2 minute read

Specific Performance

Inadequate Legal Remedy

Specific performance will be denied where money would adequately compensate the plaintiff for the loss. The court determines whether money would be adequate after examining the subject matter of the contract itself. If it is land, money is inadequate because land is traditionally viewed as being unique, in that no two parcels of land are exactly alike. An award of damages will not enable the plaintiff to acquire the same parcel of land anywhere else.

If the contract involves the sale of ordinary chattels—such as furniture, appliances, or machinery—rather than land, the general measure of damages for breach of contract is the difference between the market price and the contract price. Damages are adequate since the item could be easily repurchased on the open market and the buyer would be compensated for the amount he was compelled to spend in excess of the original contract price. The UNIFORM COMMERCIAL CODE (UCC) (a body of law adopted by the states that governs commercial transactions) permits specific performance for the breach of a sales contract for goods under limited circumstances.

Specific performance will be granted where the contract involves a unique chattel; the court determines whether a chattel is unique. A rare stamp collection is a unique chattel for purposes of specific performance, whereas stock listed on the New York or American Stock Exchange is not unique. Antiques, heirlooms, or one-of-a-kind items are considered unique because money cannot replace their value to the plaintiff. The claim that an object has sentimental value to the plaintiff is not, in and of itself, sufficient to justify specific performance. When the sentiment or personal desire for the object is based upon facts and circumstances that endow the item with a special value so that it becomes a family heirloom, specific performance will be granted.

Damages are inadequate if the estimate is difficult to make, such as in a requirements contract—a written agreement whereby one party assents to purchase from the other all the merchandise of a designated type that he might require for his business. The same principle applies where the chattel is scarce and cannot be readily repurchased on the open market even though it is not unique. Where the same contract combines unique and ordinary items, the entire contract will be specifically enforced.

As a general rule, breaches of personal service contracts are compensated at law by damages unless the services are unique. In such a case, the contract usually contains a negative covenant that prohibits a person from practicing her profession or performing those unique services for anyone else within a certain distance from a former employer for a specified period of time. The employer would seek to specifically enforce this negative COVENANT against the person who violates it. These provisions, sometimes called covenants not to compete, are enforced only if they are reasonable in scope; otherwise monetary damages are awarded. A court will never specifically enforce an employment contract by ordering an employee to work for an employer because the THIRTEENTH AMENDMENT to the Constitution prohibits SLAVERY.

Insolvency of the defendant, which prevents the plaintiff from collecting damages, does not determine whether specific performance will be granted. The court ascertains only whether an adequate legal remedy exists, not whether the defendant has the financial resources to pay the judgment.

Additional topics

Law Library - American Law and Legal InformationFree Legal Encyclopedia: Special power to Strategic Lawsuits against Public ParticipationSpecific Performance - Valid Contract, Plaintiff's Conduct, Inadequate Legal Remedy, Supervision Of Performance, Defenses - Right to Specific Performance