What Is 'Specific Performance' as a Legal Remedy?

Specific performance is a legal remedy that requires one party to fulfill their contractual obligations in breach of contract cases. This remedy is available when no other remedy will adequately compensate the non-breaching party and when monetary damages are not an adequate remedy, the court can order the defendant to perform the original terms of the contract. For example, in a dispute over real property where a seller has changed their mind about selling their house, a court can order that the seller honor the real estate contract.

Specific Performance: Overview

Specific performance is a type of remedy courts use when no other remedy, including equitable relief, will adequately compensate the other party. The court may use this legal remedy to put the injured party in the position they would have enjoyed had the contract been fully performed.

Types of Remedies

Specific performance is one of several types of remedies. The goal of remedies in contract law is to make the non-breaching party whole following a breach of contract. Other remedies include, but are not limited to the following:

• Money Damages. The court awards an amount of money designed to make the non-breaching party whole.

• Liquidated Damages. In the event of a contract breach, the parties can agree to a specific amount of money payable to the non-breaching party.

• Consequential Damages. These are damages related to foreseeable consequences of the breach of contract.

• Expectation Damages. These damages compensate the non-breaching party with an award equal to the full amount of the breach of contract.

Specific Performance Awards

Specific performance is one of several types of remedies and the most common reason courts grant specific performance is that the subject of the contract is unique. For instance, when a contract is for the sale of a property, mere monetary damages may not remedy the purchaser's situation.

Specific Performance Example

Rina offers to buy Beth's house, and Beth accepts but later decides to keep the property. Real estate is unique. Since no other piece of property or house is exactly like Beth's, Rina can claim specific performance on the contract. Beth will have to go through with the sale at the original purchase price if the court orders her to do so. This example of specific performance is an equitable remedy.

Specific Performance and 'Replevin'

Replevin, commonly called "claim and delivery," refers to a court-ordered transfer of actual property. It's a contract remedy similar to specific performance, and it's often used interchangeably in statutes.

For instance, the Uniform Commercial Code (UCC) states that a buyer "has a right of replevin for goods identified to the contract if after reasonable effort he is unable to effect cover for such goods or the circumstances reasonably indicate that such effort will be unavailing."

In other words, a court may order the transfer of actual goods -- replevin -- as a remedy of specific performance in a contract dispute. This happens when compensatory damages, such as cash, are insufficient to cover the damages.

When Do Courts Order Specific Performance?

Courts will enforce specific performance only if the contract is fair and equitable.

Apart from real estate, courts have ordered specific performance for:

• Works of art

• Custom-made products

• Goods in short supply

Nearly all states have adopted the UCC, which addresses specific performance. For example, California law states that specific performance may be compelled if:

• Specific performance of a contract is an appropriate remedy; and

• The other side has substantially performed its obligations, or future performance is assured.

The second requirement ensures that the nonbreaching party has also performed or will perform its obligations specified by the contract.

As you can see, a specific performance order is mainly at the court's discretion.

Get Legal Help

If you have experienced a breach of contract, you should speak to a small business lawyer. They are business law and contract law experts who can provide sound legal advice. Speak to a small business attorney today.