§ 170 Obligations Arising From Quasi-Contracts
Both in Roman and in English law there are certain obligations which are not in truth contractual, but which the law treats as if they were. They are contractual in law, but not in fact, being the subject-matter of a fictitious extension of the sphere of contract to cover obligations which do not in reality fall within it. The Romans called them obligationes quasi ex contractu. English lawyers call them quasi-contracts or implied contracts, or often enough contracts simply and without qualification. We are told, for example, that a judgment is a contract, and that a judgment debt is a contractual obligation.465 “Implied [contracts],” says Blackstone,466 “are such as reason and justice dictate, and which, therefore, the law presumes that every man undertakes to perform.” “Thus it is that every person is bound, and hath virtually agreed, to pay such particular sums of money as are charged on him by the sentence, or assessed by the interpretation, of the law.”467 So the same author speaks, much too widely indeed, of the “general implication and intendment of the courts of judicature that every man hath engaged to perform what his duty or justice requires.”468
From a quasi-contract, or contract implied in law, we must carefully distinguish a contract implied in fact. The latter is a true contract, though its existence is only inferred from the conduct of the parties, instead of being expressed. Thus when I enter an omnibus, I impliedly, yet actually agree to pay the usual fare. A contract implied in law, on the contrary, is merely fictitious, for the parties to it have not agreed at all, either expressly or tacitly.
In what cases, then, does the law recognise this fiction of quasi-contract? What classes of obligations are regarded as contractual in law, though they are not so in fact? To this question it is not possible to give any complete answer here. We can, however, single out two classes of cases, which include most, though not all, of the quasi-contractual obligations known to English law.
1. In the first place we may say in general, that in the theory of the common law all debts are deemed to be contractual in origin. A debt is an obligation to pay a liquidated sum of money, as opposed to an obligation to pay an unliquidated amount, and as opposed also to all non-pecuniary obligations. Most debts are obligationes ex contractu in truth and in fact, but there are many which have a different source. A judgment creates a debt which is non-contractual; so also does the receipt of money paid by mistake or obtained by fraud. Nevertheless, in the eye of the common law they all fall within the sphere of contract; for the law conclusively presumes that every person who owes a debt has promised to pay it. “Whatever, therefore,” says Blackstone,469 “the laws order any one to pay, that becomes instantly a debt which he hath beforehand contracted to discharge.”
Hence it is, that a judgment debtor is in legal theory liable ex contractu to satisfy the judgment. “The liability of the defendant,” says Lord Esher,470 “arises upon the implied contract to pay the amount of the judgment.” Similarly all pecuniary obligations of restitution are in theory contractual, as in the case of money paid by mistake, or obtained by fraud or duress. “If the defendant,” says Lord Mansfield,471 “be under an obligation, from the ties of natural justice, to refund, the law implies a debt, and gives this action founded on the equity of the plaintiff’s case, as it were upon a contract (quasi ex contractu, as the Roman law expresses it).” So also with pecuniary obligations of indemnity; when, for example, the goods of a stranger are distrained and sold by a landlord for rent due by his tenant, the law implies a promise by the tenant to repay their value to the owner thus deprived of them.472 A similar fictitious promise is the ground on which the law bases obligations of contribution. If, for example, two persons acting independently of each other guarantee the same debt, and one of them is subsequently compelled to pay the whole, he can recover half of the amount from the other, as due to him under a contract implied in law, although there is clearly none in fact.
2. The second class of quasi-contracts includes all those cases in which a person injured by a tort is allowed by the law to waive the tort and sue in contract instead. That is to say, there are certain obligations which are in truth delictal, and not contractual, but which may at the option of the plaintiff be treated as contractual, if he so pleases. Thus if one wrongfully takes away my goods and sells them, he is guilty of the tort known as trespass, and his obligation to pay damages for the loss suffered by me is in reality delictal. Nevertheless I may, if I think it to my interest, waive the tort, and sue him on a fictitious contract, demanding from him the payment of the money so received by him as having rightly sold the goods as my agent, and therefore as being indebted to me in respect of the price received by him; and he will not be permitted to plead his own wrongdoing in bar of any such claim.473 So if a man obtains money from me by fraudulent misrepresentation, I may sue him either in tort for damages for the deceit, or on a fictitious contract for the return of the money.
The reasons which have induced the law to recognise the fiction of quasi-contractual obligation are various. The chief of them, however, are the three following:—
(1) The traditional classification of the various forms of personal actions, as being based either on contract or on tort. This classification could be rendered exhaustive and sufficient only by forcing all liquidated pecuniary obligations into the contractual class, regardless of their true nature and origin. The theory that all common law actions are either contractual or delictal is received by the legislature even at the present day,474 and its necessary corollary is the doctrine of quasi-contract.
(2) The desire to supply a theoretical basis for new forms of obligation established by judicial decision. Here as elsewhere, legal fictions are of use in assisting the development of the law. It is easier for the courts to say that a man is bound to pay because he must be taken to have so promised, than to lay down for the first time the principle that he is bound to pay whether he has promised or not.
(3) The desire of plaintiffs to obtain the benefit of the superior efficiency of contractual remedies. In more than one respect, it was better in the old days of formalism to sue on contract than on any other ground. The contractual remedy of assumpsit was better than the action of debt, for it did not allow to the defendant the resource of wager of law. It was better than trespass and other delictal remedies, for it did not die with the person of the wrongdoer, but was available against his executors. Therefore plaintiffs were allowed to allege fictitious contracts, and to sue on them in assumpsit, whereas in truth their appropriate remedy was debt or some action ex delicto.
It seems clear that a rational system of law is free to get rid of the conception of quasi-contractual obligation altogether. No useful purpose is served by it at the present day. It still remains, however, part of the law of England, and requires recognition accordingly.