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The 411 About Specific Performance: It’s Unique And YOU Must Have It!

Douglas Dowell
2 min read
The 411 About Specific Performance:  It’s Unique And YOU Must Have It!

Man… that Van Gogh painting was going to look great on your wall in your office.

You paid a princely sum. You have signed, sealed…then suddenly, for some unknown reason, the seller balks. Delivery never occurs.

Your options after a breach of contract are always are to

  1. Do nothing and move on
  2. Negotiate
  3. Litigate

If the first two are unsatisfactory…one outstanding remedy for this scenario is specific performance.

Specific performance is defined as: An extraordinary equitable remedy that compels a party to execute a contract according to the precise terms agreed upon or to execute it substantially so that, under the circumstances, justice will be done between the parties. (Source)

Ordinarily, your primary objective in a breach case is a money award. Practically, whether you actually collect is an important factor to consider…wouldn’t you agree?

Snap back to our imagined Van Gogh scenario. You have spent a lot of money that is not longer in your hands. Neither is the painting. Tough position to be in. Your legal counsel will offer this approach. The picture is so unique that money won’t really fix the harm done. The only way to make this right is to compel specific performance!

Notice that there is a very close similarity to art work and real estate. Each property is unique in and of itself.

For example California has a five prong test whether this powerful tool will be allowed to be used:

Specific performance of a contract may be decreed whenever:

  1. its terms are sufficiently definite;
  2. consideration is adequate;
  3. there is substantial similarity of the requested performance to the contractual terms;
  4. there is mutuality of remedies; and
  5. plaintiff’s legal remedy is inadequate.

Blackburn v. Charnley, 117 Cal. App. 4th 758, 766 (Cal. Ct. App. 2004). See https://gweston.wordpress.com/tag/elements-of-specific-performance-in-california/

The first three prongs are about a meeting of the minds. Was the deal really a deal? The fourth prong brings up the next important point about specific performance. It cuts both ways! A buyer conceivably can force the seller to commit was the parties have reached a point of no return.

Ultimately, the judge will have tremendous discretion in this type of case. Your opponent will try argue that money instead will be sufficient. The fifth prong of the California test bring us right back to where we started. Will money substitute for that Van Gogh?
Photo Credit: steve-uk

Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.