Implied Contract Legal Meaning and Definition

Here is a simplified definition of the legal term Implied Contract.

Implied Contract (noun)

An "Implied Contract" is a type of agreement that, while not expressed in writing, is legally binding due to the behaviour, actions, or circumstances of those involved. This type of contract is inferred from the facts and circumstances of a situation, and not from direct words of the parties. For example, if Person A provides money to Person B with the understanding that it is to be given to Person C, and Person B instead uses the money for their own benefit, an implied contract may be recognized by a court to hold Person B accountable. These contracts are legally upheld to protect individuals from unfair practices or exploitation.