Read Full Answer >>
  4. Are waivers of subrogation clauses ever ineffective in preventing a third-party lawsuit?

    Sometimes waiver of subrogation clauses are ineffective at preventing a third-party lawsuits. In determining who is responsible ... Read Full Answer >>
  5. How do I find a good personal bankruptcy lawyer?

    While it is not necessary to hire an attorney to file bankruptcy, the rules that govern bankruptcy can be extremely complex, ... Read Full Answer >>
  6. What are unregistered securities or stocks?

    Before securities, like stocks, bonds and notes, can be offered for sale to the public, they first must be registered with ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Ex Works (EXW)

    An international trade term requiring the seller to make goods ready for pickup at his or her own place of business. All ...
  2. Letter of Intent - LOI

    A document outlining the terms of an agreement before it is finalized. LOIs are usually not legally binding in their entirety. ...
  3. Purchasing Power

    The value of a currency expressed in terms of the amount of goods or services that one unit of money can buy. Purchasing ...
  4. Real Estate Investment Trust - REIT

    A REIT is a type of security that invests in real estate through property or mortgages and often trades on major exchanges ...
  5. Section 1231 Property

    A tax term relating to depreciable business property that has been held for over a year. Section 1231 property includes buildings, ...
  6. Term Deposit

    A deposit held at a financial institution that has a fixed term, and guarantees return of principal.
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!