Implied Contract


DEFINITION of 'Implied Contract '

A legal substitute for a contract. An implied contract is an agreement created by actions of the parties involved, but it is not written or spoken. This is a contract assumed to have been drawn. In this case, there is no written record nor any actual verbal agreement. A form of an implied contract is an implied warranty provided automatically by law. An implied warranty means that when a product is purchased, it is guaranteed to work for its ordinary purpose. For example, a refrigerator is fit to keep food cool.

BREAKING DOWN 'Implied Contract '

Implied contract is an agreement which is not reduced to writing but is created on the basis of the behavior of the parties involved. Under an implied contract, it is suggested that the parties involved are acting under an agreement. In the medical field, an implied contract exists when a veterinarian examines and treats an animal. It is implied that the veterinarian will do his/her best and that the client will pay the fee charged. Historically the veterinarian has treated animals and the owners have paid.

  1. Quasi Contract

    A legal agreement created by the courts between two parties who ...
  2. Engagement Letter

    A written agreement to perform services in exchange for compensation. ...
  3. Implied Authority

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

    A type of business agreement that is spoken, not memorialized ...
  5. Adhesion Contract

    A contract in which one party has substantially more power than ...
  6. Breach Of Contract

    Violation of any of the agreed-upon terms and conditions of a ...
Related Articles
  1. Budgeting

    You Can't Live On Love

    If your head is in the clouds, check out this down-to-earth financial advice for couples.
  2. Insurance

    Understanding Your Insurance Contract

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

    Exploring Advanced Insurance Contract Fundamentals

    Understanding your contract can help you protect our family's financial security.
  4. 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.
  5. Budgeting

    Extended Warranties: Should You Take The Bait?

    Avoid shelling out for these policies and you could save hundreds of dollars.
  6. Retirement

    Create A Pain-Free Postnuptial Agreement

    This marital contract can underline your love for each other - not undermine it.
  7. Bonds & Fixed Income

    What is an Indenture?

    An indenture is a legal and binding contract between a bond issuer and the bondholders.
  8. Term

    What are Mutually Exclusive Events?

    In statistics, mutually exclusive situations involve the occurrence of one event that does not influence or cause another event.
  9. Entrepreneurship

    Risks Associated With Government Contracts

    Government contracts can be rewarding, but they also come with a variety of risks.
  10. Entrepreneurship

    10 Public Companies That Rely On Govt. Contracts

    We look at 10 of the top public companies whose businesses rely on U.S. government contracts.
  1. 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 >>
  2. What is an alienation clause?

    Whether used in reference to insurance policies, mortgages or commercial loans, an alienation clause stipulates that should ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  2. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  3. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
  4. Black Monday

    October 19, 1987, when the Dow Jones Industrial Average (DJIA) lost almost 22% in a single day. That event marked the beginning ...
  5. Monetary Policy

    Monetary policy is the actions of a central bank, currency board or other regulatory committee that determine the size and ...
  6. Indemnity

    Indemnity is compensation for damages or loss. Indemnity in the legal sense may also refer to an exemption from liability ...
Trading Center