Specific Performance of Contract: Plaintiff to Prove Readiness and Willingness to Perform Contract- Supreme Court

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October 10, 2018

Case name: Vijay Kumar & ors. v. Om Prakash

In the case, the Appellant approached the Supreme Court assailing High Court of Punjab & Haryana’s order, whereby the High Court had affirmed the judgment of the First Appellate Court thereby granting decree for specific performance in favour of the respondent-plaintiff.

In appeal, one of the main contentions of the Appellant was that the respondent-plaintiff could not establish the readiness and willingness to perform the contract.

Brief facts of the case: The case revolved around an agreement of sale entered between the parties in respect of a total sale consideration of Rs.26,00,000, wherein Rs.4,00,000/- was paid by the respondent-plaintiff to the appellants as earnest money and the remaining amount of Rs.22,00,000/- was to be paid on 31st March, 2008 that is the date fixed for executing the registration of the sale deed. However, the sale deed was not executed on the stipulated date and subsequently the respondent-plaintiff filed a suit for specific performance. The appellants contested the suit on the ground that the respondent-plaintiff was not ready and willing to perform his part of the contract.

On consideration of evidence, the Trial Court dismissed the suit for specific performance holding that the respondent had failed to prove his readiness and willingness to perform the contract. Later in appeal, the High Court set aside Trial Court’s order and passed an order in favour of the respondent-plaintiff.

Bench’s Verdict

The Two-Judge Bench of the Supreme Court allowed the appeal in view of the following observations in the case:

  • That in order to obtain a decree for specific performance, the plaintiff has to prove his readiness and willingness to perform his part of the contract and the readiness and willingness has to be shown throughout and has to be established by the plaintiff. In view of the facts of the case, the Supreme Court noted that the respondent-plaintiff had not shown his capacity to pay the balance sale consideration of Rs.22,00,000.
  • The Supreme Court also remarked that the relief for specific performance is purely discretionary. The Court noted that though the respondent-plaintiff has alleged that he was ready and willing to perform his part of the contract, the First Appellate Court ought to have examined first whether the respondent-plaintiff was able to show his capacity to pay the balance money.

The entire case can be accessed here.

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