Contracts That Cannot Be Specifically Enforced

together with sub-sections on when the court could enforce a part, and on contracts to execute a mortgage or provide security.

The item that has GONE is the first, and its disappearance is the whole point of the amendment. Adequacy of compensation is no longer a reason to refuse specific performance, because section 10 no longer asks about it. A student who lists "where damages are an adequate remedy" as a case under section 14 is stating repealed law.

What is NEW is clause (a), substituted performance, which could not have existed before 2018 because section 20 was then the discretion section.

The four classes

(a) Substituted performance already obtained

Where a party has obtained substituted performance under section 20, he cannot also have specific performance. Section 20 lets a party whose contract is broken have it performed by a third party or by his own agency and recover the cost from the party in breach. Having taken that route and been paid for it, he has had his remedy.

The same idea appears as a personal bar in section 16(a), which was substituted at the same time. The two work together, and it is worth noting that the Act says it twice.

See [Substituted Performance of Contract].

(b) A continuous duty the court cannot supervise

The classic example is a building or repair contract requiring work over months, or an agreement to run a business, or to maintain premises. A decree would require the court to superintend performance indefinitely and to be asked repeatedly whether it had been complied with.

This class has been significantly narrowed in practice by section 14A, inserted in 2018, which lets the court engage experts to report on any specific issue. Supervision that was once impracticable may now be manageable, and the two provisions should be read together. See [The Court's Power to Engage Experts].

(c) So dependent on personal qualifications that material terms cannot be enforced

Contracts of personal service are the standard case: a singer, a painter, a surgeon, an employee. Two reasons are given and both should be stated.

It cannot be done. A court cannot make a person sing well, and a decree that produced a sullen performance would give the plaintiff nothing.

It should not be done. Compelling personal service is close to compelling labour, and the relationship of employer and employee cannot be forced to continue.

But the negative half can often be enforced. Where such a contract contains a negative covenant, section 42 allows the court to grant an injunction restraining its breach, and the fact that specific performance of the affirmative part cannot be obtained is no bar. See [Injunction to Perform a Negative Agreement].

Note the narrowing. The old clause read "so dependent on the personal qualifications or volition of the parties, or otherwise from its nature is such". The new clause drops "or volition" and the residuary words, so the class is tighter than it was.

(d) Determinable in its nature

A contract which is in its nature determinable is one that either party may bring to an end at will, or on notice, without needing a reason.

The reason for the exclusion is plain: a decree would be futile, because the defendant could lawfully terminate the contract the moment after it was passed, and the court will not do a useless thing.

The commonest examples are a partnership at will, an agency terminable at will and a licence revocable at pleasure.

What is NOT in the list any more

Worth setting out as a short paragraph in any answer, because it shows the examiner that the currency point has been taken.

• Adequacy of compensation is gone. It is not a ground under section 14 and not a condition under section 10.
• "Minute or numerous details" is gone as a separate head, and so is the reference to volition and the residuary "or otherwise from its nature is such".
• The old sub-sections on part performance and on contracts to execute a mortgage or furnish security are gone from section 14; part performance is dealt with by section 12.

A worked example

Test six contracts against the current section 14.

• Eshwar agrees to sell Farida a specific plot of land. She sues for specific performance. None of the four classes applies. Under section 10 the court shall enforce, subject to sections 11(2) and 16. Farida need not show that damages are inadequate.
• Eshwar agrees to maintain the landscaping of Farida's estate for ten years. A continuous duty the court cannot supervise, clause (b), so not specifically enforceable. But note section 14A: the court may engage an expert to report, and the practical force of the objection is weaker than it was.
• Eshwar, a portrait painter, agrees to paint Farida. Clause (c): so dependent on personal qualifications that the court cannot enforce its material terms. She is left to damages.
• The same contract provides that Eshwar will not paint for anyone else during the sitting period. The affirmative promise cannot be enforced, but section 42 allows an injunction on the negative covenant.
• Eshwar and Farida are partners in a partnership at will, and she sues to enforce the partnership agreement. Clause (d): determinable in its nature, since he may dissolve it at will. A decree would be futile.
• Eshwar fails to deliver machinery; Farida gives notice under section 20, has the work done by a third party and recovers the cost. Clause (a): having obtained substituted performance, she cannot also have specific performance, and section 16(a) bars her as a personal bar as well.

What it does NOT mean

"A contract is not specifically enforceable where damages are adequate." That head was removed in 2018.

"No building contract can ever be specifically enforced." Clause (b) turns on whether the court can supervise, and section 14A now gives it expert assistance, so the objection is narrower than it was.

"A contract of personal service cannot be touched by the court at all." Its negative stipulations may be enforced by injunction under section 42.

"Determinable means the contract has been terminated." It means the contract is by its nature liable to be determined, typically at will or on notice.

"Section 14 is the only bar to specific performance." Sections 11(2), 16, 17 and 18 also bar or qualify it, and section 9 lets in the general law of contract.

Quick revision

• s.14, substituted by s.5 of the 2018 Act, in force 1 October 2018. Four classes cannot be specifically enforced.
• (a) substituted performance already obtained under s.20 (and see s.16(a), the matching personal bar).
• (b) a continuous duty the court cannot supervise, narrowed in practice by s.14A, expert assistance.
• (c) so dependent on the personal qualifications of the parties that material terms cannot be enforced. But the negative covenant may be enjoined under s.42.
• (d) determinable in its nature: a decree would be futile. Partnership at will, agency at will.
• GONE from the section: "compensation in money is an adequate relief", the "minute or numerous details" head, the word "volition", and the residuary words. Do not list adequacy of damages.
• NEW: clause (a), which could not have existed before 2018, because s.20 was then the discretion section.

Test yourself

1. List the four contracts that cannot be specifically enforced. Those where a party has obtained substituted performance of the contract under section 20; those whose performance involves the performance of a continuous duty which the court cannot supervise; those so dependent on the personal qualifications of the parties that the court cannot enforce specific performance of their material terms; and those which are in their nature determinable.

2. What was removed from section 14 in 2018, and why does it matter? The head excluding a contract for the non performance of which compensation in money is an adequate relief, along with the "minute or numerous details" head, the reference to volition and the residuary words. It matters because adequacy of damages is no longer a reason to refuse specific performance at all: section 10 now says the court shall enforce, subject only to sections 11(2), 14 and 16.

3. Why is a determinable contract excluded? Because a decree would be futile. A contract determinable in its nature can be brought to an end by a party at will or on notice without cause, so the defendant could lawfully terminate it immediately after the decree, and the court will not make an order that achieves nothing. A partnership at will and an agency terminable at will are the usual examples.

4. Can any part of a contract of personal service be enforced? Its affirmative obligations cannot, under clause (c), both because a court cannot compel a person to render personal service properly and because it should not compel the relationship to continue. But where such a contract contains a negative stipulation, section 42 allows the court to grant an injunction restraining its breach, notwithstanding that specific performance of the affirmative agreement cannot be obtained.

5. How has section 14A affected clause (b)? Clause (b) excludes contracts involving a continuous duty the court cannot supervise, and the difficulty was practical. Section 14A, inserted in 2018, allows the court to engage one or more experts to report on any specific issue, to secure their attendance, and to require persons to give information or provide access for inspection, so supervision that was once impracticable may now be manageable and the class is narrower in effect than its words suggest.