Specific Performance

The term “specific performance” refers to literal performance of one’s obligations under a contract. Should a party default on his obligation, a court may issue an order for specific performance, requiring a party to perform a particular action. The action is usually one that has been previously detailed in a contract. Specific performance is an alternative to a court’s decision to award damages and it is commonly used as injunctive relief in cases involving real property or the disclosure of confidential information. To explore this concept, consider the following specific performance definition.

Definition of Specific Performance

Noun

  1. The performance of a legal contract strictly or substantially according to its terms.
  2. Compliance with one’s contractual obligation, as ordered by a court.

Origin

1870-1875

What is Specific Performance

While specific performance is technically the performance of a contractual obligation, it is most commonly referred to in relation to a court order to fulfill such an obligation.

Specific performance is a directive ordered by a court wherein a party to a contract must perform a specific action as outlined in an existent contract. 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.

For example, specific performance is usually ordered in cases wherein an award of damages would not be enough to remedy the situation, such as cases involving the sale of real property. A specific performance remedy is up to the discretion of the court. Therefore, its availability relies heavily upon whether its award is appropriate when considering the facts of the case.

History of Specific Performance

Insofar as the history of specific performance is concerned, such a remedy was not initially permitted under common law. A litigant’s rights were limited to his being able to collect damages for his loss or suffering. However, the history of specific performance saw the courts of equity realizing that real property made for unique cases. As such, damages were not always adequate insofar as compensation for someone’s loss.

Specific performance was therefore established so as to guarantee a party the remedy of the right to possession of the land. Specific performance allowed the plaintiff in a case the right to take ownership over the property at the center of the dispute. Insofar as performance contracts are concerned, however, the threat of contempt of court was sometimes used to enforce a party’s ownership, rather than specific performance.

Circumstances in Which Specific Performance Might Be Ordered

There are certain circumstances in which specific performance might be ordered. For example, specific performance will be enforced only in cases where the underlying contract was both fair and equitable. Examples of specific goods that have been at the center of cases wherein the courts have ordered specific performance include works of art, and products that were custom-made specific to the buyer’s request.

California has its own circumstances in which specific performance might be ordered. For instance, specific performance is ordered if the court decides that it is an appropriate remedy for the situation at hand. Another circumstance in which specific performance might be ordered is in a situation wherein a party agrees to perform an action in the future which had been previously detailed in the contract at issue.

Exceptional Circumstances Barring Specific Performance

The award of specific performance is never a guarantee. There exist exceptional circumstances barring specific performance, which influence a court’s decision. Some examples of these exceptional circumstances barring specific performance include:

  • Such an order would cause the defendant severe hardship.
  • The underlying contract is found to be unconscionable, or too vague to enforce.
  • Damages would be enough to remedy the plaintiff’s loss.
  • The claimant has “unclean hands,” meaning he has misbehaved in some way.

If the court finds any of these exceptional circumstances barring specific performance to be true, then specific performance will not be ordered.

Buyer’s Right to Specific Performance or Replevin

A buyer’s right to specific performance or replevin is determined by three main factors. First, specific performance may only be ordered when the goods are unique. Second, an order of a buyer’s right to specific performance or replevin may include terms and conditions that the court feels are just insofar as the payment of damages or other relief. Finally, a buyer’s right to specific performance or replevin of goods identified in a contract is confirmed if, after reasonable effort, he is still unable to recover what he has lost.

If the buyer has purchased goods for the purposes of household or personal use, or for members of his family, then his right of replevin is fulfilled upon his acquiring special property. This is true even if the seller refused to fulfill his end of the contract or simply failed to deliver as was promised.

Replevin

The right of replevin is the right of an individual to recover goods or chattel that were wrongfully taken, after having given them for security. This is different from repossessing the property.

For example:

Jill bought a used car just over a year ago. She financed the car through the car lot, and only made payments for the first eight months. Jill has been hiding the car, expecting the creditor to repossess it, and her brothers have threatened violence when a tow truck showed up at her apartment to take it. In this case, the creditor is unable to repossess the car without breaching the peace, or without risking injury.

The creditor may apply to the court for replevin, asking the court to order Jill to return the car. If Jill were to refuse to comply with an order of replevin, she risks a charge of contempt of court. In addition, she would likely be ordered to pay the creditor the balance owed on the car loan, as well as any fees and costs associated with the recovery.

Specific Performance Example Involving an Oral Contract

An example of specific performance occurred in April 10, 1959, when Harold Weldon, a driller, was in E.C. Joachim’s store on April 10, 1959 when the two entered into an oral contract to transfer the interest in an oil and gas lease. Weldon alleged that the deal hinged on Weldon’s securing a drilling contractor to drill a well on the property leased by Joachim. For such services, Weldon alleged that Joachim agreed to convey to him the royalty interest in the lease, but ultimately refused to make the transfer. Weldon then sued Joachim for breach of contract, and Joachim countersued with a general denial.

Weldon finally found a contractor, Paul Hammer, who drilled the well and obtained an assignment of the lease from Joachim. On the same day that Joachim assigned the lease to Hammer and his partner, Weldon demanded that Joachim assign him the interest he had been promised. Joachim, however, ultimately refused to uphold his end of the bargain. Joachim testified that he never had any conversation with Weldon insofar as drilling the well, nor did he have an oral or written contract with Weldon.

At trial, the contractor testified that he would not have taken the contract if it hadn’t been for Weldon’s efforts. Upon the completion of the trial in the matter, the court found that the parties had indeed entered into an oral contract, and that Weldon had upheld his part of the contract. As such, the court felt that Weldon was entitled to specific performance and ordered in his favor.

Joachim moved for a new trial, which was overruled, and so he appealed the trial court’s decision to the Supreme Court of Oklahoma. Joachim’s argument was that the evidence relied on by Weldon to establish the contract at issue was not clear nor forcible to bring it within the rule that applies to specific performance cases involving oral contracts.

The Supreme Court of Oklahoma, however, disagreed, holding specifically:

“The evidence in the instant action is cogent, clear and forcible as to leave no reasonable doubt that plaintiff and defendant entered into an oral agreement wherein defendant would give plaintiff an interest in the lease if plaintiff would find somebody to drill the lease. That plaintiff fully completed his part of the contract by finding a party who drilled the lease. We therefore conclude that plaintiff and defendant entered into an oral contract as contended by plaintiff and the trial court did not err in so finding.”

As such, the findings of the trial court were affirmed, in that the Supreme Court of Oklahoma held that Weldon did perform on the oral contract as agreed and further, that the trial court did not err in its decision to enforce specific performance.

Related Legal Terms and Issues

  • Contempt of Court – A willful act of disobedience to an order of the court; deliberately being rude or disrespectful to the judge or the court.
  • Court of Equity – A court that is authorized to apply the principles of equity, rather than the law, to the cases that are brought before it.
  • Defendant – A party against whom a lawsuit has been filed in civil court, or who has been accused of, or charged with, a crime or offense.
  • Injunctive Relief – A court-ordered act or prohibition against an act or condition.
  • Plaintiff – A person who brings a legal action against another person or entity, such as in a civil lawsuit, or criminal proceedings.
  • Replevin – A procedure providing for seized goods to be returned to their owner pending the outcome of a case wherein the rights of the interested parties are determined.
  • Trial – A formal presentation of evidence before a judge and jury for the purpose of determining guilt or innocence in a criminal case, or to make a determination in a civil matter.
  • Unclean Hands – The act of having done something unethical regarding the subject of a lawsuit.
  • Unconscionable – Shockingly unfair or unjust; shocking to the conscience; extremely wrong.

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