Specific Performance Cases: Everything You Need to Know
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. 3 min read
2. When Should Specific Performance Be Used?
3. Situational Considerations in Granting Specific Performance
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 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. It can come in the form of any forced action but usually involves performing previously agreed-upon tasks. This type of remedy is often used in cases that involve a unique object or piece of property.
What Is Specific Performance?
When a party fails to meet his or her contractual obligations, the other party might consider using one of several legal remedies. 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. This kind of remedy is known as specific performance. As an alternative to awarding damages, specific performance commonly serves as injunctive relief in legal cases related to real estate or the disclosure of confidential information.
When Should Specific Performance Be Used?
Specific performance is a specialized remedy the court uses when all other remedies, including monetary compensation, cannot compensate the plaintiff adequately. If there is a legal remedy that provides adequate compensation, the court will use that remedy instead. Usually, the court will grant specific performance under one of the following circumstances:
- The contract's subject matter is unique.
- It is not just a matter of money.
- The amount of damages cannot be clearly determined.
For instance, if a contract involves the sale of a unique object or property, monetary damages alone might not remedy the buyer's situation. Specific performance is often used in real estate transactions because every piece of land has unique characteristics, such as location, pre-existing structures, natural resources, and others. 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.
Situational Considerations in Granting Specific Performance
Think strategically before requesting a specific performance remedy. Whether you wish to obtain an injunction or seek monetary compensation, it can be costly to bring a case before the court. It's possible that the other party did not fulfill the contract because he or she was truly unable to. Say, for example, a fire at the party's production facility reduced or eliminated his or her capacity to produce the promised goods. In such a situation, going to court might cause you to lose money without getting the result you wanted.
The court tends to take a harder stance on specific performance. Its decision will be based on the concept of equity, meaning it will award specific performance only if monetary compensation will not solve the problem. Similar to injunctions, the court does not have to order specific performance in all civil law cases. Instead, it must consider the individual factors in a case to determine if specific performance is an appropriate remedy. There is no guarantee that the court will award specific performance.
In many situations, specific performance does not adequately compensate the innocent party for his or her loss or injury. Under such a circumstance, the court will rarely award specific performance, even if monetary damages are not an adequate compensation. It will avoid specific performance when:
- It is impossible to grant specific performance.
- Specific performance will cause severe harm to the breaching party.
- Specific performance will be supervised constantly.
- The contract is unconscionable.
- The contract is for the provision of services.
- It is stated in the contract that either party can terminate the agreement at will.
- The plaintiff has failed to meet his or her contractual obligations.
The court usually prefers to award monetary damages whenever possible because it is easier to enforce and does not require the defendant to perform a task that he or she is reluctant to do. 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.
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