Also known as:express understanding · implied understanding · agreement · meeting of the minds
Written by attorneys · grounded in primary & secondary sources — see below
An arrangement, whether stated outright or inferred from conduct, between parties concerning their mutual rights, obligations, or objectives. The existence of such an arrangement is determined from the circumstances surrounding the parties' interactions.
Sources & Authorities· 40 primary sources
Select any source to read its text and confirm it supports the definition.
Cases
Statutes
How it applies
Common Examples
6
Conspiracy Agreement Formed by Conduct
Ella Emerson and Eric Espinoza discussed plans to forge documents and then acted in coordination to create and pass the papers. Their coordinated steps showed they had reached an express or implied understanding to pursue the unlawful objective. The agreement alone completed the conspiracy even without further steps.
Merger Clause Bars Prior Promises
Eugene Ellsworth sold land to Emma Erickson under a contract containing a merger clause. After closing, Erickson discovered an earlier oral promise about boundary fencing that was absent from the deed. The clause established that the written documents reflected the complete express or implied understanding between the parties.
Edith Eberhardt sued Eastern Electric after an accident. Eastern Electric possessed an insurance policy that could cover part of any judgment. The parties shared an express or implied understanding that the policy terms would be produced for inspection under the discovery rules.
Lawyer Must Deliver Client Funds
Emmett Egan received settlement proceeds belonging partly to a client. Egan and the client had an express or implied understanding that the funds would be turned over promptly once received. The lawyer therefore had to notify the client and deliver the money without delay.
Self-Help Provision Ruled Void
Evergreen Bank leased property to Enigma Technologies under terms allowing the landlord to reenter without court process upon default. Because the controlling law did not preserve self-help, the lease clause created an express or implied understanding that violated public policy and was unenforceable.
Express Assumption Bars Recovery
Emmett Egan signed a waiver before using Everest Holdings' equipment. The document created an express or implied understanding that Egan accepted the risk of harm from the company's negligent maintenance. Egan therefore could not recover for injuries caused by that negligence.
Common questions
Frequently Asked
1
How is the existence of an express or implied understanding proven in an estate tax context?+
Courts examine the circumstances of the transfer, including continued possession by the donor and family arrangements. The burden falls on the taxpayer to disprove any such understanding, and that burden is especially heavy in intrafamily transfers.
Supporting sources
438 U.S. 104, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978)Property
…on its investment. Appellants own the Grand Central Terminal, which has been designated a landmark. They entered into a lease agreement with a third party to construct a multistory office building above the terminal. The Commission rejected the proposed construction, finding that it would destroy the terminal's historic and…