This section is from the book "Dart's Treatise On The Law And Practice Relating To Vendors And Purchasers Of Real Estate", by J. Henry Dart . Also available from Amazon: A treatise on the law and practice relating to vendors and purchasers of real estate.
The existence of an incumbrance not a matter of defence.
A difficulty sometimes arises on the assignment of a contract to grant a lease from the fact that the lessor does not get the covenants of the person to whom he contracted to grant the lease, but only those of the assignee of the contract. It appears, however, to be no answer to an action by the assignee of the contract for specific performance against the lessor, that the plaintiff cannot procure covenants from the on the ground that the vendor had not obtained a licence to assign at the date of the writ.
Difficulty on assignment of contract for a lease.
(u) William v. Brisco, (1882) 22 Ch. D. 441; see especially p. 449, judgment of Cotton, L. J.; North v. Percival, 1898, 2 Ch. 128; 67 L. J. Ch. 321.
(o) Micholls v. Corbett, (1865) 3 D. J. & S. 18; and see Want v. Stalli-brass, (1873) L. R. 8 Ex. 175, 179; 42 L. J. Ex. 108.
(p) Sup. p. 319.
(7) Duke of Beaufort v. Glynn, (1855) 3 S. & G. 213 ; 1 Jur. N. S. at p. 800. See Conv. Act, 1881, e. 5.
The fact that the vendor contracted to sell his own estate, in the name of, or as agent for, another (.$) ; or that the nominal purchaser was in fact the agent for a third person with whom the vendor has quarrelled upon other matters (t), or to whom he has given a bare refusal (u) to deal for the estate, is not, in general, any defence to a suit for specific performance: unless the case can be brought within the class of cases previously noticed (x), by showing that the misrepresentation was used as the inducement to the defendant to enter into the contract (y).
Whether it is a good defence to a purchaser's action for specific performance that the vendor, when he signed the contract, supposed the purchaser to be another person of the same name, is a question of construction ; and evidence may possibly be admissible to show that the contract was intended to be for sale to a particular person (z).
Vendor mistaken in identity of purchaser.
The insertion in the contract of a penalty in case of nonperformance, is no defence to a suit for specific performance (a) : nor is a stipulation for the payment of a specified sum as liquidated damages (b) ; in fact, decrees have been made upon agreements which took the shape of bonds (c) : but the obligee must elect between his legal and equitable remedies (d). A bond void at Law may be a good agreement in Equity (e).
Insertion of penalty, no defence.
(r) Buckland v. Papillon, (1866) 2 Ch. 67; 36 L.J. Ch. 81.
(s) Fellowes v. Lord Gwydyr, (1829) 1 R. & M. 83.
(t) Hall v. Warren, (1804) 9 Ves. 605.
(u) Sug. 14th ed. 219, citing Lord Irnham v. Child, (1781) 1 Br. C. C. 92, 95; but qu. whether this doctrine can be extended to cases of refusal grounded on any particular and specified reason: see (1844) 1 Coll. 219; Bonnett v. Sadler, (1808) 14
Ves. 528; O'Herlihy v. Hedges, (1803) 1 Sch. & L. 123.
(x) Sup. p. 806 et seq.
(y) Phillips v. Duke of Bucks., (1682) 1 Vern. 227 ; and see Nelthorpe v. Holgate, (1844) 1 Coll. 203; Nash v. Disc, (1898) 78 L. T. 445; Archer v. Stone, (1898) 78 L. T. 34. As to personal objections as an element of defence, see Fry, 4th ed. 93, 94 ; Smith v. Wheatcroft, (1878) 9 Ch. D. 223; 47 L.J. Ch. 745.
(z) See Smith v. Wheatcroft, sup.
The circumstance that damages could not be recovered upon the contract at Law, has not been universally considered a good defence to a suit for specific performance, although, as observed by Lord Hardwicke (f), "There are very few cases in which a Court of Equity can decree a performance of a covenant or agreement upon which there can be no action at Law, according to the words of the articles and the events which have happened." In his treatise on specific performance (g), Lord Justice Fry points out that, by the principles of the Common Law, exact performance by the plaintiff of his part of the contract according to its very terms must be averred and proved, whereas in Equity a distinction has been made between those terms which are of the essence of the contract, and those which are not thus essential, and a breach of which it is inequitable for either party to set up against the other as a reason for refusing to execute the contract between them. On this ground, he says, the jurisdiction rests in all cases where specific performance is decreed with compensation to the plaintiff. And it must be noticed that the modern tendency of the Court is to hold people to the actual bargains they have made, and thus indirectly to confine the jurisdiction within the limits of legal relief (h).
Inability to recover damages at Law, how far a defence.
(a) Howard v. Hopkyns, (1742) 2 Atk. 371; Coles v. Sims, (1854) 5 D. M. & G. 1 ; 23 L. J. Ch. 258 ; and see Logan v. Wienholt, (1833) 1 C. & F. 61l, 630.
(b) Darbey v. Whitaker, (1857) 4 Dr. 134.
(c) Hobson v. Trevor, (1723) 2 P. W. 191; Butler v. Powis, (1845) 2 Coll. 156 ; but not if the plaintiff has enforced the penalty, Suinter v. Fcrgu~ son, (1849) 1 Mac. & G. 286. As to the jurisdiction of a Court of Equity to restrain a breach of an agreement secured by a bond, see Clarkson v. Edge, (1863) 33 Beav. 227 ; 33 L. J. Ch. 443; Fox v. Scard, (1863) 33 Beav. 327, 328 ; and see Judicature Act, 1873, s. 24, sub-s. 5.
(d) Fox v. Scard, sup.
(e) Squire v. Whitton, (1848) 1 H. L. C. 333.
(/) See Whitmcl v. Farrcl, (1749) 1 Ves. sen. 256, 258.
(g) 4th ed. p. 21.
And Equity will not decree specific performance of part of a contract, if unable to enforce specific performance of all its material terms (*).
Contract incapable of complete performance.
As to the 3rd of the above heads. - Upon defects in the estate itself, we may refer to former observations respecting misdescriptions and compensation (k) : we may also remark that, although either the original non-existence of, or the want of a sufficient title to, a material part of the property or that part of it which may have formed the inducement to the purchaser, is a sufficient defence to an action for specific performance, yet mere non-existence of a part does not, universally, as a ground of defence, stand so high as want of title ; for it may, obviously, be often a very different matter to a purchaser whether he be simply unable to get a particular part of what he contracted for, or whether such part will be liable to be held by another person, and converted into a nuisance (I).