All questions

Contract formation

i Elements

To enter into an enforceable contract in DC, the 'parties must (1) express an intent to be bound, (2) agree to all material terms, and (3) assume mutual obligations'.2 Like many jurisdictions, including Virginia, DC follows the objective view of contracts.3 Thus, both intent to be bound, and agreement to material terms, are objective inquiries.4

Intent to be bound hinges on whether the parties' 'choice of language . . . manifested a mutual intent to be bound contractually' – a requirement that is established through offer and acceptance.5 Agreement to material terms is met when each party assents to 'the essential terms of the contract'.6 Courts performing this analysis consider whether the parties' 'acts manifested agreement as to each material aspect of the [contract],' i.e., whether there was a 'meeting of the minds'.7

The third element, mutual obligations, 'exists when each party agrees to do something it otherwise is under no legal obligation to do, or to refrain from doing something it has a legal right to do'.8 'An exchange of promises provides sufficient consideration, evidencing mutual obligation'.9

The elements in Virginia are similar: 'there must be a complete agreement including acceptance of an offer as well as valuable consideration'.10 'Complete agreement' is the Virginia equivalent of 'meeting of the minds'.11 Under Virginia's objective approach,12 whether there was mutual assent (i.e., meeting of the minds) rests on the words and actions of the parties, not their 'unexpressed state[s] of mind'.13

ii Oral contracts

In both DC and Virginia, the 'proponent of an oral contract has the burden of proving all the elements of a valid and enforceable contract'.14 Both jurisdictions will enforce an oral contract so long as it does not violate the statute of frauds and the essential elements of a contract are satisfied.15 Notably, courts considering whether an oral contract was formed frequently reference the burden of proof – often to the detriment of the party seeking enforcement.16 They also vigilantly ensure 'all material terms' were agreed upon.17

iii Implied-in-fact contracts, unjust enrichment, and promissory estoppel

'An implied-in-fact contract is a true contract, containing all necessary elements of a binding agreement; it differs from other contracts only in that it has not been committed to writing or stated orally in express terms, but rather is inferred from the conduct of the parties in the milieu in which they dealt'.18 DC law provides for recovery under an implied-in-fact-contract theory when '(1) valuable services [were] rendered [by the plaintiff]; (2) for the person sought to be charged; (3) which services were accepted by the person sought to be charged, and enjoyed by him or her; and (4) under such circumstances as reasonably notified the person sought to be charged that the plaintiff, in performing such services, expected to be paid'.19 Virginia applies a slightly different standard: it will enforce an implied-in-fact contract if 'the typical requirements to form a contract are present,' and a contractual relationship can be inferred from 'consideration of [the parties'] acts and conduct'.20

Additionally, although it is not a contractual remedy, both jurisdictions provide that an aggrieved party may be able to recover under a theory of unjust enrichment. In DC, the plaintiff must show that he or she '(1) . . . conferred a benefit on the defendant; (2) the defendant retain[ed] the benefit; and (3) under the circumstances, the defendant's retention of the benefit is unjust.'21 In Virginia, a plaintiff must show that '(1) he conferred a benefit on [the defendant]; (2) [the defendant] knew of the benefit and should reasonably have expected to repay [the plaintiff]; and (3) [the defendant] accepted or retained the benefit without paying for its value'.22 In other words, in Virginia, '[o]ne may not recover under a theory of implied contract simply by showing a benefit to the defendant, without adducing other facts to raise an implication that the defendant promised to pay the plaintiff for such benefit'.23

Unjust enrichment claims operate in the absence of a valid contract.24 'One who has entered into a valid contract cannot be heard to complain that the contract is unjust, or that it unjustly enriches the party with whom he or she has reached agreement.'25 As an equitable remedy, unjust enrichment's use generally 'depends on whether it is fair and just for the recipient to retain the benefit, not on whether the person or persons who bestowed the benefit had any duty to do so'.26

Of the two, only DC recognises the doctrine of promissory estoppel.27 In DC, the doctrine applies when a promise has been made to the plaintiff that (1) the plaintiff detrimentally relied on, and (2) that reasonably induced the plaintiff's reliance.28 Like unjust enrichment, promissory estoppel is an equitable remedy.29 Courts will only apply it if 'injustice otherwise [would] not [be] avoidable.'30 Although 'injustice' is an inherently malleable standard, past decisions have shed some light on its contours. For example, the DC Court of Appeals has held that injustice is not otherwise unavoidable when a plaintiff has already been 'fully compensated' for the alleged injury.31 Similarly, DC has also held that justice does not require use of a promissory estoppel claim when the estoppel claim merely 'restates' a breach of contract claim.32 A promissory estoppel claim must, therefore, rely on a non-contractual promise to succeed.33