The rarity of specific performance

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COMPULSORY ASSIGNMENT

A jurisdictional hurdle to be met before a court can make an order for specific performance of a contract is that damages for breach of contract at common law must be inadequate.

McBride (N J McBride, Key Ideas in Contract Law, Hart Publishing, Oxford, 2017, p11) argues that the inadequacy of damages principle renders specific performance rare for the following reasons:

The rarity of specific performance is easily accounted for on the basis that the remedy of specific performance amounts to a much more serious intrusion on civil liberties than an order to pay damages.

This is not just because ordering someone to act in a particular way is more constraining than ordering someone to pay another money (this is why people would much rather give money to charity than volunteer their time to work for a local charity) but also because the breach of an order for specific performance amounts to a contempt of court, punishable through imprisonment - so making an order for specific performance turns a simple breach of contract into a potential crime.

Moreover, ordering a contract to be specifically performed involves a lot more work for the justice system, both in adjudicating future disputes over whether the order for specific performance has been properly observed and in dealing with contractors who fail to abide by those orders.

The courts, quite properly, will refuse to involve the justice system in such extra work if damages would be an ‘adequate remedy' to protect the interests of the victim of the breach of contract.

Finally, being able to obtain an order for specific performance and being able to hold it - with the possibility of punitive sanctions for its breach - over the head of the breaching party creates all sorts of unpleasant opportunities for extorting excessive amounts of money from a breaching party in return for allowing the order to lapse.

Again, the courts, quite properly, would rather not create such opportunities for extortion when damages would be an ‘adequate remedy' to protect the interests of the victim of a breach of contract.

Reference no: EM131830597

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