Specific Performance in Real Estate Transactions: When a Court Can Force the Sale

Intro

Most contract disputes are resolved through money damages. Real estate transactions are different. Because each parcel of property is considered unique, courts may order specific performance—requiring a party to complete the sale as agreed rather than simply paying damages. Specific performance is among the most powerful remedies available in real estate litigation, but it is not automatic. Presidio Law Firm LLP represents buyers and sellers in disputes where the right to compel performance is contested and the outcome will determine ownership of the property itself.

Why Real Estate Is Treated as Unique

Courts recognize that real property cannot always be replaced by a comparable substitute. Location, access, zoning, development potential, and strategic value often make monetary compensation inadequate. As a result, equity may intervene where legal remedies fall short.

This principle underlies the availability of specific performance, but it also imposes higher standards on the party seeking it.

Specific Performance Is an Equitable Remedy

Specific performance is not granted as a matter of right. It is an equitable remedy, meaning courts consider fairness, conduct, and feasibility in addition to contractual breach.

A party seeking to compel performance must show not only that the contract was breached, but that enforcement would be just under the circumstances. Equity looks closely at behavior on both sides.

Core Requirements for Compelling Performance

To obtain specific performance, the moving party must generally demonstrate that the contract is definite and enforceable, that they have performed—or are ready, willing, and able to perform—their obligations, and that monetary damages would be inadequate.

Failure to meet any of these elements can defeat the remedy even where breach is otherwise established.

“Ready, Willing, and Able” Is Often the Battleground

The requirement that a buyer be ready, willing, and able to perform is frequently contested. Proof may include financing commitments, available funds, and compliance with contractual conditions.

Disputes often arise where financing was delayed, approvals were pending, or conditions were not fully satisfied at the time performance was demanded. Courts scrutinize whether the buyer could have closed had the seller performed.

Good Faith and Clean Hands

Equity requires clean hands. A party seeking specific performance must show that they acted in good faith and did not contribute to the failure of the transaction.

Delay, strategic maneuvering, or attempts to renegotiate under pressure can undermine equitable standing. Courts are reluctant to compel performance where the requesting party engaged in inequitable conduct.

Common Defenses Raised by Opposing Parties

Sellers resisting specific performance often assert defenses such as impossibility, failure of conditions, uncertainty in contract terms, or that damages would be adequate. Buyers may face claims that contingencies were not satisfied or that deadlines were missed.

Market changes alone—such as price increases or decreases—are rarely sufficient to defeat enforcement. Courts generally do not allow parties to escape a bad bargain simply because circumstances shifted.

Procedural Posture and Timing Considerations

Specific performance claims are often brought early in litigation to preserve the transaction. Temporary restraining orders or preliminary injunctions may be sought to prevent sale to a third party while the dispute is resolved.

Timing matters. Delay in asserting the remedy can signal waiver or undermine the claim that the property is truly unique to the buyer.

Interaction With Escrow and Third Parties

Escrow instructions, notices of default, and communications with brokers or lenders can materially affect specific performance claims. Missteps may complicate enforcement or expose parties to additional claims.

Where third parties are involved, courts may consider whether performance remains feasible or whether competing interests have intervened.

Risks and Strategic Tradeoffs

Specific performance is a powerful remedy, but it carries risks. Litigation may be prolonged, and the relationship between buyer and seller may deteriorate irreparably. In some cases, pursuing damages or negotiated resolution may better serve the client’s objectives.

Strategic evaluation is essential. Not every breach warrants forcing a reluctant party to close.

Judicial Discretion and Practical Outcomes

Even when legal requirements are met, courts retain discretion in crafting equitable relief. Orders may include conditions, timelines, or adjustments designed to ensure fairness and feasibility.

Understanding how courts balance legal rights with practical realities is critical to effective advocacy in these cases.

Why Experience Matters in Specific Performance Litigation

Specific performance cases require mastery of both contract law and equitable principles. Small procedural errors or poorly framed arguments can foreclose the remedy entirely.

Experienced counsel can assess whether specific performance is achievable, advise on strategic alternatives, and pursue enforcement in a manner aligned with long-term objectives.

Closing

Specific performance can determine whether a real estate transaction is completed or lost forever. It is a remedy that demands precision, credibility, and strategic judgment. Presidio Law Firm LLP works with buyers and sellers to evaluate when compelling performance is appropriate and to pursue or defend these claims with a focus on protecting substantial property interests and long-term value.