Case study: A Request for Goods or Services: Implying A Promise to Pay

When someone requests the supply of goods or services, the lawbe it through common law or by applicable legislation such as the Sale of Goods Actwill imply a promise to pay a reasonable price for those goods or services. The law draws this conclusion because, in a business situation, it is the intention of the parties that goods or services are not to be provided for free, but rather are to be purchased. Implying such a term reflects what can only be the reasonable expectation of the parties and is needed to give purpose and effect to the rest of the contract. If the goods or services have already been provided but there has been no agreement on price, a term must be implied to require payment. The obligation on the customer is not to pay whatever the supplier chooses to charge or whatever the customer is willing to pay, but to pay a reasonable amount, as determined by the judge. This is known as a contractual quantum meruit, which is Latin for as much as is merited or deserved. Given the expense and uncertainty of judicial proceedings, it is in the interests of both parties to agree on the price, in advance, as an express term. The objective is to avoid the surprises and misunderstandings that may lead to a legal dispute.

1. Critical Analysis: Does the laws willingness to imply a promise to pay lead to uncertainty? Why should someone have liability on a promise that she has not expressly made?