What is necessarily to be averred and proved by a person seeking specific performance of a contract?

Averments and Proof in a Suit for Specific Performance of Contract

Governing Legal Principle

A plaintiff seeking specific performance of a contract must both aver and prove every material ingredient of his claim with precision and particularity. The law imposes a strict requirement of pleading — the plaint must contain specific allegations of fact establishing the right to relief, and those averments must be substantiated by cogent evidence at trial. The governing statutory provisions are Sections 10, 11, 14 and 16 of the Specific Relief Act, 1963 (as amended by the Specific Relief (Amendment) Act, 2018), read with Order VI, Rule 2 of the Code of Civil Procedure, 1908, and Article 54 of the Schedule to the Limitation Act, 1963.

I. Existence of a Valid, Concluded Contract

The bedrock requirement is the establishment of a valid and concluded contract between the plaintiff and the defendant. A contract is concluded when the parties have reached a consensus ad idem on all essential terms — the subject matter, consideration, parties, and mode of performance — without any condition remaining to be negotiated or agreed upon.

No decree for specific performance can be passed in the absence of a concluded contract. A letter of intent, memorandum of understanding, or term sheet between parties does not constitute a concluded contract capable of enforcement, as they represent an agreement to agree, which is void for uncertainty under settled contract law. Similarly, where the acceptance of an offer is conditional, it amounts to a counter-offer and not a concluded contract. The Supreme Court in Kamal Kumar v. Premlata Joshi, AIR 2019 SC 459 (2019) 3 SCC 704, has authoritatively enumerated the material questions to be determined in a suit for specific performance, the foremost being "whether there exists a valid and concluded contract between the parties for sale/purchase of the suit property".

The plaintiff carries the onus of proving the contract beyond reasonable doubt, and the evidence and proof of the agreement must be "absolutely clear and certain". Where the suit is based on an oral agreement for sale of immovable property, the burden is particularly heavy: the plaintiff must establish consensus ad idem on all fundamental terms, and the oral testimony must be cogent, consistent, and unambiguous — Brij Mohan v. Sugra Begum, (1990) 4 SCC 147.

II. Enforceability of the Contract

The contract must not fall within the categories of contracts not specifically enforceable under Section 14 of the Specific Relief Act, 1963. Prior to the 2018 Amendment, the plaintiff was additionally required to plead and prove, under the unamended Section 10, that either (a) no standard existed for ascertaining actual damages caused by non-performance, or (b) monetary compensation would not afford adequate relief. The amended Section 10, operative prospectively from the date of the 2018 Amendment, has done away with this requirement entirely: the grant of specific performance is now mandatory, subject only to Sections 11(2), 14, and 16, and the plaintiff is no longer required to establish inadequacy of monetary relief as a condition precedent.

For contracts to transfer immovable property, the earlier unamended Explanation to Section 10 raised a rebuttable presumption that monetary compensation would not adequately relieve breach — placing the burden on the defendant to rebut it. Under the amended regime, no such threshold inquiry is necessary, and specific performance is the rule, not the exception. In all cases, whether before or after the 2018 Amendment, the contract must relate to an identifiable subject matter described with certainty; if the property or terms are insufficiently described, no decree can follow — Shanker Singh v. Narinder Singh, (2014) 16 SCC 662.

III. Readiness and Willingness to Perform: The Mandate of Section 16(c)

The most critical and frequently litigated requirement in a suit for specific performance is the plaintiff's continuous readiness and willingness to perform his part of the contract. Section 16(c) of the Specific Relief Act, 1963 explicitly bars the grant of specific performance to a plaintiff who fails to aver and prove that he has performed, or has always been ready and willing to perform, the essential terms of the contract on his side.

The Averment Requirement

Section 16(c) constitutes an "additional mandatory rule of pleadings," to be read with Order VI, Rule 2 of the CPC, for the purpose of making a complete cause of action in a suit for specific performance. The plaint must contain a specific assertion that the plaintiff is, and has throughout been, ready and willing to perform his obligations. The failure to make this averment is fatal to the suit; courts are left with no option but to dismiss the claim — JP Builders v. A. Ramadas Rao, (2011) 1 SCC 429. As the Supreme Court held in that case, it is also clear that readiness to perform must be established throughout the relevant points of time, and non-compliance with this statutory mandate renders the court unable to grant specific performance even when no specific plea of non-compliance is raised by the defendant.

Mere insertion of the averment in the plaint, without proof, is insufficient; equally, proof without a proper averment, save in exceptional circumstances, will not save the suit. The courts have consistently held, in a long line of decisions including Mohinder Kaur v. Sant Paul Singh, AIR 2019 SC 4780, that the plaintiff cannot be considered to be ready and willing to perform his part of the contract merely because he averred so in the plaint. The averment and the proof must be co-extensive.

The Proof Requirement: Continuous Readiness and Willingness

Readiness and willingness must be continuous — from the date of the contract through the date of the decree. As stated in Gomithinayagam Pillai v. Palaniswami Nadar, AIR 1967 SC 868 (1967) 1 SCR 227, a purchaser claiming specific performance must show that since the date of the contract, up to the date of hearing, he was continuously ready and willing to perform his part of the contract.

Readiness and willingness are assessed from the conduct of the plaintiff in its totality, both prior to and subsequent to the filing of the suit — Jugraj Singh v. Labh Singh, AIR 1995 SC 945. The following indicia are relevant to the inquiry:

·       The plaintiff's financial capacity to pay the balance consideration at the time of contracting and at the time of suit.

• Issuance of notices calling upon the defendant to execute the conveyance.

• Attendance at the Sub-Registrar's office with money in hand on the stipulated date.

• Absence of any conduct indicating repudiation or abandonment of the contract.

• Non-imposition of conditions not contemplated by the contract as prerequisites for performance

• The burden of proof is on the plaintiff. However, where both parties lead evidence, the question of burden becomes academic — J.P. Builders v. A. Ramadas Rao, (2011) 1 SCC 429. Where the defendant repudiates the contract, the plaintiff is not absolved from showing readiness and willingness; he must still prove that he was ready and willing, though actual tender of money is not required as a condition precedent for the suit.
  

Continuous Readiness: Temporal Scope

The plaintiff's readiness and willingness must subsist "from the date of agreement till the date of filing of the suit" and beyond, through the date of decree. A suit filed three years after the initial legal notice for specific performance, with no steps taken in the intervening period, will not give rise to a presumption of readiness and willingness — Atma Ram v. Charanjit Singh, (2020) SCC OnLine SC 162.

IV. Performance of Plaintiff's Part of the Contract

The plaintiff must plead and prove that he has either performed his part of the obligations under the contract or was always ready and willing to perform them. Where the plaintiff has already paid the entire consideration and was put in possession, the mere expression of readiness and willingness serves no purpose — full performance speaks for itself. Where the plaintiff is required to perform a condition precedent (such as obtaining a no-objection certificate, or obtaining Urban Land Ceiling clearance), failure to do so, without adequate explanation, will disentitle him to the relief — Chandnee v. C.L. Katial, AIR 1964 SC 978.

V. Suit Filed Within Limitation

The suit must be filed within the prescribed period under Article 54 of the Schedule to the Limitation Act, 1963: three years from the date fixed for performance, or where no date is fixed, three years from the date when the plaintiff has notice that performance has been refused. The plaintiff must aver and, if challenged, prove that the suit is within limitation. An inordinate or unexplained delay in filing the suit, even if within the three-year period, is a relevant consideration under the unamended Section 20 for the exercise of discretionary jurisdiction, and may disentitle the plaintiff to the equitable relief — K. Raju v. P. Ramalingam, 2014 (5) CTC 729.

VI. No Personal Bar Under Section 16

The plaintiff must not be disentitled by any of the personal bars enumerated in Section 16 of the Act. These bars include: (a) having obtained the contract by fraud, misrepresentation, or undue influence; (b) having done any act through which the contract became void or voidable at the option of the defendant; and (c) non-compliance with the averment and proof of readiness and willingness under clause (c). A plaintiff who has treated the contract as at an end by claiming only damages has, by that election, disentitled himself to specific performance — Ardeshir Mama v. Flora Sassoon, AIR 1928 PC 208.

VII. Summary of What Must be Averred and Proved

In K. Raju v. P. Ramalingam (Madras), and more comprehensively by the Supreme Court in Kamal Kumar v. Premlata Joshi, AIR 2019 SC 459, the following have been identified as the essential matters to be pleaded and proved:

Current Legal Position

The legal position, as consolidated by statute and settled by the Supreme Court, is that a plaintiff seeking specific performance must establish a valid and concluded contract, must specifically aver in the plaint his continuous readiness and willingness to perform his part of the contract from the date of the agreement to the date of the decree, must substantiate that averment with cogent evidence, and must show that the suit has been filed within the period prescribed by Article 54 of the Limitation Act, 1963, without inordinate delay. Post the 2018 Amendment to the Specific Relief Act, specific performance is now the rule and not the exception, and the plaintiff is no longer required to demonstrate the inadequacy of monetary compensation as a threshold condition — but the stringent requirements of Section 16(c) touching readiness and willingness remain as exacting as ever, and their non-compliance continues to be an absolute bar to the grant of the relief.