Contract Remedies - Specific Performance Flashcards
Specific Performance requires D to perform
Rare in real life but common on bar.
Specific performance requires D to perform the K.
5-part checklist:
1) K must be valid, certain, and definite = P must show K is valid. To force D to perform, P must show K terms with even more certainty and definiteness than is necessary even for money damages
2) P fulfills Conditions = P must show he already did his part or he is ready, willing, and able to perform. 2 ways this comes up with land sale K:
-> Deficiencies fact pattern = seller can’t deliver the agreed upon consideration. Usually the quantity of land (seller really only had 90% of the acres). Threshold inquiry: is P the seller or buyer? If seller is P, we can specifically enforce if the defect is minor. Party received substantial benefit of the bargain despite specific performance. If defect is major, can’t force specific performance unless it’s curable. If P is buyer, buyer can enforce K even if the defect is major. The buyer would just have to pay less. But, if defect is “very major” that would be like missing half or more of the promised consideration. Remember, if specific performance is applied, COURT USES ABATEMENT: lowering price because of defect
-> Time is of the essence fact pattern: buyer can’t meet K condition of timely performance. There will be land sale K and it has express “time is of the essence” clause with forfeiture provision if performance is not timely. So K says: payments must be on first of each month, if not met, then performance will be forfeited. Then there will have been partial performance, now potentially subject to forfeiture. Buyer will have made some late payment triggering the Timing and Forfeiture clauses. Then seller says sorry, I can keep both land and money you paid me to date. Then buyer brings lawsuit for specific performance, saying we gotta continue with this K. What do? Remember specific performance is an equitable remedy: “equity abhors forfeitures”. The buyer came in and put down money, so it’s harsh to make em lose it all just by being late. Court examines if tardiness is de minimis or there is undue hardship like losing both your land and money. Almost always award specific performance and under the modern trend, courts would give P restitutionary relief (give money back if specific performance not granted).
3) Inadequate legal remedy alternative: specific performance only available if legal remedies are inadequate. The alternative in contracts is money damages- damages speculative, D is insolvent, multiple suits, or there is uniqueness. If property is unique, must make threshold determination: is K for the sale of real or personal property? All land is unique and specific performance is therefore available.
-> But personal property is not unique. With a few exceptions where it is unique if:
–» Rare
–» of Personal Significance
–» unique due to special circumstances
-> Liquidated damages clause general rule: it does not make money damages adequate. Specific performance is still available. Exception: if clause provides it’s to be the ONLY remedy
4) Feasibility of enforcement. Ex: personal services are not specifically enforceable. Noncompetes are enforceable if the services are unique and scope is reasonable.
Defenses:
- Unconscionability tested at time of K formation.
- Mistake
- Misrepresentation
Statute of Frauds vs. Specific Performance Problem with Remedies - Part Performance Exception
If one has rendered valuable part performance in reliance on the K, the statute of frauds no longer applies and specific performance will be granted:
whole or partial Payment +
Possession/Improvement/Services
Under the modern trend, valuable Services alone is sufficient.
Caretaker cared for old man until he died. He promised to give her the house if she stayed with him until he died. After he died, estate refused to convey, claiming SoF as defense. Caretaker won specific performance because she gave Services.
Specific Performance Checklist (MEMORIZE)
CCIFD = “Cha Cha Is Fairly Difficult”
1) Contract is Valid
2) Conditions of P are fulfilled
3) Inadequate Legal Remedy
4) Feasibility of Enforcement
5) Defenses
