Implied Contracts in California: When Conduct Creates a Binding Agreement

Last updated: November 2026

An implied contract in California is a contract whose existence and terms are shown by the parties' conduct rather than by their words. (Civ. Code, § 1621.) It is a real contract, enforceable like any other, and it is usually called an implied-in-fact contract to distinguish it from a quasi-contract, which is a restitution remedy the law imposes without any agreement. Kolmogorov Law, P.C. litigates implied contract claims for businesses in Orange County, Los Angeles, and across California.

Call (909) 235-6116 or contact us online if your business has been performing under an arrangement nobody ever wrote down.

Express, implied, and quasi: three different things

The Civil Code divides contracts into two kinds. A contract is either express or implied. (Civ. Code, § 1619.) An express contract is one whose terms are stated in words. (Civ. Code, § 1620.) An implied contract is one whose existence and terms are manifested by conduct. (Civ. Code, § 1621.)

The difference is in the proof, not the obligation. An express contract can be oral or written; what makes it express is that someone said or wrote the terms. An implied-in-fact contract is proved by showing what the parties did and inferring from that what they must have agreed. Both require the same mutual assent and consideration. Both are enforced with the same remedies.

A quasi-contract, sometimes called a contract implied in law, is not a contract. It is a label courts use when one party has been unjustly enriched at another's expense and fairness requires restitution. There is no agreement to find. The remedy is the value of the benefit conferred, not the expectation damages a contract would give. Pleading the right theory matters because the elements, the measure of recovery, and the defenses are different.

How an implied-in-fact contract is formed

The question is whether a reasonable person, looking at the conduct of both sides, would conclude that they had agreed to an exchange. CACI No. 305 asks the jury exactly that: whether the parties' conduct showed an intent to be bound and what the terms were.

Several kinds of conduct carry weight. One party repeatedly performs services and the other repeatedly accepts them and pays. A party continues to supply goods after a written contract expires, and the buyer keeps ordering and paying at the old price. A company gives a vendor access, specifications, and deadlines, and the vendor delivers to them. In each situation the parties never signed anything for the period in question, but their behavior speaks.

Conduct can also show the terms. If the buyer paid net-thirty for two years without objection, net-thirty is probably a term. If the price was the same on every invoice, that is probably the price.

Where business owners meet implied contracts

A written services agreement expired eighteen months ago. Nobody renewed it, but the vendor kept working and the client kept paying monthly. Then the client stops paying and says there was no contract. The conduct since the expiration is the contract, and the expired agreement is strong evidence of its terms.

A manufacturer asks a contract shop to produce a prototype, then a pilot run, then a full production run, each on a verbal go-ahead followed by a purchase order that arrived after the work started. On the final run no purchase order comes and the manufacturer refuses the goods. The pattern of go-aheads and payments supports an implied agreement to pay for work it requested. Our page on collecting unpaid invoices covers the collection side.

A departing executive claims the company's practice of paying severance to others, combined with assurances from the founder, created an implied promise of severance. Employment with no specified term may be terminated at will (Lab. Code, § 2922), but a long course of conduct and specific assurances can, in some cases, support an implied-in-fact term. We defend these claims on the employer side, and our page on a former employee threatening to sue explains the first steps.

What an implied contract cannot do

An implied term cannot contradict an express one. If a signed agreement says the relationship may be ended on thirty days' notice, conduct suggesting a longer commitment will not override it. Courts find implied terms in the gaps of an agreement, not in opposition to its text.

The statute of frauds also applies. Conduct cannot create an enforceable contract that a statute requires to be in writing, such as a sale of real property, unless an exception such as full performance or estoppel applies. (Civ. Code, § 1624, subd. (a).)

The implied covenant of good faith and fair dealing is a separate concept. It is a term the law reads into every contract, express or implied, and I cover it on our page on the implied covenant.

Proving the claim, and the deadline

An implied contract claim is proved by evidence of conduct: invoices, payments, delivery records, emails confirming assignments, and testimony from the people who did the work and accepted it. The plaintiff bears the burden by a preponderance of the evidence. (Evid. Code, §§ 115, 500.) Our page on how to prove breach of contract describes the evidence in detail.

The deadline is short. An action on a contract not founded upon an instrument in writing must be brought within two years. (Code Civ. Proc., § 339, subd. 1.) An implied-in-fact contract, by definition, is not founded on a writing, so the two-year period usually applies. Where the conduct followed a written contract that expired, there is an argument for the four-year period, but it should not be relied on without advice.

Damages follow the ordinary contract measure: the amount that compensates for the detriment the breach caused. (Civ. Code, § 3300.) For a quasi-contract claim, by contrast, the measure is the reasonable value of the benefit conferred.

What we do, and where the cases are heard

We reconstruct the relationship from the records and decide whether the facts support an implied-in-fact contract, a quasi-contract, or both. On the defense side we look for an express term that forecloses the implied one, for a writing requirement, and for the two-year bar.

These cases are heard in the Superior Court: the Central Justice Center in Santa Ana for Orange County, the Stanley Mosk Courthouse for Los Angeles. Cases with out-of-state parties may be in the Central District of California.

What to bring to the first meeting

Bring the records of the relationship over its whole life: every invoice and payment, purchase orders, delivery confirmations, emails assigning work or approving it, and any expired written agreement. A simple spreadsheet of dates and amounts helps more than a long narrative.

Frequently asked questions

What is an implied contract?

An implied contract, or implied-in-fact contract, is an agreement whose existence and terms are shown by the conduct of the parties rather than by spoken or written words. (Civ. Code, § 1621.) It is a true contract with the same requirements and remedies as an express one. The difference is only in how it is proved.

Is an implied contract enforceable in California?

Yes. The Civil Code recognizes implied contracts alongside express ones, and courts enforce them when the conduct shows mutual assent to an exchange. The limits are the statute of frauds, which bars conduct from creating contracts that must be in writing, and the rule that an implied term cannot contradict an express one.

What is the difference between an implied-in-fact contract and an implied-in-law contract?

An implied-in-fact contract is a genuine agreement proved by conduct. An implied-in-law contract, or quasi-contract, is not an agreement at all; it is a restitution remedy courts impose to prevent unjust enrichment. The first gives expectation damages. The second gives the value of the benefit conferred.

How long do I have to sue on an implied contract?

Two years from the breach, in most cases, because an implied contract is not founded on a written instrument. (Code Civ. Proc., § 339, subd. 1.) If the conduct continued a written agreement, the four-year period may be arguable. Treat two years as the working deadline.

Talk to a California breach of contract attorney

If your business is relying on an agreement that was never written down, or defending a claim based on one, call (909) 235-6116 or contact us online. Kolmogorov Law, P.C. is located at 327 Magnet, Irvine, CA 92618, and represents businesses in Orange County, Los Angeles, and throughout California.

This page provides general information about California law and is not legal advice. Outcomes depend on the conduct of the parties, the facts, and the court.