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Specific Performance as a Remedy in Real Estate Contract Disputes

When a contracting party fails or refuses to perform a duty and causes the other party a loss, the usual remedy is compensatory damages. Courts do not often order the breaching party to fulfill the outstanding obligations. However, real estate contracts can be the exception. This is because the law deems every parcel of real property to be inherently unique in nature. Most other types of losses can be remedied with money, but land and included structures are not easily replaceable. In certain circumstances, a court will grant the equitable remedy known as specific performance.

One of the factors that makes real estate unique is its location. Residential property buyers usually want a certain city or town, school district or specific neighborhood or street. The environment, view or proximity to family may be of high importance. Commercial real estate buyers find significant competitive advantages in location details down to the flow of traffic on a given street at certain hours. The location of property of course cannot be changed. Therefore, a court might properly use specific performance to give the innocent party the benefit of their contract.

Just as land itself is unique, the land’s structures and improvements may have their own exceptional character. Some residential buyers want historic houses or those of an architectural style. Commercial buyers may look for buildings suitable for particular operations. Finding a comparable structure in an acceptable location may be difficult. Also constructing a new building that serves the buyer’s needs or preferences might not be feasible. In many cases the relevant laws and regulations now prohibit the type of building in the contract. Sometimes the required construction techniques have been abandoned. So completing the transaction might be the only practical remedy for an aggrieved buyer.

Obtaining an order for specific performance can be difficult, even in real estate litigation. There are multiple prerequisites and requirements. For example, any court order for specific performance must be reasonable. If a building or structure is destroyed by fire or natural disaster, the current owner cannot be ordered to rebuild to complete a sales contract. Also the party seeking specific performance must come to court with “clean hands.” That is, they must be innocent of wrongdoing and must have done nothing to impede the performance of the contract.

H. Clay Parker, Esq. is a Florida real estate litigator with experience serving clients throughout the Orlando area. If you have a real estate transaction issue to resolve, feel free to contact us online or call {PHONE} for a consultation.

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