Specific Performance & Contracts
In specific performance actions, the contract is actually performed instead of just the payment being made.
This type of action is often the legal remedy of choice in real estate contracts because each parcel of land is unique and different from other contracts.
This is an equitable remedy compelling future performance, which means that it is not available as a right in court, but rather it is granted by the court based on what is fair in a specific situation. This type of remedy is only granted if money damages would not be an adequate solution.
The main reason for this is that specific performance can take into account all of the unique circumstances involved in a particular contract, whereas money damages are more general and may not be appropriate in every case.
A court may order specific performance not only for enforcing the purchase price of real property but also in other certain circumstances where mere money damages are not enough because of the unique property or custom made products that demand equitable principles for an order specific performance.
For example, specific performance might be ordered if the unique property has sentimental value to the plaintiff and damages in the form of money would not be able to compensate for that. Real estate contracts are very special and different from other contracts because of the land.
The real property subject to the sale contract is unique – there is only that one plot of land on the earth! Therefore the appropriate remedy is not monetary damages when enforcing the valid and binding contract, the adequate remedy of specific performance is appropriate for the non breaching party.
As a result of this, a cause of action arose over history that requires three special things to allow you to enforce a contract for the sale of real property through a specific performance action.
Call our attorneys have experience in business contracts so call us today for help.
Define Specific Performance:
Specific performance is a legal remedy that can be ordered by a court when a contract has been breached. When specific performance is ordered, the goal is to force the breaching party to carry out their obligations as specified in the agreement. This type of remedy is only available in certain cases where no other remedy will suffice. Money damages will not put the injured party in the position they would have enjoyed had the contract been fully performed. When a contract is for the sale of a unique property, for example, specific performance may be the only remedy available. In order to obtain specific performance, a plaintiff must plead and prove that they have a cause of action for specific performance.
Elements of Specific Performance Actions
Illinois courts hold (it means that is what the court said) that there are three elements of a specific performance action that must be proven before a court will award the remedy and make someone close on the sale of real estate. These elements comprise the specific performance definition for breach of contracts lawsuits involving the purchase of real property.
- Existence Of A Valid, Binding And Enforceable Contract
- Compliance By The Plaintiff With Terms Of Contract
- The Failure Of The Defendant To Perform Its Part Of The Contract.
Existence of valid, binding and enforceable contract
Not all contracts are enforceable – for example, illegal contracts to commit crimes or violate laws are not enforceable – bad news for all those criminals out there trying to enforce their contracts to break the law.
Of course, most land deals are lawful, and therefore often enforceable, valid and binding.
A valid contract also cannot have defenses to escape performance – for example duress, or unclean hands, or fraud. These are all defenses to the validity of a contract.
The vast majority – well over 95% of all contracts are valid, binding and enforceable.
Compliance by the Plaintiff in Performance
In breach of contract actions – the plaintiff (the person that sues in court for its rights) must be entirely blameless.
The plaintiff must have performed its end of the bargain – or have been excused from that performance by the anticipatory breach of the defendant.
Even if the performance by the Plaintiff has been excused, they still must be “ready, willing and able” to perform according to the terms of the contract.
Performance issues is where the real meat-and-potatoes of the specific performance cause of action for sale contracts for land or buildings come up.
Questions of fact as to if the Plaintiff has performed, or is ready to perform can be very tricky – call our experienced attorneys today with your unique fact pattern.
Specific Performance Under Uniform Commercial Code
A cause of action for specific performance may also be controlled by statute. Section 2-716 of the Uniform Commercial Code (UCC), 810 ILCS 5/2-716, provides for an action for specific performance:
- Specific Performance May Be Ordered Where The Goods Are Unique Or In Other Proper Circumstances.
- The Judgment For Specific Performance May Include Such Terms And Conditions As To Payment Of The Price, Damages, Or Other Relief As The Court May Deem Just.
legal action: When two people make a deal, and one of them doesn’t hold up their end of the bargain, the other person may take them to court to get what they’re owed. This is called legal action.
court orders: If you go to court, the judge may order the other person to give you what you’re owed. This is called a court order.
entitled to specific performance: If you have a unique item that was promised in a deal, and there’s no other one like it, you may be entitled to something called “specific performance.” This means the other person is forced to give you what they promised.
the Uniform Commercial Code: The UCC : A comprehensive code (statute) governing commercial transactions in all types from sales to secured transaction, even commercial paper and negotiated instruments.
failure by the defendant to perform
The final of the three-legged stool that is a specific performance action is the breach by the defendant to perform according to the terms of the contract for the sale of real estate.
Quite often one party gets cold feet and wants out of the real estate sale. They fail to close, which is almost always a defined breach of contract under its plain language.
Sometimes, the failure to perform is excused due to the complex operations of some real estate deals with their various amendments and conditions.
If your contract for sale of real estate has fallen through and you want to assert your rights – contact our offices today.
what does specific performance mean in real estate
When it comes to specific performance in regards to contractual operations, there is a unique circumstance that often results besides monetary damages.
Because each parcel of land is very special and different from other contracts due to its possession of specific characteristics, specific performance actions are often taken in order to ensure that the contract is fulfilled as intended.
This is an equitable remedy, which means that it is not a right that is automatically granted, but rather something that the court may choose to do if it feels that it is fair in the given situation.
In real estate, specific performance is a remedy that can be ordered by a court when one party to a binding contract has violated the agreement. When ordering specific performance, the court insists that the party in breach of contract fulfill their obligations as specified in the agreement. This typically occurs when the property or asset that is the subject of the contract is unique and cannot be replaced with money. Here are some examples of real-world situations in which a court might order specific performance:
Sale of a Unique Piece of Property: In Florida, if a seller breaches a real estate contract for the sale of beachfront property, the court may order them to specifically perform under the agreement and sell the property to the buyer.
when can specific performance be enforced under a sales contract?
In most cases, specific performance is only awarded when damages would not be an adequate remedy. This means that if the party who failed to uphold their end of the bargain simply pays damages, this will not be sufficient.
The party who is seeking specific performance must show that they were harmed in some way by the other party’s failure to uphold their end of the contract.
define specific performance in real estate
When it comes to real estate contracts, specific performance often applies because the land that is subject to the sale is so unique.
Each parcel of land possesses its own specific characteristics and value, which is why it is so important that the contract is fulfilled as intended.
When a party breaches a contract to purchase real estate, the other party may be able to seek specific performance as equitable relief. This means that the court will order the breaching party to perform their end of the bargain and close on the sale.
There are three elements that must be proven before the specific performance will be granted: the existence of a valid, binding, and enforceable contract; compliance by the plaintiff with terms of the contract; and the failure of the defendant to perform its part of the contract.
Not all contracts qualify for specific performance, and in some cases, the breaching party may have a valid defense. If you are considering seeking specific performance, it is important to speak with an attorney to discuss your case.
If you are the party who breached the contract, it is important to speak with an attorney as well. There may be a valid defense that can be raised, such as the impossibility of performance or changed circumstances. An experienced attorney can help you understand your rights and defenses in a specific performance action.
If specific performance is not granted, it can often lead to a situation where the party who failed to uphold their end of the bargain simply walks away with no consequences, which can be very harmful to the other party.
Not all contracts result in an order for specific performance, as this remedy is typically reserved for unique or extraordinary circumstances. If you are involved in a breach of contract lawsuit involving the purchase of real property, it is important to speak with an experienced contracts attorney.
Bullet Points about specific performance
When specific performance is ordered, the goal is not to compensate the injured party but to force the breaching party to carry out their obligations.
- This type of remedy is only available in certain cases where no other remedy will adequately compensate a wronged party to an underlying contract.
- When a contract is for the sale of a unique property, for instance, specific performance may be the only remedy available.
- In order to obtain specific performance, a plaintiff must plead and prove that they have a cause of action for specific performance.
- Money damages will not put the injured party in the position they would have enjoyed had the contract been fully performed.
- Specific performance is a type of legal remedy that can be ordered by a court when a contract has been breached and actual performance is commanded.
Specific Performance Lawyer
Whether you’re a bank or distressed asset purchaser, Thomas Howard can help you quickly recover your contractual obligations.
Thomas Howard was on the ball and got things done. Easy to work with, communicates very well, and I would recommend him anytime.
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