specific performance of contract case laws

It's possible that the other party did not fulfill the contract because he or she was truly unable to. Specific performance is the legal concept that anyone who signs a contract is bound to the terms of the contract. Specific performance means enforcement of exact terms of the contract. But something goes wrong during construction and, in the end, the building comes out to 35 feet. Specific performance requires a party to take a specific action to essentially correct the breach of contract. Answer:- Section 15 of the Act says specific performance of a contract may be obtained by. The Model Law similarly omits any reference to specific performance but, to avoid any doubt, s33A provides that, unless otherwise agreed by the parties, the arbitrator has power to make an award ordering specific performance of any contract if the Court would have power to award specific performance of that Contract. The latter remedy is specific performance. Specific performance is an alternative equitrable remedy to a cause of action for breach of contract. Actions for specific performance are usually allowed with regard to a contract involving the sale of particular real estate; and a contract for sale of a particular business. Pirie v Saunders (1961) 104 CLR 149; [1961] HCA 4 Formalities - oral agreement - authenticated signature fiction . Jur. Specific performance is equitable relief, given by the court to enforce against a defendant, the duty of doing what he agreed by contract to do. In many situations, specific performance does not adequately compensate the innocent party for his or her loss or injury. The subject matter of the contract must be unique, or an action for damages would be the proper remedy. UpCounsel accepts only the top 5 percent of lawyers to its site. Specific performance is a discretionary order made by a court wherein a party to a contract must perform a specific action as outlined in an existent contract. Specific performance can be granted only by a court in the exercise of its EQUITY powers, subsequent to a determination of whether a valid contract that can be enforced exists and an evaluation of the relief sought. It is stated in the contract that either party can. ‘ The principle is now well established that a refusal by one party to a contract to perform it before the date of performance arrives places the other party in a position to elect whether to treat such conduct as a breach of contract, or persist in the contract and hold his … For example, say a construction company is required to build a building to a height of 40 feet. In many cases, specific performance is regulated by the Uniform Commercial Code, which is a set of laws adopted by the states which govern all commercial transactions. Although the plaintiff can elect to claim specific performance from the defendant, the court has a discretion to grant or decline the order of specific performance. This order emphasises the performance of contractual obligations. The court can issue an order compelling a party to comply with their contractual obligations – a good example being to complete building works on time. Was this document helpful? The Model Law similarly omits any reference to specific performance but, to avoid any doubt, s33A provides that, unless otherwise agreed by the parties, the arbitrator has power to make an award ordering specific performance of any contract if the Court would have power to award specific performance of that Contract. The obligation of parties to contract—The parties to a contract must either perform, or offer to perform, their respective promises unless such performance is dispensed with or excused under the provisions of this Act, or of any other law. 2. If roles were to be reversed, the Defendant would be entitled to enforce a claim for that amount in exchange of the completion documents. Beswick v Beswick [1968] AC 58. 3. T he Supreme Court in a recent judgment laid down requirements for the parties in their respective pleadings, and proof with evidence in accordance with law for the specific performance of a suit.. 2.1.2 Substantial performance A further exception exists where a court is satisfied that substantial performance is present. To explore … This order emphasises the performance of contractual obligations. Specific performance is an alternative to a courts decision to award damages and it is commonly used as injunctive relief in cases involving real property or the disclosure of confidential information. If the court orders specific performance, the defendant might face multiple consequences, such as a contempt charge or a heavy fine, if he or she refuses to fulfill the order. According to Section 10 of Specific Relief Act 1963 in the following conditions specific performance of the contract is enforceable: … Contract law – Privity of contract – Specific performance. This type of remedy is often used in cases that involve a unique object or piece of property. Vendor and Purchaser - contract of sale - oral agreement - specific performance - adequacy of damages. Section 27 of Indian contract Act says that The parties to a contract must either perform, or offer to perform, their respective promises, unless such performance is dispensed with or excused under the provisions of this Act, or any other law. Specific performance is a primary remedy for breach of contract available for the aggrieved party. To that end, while most cases involve the buyer of real property requesting specific performance from the seller, the law recognizes that the seller has a remedy in specific performance as well. Everything You Need to Know. In expecting exact performance, the courts mean that, performance must match contractual obligations. Clean hands: Walters v Morgan (1861) 3 DF & J 718 Case summary. A suit for specific performance can be filed by any party, in a court of competent jurisdiction, who has suffered loss due to non-performance of contract on part of the other party to the contract. 37. LAW ON SPECIFIC PERFORMANCE OF CONTRACT Introductory:-A contract is an agreement upon sufficient consideration to do or not to do a particular act. 71 Am. Obtaining specific performance in contracts for the provision of goods and services. Contract law has two methods of achieving this "compensation goal": requiring the breaching party to pay damages, either to enable Specific performance is a legal remedy. The plaintiff has failed to meet his or her contractual obligations. Basics of Specific Performance In a real estate contract, parties may agree to a contract, such as for the sale of a home. If one party does not fully perform the contract this will amount to a breach of contract and the other party may have a claim for damages unless the contract has been frustrated. One such remedy is known as specific performance. [55] Christie: The Law of Contract in South Africa 6 th Ed at p 545 states: ‘ Our law is clear that a plaintiff is always entitled to claim specific performance and, assuming he makes out a case, his claim will be granted, subject only to the court’s discretion. If a monetary remedy does not make the non-defaulting party whole, the court can order the breaching party to perform his or her contractual duties as originally promised. Situational Considerations in Granting Specific Performance, Suit for Specific Performance of Contract, Format of Suit for Specific Performance of Contract, What Is an Equitable Remedy? It is impossible to grant specific performance. … When Should Specific Performance Be Used? ¶0 1. September 18, 2020 Case Law Reporter Supreme Court of India. Vendor and Purchaser - contract of sale - oral agreement - specific performance - adequacy of damages. In case of his failure, the other party will have a right sue for performance of the contract. For example, say a construction company is required to build a building to a height of 40 feet. Replevin would apply. The law with respect to specific performance of a contract is well established in India. The Plaintiff had performed her obligations under the contract but only partially. What kinds of remedies exist for the party who suffers as a result of a contract breach? If one of the parties does not honor the contract by breaching the terms of the contract, the harmed party often does not want money damages but instead wants actual performance of the terms of the contract. Specific performance is one of the options available when monetary compensation is not sufficient to put the plaintiff in the same position as he or she would have been if the breach did not occur. These remedies include filing a lawsuit to collect damages or seeking a court order requiring the infringing party to live up to their obligations. The amount of damages cannot be clearly determined. Under it the plaintiff claims for the specific thing of which he is entitled as per the terms of contract. Specific Performance. The most common reason courts grant specific performance is that the subject of the contract is unique, when it's not merely a matter of money or where the true amount of damages is unclear. It encompasses the idea that all parties to a contract are bound by the exact terms stated in that contract and that there are remedies that a wronged party can pursue when someone is in breach of those terms. The courts are unlikely to order specific performance for contracts for personal service. Author: Robin Soni “Specific Performance” an order of the court, which is an alternative of monetary compensation awarded in case of breach of contract by any party i.e when one party fails to fulfil terms of the contract, another party can ask the court to direct the party for performing his contractual obligations instead of awarding damages. Contract law is a body of law that governs, enforces, and interprets agreements related to an exchange of goods, services, properties, or money. Specific performance is an equitable remedy in the law of contract, whereby a court issues an order requiring a party to perform a specific act, such as to complete performance of the contract. Specific performance was refused by High Court by determining the agreement of sale as invalid, on the ground that the provisions of Section 33 of Karnataka Co-operative Societies Act, 1959, invalidates such agreement of sale, because the suit properties were sub­ject to charge on the date of sale, since the seller had taken a loan on security of goods. What happens after a contract is broken? 3. Specific performance can refer to any kind of forced action, though it is usually enforced so as to complete a transaction that had been previously agreed to. These unique qualities are considerations that the buyer and seller must make when they are pricing the land, negotiating the price, and agreeing on the final price. Whether you wish to obtain an injunction or seek monetary compensation, it can be costly to bring a case before the court. Instead, it must consider the individual factors in a case to determine if specific performance is an appropriate remedy. This case undermines the basic principle of contract law that the parties do not need to come with equal bargaining power. If it is not, as to him, just and reasonable; 3. When specific performance would place undue burden on the defendant, When a contract stipulates that either party can renege without notice, When mutuality was lacking when the contract was signed, When the contract required constant supervision. Because of the principle of equity, courts generally prefer to award damages rather than enforce contractual provisos. There are many circumstances where specific performance will not be ordered by the court. Specific performance of a contract. Specific performance is an action to compel a party who breached a contract to perform the contract as promised. © 2020 Spevack Law Firm. The grant of relief of specific performance is a discretionary and equitable relief. The representative-in-interest, or the principal, or any party thereto excepting where the earning skill, solvency or any personal quality of such party is a material ingredient in the court. Specific performance is a specialized remedy the court uses when all other remedies, including monetary compensation, cannot compensate the plaintiff adequately. Specific performance requires a party to take a specific action to essentially correct the breach of contract. There is therefore no standard template which is used for every transaction. The party on whom this contractual obligation rests must not fails to discharge such obligation. There are express statutory provisions that allow the court to exercise its discretion to grant specific performance for contracts for the provision of goods and services. 2. Specific performance grants the plaintiff what he actually bargained for in the contract rather than damages (pecuniary compensation for loss or injury incurred through the unlawful conduct of another) for not receiving it; thus specific performance is an equitable rather than legal remedy. Think strategically before requesting a specific performance remedy. Say, for example, a fire at the party's production facility reduced or eliminated his or her capacity to produce the promised goods. The court tends to take a harder stance on specific performance. If you seek specific performance as a remedy in this case, then the party that breached the contract would be required to build the building up to 40 feet. Courts may order that a defendant in a breach of contract case give specific performance in the form of replevin as a remedy when compensatory damages are insufficient to solve the dispute. This kind of remedy is known as specific performance. Under such a circumstance, the court will rarely award specific performance, even if monetary damages are not an adequate compensation. If there is a legal remedy that provides adequate compensation, the court will use that remedy instead. Typically, this remedy is used when the subject of a contract is unique, making it difficult to assign a fair amount of monetary damages. When a party fails to meet his or her contractual obligations, the other party might consider using one of several legal remedies. There is no guarantee that the court will award specific performance. Equity. Specific performance is used by the courts instead of compensatory damages when no other remedy will adequately compensate the other party. Similar to injunctions, the court does not have to order specific performance in all civil law cases. It is true that Courts will exercise a discretion in determining whether or not decrees of specific performance should be made. 495, 532 (1959). BASIS OF THE REMEDY 2.1. 3 min read. Specific performance is ordered only on equitable grounds in view of all the conditions surrounding the particular case. Specific Performance. Specific performance will be supervised constantly. Specific Relief Act, 1963 – Section 12 – Specific performance of part of contract – A contractee who frustrates a contract deliberately by his own wrongful acts cannot be permitted to escape scot free. Specific performance as a primary remedy in the South African law of contract. TYPES OF CONTRACT. How to cite this paper: Kanamugire, J. C. (2015). Under the law of equity which governs the rights of the parties in the case of specific performance of contract to sell real estate, law looks not at the letter but at the substance of the agreement. This is called ‘Specific Performance’. 30 Falcke v Gray allowed the defendant to escape the contract without apparent penalty as the order of specific performance was dismissed without costs and there was no discussion of the damages to be awarded in its place. [Total: 3 Average: 5] The Specific Relief Act, 1963 – Section 12 – Specific performance of part of contract – A contractee who frustrates a contract deliberately by his own wrongful acts cannot be permitted to escape scot free. A contract should be performed at the time specified and at the place agreed upon. Placer Development Ltd v Commonwealth [1969] HCA 29; (1969) 121 CLR 353 (High Court) Certainty . All rights reserved. Specific performance is one of the options available when monetary compensation is not sufficient to put the plaintiff in the same position as he or she would have been if the breach did not occur. ¶0 1. In a breach of contract case, the court can consider ordering specific performance as long as the innocent party asks for that remedy. Specific performance requires a party to take a specific action to essentially correct the breach of contract. If you or your business have suffered as a result of a broken contract, our business litigation attorneys are prepared to assist you in seeking the remedy you desire. Each contract is drafted with the specific needs of both parties in mind. But something goes wrong during construction and, in the end, the building comes out to 35 feet. Overview. Specific performance cases are legal cases in which a party is required to fulfill his or her contractual obligations to resolve a breach of contract. Specific performance is a remedy sought in civil court, instead of money. Lamare v Dixon (1873) LR 6 HL 414 Case summary. PB was in poor health and agreed with the defendant, his nephew, that he would transfer the trade and good will of his coal business to him on the basis that the nephew employed him as a consultant for the rest of his life and paid him for this. Specific per… That was a case where specific performance would be appropriate. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb. The action is usually one that has been previously detailed in a contract. In simple terms, replevin refers to a case in which one party has given a security deposit on a contract and the other party has not fulfilled its duty. Specific performance Order of the court directing a party to perform the contract specifically according to the terms of contract. Contracting parties should be allowed to resile from the contract and use damages as a remedy for breach of contract. In requiring a contract to be complete, the law is merely saying that any work undertaken must be carried out to the end of the obligations. When a contract is for the sale of a unique property, for instance, mere money damages may not remedy the purchaser's situation. Specific performance is a primary remedy for breach of contract available for the aggrieved party. A contract becomes discharged through performance where both parties have fully performed their contractual obligations. For example, if A agrees to sell certain shares to B of a specific company which are limited in number and after the payment made by B, if A refuses to sell the shares then B is entitled to recovery of those shares. Specific performance is a primary remedy for breach of contract available for the aggrieved party. The buyer may pursue specific performance if the seller is unwilling to carry out his or her obligations under the contract. Sec.37: “The parties to a contract must either perform, or offer to perform their respective promises, unless such … Facts. But something goes wrong during construction and, in the end, the building comes out to 35 feet. Specific performance is a very complex area of law, and there are many circumstances which prevent the court from making such an order, including: Where damages are sufficient: A court will only make an order for specific performance in circumstances where an award of damages would be insufficient. PERFORMANCE OF CONTRACTS Who must perform? The only modern commentator to criticize specific performance law seriously is Professor Dawson, who has called for the specific performance of all contracts to deliver chattels. The court may then award the contractually agreed price and deduct sums to reflect the amount not performed. 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