Lesson 30: Specific Performance

As part of our comprehensive discussion on contracts, we now turn our attention to a unique remedy for breach of contract known as specific performance. Specific performance is an equitable remedy that requires the breaching party to perform their contractual obligations. It is typically used in cases where monetary damages are insufficient to redress the harm caused by the breach.

When is Specific Performance Available?

Specific performance is generally granted under the following circumstances:

  • Unique Subject Matter: The subject matter of the contract is unique, such as real estate or rare items.
  • Inadequate Remedy at Law: Monetary damages are insufficient to compensate the non-breaching party.
  • Mutuality of Performance: Both parties are capable of performing their respective obligations under the contract.
  • Definiteness of Terms: The contract terms are clear and specific enough to enforce.

Example:

Consider a contract for the sale of a rare painting. The buyer wants the painting itself, not a monetary equivalent. If the seller breaches the contract, the court may order specific performance, requiring the seller to deliver the painting to the buyer.

Specific performance is more likely to be granted in contracts involving real estate or unique goods because their value cannot be easily quantified in monetary terms.

Legal Framework

The legal framework for specific performance varies by jurisdiction but generally includes the following elements:

  • Jurisdictional Requirements: Some jurisdictions have specific statutes or common law precedents governing the availability of specific performance.
  • Equitable Considerations: Courts consider whether granting specific performance would be fair and just in the circumstances of the case.

Diagram:

Limitations of Specific Performance

Specific performance is not an appropriate remedy in every case. Some limitations include:

  • Personal Services Contracts: Specific performance is generally not available for personal services contracts, as it is difficult to enforce and monitor performance.
  • Hardship to Defendant: If specific performance would cause undue hardship to the defendant, courts are less likely to grant it.
  • Public Policy: Courts may deny specific performance if it contravenes public policy.

Mathematical Representation:





If $D \\leq P$, where $D$ is damages and $P$ is performance value, then specific performance may be considered.

Case Law Examples

Several landmark cases illustrate the application of specific performance:

  • Lumley v. Wagner: A key case in which the court denied specific performance for a personal services contract.
  • Van Schaick v. Parsons: A case where specific performance was granted due to the unique nature of the property involved.

Flowchart:

Statutory Provisions

Several jurisdictions have statutory provisions that either limit or expand the availability of specific performance. For example:

  • Uniform Commercial Code (UCC): Under the UCC, specific performance may be available for the sale of goods when the goods are unique or in other proper circumstances (UCC Section 2-716).
  • Real Estate Statutes: Many jurisdictions have specific statutes that make specific performance more readily available for real estate transactions due to the unique nature of real property.

Defenses Against Specific Performance

Defendants can raise several defenses to argue against the granting of specific performance:

  • Impossibility of Performance: If it is impossible for the defendant to perform their contractual obligations, specific performance will not be granted.
  • Laches: If the plaintiff unreasonably delays in seeking specific performance, the court may deny the remedy based on the doctrine of laches.
  • Unclean Hands: If the plaintiff has acted unethically or in bad faith concerning the contract, the court may deny specific performance based on the doctrine of unclean hands.

Diagram:

Conclusion

Specific performance is a powerful but limited equitable remedy in contract law. It is typically reserved for situations where the subject matter of the contract is unique, and monetary damages are inadequate. Courts consider several factors, including jurisdictional requirements, equitable considerations, and defenses, when deciding whether to grant specific performance. Understanding these nuances is crucial for any practitioner dealing with contract disputes.

« Previous
Next »