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Implied contracts may result in disputes

On Behalf of | Jan 13, 2022 | Blog |

Parties agree to a contract with the understanding that both parties intend to hold up their end. Failures to follow through with specific contractual terms could lead to a lawsuit in a Minnesota courtroom. However, litigation might become more complex when arguments about a breach center on implied contractual terms.

Implied contract fundamental points

Although specific items might not appear in a contractual agreement, an assumption exists that they are covered by the document. Some elements of implied contractual agreements are somewhat understood. For example, anyone who signs a deal with a rental car fleet to serve a corporate account would believe the vehicles are in good working order. If not, the vehicle provider may breach the contract by providing a defective product.

Many contracts may come with assumptions that implied agreements exist. While it would be possible to spell out every minute detail in a contract, doing so could cost significant time and money. So, the parties may agree to accept the implied element of the terms.

Precedent may factor into assumptions about implied contracts. Suppose there is something customary in a particular business, such as a trucking company delivering goods on time. In that case, the customary element may be considered an acceptable implied component to the arrangement.

Disputes over implied terms

Contract disputes may arise over whether a party held up an agreement or breached it. One party may argue there was an implication existing in the contract, while the other may suggest the party’s expectations are outside the deal’s scope.

A court may review the contract and listen to arguments from both sides. The decision could determine if one party breached due to ignoring an implied element.