Recently, we discussed the topic of damage recovery by examining the well-known case of Hadley v. Baxendale. As we saw in that case, damage recovery in breach of contract cases is limited by the principle of foreseeability, such that damages must be reasonably foreseeable to be recoverable. We will continue to look at core contract law issues in this post by examining the concept of quantum meruit.
What Is Quantum Meruit?
The concept of quantum meruit – a phrase which is Latin for “what someone deserves” – is in the same category as promissory estoppel, a concept we have discussed before. Like promissory estoppel, quantum meruit comes into play when we have contracts which are superficially flawed or incomplete. In the case of quantum meruit, the issue is about assigning liability in cases in which the element of acceptance is flawed or questionable. If one party accepts the benefits given by the services of another party, and that other party expected compensation, quantum meruit may apply even if no verbal or written acceptance occurred. Let’s explore the case of Day v. Caton to explore the concept of quantum meruit in detail.
Overview of Day v. Caton
In this case, the plaintiff and defendant shared a property line. The plaintiff built a wall which extended onto the defendant’s property. Approximately half of the completed wall stood on the defendant’s property. The defendant was aware that the plaintiff intended to complete the wall, and that roughly half of the wall would end up on his side, and that the plaintiff expected compensation. The plaintiff expected to be compensated because the defendant had a clear benefit from the wall.
The court determined that the defendant was in fact liable for half of the costs of the wall. And the court based this determination using the quantum meruit concept. Because the defendant was fully aware of the building plans, and made no objection, and had plenty of opportunities to object, the defendant entered into an “implied-in-fact” contract when he accepted the construction of the wall. Disallowing recovery for the plaintiff would have resulted in clear unfairness. This is true even though there was no actual verbal consent, and therefore no firm “acceptance” by the defendant.
The Implied-in-Fact Contract
The concept of the “implied-in-fact” contract discussed in Day v. Caton can be extrapolated to other scenarios. If the court finds certain things present in a given scenario, then an implied-in-fact contract may be inferred. If the plaintiff expects payment, the defendant believes that the plaintiff expects payment, the defendant has the opportunity to make an objection but declines to make the objection, and the defendant does in fact derive benefit from the plaintiff’s services, then a contract may be implied-in-fact.
- Implied-in-fact contracts may be inferred from the facts of a case.
- Plaintiffs must actually expect payment for services.
- The defendant must have reason to believe that the plaintiff expects payment.
- The accused has an opportunity to object, but doesn’t object.
- The defendant does in fact derive benefit from the services provided by the plaintiff.
Contact Trembly Law Firm for More Information
The specific scenario described in the case of Day v. Caton may be rare, but the principle of quantum meruit shows up fairly often. If you would like additional guidance on this concept, or you have a contract formation or other contract issue, get in touch with the Trembly Law Firm today. The business lawyers at Trembly Law Firm can provide expert counsel on your contract case and make sure that a just outcome is attained. Give us a call today at (305) 431-5678 for more information.