Taking Specific Performance Seriously: Trumping Damages as the Presumptive Remedy for Breach of Contract

As even the most cursory of legal searches on specific performance will reveal, there is no shortage of doctrinal material, in the form of learned articles and even entire treatises, written on this topic. Indeed, this remedy has been the subject of intense debate amongst jurists in both the civil and common law legal traditions. It has attracted the attention of theoretical scholars who seek to fit it within various theories of contractual rights. A great deal has been written by academics pre-occupied with an economic analysis of law, as well as those who focus on comparative approaches to legal research. Interest in this area is not reserved exclusively to academics. Legal practitioners involved in litigating contract claims for their clients, and the judges before whom these claims are argued, are extremely conscious of the practical importance of the remedy that follows a breach of promise. While the subject has attracted attention in most jurisdictions, Canada’s legal system presents an ideal opportunity to examine specific performance from the full panoply of perspectives. The bi-jural nature of this country provides us with a local comparative laboratory, enabling us to compare and contrast the practical and theoretical implications of the different positions of the civil and common law with respect to this remedy.Moreover, the Quebec experience on specific performance is extremely instructive. Until the 1980s, Quebec courts remained loathe to actually award “l’execution en nature,” creating a gap between the supposed primacy of specific performance in civilian theory on the one hand, and the narrowness of the remedy in practice on the other. Quebec judges had fallen prey to the perils of wholesale legal transplantation — namely the inappropriateness of simply adopting a legal concept from a foreign legal tradition without properly adapting it and molding it to the particularities of the receiving legal tradition. Quebec courts had committed the classic legal transplantation error in thinking that just because Quebec had borrowed the procedural remedy of the injunction from the common law, they had to interpret and apply that remedy in the same restrictive manner as the legal system from which it had been borrowed. However, beginning in the early 1980s, a new trend began in Quebec when several judges bravely rejected the inappropriate allegiance to the narrow common law attitude and specific performance emerged as an important remedy in Quebec law, eventually taking its rightful place as the presumptive remedy. Of particular importance is the 1988 decision of the Quebec Superior Court in Construction Belcourt Ltee v. Golden Griddle Pancake House Ltd., a decision that still provides one of the most cogent and thorough examinations of specific performance in Quebec law. This case, with facts virtually identical to those in the leading House of Lords decision in Co-operative Insurance Society v. Argyll Stores (Holdings) Ltd., provides an ideal opportunity to compare the remedy in the context of the intellectual traditions of the civil and common law, as well as their distinct methodologies and historical development. Both cases dealt with lessees who closed the doors to their respective businesses because they were losing money and thereby breached the continuous operation provisions contained in their commercial leases. That these two cases result in diametrically-opposed judicial findings is extremely revealing of the classical positions of the two legal traditions. And despite the vast amount of material already written on the subject, it certainly invites us to undertake a serious examination of whether damages or specific performance should be the presumptive remedy for breach of contract. This paper will be divided into three broad sections. First, in order to answer the question of whether specific performance should be the presumptive remedy, we have to examine why we might want that to be the case. The first part of this paper will therefore deal with the positive aspects of specific performance and the reasons for which a creditor, victim of a contract breach, might prefer this recourse. It will also attempt to respond to some of the arguments levied against the remedy by its critics.The second part will examine the current state of the law on specific performance in the respective legal traditions and, in particular, how the civil and common law differ and/or converge on this question in both theory and practice.Finally, on the assumption that specific performance should be the presumptive remedy, the paper will conclude by examining whether there are any circumstances that should temper its pre-eminence and limit its award by a court and if so, what those circumstances may be.

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