Specific performance of a part of the contract
In some cases of breach of contracts, damages will not be an adequate remedy and the Court in its opinion, may direct the party in breach to carry out his part of promise according to the terms of the contract. This is the direction for 'specific performance' of the contract, by the Court at the instance of the party not in breach. Thus the discretionary power of the Court to order specific performance of the contract, can be exercised in the following situations;
- Where the act agreed to be done is such that, for its non-performance, compensation in money cannot be an adequate relief;
- Where there are no standards for ascertaining the actual damage caused by the non-performance of the contract;
- Where it is probable that the compensation in money can't be availed for the non performance of the act agreed to be done.
Sec. 12 of the Specific Relief Act deals with the specific performance of part of a contract. Sec.12 (1) provides that, the Court shall not grant the specific performance of part of a contract. But clauses (2) to (4) of Sec. 12 recognize certain exceptions to that. There is one deciding factor, which will determine that whether specific performance of a part of a contract is to be ordered or not; i.e., the proportion the part which can be performed bears to that which cannot be performed. In a case, where the part which cannot be performed bears only a small proportion to the whole in value and the unperformed part can be compensated adequately in terms of money, the Court may order specific performance of one part and compensation for the other. In a case where the part which cannot be performed forms a considerable part of the whole, the Court has to first see whether the major part which has to be left out admits of money compensation or not. If the unperformed portion can be compensated in terms of money, the Court may order specific performance of the rest part of the contract provided that the party seeking relief has paid his consideration under the contract as reduced by the amount of compensation for the unperformed portion. If it is not admitted for compensation the Court is at liberty to order specific performance only when the party seeking the relief has paid the whole consideration without any reductions. In other words, where the part that would remain unperformed does not admit for compensation in terms of money, the Court may order specific performance only if the party seeking performance undertakes to pay the consideration for the whole of the contract without any abatement. In both these situations, the party seeking specific performance of a part of the contract has to relinquish all claims as to the performance of the remaining part and also all the rights to compensation either for the deficiency or for any loss or damages sustained through the defendant's default as to performance.
In another sense, when a Court decrees specific performance of a part of a contract, it virtually amounts to the Court making a new bargain for the contracting parties, which they would have never made for themselves and it is for this reason, that it is only in special cases, subject to certain conditions, that a party can claim specific performance of a part of a contract. Under Section 12(3) of the Act, a party, who is not in default, is entitled to specific performance of a contract even where the portion unperformed is considerable part of the entire contract, and there will be an abatement in the price payable.
So, for the applicability of Sub. Sec.(2) to (4) of the section 12 of the Specific Relief Act, the following aspects may be taken into consideration.
- Sub. Section (2) of section 12 of the Act deals with a case, where the part which must be left unperformed bears only a small proportion to the whole in value and the other party admits for compensation in money;
- Where it is found that the party who has promised to sell, has no title over one item out of several items, which he had promised to sell, it is to be considered that whether the part of the contract which cannot be performed bears only a small proportion to the whole in value and admits for compensation in money or that does not bear only a small portion to the whole in value or does not admits for compensation in money. If the part of the contract which can't be performed in the conveyance of an item which is only a small portion of the whole in value and the other party admits for compensation in money, specific performance of part of contract can be allowed;
- If a vendor claims specific performance and the Court refuses to accept it, and the purchaser is not willing for decree on terms that, the vendor will make compensation to the purchaser, the specific performance of part of contract can be allowed;
- Where the performance of a contract is depended on the consent of a third person and such consent cannot be obtained for any reasons, specific performance cannot be ordered; and
- In case of a divisible contract specific performance of a part of contract can be ordered. The nature of a contract, whether it is divisible or not shall be determined upon the facts and circumstances of each and every case; which is definitely a question of fact.
Sub. Section (2) and (3) of Section 12 are not confined to cases, where the inability to perform the contract is due to legal defect like want of title etc. Sub. Section (2) applies to a case where a party who is unable to perform whole or part of contract sues for specific performance. Sub. Section (3) may apply if necessary conditions for its applicability are found to exist. Sec. 12(3) provides that where a party is unable to perform the whole of his part, he is not entitled to a decree for specific performance, if the part remains unperformed forms a considerable part of the whole, even though admitting for compensation in money or does not admit for compensation in money. But at the instance either party, the Court may direct to perform the defaulter specifically so much of his part as he can perform if the party who brings the suit fulfilled the conditions of Section 12(3) (i) & (ii).
The conditions are :-
- In the case in which the unperformed part forms a considerable part of the whole and admits for compensation in money, the plaintiff must pay the agreed consideration for the whole of the contract less the consideration for the unperformed part; and where the unperformed part does not admit for compensation in money, the plaintiff must pay full consideration for the whole contract without abatement; and
- In either case, the plaintiff must relinquish all claims to the performance of the remaining part of the contracts and all rights to compensation, either for the deficiency or for the loss or damages sustained by him through the default of the defendant.
In Ansal Properties and Industries (p) Ltd. v. Rajinder Singh [1990 (3) Cur.C.C. 213 Delhi] case, it was observed that "Section 12 of the Specific Relief Act does not require that in a suit seeking part performance of contract, the plaintiff must deposit the sale consideration prior to the entertainment of the suit". But a claim for grant a relief of benefit under Section 12 (3) cannot be rejected merely on the ground that;
- It was not made at the trial stage and was made at the Appellate Court; and
- It was neither taken in the plaint nor put forth before the Court in writing. Often inquiry and trial may be required to come to a conclusion that whether a person will be entitled to a specific performance in part or not - [T.K. Santha v. A.G. Rathnam. 1989 (2) KLJ 365, 375]
Suggested Readings
- 1988 (2) KLJ 371
- 1991 (1) KLJ 559
- AIR 1988 Ker. 277
- AIR 1993 Ker. 134
- ILR 1983 (1) Ker 599
- 1989 (2) KLJ 365
- 1990 (2) KLJ 497
- AIR 1990 Ker 69
- 12. 1994 (1) KLT 689
- ILR 2000 (3) Ker 632
- AIR 2000 SC 2927
