Name : Neelam Lalwani

Roll Number: 155

Class: F.Y.LL.B 2020-21
Division: C
Subject: CONTRACT – I
Assignment Topic: “contracts which cannot be specifically enforced”
Name of Faculty: Adv. Sangeeta Mehta
CONTRACTS WHICH CANNOT BE
SPECIFICALLY ENFORCED

Neelam Lalwani
Div C
14 May 2021
 INTRODUCTION
The Specific Relief Act, 1963 (‘Act’)is the act enacted by the parliament to grant remedies / relief to
the aggrieved party in case of non-performance of a contract. The relief has to be provided by the non
performing party to the other party in the prescribed manner since the monetary compensation /
damages may not be enough.
The Specific Relief (Amendment) Act, 2018 (the "Amendment Act") amending the provisions of the
Specific Relief Act, 1963 (the "Act") came into force on August 1, 2018.
The Amendment Act prescribes following relief’s:

• Specific Relief:
- Recovering possession of property;
- Specific performance of contracts;
- Rectification of instruments;
- Cancellation of instruments;
- Declaratory decrees;

• Preventive Relief:
- Injunctions generally;
- Perpetual injunctions;

OBJECT
The contract is an agreement to do or restrain from doing something for a consideration. If the person
on whom this contractual obligation rests, fails to discharge it, other party has right to either to insist
on the literal and actual performance of the contract or to obtain compensation for the non-performance
of it. The former is called the ‘Specific Performance.’
The Specific Relief expression means “relief in particular”. It means a remedy / relief which aims at
actual fulfillment of the obligation and not the compensatory nature. Prior to enactment of the Act, the
only remedy available to the parties in contract was that of ‘damages’ wherein the person in default
may not be perform the actual act / fulfil the promise. However, it may be noted that in certain cases
the damages / monetary compensation may not be sufficient.
Given the above, The Specific Relief Act was enacted which aims at exact fulfillment of obligation.
It may be noted that the Specific relief can be granted only for the purpose of enforcing individual’s
civil rights and not for the mere purpose of enforcing a penal law.
The Act prescribes the reliefs and remedy wherein specific performance of the contract is enforced by
the court on the defaulting party. It may however be noted that there are certain contracts wherein
specific performance may not be directed by the court. These contracts are specifically prescribed
under section 14 of the Act.
 CONTENT

*Section 14 of the Act prescribes the contracts which cannot be specifically enforced as follows:
a) a contract for the non-performance in which compensation in money is an adequate relief; *
b) a contract, the performance of which involves the performance of a continuous duty which the
court cannot supervise;
c) a contract which is so dependent on the personal qualifications of the parties that the court
cannot enforce specific performance of its material terms; and
d) a contract which is in its nature determinable.
* where a party to the contract has obtained substituted performance of contract in accordance with
the provisions of section 20; (introduced vide Amendment Act)

- a contract for the non-performance in which compensation in money is an adequate relief

A contract wherein the aggrieved party can be adequately compensated in terms of money, the
court may not grant specific performance of such contract.
For example:
Mr. B contract to sell a piece of jewelry to Miss C, however the later Mr. B was unable to sell
the same to Miss C as per the contract. In such a scenario, Miss C may be adequately
compensated in monetary terms for the value to be determined between the engaging parties.
Accordingly, the court may not grant the relief for specific performance of contract.

- a contract, the performance of which involves the performance of a continuous duty which
the court cannot supervise;
A contract which involves the performance of the duty which is continuous in nature like a
contract to deliver the goods in installment or a contract of continuous services which may not
be supervised by the court, cannot be specifically enforced.
The above provision may be understood from the following judicial precedent :
Ryan v Mutual Tontine Westminster Chambers Assn, (1893) 1 Ch 116 (CA),
Facts of the Case:
A residential flat was leased to various tenants. The lease contained a covenant that agreed that
the premises were let subject to the regulations made by the owners in relation to the resident
porter. The regulations provided that the block should be in charge of a resident porter who
would act as a servant to those in the blocks and was in constant attendance by himself or an
assistant on a temporary basis. The owners appointed a cook to this role who employed others
to perform his duties whilst he worked at a local restaurant.
 Issue raised
The suit for non-performance by the porter was brought to light and relief as to specific
performance was sought.
Decision
Given the facts of the case and considering the practical restrictions it was held that this
undertaking could not be specifically enforced since it would require ‘that constant
superintendence by the court which the court has always in such cases declined to give’.

- a contract which is so dependent on the personal qualifications of the parties that the court
cannot enforce specific performance of its material terms; and
A contract which involves performance of duty requiring personal qualification or some skills
which is possessed by any of the parties, and hence the non-performance of the contract cannot
be relieved under this Act as the court cannot enforce a specific performance for personalized
skills or is otherwise of a very decisive nature.
Contract of employment, contract of personal services, contract involving the performance based
of artistic skills like singing, painting are the general examples of the contract which requires
personal skills. It may be noted that these types of contract are very specific and particular to a
person and it is beyond the judicial capacity to ensure the actual performance of such contracts.
The only remedy under such contracts are damages.
For example :
Mr. A has entered into an agreement with ABC publishers to complete a literature for the
publisher. However due to certain specific reason Mr. A was unable to complete the literature.
In such a scenario , the court may not order specific performance of contract i.e., completion of
literature work to Mr. A.
The above provision may be understood from the following judicial precedent :
Percept D'Mark (India) (P) Ltd v Zaheer Khan, (2006) 4 SCC 227
Facts of the case:
Defendant entered into a contract for management of his media affairs with the plaintiff company
on the term that prior to the completion of first negotiation period and thereafter, plaintiff will
have the ‘right of first refusal’ in regard to any offer for services of management of media affairs
received by defendant; such that defendant cannot accept any third party offer without offering
plaintiff right to match the offer on same terms and in plaintiff’s failing to do so. However,
defendant entered into an agreement with third party after the termination of the said agreement
and plaintiff claimed permanent injunction.
 Issue raised
The defendant cannot accept the offer and he have to specifically perform the contract terms to
give first right to match the offer.
Decision
Given the facts of the case, it may be noted that the specific performance of a contract for
personal, confidential and fiduciary service dependent on mutual trust, faith and confidence has
been held to be barred under Section 14(l)(a),(b) and (d).

- a contract which is in its nature determinable.

A contract which is in its nature is determinable cannot be ordered to be performed specifically.
It may be noted that if a contract is revocable at the option of opposite party and is not specifically
enforceable.
For Example :
A and B contract to become partners in a certain business, the contract did not specify the
duration of the proposed partnership. The contract cannot be specifically performed, for, if it
were so performed, either A or B might at once dissolve the partnership.
Following contracts may be said to be determinable in nature :
- Employment Contract : A contract of employment may be said to be not specifically
enforceable. A person which has been selected to for a specific position to which he was
selected. Courts do not ordinarily enforce performance of contracts of a personal character,
such as a contract of employment. The remedy is to sue for damages. The grant of specific
performance is purely discretionary and must be refused when not warranted by the ends
of justice. Such relief can be granted only on sound legal principles. In the absence of any
statutory requirement, courts do not ordinarily force an employer to recruit or retain in
service an employee not required by the employer.

- Revocable Contracts : In Turnaround Logistics (P) Ltd. v. Jet Airways (India) Ltd. & Ors.
the Delhi High Court held that all revocable deeds and voidable contracts are determinable
contracts. It was held that specific performance of such agreements would not be granted
because the court will not go through the idle ceremony of ordering the execution of a deed
or instrument, which is revocable and ultimately cannot be enforced. The court also held
that not only voidable contracts, but even contracts which provide for termination on the
happening of a particular event would be determinable in nature.
 The above provision may be understood from the following judicial precedent :
Spice Digital Ltd. v. Vistaas Digital Media Pvt. Ltd (2012) 114 (6) Bom LR 3696
Facts of the case:
The company carries on business of telecom value added services. The respondent is carrying
on business of telecom content aggregation. It is the case of the appellant that the respondent
approached the appellant in the month of September, 2009 with a proposal for providing “Live
Aarti” feed from Shree Shirdi Saibaba Shrine, Shree Siddhivinayak Temple, Mumbai and Shree
Kashivishwanath Temple, Varanasi and certain other shrines and sought the appellants support
and assistance in developing the market for the said service. The appellant accordingly entered
into an agreement with the respondent for a period of three months.
Later the companies entered into a Content License Agreement effective from 1st January, 2010
initially for a period of 18 months. The said agreement was terminable with a prior written notice
of at least 30 days without assigning any reason. Also, the agreement can be terminated
immediately upon breach by the other party by giving 14 days’ time to cure the breach.
Issue raised:
Whether the specific performance can be ordered and injunction can be granted.
Decision:
No injunction can be granted in the present case. Also, the specific relief cannot be granted under
the Specific Relief Act. The contract which is determinable cannot be specifically enforced.

CONCLUSION
In light of various judgements and judicial pronouncements it has been observed that a court will not
make an order to specifically enforce a contract. The remedy of specific performance is discretionary
remedy. Where the alternate remedies such as monetary compensation is available the contract may
not be ordered to be specifically enforced. It may be further noted that when rendering of personal
service under a contract is dependent upon the volition of the parties or where the acts stipulated
required special knowledge, skill, ability, experience or the exercise of judgement, discretion integrity
and like personal qualities in short, whenever a performance according to the spirit of the contract rests
on the individual will and capacity of the contracting party, a court cannot direct specific performance
of those duties for or on behalf of the contracting party.

BIBLIOGRAPHY

• Law of Contract and Specific Relief – Avtar Singh

• https://indiankanoon.org/
• mondaq.com
• https://corporate.cyrilamarchandblogs.com