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        Case ID :

        2010 (10) TMI 1177 - SC - Indian Laws

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        Readiness and willingness in specific performance turns on personal proof; damages clauses do not automatically bar the remedy. In a suit for specific performance, the plaintiff must plead and prove continuous readiness and willingness under Section 16(c) of the Specific Relief ...
                      Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
                        Provisions expressly mentioned in the judgment/order text.

                            Readiness and willingness in specific performance turns on personal proof; damages clauses do not automatically bar the remedy.

                            In a suit for specific performance, the plaintiff must plead and prove continuous readiness and willingness under Section 16(c) of the Specific Relief Act, and where that issue depends on the plaintiff's own state of mind and conduct, personal testimony is ordinarily required. An attorney holder can speak only to matters within personal knowledge and cannot replace the principal on crucial facts. A clause providing damages or forfeiture on breach does not, by itself, exclude specific performance unless the contract clearly makes payment a true alternative to performance. On the facts discussed, the plaintiff failed to prove readiness and willingness, so specific performance and refund of earnest money could not be claimed.




                            Issues: (i) Whether the plaintiff proved continuous readiness and willingness to perform the contract so as to satisfy Section 16(c) of the Specific Relief Act, 1963. (ii) Whether the agreement, which provided for payment of damages on breach, excluded the remedy of specific performance. (iii) Whether the evidence established that the plaintiff was not ready and willing and that the defendant was entitled to treat the contract as rescinded and forfeit the earnest money.

                            Issue (i): Whether the plaintiff proved continuous readiness and willingness to perform the contract so as to satisfy Section 16(c) of the Specific Relief Act, 1963.

                            Analysis: A plaintiff seeking specific performance must not only plead readiness and willingness but also prove it by acceptable evidence. Where the matter depends on the plaintiff's own state of mind, capacity, and conduct, the plaintiff ordinarily must enter the witness box. An attorney holder can depose only to matters within personal knowledge or acts done by him, and cannot substitute for the principal on matters exclusively within the principal's knowledge. Here, the plaintiff did not testify, the attorney holder examined had no personal knowledge of the crucial stages, and the supporting witness could not replace the plaintiff on the issue of readiness and willingness.

                            Conclusion: The requirement of Section 16(c) was not proved, and the suit failed on this ground.

                            Issue (ii): Whether the agreement, which provided for payment of damages on breach, excluded the remedy of specific performance.

                            Analysis: A clause stipulating damages on breach does not, by itself, bar specific performance. Under the statutory scheme, specific performance may still be granted unless the contract shows that the named sum was intended to confer an option to pay money in lieu of performance. The agreement here provided for double earnest money on the seller's default and forfeiture on the purchaser's default, but did not make payment of money an alternative to performance or expressly exclude specific performance.

                            Conclusion: The damages clause did not bar specific performance in principle.

                            Issue (iii): Whether the evidence established that the plaintiff was not ready and willing and that the defendant was entitled to treat the contract as rescinded and forfeit the earnest money.

                            Analysis: The material on record showed that the plaintiff did not adduce reliable evidence of financial readiness or willingness on the relevant date, while the correspondence and surrounding circumstances supported the defendant's version that the plaintiff was not prepared to complete the transaction. The plaintiff's failure to prove readiness and willingness was fatal, and the claim for return of earnest money also could not survive.

                            Conclusion: The evidence established that the plaintiff was not entitled to specific performance or refund of earnest money.

                            Final Conclusion: The appeal succeeded, the decrees of the courts below were set aside, and the suit for specific performance was dismissed for non-compliance with the statutory requirement of readiness and willingness.

                            Ratio Decidendi: In a suit for specific performance, the plaintiff must personally prove readiness and willingness when that issue turns on his own state of mind and conduct; an attorney holder without personal knowledge cannot substitute for that proof, and a clause for damages on breach does not exclude specific performance unless the contract clearly makes money an alternative to performance.


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                            ActsIncome Tax
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