Suit for Specific Performance of

Contracts
By
Muhammad Waqas Javed
 Section 12 Contracts which are specifically enforceable.

Except as otherwise provided in this Chapter, the specific performance of any contract
may in the discretion of the Court be enforced—

(a) when the act agreed to be done is in the performance, wholly or partly, of a trust;

(b) when [their] exists no standard for ascertaining the actual damage caused by
nonperformance of the act agreed to be done; [ e.g. Painting of Mona Lisa OR A
agrees to buy, and B agrees to sell, a picture by a dead painter and two rare China
vases. A may compel B specifically to perform this contract, for there is no standard
for ascertaining the actual damage which would be caused by its non­performance.]

(c) when the act agreed to be done is such that pecuniary compensation for its
nonperformance would not afford adequate relief; or [e.g. Court considers its not
adequate relief, {A contracts with B to sell him a house for Rs. 1,000. B is entitled to a
decree directing A to convey the house to him, he paying the purchase ­money.}]

(d) when it is probable that pecuniary compensation cannot be got for the non­
performance of the act agreed to be done. [Insolvency]
.
Conti…

Explanation. [Rebuttable Presumption; inadequacy

of compensation for immoveable property
transferring contracts]
­Unless and until the contrary is proved, the Court
shall presume that the breach of a contract to transfer
immoveable property cannot be adequately relieved by
compensation in money, and that the breach of a
contract to transfer moveable property can be thus
relieved.
 Problem
Mr. Black and Mr. White on 07th March 2020 enter into an agreement for purchase of
Bungalow for sale consideration of Rs. 2 crore. Under the agreement it was settled
between the parties that Mr. White had to pay remaining 1 crore 70 lac rupees to Mr.
Black in the next six months from the above mentioned date apart from advance earnest
money Rs. 30/- lac paid on the said date. Mr. Black is a very mean and greedy person
and following his greed, he sold the same Bungalow to Mr. Green on 7th of June, 2020 in
violation of the previous agreement between Mr. White and Mr. Black.
In response, Mr. White filed a suit for specific performance of contract. The lawyer of
Mr. Black pleaded in written statement, despite the fact there is violation of agreement,
Mr. Black is ready to compensate Mr. White. He also asserted that specific performance
of agreement to sell is not available remedy to Mr. While in the light of principles of
equity and Specific Relief Act, 1877. It is significant to mention, Mr. Black had sold the
Bungalow for double consideration decided between Mr. White and Mr. Black.
1. Past Conduct (30 lac in time payment).
2. Future Conduct (Remaining consideration ready and will to be paid)— either way, we
can interpret it.
3. Presumption in favour plaintiff U/S 12 Explanation.
 Application of Maxims: He who seeks equity Must do equity.
He who comes to equity must come with clean hands.
Anyone seeking the remedy of suit for specific performance of contracts must
plead (Pleading in CPC Order- Plaint and Written Statement) and prove
(Evidence –written or oral) that he is ready and willing to perform his part of
agreement. This must be proved through the application of above mentioned
two maxims.
 He who comes to equity must come with clean hands. (Past Conduct) –
Plaintiff must show that there is no fault, in past, in performance of
agreement.
e.g. Agreement to sell bearing land, 6 installments, 3 installments paid within
the decided time. (No fault—Clean Past Conduct) or Agreement to sell
bearing land, 6 installments paid, 3 installment default in payment or late
payment of installments to be paid within the decided time, plaintiff. (fault—
No Clean Past Conduct)
He who seeks equity Must do equity. (Future Conduct)– Plaintiff must show that
he is ready and willing to perform, in future, his part of agreement. [Ready and
willing to perform future transaction; e.g. Payment or deposit of remaining amount
etc.]
 2004 CLD 343

It was held that plaintiff has

to declare and prove, he had
done and is ready and
willing to perform his part of
obligations.
 Case Laws as to deposit of remaining Consideration as
Performance of agreement.

2017 SCMR 2022, Reliance also on 2020 SCMR 171, 2021

SCMR 7
There are very significant case laws. Supreme Court held if a
person is praying for remedy of specific performance of
agreement from another party, it is incumbent upon such
person to give application for deposit the remaining amount
of consideration on the initial hearing of the court.
If he does not submit the remaining sale consideration on the
initial court hearing, the suit shall be dismissed and in case
the suit is filed by the other party, it shall be decreed.
A(purchaser)----B(owner)—1 cror, A refused, B files suit S.
Performance (decree).
 Specific Performance and Injunctions
While seeking the relief for specific performance,
one may also seek remedy of injunction [direction
of court to do (Mandatory) or not to do something
(Prohibitory) either temporary or permanent].
Injunction is also an equitable relief. It also
requires that any party seeking such relief must
come with bona fide and no fault either in previous
or future conduct. Future conduct involves
“application for deposit the remaining amount of
consideration on the initial hearing of the court.”
 How to prove Specific Performance?
2016 SCMR 340
Execution of document, Attestation of Document (witnesses sign),
It was held that initially burden to prove the suit for specific performance lies upon the plaintiff
seeking such relief. He has to prove through; agreement to sell, attesting witnesses, Scribe
(who writes the documents) in case of death of attesting witnesses, stamp vendor with stamp
vendor register, admission by parties.
 Other ways: By Persons in whose presence document was reduced to writing, by persons
acquainted with the writing of deceased witness, by Court comparison of signatures or
writing, Handwriting expert opinion, By production of Notary Public who attested the stamp
paper.
Attesting Witnesses (Two)/Marginal
U/Art. 17 of QSO, 1984, any financial Transactions needs need to be proved through two
witnesses.
Article 79 of QSO is pertaining to Attesting witnesses, it envisages that documents needs to
be proved through two attesting witnesses.
The latest law of Lahore High Court requires that any agreement creating financial
obligations needs to be attested by two attesting witnesses. 2011 MLD 96]
In order to bring the case within the purview of Article 17 QSO, two ingredients must be
fulfilled. First, there must be an instrument. Secondly, it must relate to financial or future
obligations. Agreement to sell or sale of immoveable property being a written document is
an instrument within the meaning of Article 79 QSO. [2011 PLD SC 241]
Whether Times is the essence of Contract or
not?
 Generally----Time is essence of agreement. Means to say, a
contract needs to be performed within the stipulated time.
[1995 SCMR 1431, PLD 1995 Lah 405]Effect—of Non performance
within due time—contract is voidable.
 Exception– Immoveable property– Time is presumed not to be
essence of agreement U/S 55 of Contract Act. But it is still not
a rule of Thumb. Other facts may show that time was not
essence of contract.
 Question also depends up –Intention of Parties
Action/conduct (e.g. extension in time).
 Whereas mentioning of Liquidated damages may show that
time was the essence. [ PLD 1973 SC 39, 1994 SCMR 2189]
 2006 PLC 1152
Equity looks into intention
rather than form. Despite time
mentioned, intention of the
parties may differ.
• Whether Declaratory Suit can be
filed on the basis of agreement to
sell ?