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Quantum meruit is compensation for goods and services provided with an expectation of payment. Damages cannot exceed a reasonable amount, preventing unfair enrichment. It arises in cases with an implied promise to pay or a broken contract. The court evaluates costs and real value to determine a fair judgment. Having contracts in place can reduce time spent in court.
Quantum meruit, a Latin phrase that can be roughly translated as “how much deserved,” refers to the compensation someone is entitled to for providing goods and services with an expectation of payment. If someone is not compensated, the matter can be taken to court and the court can award damages based on quantum merit. Such damages cannot exceed the reasonable amount to which the person is entitled; people cannot be forced, in other words, to pay more than anything is worth in return.
This concept often arises in cases where there is an implied promise to pay, but no explicit agreement is made. It can also occur when a contract is broken or in a situation where people have a quasi-contract. In all cases, even in the absence of a formal payment agreement or if the terms of a contract have been suspended due to a default, individuals are still entitled to payment on the merits.
This is designed to prevent unfair enrichment, where people benefit from products and services at someone else’s expense. For example, if a contractor is working on a bridge and leaves midway, violating the agreement, the contractor is still entitled to compensation for the materials used in the bridge based on quantum value. Of course, the homeowner can also sue for breach of contract and recover damages from the contractor, as the homeowner will need to find another contractor to finish the job.
The amount granted in such cases must be reasonable. The court evaluates the costs incurred by the party requesting the return and reaches a judgment that it considers fair, based on the situation and the real value of the products and services provided. As mentioned in the example above, receiving restitution on quantum merit does not relieve individuals of liability for breach of contract, and it is possible to be sued by the defendant.
To avoid cases where people have to ask for returns, it is advisable to have contracts in place for situations where one party supplies goods and services, and that those contracts specifically set out terms in the event of a breach. This will reduce the time spent in court in case the contract needs to be broken and will provide security for both parties involved in the settlement. An attorney can assist with the process of developing an appropriate contract and confirming that the contract is structured correctly.
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