1 Methods of Creation

The way a contract comes into being gives some ideas of its nature. Thus, there are express contracts, implied contracts, and quasi contracts.

Express contracts. In an express contract, the agreement is stated in words —written or spoken.

Implied contracts. In an implied contract, the agreement is not stated in words. Instead, the intent of the parties is shown by their conduct and by the surrounding circumstances. For example, a schoolboy buys some fruit juice in the high school cafeteria by inserting coins into a vending machine.

Quasi contracts. In a quasi contract, the parties are bound as though there were a valid contract even though technically there is none. For example, a doctor may voluntarily give first help to a person injured in an accident. There is no agreement. Yet a doctor may submit a bill and collect a charge reasonable for such a professional service. Thus, the law creates an obligation in an absence of an actual agreement between the parties. This is done to prevent unjust enrichment of one party. Strictly speaking, no contract exists because some essential element is missing. Someone who is not a doctor could give similar first aid yet not be entitled to payment since the service is not done with the expectation of payment nor by licensed specialist.

2 Formality

A few contracts must meet strict requirements as to formality. They are called formal contracts. Most need not meet such requirements. They are called simple contracts.

Formal contracts. A formal contract is a written contract that must be in some special form to be enforceable. Examples are commercial papers and contracts under seal. Commercial papers, such as an ordinary check, must meet certain requirements to be valid. A contract under seal is one with a seal attached or with a similar impression made on the paper. Seals have always served to validate agreements.

Simple contracts. A contract that is not formal is a simple contract. This is true whether the contract is oral, written, or based on conduct.

An example of simple written contract

THIS AGREEMENT is made on May 10, 20___, between New Way Pavers, 17 Beacon Street, Boston, Massachusetts, and J. Clayton Jones, 742 Regent Circle, Brookline, Massachusetts. New Way Pavers agrees to furnish all materials and to perform in a workmanlike manner all necessary labor required to remove present concrete walk in front of the residence at 742 Regent Circle from the building door to the public sidewalk; to replace the walk with red brick (of quality and grade as in sample) laid in a herringbone pattern, on a new concrete base 2,5"thick, in consideration for which Jones agrees to pay New Way Pavers or its assignee three thousand two hundred dollars ($3,200) upon completion of the work on or before August 10, 20___. NEW WAY PAVERS By James G. Mason J. Clayton Jones