What Is Specific Performance? When Courts Order It and When They Refuse

Specific performance is an order from a court telling a party to actually do what the contract says. It is different from damages, where the court only awards money for the breach. The remedy comes mainly from the Specific Relief Act, 1963, as amended by the Specific Relief (Amendment) Act, 2018.

Why the law changed in 2018

Before the amendment, the court had discretion on whether to grant specific performance. The 2018 amendment narrowed that discretion. Section 10 now says the contract "shall be enforced by the court subject to" Section 11(2), Section 14 and Section 16. The Statement of Objects and Reasons said the aim was to make specific performance the general rule, not the exception.

The old Section 10 had a presumption. Breach of a contract to transfer immovable property was presumed not to be compensable in money. For movables, the presumption went the other way, with exceptions such as goods that are not ordinary articles of commerce, goods of special value to the plaintiff, goods not easily available in the market, and property held by the defendant as agent or trustee.

What the Act (as amended) says

·        Section 10: specific performance is generally enforced, subject to Sections 11, 14 and 16.

·        Section 14: lists contracts that cannot be specifically enforced. These include contracts where substituted performance has been obtained under Section 20, contracts requiring continuous duties the court cannot supervise, contracts so dependent on personal qualifications that the court cannot enforce material terms, and contracts determinable in nature.

·        Section 16(c): the plaintiff must prove that he performed, or was always ready and willing to perform, the essential terms. The amendment changed "aver and prove" to "prove."

·        Section 19: says against whom the remedy can be enforced, and protects a transferee for value who paid in good faith and without notice.

·        Section 20: substituted performance. The wronged party may have the contract performed through a third party or its own agency after giving at least thirty days' written notice, and recover the cost. Once it does so, it cannot claim specific performance, though compensation remains possible.

·        Section 22: possession, partition or refund of earnest money must be specifically claimed.

·        Section 14A (inserted in 2018): the court may engage experts on specific issues.

Read Also: Hindu Minority and Guardianship Act 1956 Explained

Ten working principles courts apply

A good article on this topic (SCC Online's "Specific Performance: Principles Revisited") collects the working rules:

·        Readiness and willingness must be shown from the date of the contract until the decree, judged by conduct and the whole record, not by a bare statement.

·        The plaintiff's conduct must be unblemished.

·        Actual tender or deposit of money is not always required, unless the court directs.

·        If the contract was terminated, the plaintiff must seek to set aside the termination. Otherwise it may be treated as acceptance of the termination.

·        A plaintiff not in possession must claim possession under Section 22.

·        The contracting parties and any purchaser of the property are necessary parties. Third parties claiming adversely to the vendor are not.

·        Where the property has gone to a later purchaser, the decree usually directs the vendor and the later transferee to join in the conveyance to the earlier one.

·        A suit must be filed within three years from the date fixed for performance, or, if none is fixed, from when the plaintiff has notice of refusal (Article 54 of the Limitation Act, 1963).

·        A court that passes a decree keeps control over it and can give further directions.

When courts refuse

The remedy may be refused where:

·        readiness and willingness is not proved;

·        the plaintiff's conduct is blameworthy;

·        a terminated contract's termination is not challenged;

·        possession is sought without claiming it under Section 22;

·        necessary parties are missing;

·        the suit is time-barred; or

·        for movables, the goods are ordinary commercial items that money can replace, and no exception applies.

Cases to name in an answer

The article lists Supreme Court decisions such as Mehboob-ur-Rehman v. Ahsanul Ghani (2019), Umabai v. Nilkanth Dhondiba Chavan (2005), J.P. Builders v. A. Ramadas Rao (2011), A. Kanthamani v. Nasreen Ahmed (2017), Vijay Kumar v. Om Parkash (2018) and I.S. Sikandar v. K. Subramani (2013). Privy Council decisions include Ardeshir Mama v. Flora Sassoon (1928) and Bank of India Ltd. v. Jamsetji A.H. Chinoy (1949).

A simple example

Seema signs an agreement to buy a plot. The seller then refuses to sell. Seema can sue for specific performance only if she proves that she was ready and willing, from the date of the contract to the decree, and files within time. If she never paid or showed means, the court may refuse. If she wants possession too, she must claim it under Section 22.

FAQs

What is specific performance?

An equitable remedy where the court directs a party to carry out its contractual obligations, instead of awarding only damages.

Which Act governs it?

The Specific Relief Act, 1963, as amended in 2018.

What did the 2018 amendment do to Section 10?

It made specific performance enforceable subject to Sections 11(2), 14 and 16, narrowing the court's discretion.

What must the plaintiff prove under Section 16(c)?

That he performed, or was always ready and willing to perform, the essential terms.

What is substituted performance?

Under Section 20, the wronged party may get the contract performed through a third party after thirty days' written notice and recover the cost.

What is the limitation period?

Three years from the date fixed for performance, or from notice of refusal if no date is fixed.

Does the plaintiff always have to deposit the money?

No. Actual tender or deposit is not always required unless the court directs.

Do I need to claim possession separately?

Yes, a plaintiff not in possession must claim it under Section 22.

Conclusion

The central message is that specific performance is now the general rule, but only for plaintiffs who prove readiness and willingness and plead and prove everything else properly. That is a strong theme for Civil Judge Exam papers.

At Aashayein Judiciary, Nitesh Sir and the team convert the Specific Relief Act into easy Judiciary Notes and Judiciary Study Material. Join our Online Judiciary Coaching, solve PYQ and take Mock Test series for the Civil Judge Exam, PCS J Exam and APO Exam.