of this chapter. It is the fundamental principle regulating the exercise of this equitable jurisdiction, that whenever the legal remedy of damages is sufficient, equity will not interfere, and the specific performance will be refused; and this is always the case when the contract is satisfied by a payment of money. This rule has a wide application to a great variety of agreements.(1) For this reason contracts concerning goods, wares, and merchandise, and other ordinary chattels, or public and other stocks or securities, which have a market value and sale, are not specifically executed.(2)

SEC. 48. Many of the ordinary classes of contracts, for which the legal remedy is sufficient, have been mentioned in Section I, and need not be repeated here. In addition to these, the following cases have been decided. Where the rights of the party, plaintiff, under a contract, will be fully satisfied by an account of profits, and a payment of the sum found due thereby, and there is no obstacle to a recovery of such amount at law, a suit for a specific performance cannot be maintained.(3) Since the breach can always be fully compensated by

(1) For instance, of contracts with railway companies, see Lord James Stuart v. London, & N. W. R'y Co., 1 DeG. M. & G. 721; Webb v. Direct London, etc., R'y Co., 1 DeG. M. & G. 521 ; but see remarks on these cases in Hawkes v. Eastern Counties R'y Co., 1 DeG. M. & G. 737; 5 H. L. Cas. 331, per Ld. ST. LEONARDS; South Wales R'y Co. v. Wythes, 1 K. & J. 186; 5 DeG. M. & G. 880; Meynell v. Surtees, 3 Sm. & Gif. 101; Morgan v. Milman, 3 DeG. M. & G. 35; Garrett v. Banstead, etc., R'y Co., 4 DeG. J. & S. 462, 465, 467. Agreement to run a grain elevator, etc., Richmond v. Dubuque, etc., R. R., 33 Iowa, 423. See, also, Hammond v. Messenger, 9 Sim. 327; Rose v. Clark, 1 Y. & C. 534; Dhegetoft v. London Ass. Co., Mosely, 83; 1 Atk. 547; Carter v. U. S. Ins. Co., 1 John. Ch. 463; Pitkin v. Pitkin, 7 Conn. 315; Bailey v. Strong, 8 Conn. 278; Redmund v. Dickerson, 1 Stockt. 507; Mechanics' B'k v. DeBolt, 1 Ohio St. 591; Bonebright v. Pease, 3 Mich. 318; Thompson v. Manley, 16 Geo. 440; Deggett v. Hart, 5 Flor. 215; Rees v. Parish, 1 McCord Ch. 59; Bell v. Bemen, 3 Murph. 273; Adair v. Winchester, 7 Gill. & John. 114; Smiley v. Bell, Mart. & Yerg. 378; Mosely v. Boush, 4 Rand. 392; Powell v. Central Plank-Road Co., 24 Ala. 441; Strasburgh R. R. v. Echternacht, 9 Harris, 220.

(2) See Cud v. Rutter, 1 P. Wms. 570; 2 Eq. Cas. Abr. 18, pl. 8; Adderley v. Dixon, 1 S. & S. 610; Wright v. Bell, 5 Price, 329; Cappur v. Harris, Bunb. 135; Ferguson v. Paschall, 11 Mo. 267; Scott v. Bellgeny, 4 Miss. 119; Caldwell v. Myers, Hardin, 551; Madison v. Chinn, 3 J. J. Marsh. 230; Dalzell v. Crawford, 2 Pa. L. J. 17, 19; Ins. Co. of A. A. v. Union Canal Co., 2 Pa. L. J. 65, 67; Savary v. Spence, 13 Ala. 561; Bubier v. Bubier, 24 Me. 42; Justices v. Croft, 18 Geo. 473; Roundtree v. McLane, 1 Hempst. 245; Waters v. Howard, 1 Md. Ch. 12, 118; Hoy v. Hansborough, 1 Freem. Ch. 533, 543; Cowles v. Whitman, 10 Conn. 121, 124; Brown v. Gilliland, 3 Dessau. 539, 541; Gram v. Stebbins, 6 Paige, 124; Austin v. Gillespie, 1 Jones Eq. 261; Ashe v. Johnson, 2 Jones Eq. 149; Lloyd v. Wheatley, 2 Jones Eq. 267; Sullivan v. Tuck, 1 Md. Ch. 59.

(3) Ord v. Johnston, 1 Jur. (N. S.) 1063; Sturge v. Midland Ry. Co., W. R. (1857-8) 233. And see McKewan v. Sanderson, L. R. 20 Eq. 65. Suit to enforce

damages, a contract to lend, either money or chattels, will not be specifically enforced ;(1) nor a contract to borrow ;(2) nor a contract to pay money.(3) A specific performance of contracts for hiring and service is also refused, because the legal remedy is sufficient, as well as because the equitable relief is impracticable; (4) and the same is true of the contract of agency.(5)

SEC. 49. The specific performance of an agreement for a tenancy from year to year, which stipulated that the tenant was to abide, in all respects, by the terms entered into by a previous tenant, and was to pay for a further agreement to be drawn up, was refused on the ground that the legal remedy was adequate. It was contended that equity should interpose, in order to settle the proper terms of the final contract, but it was held that these might be fully shown at law.(6) Contracts for the sale of ships, or shares in them, stand upon a peculiar footing, the result of the statutory policy for encouraging and protecting domestic commerce. Under the registry acts, there can be no contract for the transfer of a British ship, or of shares in it, valid in equity, which is not also valid in law; in other words, there is no such thing as an equitable sale or title distinct from a legal sale and title. As a contract will create a legal title, or amount to a transfer in law, it follows that the legal remedy must always be sufficient, and there can be no place for the interference of equity to compel a specific performance, and turn an equitable interest into a legal title by the execution of a conveyance.(7) This doctrine applies both to sales and

a guaranty for payment of money. Held, void, as being in fraud of the bankrupt act. Also, held, in no sense a case for specific performance; it is simply a suit against the guarantor to recover the amount due, and for an accounting to ascertain how much is due.

(1) Flight v. Bolland, 4 Russ. 298, 301; Brough v. Oddy, 1 R. & My. 55; Sichel v. Mosenthal, 30 Beav. 371; Thorpe v. Hosford, 20 W. R. 922. Will not specifically enforce a charter party. DeMattos v. Gibson, 4 DeG. & J. 276; Claringbould v. Curtis, 21 L. J. Ch. 541; Norton v. Serle, Finch. 149.

(2) Rogers v. Challis, 27 Beav. 175.

(3) Crampton v. Varna, Ry. Co., L. R. 7 Ch. 562; 20 W. R. 713 (L. C.); Clark v. Lord Rivers, L. R. 5 Eq. 91 (curious case); but it seems an agreement to execute a mortgage, in consideration of money due, will be specifically enforced in equity. Ashton v. Corrigan, L. R. 13 Eq. 76.

(4) Johnson v. Shrewsbury, etc., Ry. Co., 3 DeG. M. & G. 914; Pickering v. Bishop of Ely, 2 Y. & C. C. C. 249; Stocker v. Brocklebank, 3 Mac. & G. 250; Horne v. London & N. W. Ry. Co., 10 W. R. 170; Brett v. East India & London Shipping Co., 12 W. R. 596; Mair v. Himalaya Tea Co., L. R. 1 Eq. 411.

(5) Chinnock v. Sainsbury, 30 L. J. (N. S.) Ch. 409.

(6) Clayton v. Illingworth, 10 Ha. 451.

(7) See 6 Geo. IV, ch. 110, § 31; 8 & 9 Vict. ch. 89, § 34, which provides that when property in a vessel, or a part thereof, shall be sold, "the same shall be

to contracts, the statutes preventing any equitable right arising from notice or other incidents. (1) A contract, however, which relates exclusively to the proceeds arising from the sale of a vessel, and not to the ship itself, is said not to be within the acts, and it may, therefore, under the proper conditions, be specifically enforced.(2) Although it has been judicially stated that fraud might be an occasion for the interference of equity, in respect of such contracts, no case has decided the question, and much less determined what particular fraud would create an equitable right.(3) The United States statutes concerning shipping are framed in accordance with the same policy, and contain similar provisions.(4) An agreement to sell a foreign ship, not affected by the navigation acts, may be specifically enforced.(5)

SEC. 50. Where the parties to any agreement, whatever may be the subject-matter or the terms, have added a provision for the payment, in case of a breach, of a certain sum which is truly liquidated damages and not a penalty-in other words, where the contract stipulates for one of two things in the alternative, the performance of certain acts, or the payment of a certain amount of money in lieu thereof-equity will not interfere to decree a specific performance of the first alternative, but will leave the injured party to his legal remedy of recovering the money specified in the second. The reason of this rule is, that

transferred by bill of sale or other instrument in writing, containing a recital of the certificate of registry of such ship or vessel, or the principal contents thereof, otherwise such transfer shall not be valid or effectual for any purpose whatever, either in law or in equity." As an agreement without this recital is absolutely void, there is no such thing as an agreement to transfer a ship which does not actually transfer it, so that there can be no occasion for any further specific execution. 17 & 18 Vict. ch. 104, § 43. omits the above clause making the instrument void at law and in equity, etc., but this change in the statutory language has not made any change in the doctrine laid down by the courts. See Brewster v. Clarke, 2 Mer. 75; Thompson v. Leake, 1 Madd. 39; Newnham v. Graves, 1 Madd. 399, n.; Battersby v. Smyth, 3 Madd. 110; Hughes v. Morris, 2 DeG. M. & G. 349, 357; Coombes v. Mansfield, 24 L. J. Ch. 513; 3 Drew. 193; Liverpool Borough Bk. v. Turner, 2 DeG. F. & J. 502; 1 J. & H. 159; McLarty v. Middleton, 9 W. R. 861. (1) McCalmont v. Rankin, 2 DeG. M. & G. 403, which contains an exhaustive discussion of the principle and the decisions by Ld. ST. LEONARDS.

(2) Armstrong v. Armstrong, 21 Beav. 78; McCalmont v. Rankin, 2 DeG. M. & G. 424, per Ld. ST. LEONARDS; Coombs v. Mansfield, 3 Drew. 193; Clarke v. Batters, 1 K. & J. 242.

(3) Armstrong v. Armstrong, 21 Beav. 71, 87; in McCalmont v. Rankin, 2 DeG. M. & G. 416, 421, Ld. ST. LEONARDS said: "I am perfectly clear that, so far as the authorities have gone, there have been cases very much like fraud, and yet no relief has been given." See Holderness v. Lamport, 29 Beav, 129,

(4) U. S. R. S. § 4170.

(5) Hart v. Herwig, L. R. 8 Ch. 860.

the parties have formally agreed upon the compensation-have assessed the damages-and have thereby declared that an appeal to equity is unnecessary, since they have made the legal relief adequate.(1) If the provision for a pecuniary payment is a penalty, however, it may be disregarded, and the substantial part of the agreement specifically enforced, provided it is one to which the equitable remedy can be applied.(2) The mere fact that a contract contains a penalty is not, of itself, a ground for decreeing a specific performance; the terms must be such that relief would have been given without the penalty, and then the presence of it would not interfere with the equitable jurisdiction. It is not within the province of the present work to distinguish between penalties and liquidated damages. I have simply collected in the foot-note a number of cases

(1) Howard v. Hopkins, 2 Atk. 371; French v. Macale, 2 Dr. & War. 269; Roper v. Bartholomew, 12 Pri. 797; Skinner v. Dayton, 2 John. Ch. 526; City Bank of Baltimore v. Smith, 3 Gill & John. 265; Jones v. Green, 3 Y. & J. 298; Coles v. Sims, 5 DeG. M. & G. 1; Jaquith v. Hudson, 5 Mich. 123; Cotheal v. Talmadge, 9 N. Y. 551; Bagley v. Peddie, 16 N. Y. 469; Chamberlain v. Bagley, 11 N. H. 234; Williams v. Dakin, 22 Wend. 201; Rolfe v. Peterson, 2 Bro. P. C. 436; Woodward v. Gyles, 2 Vern. 119; Gerrard v. O'Reilly, 3 Dr. & War. 414; Magrane v. Archbold, 1 Dow, 107; Ranger v. Great Western R'y Co., 5 H. L. C. 73; Hahn v. Concordia Society, 42 Md. 460.

(2) Chilliner v. Chilliner, 2 Ves. Sen. 528; Hobson v. Trevor, 2 P. Wms. 191; Kennedy v. Lee, 3 Meriv. 441, 450; Howard v. Hopkins, 2 Atk. 371; Prebble v. Boghurst, 1 Sw. 309; Jeudwine v. Agate, 3 Sim. 141; Logan v. Wienholt, 1 Cl. & Fin. 611; 7 Bli. (N. S.) 1, 49, 50; Butler v. Powis, 2 Coll. C. C. 156; Roper v. Bartholomew, 12 Pri. 797; Sloman v. Walter, 1 Bro. C. C. 418; Jones v. Heavens, L. R. 4 Ch. D. 636; In re Dagenham Dock Co. Ex parte Hulse, L. R. 8 Ch. 1022 (provision in a certain contract for sale of land held to be a penalty). A bond with a penalty to convey land will be specifically enforced against the obligor; he cannot elect to convey or to pay the penalty; it is immaterial that the purchaser is not formally bound, or has not performed, if he offers to perform ; performance on his part can be secured in the decree. Ewins v. Gordon, 49 N. H. 444. Where a person has bound himself, by his covenant, to do or to omit a specified thing, and has fixed a certain sum of money which he will pay upon a breach of the covenant, he is not thereby absolved from the performance of the thing agreed, and equity will specifically enforce the contract, if it is otherwise a proper one to be so enforced. Gillis v. Hall, 7 Phila. 422; 2 Brews. 342; Dooley v. Watson, 1 Gray, 414, per SHAW, C. J. : Courts of equity have long since overruled the doctrine that a bond for the payment of money, conditioned to be void on the conyeyance of land, is to be treated as a mere agreement to pay money. When the penalty appears to be intended merely as a security for the performance of the agreement, the principal object of the parties will be carried out." See, also, Hooker v. Pynchon, 3 Gray, 550; Fisher v. Shaw, 42 Me. 32; Hull v. Sturdivant, 46 Me. 34; Dailey v. Lichfield, 10 Mich. 29. In Whitney v. Stone, 23 Cal. 275, it was held that an award otherwise proper would be enforced, although the agreement to submit contained a penalty.

in which contracts, with penalties, have been specifically enforced. Having thus described the general nature of the remedy, I shall proceed to discuss, in a more particular and exhaustive manner, the features and incidents which must belong to the contract in order that the equitable remedial right may exist.