Which term describes a contract whose terms and intentions are indicated by the actions of the parties and the surrounding circumstances?

• A. Implied contract
• B. Void contract
• C. Implied-in-law contract
• D. Executory contract

Answer: (A)

An implied contract forms from the parties’ conduct and the surrounding circumstances rather than from explicit words. When services are rendered and payment is expected, the parties’ actions signal mutual assent, so the law recognizes a binding agreement even without a written or spoken contract. This is different from an implied-in-law contract (quasi-contract), which a court creates to prevent unjust enrichment when no actual agreement exists. A void contract is unenforceable from the start due to illegality or incapacity, and an executory contract is simply one in which some obligations remain to be fulfilled. So the term that describes a contract whose terms and intentions are indicated by actions and surrounding circumstances is an implied contract.