Specific performance

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The basic principles of contract

A Jolly Contrarian tiptoe through the tulips of consensus™

Formation: capacity and authority · representation · misrepresentation · offer · acceptance · consideration · intention to create legal relations · agreement to agree · privity of contract oral vs written contract · principal · agent
Interpretation and change: governing law · mistake · implied term · amendment · assignment · novation
Performance: force majeure · promise · waiver · warranty · covenant · sovereign immunity · illegality · severability · good faith · commercially reasonable manner · commercial imperative · indemnity · guarantee
Breach: breach · repudiation · causation · remoteness of damage · direct loss · consequential loss · foreseeability · damages · contractual negligence · process agent
Remedies: damages · adequacy of damages ·equitable remedies · injunction · specific performance · limited recourse · rescission · estoppel · concurrent liability
Not contracts: Restitutionquasi-contractquasi-agency

Index: Click to expand:

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Specific performance one of the great equitable remedies for breach of contract — designed to wrap an innocent, clean-handed contractual counterparty with the warm blanket of the courts of chancery when the cold economic rationalism of the common law leave his moral senses — and those of the Ch.D — still outraged. All it really amounts to is a court order directing a contracting party to do what it has promised to do, where the court has plausible grounds to think that it might not — most likely, where “damages would not be an adequate remedy” — you will hear that phrase chucked about a lot — and the innocent party cannot find someone else to perform the contract in the breaching party’s stead (and thus have a clear and adequate measure of loss for a damages claim).

Specific performance is common in commercial construction contracts — where me winding up with the house you promised to build me is a lot more important than me getting the liquidated value, in cash, of the house you promised to build me — but less so for for personal service contracts where bleeding-heart liberal types — and let’s face it, the whole law of equity oozed from the bleeding hearts of bleeding-heart liberal types — would fret that requiring a poor indentured soul to specifically perform as promised in the paid advancement of one employer’s affairs might restrict that individual’s human rights to perform specifically in the advancement of another’s.

A court is less apt to grant specific performance where the contractual obligations are not clearly defined or it would have to supervise the performance over a period of time.

Confidentiality agreements

Specific performance is also the dirty little secret of the NDA. You will see the acknowledgment routinely rehearsed in an NDA that “damages may not be an adequate remedy”, and that it may be reasonable to seek injunctions, and other mortal horrors of the Courts of Chancery. What this means is that, in almost all cases, the provider of confidential information doesn’t suffer any loss.

See also