1. 2. 3. 4.

1.

Where compensation is adequate Contract involving personal Skill Contracts of Determinable Nature Contract requiring Constant supervision

Where compensation is adequate- court will not order specific performance where the aggrieved party can be adequately compensated in terms of money. Illustration1. A contract to sell, and B contract to buy, a lakh of rupees in 4% of loan from Center Government. In Meenashisundara v/s Rathnasami- it was held by the court that an ordinary contract to lend or borrow money whether with or without security is an example of a contract which cannot be specifically enforced. 1. Contract involving personal Skill- it is not possible for the court to supervise the performance of a contract which deals with the personal qualifications of the promisor or is otherwise of volitional nature. Contract of employment, contract of personal services, contracts involving performance of artistic skill, is beyond the capacity of judicial process to enforce. Illustrations A contracts to render personal services to B. A contracts to employ B on personal services. A, an author, contracts with B, a publisher, to complete a literary work. B cannot enforce specific performance of this contract. In SB Dutt v/s University of Delhi- An employer may not be compelled to keep an employee in accordance with a contract of employment, in this Case the SC however, did not approve of an arbitrator's award reinstating a professor removed by the Delhi University. 1. Contracts of Determinable Nature- Specific performance is not ordered to a contract which is in its nature determinable. No order of specific performance is likely to be passed when the contract is revocable at the option of the opposite party.

Illustration-A and B contract to become partners in a certain business, the contract did not specify the duration of the proposed partnership.
1.

Contract requiring Constant supervision- A contract cannot be enforced where it involves the performance of a continuous duty which the court cannot supervise. For example the obligation of a railway company to operate signals and to provide engine power.

Contracts which cannot be specifically enforced Following contracts cannot specifically enforced (a) Where compensation is adequate relief (b) Contract runs into such minute or numerous details or depends on personal qualifications of parties or is such that Court cannot enforce specific performance of its material terms (c) Contract which in its nature is determinable (d) Contract, performance of which involves a continuous duty, which Court cannot supervise. [section 14]. - - In other words, in case of movable articles or contract of intricate nature, specific performance will normally not be ordered by Court. - - Specific performance of contract of personal nature cannot be ordered. Under section 28 of the specific relief act specific performance of the contract cannot be enforced against a party in any of the following cases. 1. If the consideration to be received by him is so grossly inadequate with reference to the state of things existing at the date of the contract as to be either by itself or coupled with other circumstances evidence of fraud or of undue advantage taken by the plaintiff. 2. If his assent was obtained by the misrepresentation (whether willful for innocent) concealment circumvention or unfair practices of any party to whom performance would become due under the contract or by any promise of such party which has not been substantially fulfilled. 3.If his assent was given under the influence of mistake of fact misapprehension or surprise.
Mangu D/O. Bahar Mahar vs Vijli D/O. Bartabhai And Ors. on 7/7/1965 JUDGMENT N.M. Miabhoy, J. 1. This Second Appeal is directed against the decision dated 10th December 1957 recorded by the learned District Judge Broach in Regular Civil Appeal No. 42 of 1957. The facts necessary to be stated in order to understand the disputes between the parties may be stated at first. Defendants Nos. 1 and 2 are the sisters of the husband of plaintiff. Plaintiff filed Civil Suit No. 105 of 1954 against defendants Nos. 1 2 and 3 for partition of certain properties mentioned in the

plaint of that suit and separate possession of her 1/2 share therein. Defendant No. 3 was joined as a party because defendants Nos. 1 and 2 had mortgaged some of the aforesaid suit properties with him. The suit ended in a compromise and a consent decree of which Ex. 23 is a certified copy was passed on 26 of July 1955. By this decree plaintiff was made the exclusive owner of lot No. B in that suit and defendants No. 1 and 2 were made exclusive owners of lot No. C therein. A latrine which was lot No. D was kept common between the parties. This compromise decree contained the following agreement which plaintiff seeks to enforce specifically in the suit from out of which this Second Appeal arises. The agreement is as follows: Each party has to sell to the other respective portions of the properties which have come to their share as above at a price fixed by two members of the Panch when either party wants to sell its share. On 17 January 1956 defendants Nos. 1 and 2 sold property comprised in lot No. 'C and their share in the property comprised in lot No. D by a sale deed of that date which is Ex. 33 in the case. The sale was made for Rs. 1 800 Plaintiffs case however was that though the sale purported to be for Rs. 1 800 the actual price stipulated and paid was Rs. 1 300 only. Both the lower Courts have found that plaintiff was right in this contention. On 23rd May 1956 plaintiff gave a notice to defendants and called upon them to honour the agreement contained in the aforesaid compromise decree. As defendants No. 3 gave a reply and refused to pass a sale-deed in favour of plaintiff she instituted the suit from out which this Second Appeal arises. 2. All the three defendants resisted the claim on a number of grounds some of them legal and others on merits. The trial Court rejected all the contentions of defendants and decreed the claim for specific performance. Defendants Nos. 1 and 3 preferred the aforesaid appeal to the District Court at Broach but the appeal was dismissed. I am no longer concerned with the dispute between the parties regarding the merits of the case. The present appeal is preferred by defendant No. I alone. Mr. Majmundar the Learned Counsel for defendant No. 1 attacks the appellate decree on same legal grounds on which the suit was attacked in the two lower Courts and in addition he has raised one or two more points which will be dealt with at their proper place. I propose to take up the contentions raised by Mr. Majmundar one by one. 3. The first contention of Mr. Majmundar was that the suit contract was void for uncertainty. The contention which was urged in the first appellate Court was that the suit contract was uncertain in regard to price. The exact price to be paid for the sale of the property has not been mentioned in the agreement. The argument was that the price was an essential term of a contract for sale and the price not having been definitely stated in the agreement the contract was void on the ground that one of the materia] terms was uncertain. This argument was repelled by the learned District Judge by reference to Illustration (e) to Section 29 of the Indian Contract Act. That illustration says that if A agrees to sell to B 1000 maunds of rice at a price to be fixed by C there is no uncertainty in the agreement because the price was capable of being made certain. The illustration illustrates the applicability of the second part of Section 29 which states that agreements which are not capable of being made certain are void. Perhaps because of the force of the arguments in the judgment of the learned District Judge Mr. Majmundar did not repeat the aforesaid contention. The contention which he urged in support of this appeal was slightly different from the aforesaid contention. Mr. Majmundar urged that the contract was uncertain because the person or persons who were to fix the price were uncertain and were not capable of being made certain. It is the validity of this argument of Mr. Majmundar which requires to be considered in this appeal. This contention is also based on Section 29 of the Indian Contract Act That section enacts that agreements the meaning of which is not certain or capable of being made certain are void. Mr. Majmundars contention is that when we have a case where the valuers identity is not fixed then the contract must be regarded as one which is uncertain as to who the

valuer is and consequently the agreement would be ambiguous in the matter of identity of the person who was to fix the price and such an agreement would at once come within the mischief of Section 29 of the Indian Contract Act. I agree with Mr. Majmundars contention that the identity of the persons who are to fix the price has not been made definite by the aforesaid contract. But that does not necessarily mean that Section 29 applies in toto. In order that the section may apply it is not enough to show that its meaning is uncertain but it must further be shown that it is imcapable of being made certain and the question for consideration is whether the terms of the aforesaid contract are such that the identity of the Panchas cannot be made certain. Is this cannot be done then I agree with Mr. Majmundar that the aforesaid Illustration (e) to Section 29 on which the judgment of the learned District Judge is based will not be applicable. The distinguishing feature between the present case and the aforesaid Illustration would be that in the Illustration the person who was to fix the price is a definite individual. But before we can answer or solve the aforesaid problem it is first of all necessary to ascertain what the meaning of the aforesaid part of the contract is. It is only after an attempt is made to understand the meaning and if the Judge is not in a position to come to a conclusion that the identity of the valuer cannot be made certain by any process of law then the contract would be void on the ground of uncertainty. Now as I read the aforesaid agreement I have no doubt whatsoever that the aforesaid part provides for the appointment of arbitrators by the two contracting parties for fixation of the price. Mr. Majmundar contended that such a meaning cannot be given to the aforesaid clause. He contended that Panch literally means five persons and the clause literally construed would mean two members of five persons. However though the original meaning of the word Panch is five the secondary meaning of that word now is an arbitrator and this is borne out by two dictionaries which have been consulted on the subject (vide Bhagvandomandal Part 6 at page 5470 and the Modern Gujarati-English Dictionary Volume II published in 1925 page 920). It is true that the aforesaid clause does not specify who is to appoint the Panchas. One way of reading the clause would be that each party was to appoint one panch and the two Panchas together were to fix the price. If this is the correct meaning I assume that defendants being unwilling to perform their part of the contract would not appoint a Panch on their behalf. But this conduct of defendants will not necessarily lead to the non-fixation of identity of their arbitrator. Section 9 of the Arbitration Act provides for a contingency of the aforesaid kind. In such a case plaintiff would have the right of appointing a sole arbitrator and getting the price fixed. Even on the assumption that the aforesaid interpretation is not correct and that the correct interpretation is that the two parties agreed to refer the question to the arbitration of two Panchas and that both the Panchas were to be appointed by the consent of the two sides even then the aforesaid clause would not fail because Section 8 of the Arbitration Act makes a provision for the appointment of an arbitrator by the Court in such a contingency. Therefore having regard to my construction of the aforesaid clause that it embodies an arbitration agreement between the parties and having regard to the provisions contained in the Arbitration Act I have come to the conclusion that there is no distinction between the present case and Illustration (e) to Section 29 of the Indian Contract Act on which the learned District Judge has relied. In this connection Mr. Majmundar drew my attention to the discussion in paragraph 10 at page 643 of the judgment of Their Lordships of the Supreme Court in Damodhar Tukaram Mangalmurti and others v. State of Bombay . In that case Their Lordships were called upon to decide whether a contract which appoints a way of determining the price can be specifically enforced and Their Lordships observed that the English decisions to which their attention had been drawn were on two lines. In Milnes v. Gery (1807) 14 Ves 400: 33 E.R. 574 the contract provided that the price shall be valued by two different persons to be nominated and if they happened to disagree then those two persons should choose a third person

whose determination shall be final. The Master of the Rolls decided in that case that the only agreement which the parties had was to purchase at a price to be ascertained in a specified mode and on the facts of the case the price not having been agreed upon in that mode there was no completed or concluded contract between the parties and therefore the contract could not be specifically enforced. In Taylor v. Brewer (1813) I M and S 290: 105 E.R. 108 a claim to compensation was on the resolution of a committee which provided that such remuneration be made as should be deemed right. It was held that the engagement was one of honour and no claim could be founded on such an agreement. Mr. Majmundar contended that the present case came within the purview of the aforesaid line of decisions. I am unable to accept this argument. In my judgment there is a clear distinction between the present case and the aforesaid two cases. None of those two cases was a case in which the price was to be fixed by the appointment of arbitrators. The first case was a case in which the parties had agreed to get the price fixed by valuers and it was held that the parties having failed to appoint the valuers there was no concluded contract. In the present case no such plea that there was no concluded contract between the parties was ever raised by defendants. The plea which defendants raised and failed to substantiate was that the agreement was void for uncertainty. In the second of the aforesaid two cases the price was to be fixed as should be deemed right. That certainty left the price to be fixed ambiguous and in the absence of any proper mode by which the price could be specifically fixed it was held that the contract could not be specifically enforced. In my judgment the facts of the present case come within the purview of the case Gourlav v. Duke of Somerset (1815) 19 Ves 429: 34 E.R. 576 and the observations which Their Lordships have quoted in the Supreme Court case Damodhar Tukaram Mangalmurti and others v. State of Bombay aforesaid are pertinent to the facts of the present case. The observations of Sir William Grant Master of the Rolls were as follows: When the agreement is that the price of the estate shall be fixed by arbitrators and they do not fix it there is no contract as the price is of the essence of a contract of sale and the Court cannot make a contract where there is none; but where the Court has determined that the agreement is binding and concluded and such as ought to be executed it does not require foreign aid to carry the details into execution. Gales agency is not of the essence of this contract.... If the parties had gone to Gale and got him to settle a lease and one of them had objected to the covenants as improper and the Bill had been filed by the other the Court would have inspected the lease; and if it were found unreasonable would not have decreed an execution of the agreement. In this connection it is to be noticed that in the present case the arbitrators have not refused to fix the price as arbitrators have not still been appointed by the parties at all. Nor is there anything to show that there has been a failure in law of the arbitration clause. It is true that if the price does not get fixed by reference to the arbitration then the contract cannot be specifically enforced. In this connection it is important to notice that in the present case defendants have never alleged that the fixation of the price by the Panchas was a condition precedent for the performance on their part of the contract to sell nor as already pointed out did they contend that there was no concluded contract on that account. Therefore so long as the aforesaid clause is capable of being enforced by resort to arbitrators by getting the price fixed by them it cannot be said that the aforesaid contract is void on the ground that the price is incapable of being fixed.