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THE SPECIFIC PERFORMANCE OF A CONTRACT.
PAGE 1. Where Specific Performance will be decreed
699 2. Where Specific Performance will not be decreed
701 (a) Where damages sufficient remedy .....
PAGE (b) Complication
701 (c) Revocability
702 (d) Absence of Consideration ... 702 3. Part Performance
703 4. Indirect Relief by Injunction .. 704
SECT. 1.-Where Specific Performance will be Decreed. To compel specific performance of a contract unperformed is ordinarily a more appropriate legal remedy than to exact damages for its non-performance. “If a contract be made and one party to it make default in performance, there appears to result to the other party a right at his election either to insist on the actual performance of the contract, or to obtain satisfaction for the nonperformance of it. It may be suggested from this that it follows ... that it ought to be assumed that every contract is specifically enforceable until the contrary be shown. But so broad a proposition has never, it is believed, been asserted by any of the judges of the Court of Chancery or their successors in the High Court of Justice, though if prophecy were the function of a law writer, it might be suggested that they will more and more approximate to such a rule." These are the opening words of the second chapter of an exhaustive and authori. tative treatise on the “Specific Performance of Contracts” (a). The main point of importance to the practitioner in connection with this view of " specific performance” is, that, subject to certain well-defined rules which will now be considered, any judicial decisions in the direction of a refusal to decree specific performance must decrease in value in proportion to their age.
The historical foundation, however, of the equitable jurisdiction Foundation of in granting a decree for specific performance of a contract is that jurisdiction
in specific the party seeking it cannot obtain a sufficient remedy by the performance. common law judgment for damages. Hence it is, that as land has a special value, the loss of which by the party entitled to it cannot be measured by money, specific performance of a contract
(a) Fry on Specific Performance, 4th ed., 1903, at p. 19, by W. D. Rawlins.
Ch. XXIV. either to buy land or to hire it on lease will invariably be s. 1.
enforced (b) if the requirements of the Statute of Frauds (c) have Specific Performance been satisfied. Similarly, specific performance will be decreed of a
contract to sell specific goods (d); and the Sale of Goods Act, 1893, 56 & 57 Vict. c. 71, s. 52 (p. 359, ante), re-enacting the Mercantile Law Amendment Act, 1856, 19 & 20 Vict. c. 97, s. 2, enacts that in any action for breach of contract to deliver specific or ascertained goods, the Court may, if it thinks fit, on the application of the plaintiff, by its judgment or decree direct that the contract shall be performed specifically, without giving the defendant the option of retaining the goods upon payment of damages. Similarly, specific performance will be decreed of a contract to sell shares in a public company (e), and also of a contract to buy such shares (f). Other instances of specifically enforceable contracts are to execute a mortgage (g), and an implied contract to execute
a memorandum of indemnity (h). Combination Under our early law, a plaintiff could neither obtain specific of damages with specific
performance in the Common Law Courts, nor damages in the performance. Court of Chancery. More recently, however, specific perform
ance in a particular class of cases became, as we have seen above, obtainable in a Common Law Court under the Mercantile Law Amendment Act, 1856, and the Court of Chancery was expressly empowered to award damages by the Chancery Amendment Act, 1858 (Lord Cairns' Act), 21 & 22 Vict. c. 27, either in lieu of or in addition to specific performance. And now by sect. 24 of the Judicature Act, 1873, any Division of the High Court may give judgment either for damages or for specific performance, or both, subject to the single restriction that the jurisdiction to grant specific performance of “contracts between vendors of real estates, including contracts for leases,” is assigned to the Chancery
Division of the High Court. Jurisdiction
The 67th section of the County Courts Act, 1888, 51 & 52 Vict. of County c. 13, gives County Courts all the powers of the High Court in
any action for the specific performance of any agreement for the sale, purchase, or lease of any property where in the case of a sale or purchase the purchase-money, or in the case of a lease the
value of the property, shall not exceed 5001. Mistake. Where even a unilateral mistake was proved, it used to be the
practice of the Court not to grant specific performance (i); but
(6) See Judicature Act, 1873, s. 34. De G. & J. 27.
(9) See Ashton v. Corrigan (1871),
(h) See Sporle v. Whayman (1855), (c) Dunenth v. Albrecht (1841), 12 20 Beav. 607. Sim. 189.
(1) Wycombe Rail. Co. v. Donnington (1) Cheale v. Kenward (1858), 3 Hospital (1866), L. R., 1 Ch. 268 ;
now under the Judicature Act, parol evidence of mistake being CH. XXIV. admitted, the agreement may be rectified and the reformed
Specific agreement enforced (k).
Sect. 2.-Where Specific Performance will not be Decreed.
(a) Where Damages sufficient Remedy. It is well settled that where damages are a sufficient remedy, specific performance of a breach of contract will not be granted, as where the contract is merely to transfer a specified Government Stock (1); for with the damages the plaintiff can at once buy as much Government Stock as he has lost by the breach of contract.
(b) Complication. The complicated character of a contract furnishes a reason for the Court refraining specifically to enforce it. On this ground, Building, &c.,
Contracts. contracts to build or repair a house (m) or to cultivate a farm in a particular manner(n), are not specifically enforceable. Under this Continuous head, too, come contracts to perform continuous acts (0), or of Acts. which the breaches are likely to be frequent (p), nor will the Court Partnership. specifically enforce an agreement to enter into partnership (q), or to borrow on mortgage (r). As to contracts for the sale of the goodwill of a business, it is doubted in the older cases whether this Sale of good. is not of too uncertain a nature to be enforced in equity, unless it
will. is connected with the sale of some interest in specified premises (8); but in more recent times the Court of Appeal entertained an action for specific performance of the sale of a "medical practice," Sale of
Medical and although the action was dismissed on the ground that there
Practice. was no binding contract, the parties never being ad idem, it was not suggested that such a contract if proved would not have been enforced (t), and as the subsequent breach of such contract by the
Baskcomb v. Beckwith (1869), L. R., 8 Eq. 100; and see Tamplin v. James (1880), 15 Ch. D. 215, C. A.
(k) Olley v. Fisher (1886), 34 Ch. D. 367; and see post, Ch. XXVII., Mistake and Rectification.
(2) See Fry, s. 68, citing Nutbrown v. Thornton (1784), 10 Ves. 161, per Lord Eldon, C., in ordering the restoration to a tenant of farming stock.
(m) See Moseley v. Virgin (1796), 3 Ves. 184.
(n) See Rayner v. Stone (1762), 2 Eden. 128.
As to compelling railway company to construct works, see Wilson v. Northampton Rail. Co. (1875), L. R., 9 Ch. 279 ; Greene v. West Cheshire Rail. Co.
(1871), L. R., 13 Eq. 44 ; Wilson v.
(0) See Powell Duffrym, &c., Co. v.
(P) See Collins v. Plumb (1810), 16 Ves. 454 ; 10 R. R. 214.
(9) Sichel v. Mosenthal (1862), 30 Beav. 371.
(r) Rogers v. Challis (1860), 29 L. J. Ch. 240.
(s) Bozon v. Farlow (1816), 1 Mer. 459; Coslake v. Till (1826), 1 Russ. 376.
(t) May v. Thomson (1882), 20 Ch. D. 705, C. A. (headnote unreliable).
CH. XXIV. vendor setting up in business himself, or soliciting former Specific per. customers, would be restrained by injunction, there seems no formance reason why such contract should not be specifically enforced (u). (uhere not Decreed).
An agreement which involves a fraud on the public will not be
enforced (x); and an agreement which is illegal will not be enforced Illegality.
unless the legal part can be separated from the illegal, and the parties intended they should be separable; and then the legal
part may be enforced (y). Delay.
The right to specific performance may be lost by delay (z) or acquiescence, as to which a less amount of acquiescence than would have been necessary to bar an action for damages will bar specific performance (a).
Contract for Partnership at Will.
(c) Revocability. If a contract be revocable by the party against whom a decree for specific performance is sought, the decree will be refused. this ground a contract to enter into a partnership at will is not specifically enforceable (b), or a contract for a lease which by virtue of the contract itself would contain a stipulation, enabling the defendant to determine the lease as soon as it was executed (c); and inasmuch as a tenancy from year to year is determinable by either party by half a year's notice to quit, a contract for such a tenancy would seem to be not specifically enforceable on the ground of the shortness of the period for which it can continue against the will of either of the parties (d).
(d) Absence of Consideration. It is well settled that a contract made without consideration (e) is not specifically enforceable (f); even damages cannot be recovered for the breach of such a contract, unless it be under seal, and the addition of a seal, though it renders the contract available for the recovery of damages, does not invest it with enforceability for specific performance. It should be borne in mind, however, that a promise of marriage is a consideration, so that although a promise to marry is not specifically enforceable, an agreement to settle property in consideration of a promise to marry is (g). (u) And see ante, p. 699.
(c) See Lewis v. Bond (1853), 18 Beav. (oc) Post v. Marsh (1880), L. R., 16 85. Ch. D. 395, per Fry, J.
(d) See Clayton v. Illinguorth (1853), (4) Odessa Tramways Co. v. Mendel 10 Hare, 451, in which, however, the (1878), 8 Ch. D. 235, C. A.
suit was dismissed merely“ in the (z) Houe v. Smith (1884), 27 Ch. D. absence of any authority." 89, C. A.
(e) See Ch. II., sect. 2, p. 20, ante. (a) Sayers v. Collyer (1884), 28 Ch. D. f) See Walrond v. Walrond (1858), 103, C. A., per Fry, L.J.
Johns. 18. (6) Hercy v. Birch (1804), 9 Ves. 357. (g) See Ch. XVIII., ante, p. 478.
SECT. 3.- Decree on Part Performance.
Performance. We have seen (ante, p. 76) that by sect. 4 of the Statute of Frauds, certain contracts as a contract to sell, or a contract to let land, are not good unless they have been put in writing signed by the party to be charged therewith. Therefore, such contracts are not as a general rule specifically enforceable unless the statute has been complied with.
There is, however, the notable exception that where the party plaintiff has partly performed an oral contract, required by the statute to be in writing, on the expectation that the party defendant would perform the rest, the Court will not allow the party defendant to back out of the contract upon the strength of the statute (1), but will decree specific performance of the oral contract. This is shortly called the “ doctrine of part performance,' and the application of it is attended with great difficulty.
It has been said in the Court of Appeal, that the doctrine applies only to cases where land was a subject matter of the contract (i), but this view is conceived to be incorrect (k), and the doctrine has been applied to an oral contract for an easement, upon the assumption that the 4th section of the statute applies to such a contract (1).
The main restriction upon the doctrine is, that the acts of Acts must be alleged part performance must be unequivocally and in their unequivocally own nature connected with some such agreement as thai alleged. with contract This is laid down after an exhaustive review of the authorities by Maddison v. Lord Selborne in Maddison v. Alderson (m), in which the House Alderson. of Lords held that an oral contract between an intestate and a woman, that he should devise to her a life estate in land, and that she should serve him as his housekeeper without wages, was not “partly performed” by the woman having served without wages for many years up to his death.
In pursuance of this well-settled rule, the mere continued Continued possession of a tenant at will, or from year to year in expecta- tenancy from
year to year. tion of a lease, is not part performance (n), nor is expenditure
(h) See Mundy v. Jolliffe (1839), 5 My. & Cr., at p. 177 ; per Lord Cottenham, C.; Ungley v. Ungley (1877), 5 Ch. D. 887, C. A.
(1) See Britain v. Rossiter (1879), 11 Q. B. D. 123, where no cases are cited in the judgments, and Thesiger, L.J., did not agree in the principle of the restriction.
(k) See per Lord Selborne, C., in Maddison v. Alderson (1883), 8 App. Cas., at p. 474, and per Kay, J., after
review of cases, in McManus v. Cooke (1887), 35 Ch. D. 681, where it is said that probably the doctrine applies to all cases in which the Court would entertain an action for specific performance if the contract had been in writing.
(1) McManus v. Cooke, supra.
(m) Maddison v. Alderson (1883), 8 App. Cas. 467.
(n) See Faulkner v. Llewellin (1862), 31 L. J., Ch. 549.