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Specific performance at the crossroads

  • A. S. Burrows (a1)

Extract

It is a fundamental principle that the expectation interest is protected for breach of contract. In protecting this interest, the main choice the law faces is between ordering specific performance and awarding damages. The former orders the defendant to carry out what he promised, whereas the latter gives the plaintiff a monetary substitute for performance. Traditionally, the expectation interest has been primarily protected by awarding damages, and specific performance has been a very secondary remedy.

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1 Parke B in Robinson v Harman (1848) I Exch 850 at 855 is the classic authority.

2 Eg it will not be ordered if it infringes the mutuality of remedy rule, or would require ‘constant supervision’, or if the contract is too vague, or is one of personal service.

3 Eg mistake by, or severe hardship to, the defendant, inadequacy of consideration, unfair conduct by the plaintiff.

4 ‘Recent cases’ is taken to include Beswick v Beswick [1968] AC 58.

5 A greater willingness to order specific performance has also recently been shown regarding less fundamental restrictions; see eg Lazard Bros & Co Ltd v Fairfield Properties Co (Mayfair) Ltd (1977) 121 Sol Jo 793; Verrall v Great Yarmouth Borough Council [1980] 3 WLR 258; Sudbrook Trading Estate Ltd v Eggleton [1982] 3 WLR 315. It may seem that Price v Strange [1978] 1 Ch 337 has also shown a greater willingness to order specific performance, but this is not so, for Fry's mutuality of remedy rule, rejected in this case, has never been clearly applied by the courts.

6 [1974] 1 WLR 576.

7 [1968] AC 58.

8 The courts were expressly given discretion to award specific performance of the sale of such goods under s 52, Sale of Goods Act 1893 (now 1979).

9 Damages may also be held inadequate because the defendant cannot pay them; see Société Des Industries Metallurgiques SA v Bronx Engineering Co [1975] 1 Lloyds Rep 465 at 468; Associated Portland Cement Manufacturers Ltd v Tiegland Shipping A/S (The Oakworth) [1975] 1 Lloyds Rep 581 at 583; C.N. Marine Inc v Stena Line A/B and Regie Voor Maritiem Transport (The Stena Nautica) (No 2) [1982] 2 Lloyds Rep 336 at 346–347. But it seems that damages will not be held inadequate in relation to specific performance merely because there is some difficulty in assessing them; see eg Pollard v Clayton (1855) 1 K & J 462; Fothergill v Rowland (1873) LR 17 Eq 132; and the Bronx Engineering case supra.

10 See eg Falcke v Gray (1859) 4 Drew 651; Thorn v Public Works Commissioners (1863) 32 Beav 490; Behnke v Bede Shipping [1927] 1 KB 649; Pusey v Pusey (1684) 1 Vern 273; Somerset v Cookson (1735) 3 P Wms 390; Fells v Read (1796) 3 Ves Jr 70; Lowther v Lowther (1806) 3 Ves 95; Macclesfield v Davies (1814) 3 V & B 16. The last five dealt not with specific performance as such, but rather with the analogous remedy of delivery up, nowadays given under s 3(2) of the Torts (Interference with Goods) Act 1977.

11 See eg Behnke v Bede Shipping [1927] 1 KB 649. North v Great Northern Rwy (1860) 2 Giff 64, which did not deal with specific performance, as such, is analogous.

12 (1966) JBL 211 at 215.

13 [1927] 1 Ch 606.

14 The three bars being discussed apply to interlocutory injunctions amounting to temporary specific performance as well as to (perpetual) specific performance, because under the traditional approach to such injunctions there is no ‘prima facie’ case, and under the approach in American Cyanamid v Ethicon Ltd [1975] AC 396, there is no serious question to be tried.

15 At 578–579.

16 [1980] 1 WLR 1375.

17 [1975] 1 Lloyds Rep 465.

18 At 1383. The order made was an interlocutory order for delivery up of the goods under the Torts (Interference with Goods) Act 1977, s 4(2). Delivery up is analogous to specific performance - see supra, n 10.

19 At 468, 469.

20 At 77.

21 At 102.

22 At 83.

23 At 88.

24 40 ALJR 471.

25 At 477, 487.

26 Lord Pearce thought that the administratrix could have recovered substantial damages. But if wrong on this, he too considered nominal damages ‘manifestly useless’; at 89. Kominal damages would here produce injustice because the widow would be deprived of the benefit of the bargain, and the nephew would keep the business while paying little for it.

27 Their comments are also probably directed to the common law remedy of payment of an agreed sum.

48 Eg Keenan v Handley (1864) 2 De G J & Sm 283; Peel v Peel (1869) 17 WR 586; Hohler v Aston [1920] 2 Ch 420.

29 Eg Ball v Coggs (1710) 1 ER 471; Alderly v Dixon (1824) 1 C & S 607; Clifford v Turrell (1841) 62 ER 826.

30 Remedies of English Law (2nd edn) pp 223–224.

31 See eg Sky Petroleum, Bronx Engineering, and The Stena Nautica (No 2) n 9, supra- here May LJ asked, ‘Is it just in all the circumstances for the plaintiff to be confined to his remedy in damages? Like Beswick this can be interpreted widely as advocating that damages will be held inadequate in a far wider set of circumstances than in the past. But again a narrow view is possible, which sees this new terminology as making no real change; certainly May LJ seemed to apply traditional reasoning in denying specific performance ie the ship was not unique. The majority reached the same result by the same reasoning without advocating any change of terminology.

32 See Beale Remedies for Breach of Contract p 142.

33 [1893] 1Ch 116.

34 Eg Pollard v Clayton (1855) 1 K & J 462; Blackett v Bates (1865) LR 1 Ch 117; Powell Duffryn Steam Co v Tuff Vale Rwy Co (1874) LR 9 Ch 331; Phipps v Jackson (1887) 56 LJ Ch 350; Dominion Coal v Dominion Iron & Steel [1909] AC 293; Dowty Boulton Paul v Wolverhampton Corpn. [1971] 2 All ER 277.

35 [1901] 1 QB 515.

36 Eg Carpenters Estates Ltd v Davies [1946] Ch 160; Jeune v Queens Cross Properties [1974] Ch 97.

37 At 523,524.

38 [1927] 1 All ER 960.

39 Ibid at 969; this was approved by Goff LJ in Price v Strange [1978] 1 Ch 337.

40 [1977] 1 Ch 106.

41 Ibid at 321–322.

42 [1973] AC 691.

43 [1978] 3 All ER 853.

44 [1971] 2 All ER 277.

45 Ibid at 284, citing 36 Halsbury's Laws (3rd edn) p 267, para 365.

46 At 724.

47 See Treitel (1966) JBL 211 at 228.

48 For cases showing a refusal of specific performance against an employee, see eg Clarke v Price (1819) 2 Wils Ch 157; De Francesco v Barnum (1890) 45 Ch D 430. For cases showing a refusal against an employer, see eg, Johnson u Shrewsbury & Birmingham Rwy Co (1853) 3 De G M & G 914; Brett v East India Shipping Co (1864) 2 H & M 404; Rigby v Connol (1880) 14 Ch D 482; Britain v Rossiter (1883) 11 QBD 123.

49 [1890] 45 Ch D 430.

50 Ibid at 438.

51 Infra, pp 112–113.

54 See n 39, supra. However in so far as the dicta was intended to also refer to specifically enforcing an employee's obligations, it cannot stand with TULRA 1974, s 16.

53 [1972] Ch 305.

54 At 314–315.

55 Ie DATA had declared its intention not to register and would therefore not have been able to conclude a legal closed shop agreement.

56 At 314.

57 At 321.

58 Jones v Lee (1980) ICR 310 may also support this view. Here an interlocutory injunction was granted restraining school managers from dismissing a teacher in breach of procedures established in the contract. Although this effectively amounted to specific performance of a personal service contract, it is only because the court based its decision solely on contractual principles that it can be viewed as supporting any significant change in approach to specific performance; for the teacher was not employed under an ordinary contract of personal service, and was therefore entitled to specific protection by traditional administrative law principles. Hill v C. A. Parsons was not cited.

59 For early cases, see eg, Willis v Childe (1851) 13 Beav 117; Fisher v Jackson [1891] 2 Ch 84.

60 Eg Vine v National Dock Labour Board [1957] AC 488; Malloch v Aberdeen Corpn [1971] 1 WLR 1578.

61 (1977) ICR 893.

62 Ibid at 902.

63 [1983] 1 All ER 241.

64 Reinstatement or re-engagement can be ordered - Employment Protection (Consolidation) Act 1978, ss 68–69. Such orders are not equivalent to specific performance because the sanction for non-compliance is merely an extra award of compensation to the employee.

65 At 252.

66 At 253.

67 Certainly in Gunton v London Borough of Richmond (1980) ICR 755 the Court of Appeal relied on the distinction between an office and employment under an ordinary contract of personal service, in deciding that a clerk at a college was not entitled to protection by administrative law principles.

68 (1972) ICR 214.

69 (1974) ICR 565.

70 The rule that repudiatory breach automatically terminates a contract of personal service has been attacked in various cases eg Thomas Marshall v Guinle (1978) ICR 905; Gunton, n 67, supra; see McMullen (1982) CLJ 110. Apart from Shaw LJ in Gunton, the judges in these cases have regarded this issue as separate from whether specific performance can be granted.

71 [1975] 1 WLR 482. Lord Denning and Stephenson LJ can be interpreted as taking a wide view of the range of exceptions while admitting that Hill v C.A. Parsons concerned very rare facts. Roskill LJ, however, thought that any exceptions would be very rare indeed.

72 Although applications for specific performance are likely to be rare, now that the unfair dismissal legislation is in force.

73 The changes advocated may not all be welcome - see supra, p 107.

I would like to thank my former colleague, Mr P. J. Davies, for his helpful comments on an earlier draft of this article.

Specific performance at the crossroads

  • A. S. Burrows (a1)

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