Remedies- Specific Performance

a) Defenses

A D may assert defenses against specific performance including i) unclean hands, ii) laches, and iii) sale to bona fide purchaser.

e) Unconscionability

A contract may be voidable where the provisions are one-sided as to be unconscionable at the time the contract is made. The defense is applied where one party has unequal and superior bargaining power over the other party. Uconscionability may be a factor in denying specific performance though it may not be a contract formation defense.

3) Feasible Enforcement

A court will not specifically enforce a promise if enforcement imposes court burdens that are disproportionate to the advantages gained from enforcement, and the harms suffered from denial. Performance that entails continuous supervision, or involves suitability judgment will generally not be ordered.

b) Unilateral Mistake

A unilateral mistake bone party is insufficient to make a contract voidable, unless the non-mistaken party i) knew or had reason to know of the mistake, or ii) had a duty to disclose the fact about which the other party was mistaken. A D's action that do not rise to the level of a contract defense for mistake can nevertheless be a factor that results in the denial of specific performance.

1) Valid Contract with More Definite and Certain Terms

For equitable relief, a valid contract requires more definite and certain terms so the court can determine what it must order each party to do.

c) Hardship

Hardship can be a factor in not granting specific performance when events that occur after contract formation fall short of impracticability, impossibility, or frustration of purpose, but cause unreasonable hardship to the defendant and third parties.

iii) Bona Fide Purchaser

Specific performance is cut off when the contract subject matter has been sold to a bona fide purchaser who 1) pay valuable consideration, 2) with no notice of the contract.

6) No Unfairness

Specific performance will not be granted if such relief would be unfair. Factors in determining unfairness include [ a) defenses, b) hardship, c) mistake, d) misrepresentation, e) inadequate consideration, f) unconscionability].

5) P's Contract Conditions

To compel specific performance of a D, conditions precedent to the performance must be satisfied or excused. [if there is anticipatory repudiation, P's conditions are excused.]

Specific Performance

To obtain specific performance, there must be 1) a valid contract with more definite and certain terms (must be more definite than money damages action), 2) inadequate legal remedy, 3) feasible enforcement, 4) performance mutuality, 5) P's contract conditions satisfied or excused, and 6) no unfairness.

d) Inadequate Consideration

While inadequate consideration is not generally grounds for granting contract relief, gross inadequate consideration can be a factor that weighs in favor of contract unfairness.

ii) Laches

The right to equitable relief is cut off when there has been unreasonable delay in initiating the claim, and the delay prejudices the defendant.

Anticipatory Repudiation

AR occurs where a promisor, prior to the time to performance arrives, unequivocally indicates s/he will not perform when performance due. AR gives non-repudiating party FOUR options: 1) treat the contract as totally repudiated and sue immediately, 2) suspend own performance and wait until performance is due to sue, 3) treat the repudiation as an offer to rescind, and contract as discharged, or 4) ignore the repudiation and urge performance.

f) Misrepresentation

If a party 1) induces another party to enter into a contract 2) asserting fraudulent misrepresentation (known untrue information), the contract is 3) voidable by the party who justifiably relies on the misrepresentation.

2) Inadequate Legal Remedy

Inadequate legal remedy if 1) speculative, 2) insolvent D, 3) need multiple suits, or 4) unique property bargained for. [2-step analysis: 1. Are there compensatory, restitution, or other money damages? If yes, there is an adequate legal remedy. 2. If not, analyze the elements above.]

4) Performance Mutuality

The aggrieved party must show the breaching party can secure performance.

i) Unclean Hands

The party seeking relief must not have been guilty of wrongful conduct with respect to the transaction subject matter.