What is an implied contract?

Study for the South Dakota Life and Health Exam. Learn with multiple choice questions, each with explanations. Prepare effectively and excel in your exam!

An implied contract is one that is established through the actions or conduct of the parties involved, rather than being explicitly stated or written down. This type of contract arises when the behavior of the parties indicates that they have agreed to certain terms, even if those terms are not formally articulated. For example, when a person orders food at a restaurant, it is understood that they will pay for the meal once it is served, creating an implied contract based on their actions.

The concept of an implied contract emphasizes that mutual consent and the intentions of the parties can be determined through their behaviors, establishing the expectation of a contractual relationship without needing written or verbal affirmation. This contractual form is commonly recognized in various situations where formal agreements are absent, yet an understanding is evident based on how the parties conduct themselves.

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