Specific Performance in UK Law

If the only real redress is damages, how can its measure or scope be affected according to whether the contract is regarded as still subsisting or as at an end? To preserve the bare contractual relationship is an empty formality. The difference is fundamental, for there is no legal substitute for voluntary performance.

At common law a term of a contract stipulating when the contract should be performed was always regarded as an essential term of the contract, but, as Lord Parker pointed out in Stickney v. Keeble, (1915) Appeal Cases, 586 at 415, in contracts for the sale of land equity, having a concurrent jurisdiction, did not look upon the stipulation as to time in precisely the same light.

But the purpose of the law of contract is not to punish wrongdoing but to satisfy the expectations of the party entitled to performance. From a wider perspective, it cannot be in the public interest for the courts to require someone to carry on business at a loss if there is any plausible alternative by which the other party can be given compensation. It is not only a waste of resources but yokes the parties together in a continuing hostile relationship.

Suppose, however, that the master insists on the employment terminating on the named day? In the ordinary course of things, the relationship of master and servant thereupon comes to an end: for it is inconsistent with the confidential nature of the relationship that it should continue contrary to the will of one of the parties thereto As Lord Kilmuir said in Vine v. National Dock Labour Board (1957) A. C., referring at page 500 to the ordinary master and servant case:

Chancery courts had further regularly awarded interest, including not only simple interest but also compound interest, when they thought that justice so demanded, that is to say in cases where money had been obtained and retained by fraud, or where it had been withheld or misapplied by a trustee or anyone else in a fiduciary position.

The law recognises that damages are not always a sufficient remedy for breach of contract. Even when awarding damages, the law does not adhere slavishly to the concept of compensation for financially measurable loss. When the circumstances require, damages are measured by reference to the benefit obtained by the wrongdoer. Further, in certain circumstances an account of profits is ordered in preference to an award of damages.

This test is applicable whether or not the event occurs as a result of the default of one of the parties to the contract, but the consequences of the event are different in the two cases.