Agreement to sale
Sashi Kumar
(Querist) 15 December 2012
This query is : Resolved
I am the seller and I entered into a sale agreement and I received 10% bayana from the buyer. The buyer was supposed to pay part payment within a month of the agreement according to the contract and the final payment at the time of registration within 3 months. The buyer did not make the part payment on the specified date, after many request the buyer did not make the payment. The registration date according to the contract has already expired and the buyer did not make the part payment or the final payment. After the contract expired two weeks later I gave the buyer another chance to make full payment in 30 days. Three days before the new registration date the buyer emailed me copies of the demand draft that he is ready with all the payment. But now due to family problem and health problem I do not want to sell the property. I have verbally offered the buyer to take double and cancel the contract mutually but buyer refused and said she wants to buy the property. So now I have sent the buyer a cancellation notice saying due to buyers non performance the contract is cancelled and buyers money is forfeited. Now the buyer is planning to file specific performance law suit to force sale of the property.
There is a Remedy clause in the contract if any party breach the contract which reads as follows:
"That in case the first party backs out from this transaction then the first party is liable to refund the double amount of the earnest money to the second party and in case the second party backs out from this transaction then his paid amount of earnest money shall be forfeited by the first party."
There is NO clause for specific performance for sale of property in the contract.
My question is
Have I breached the contract or not?
If I have breached the contract can the court order specific performance to sell the property even when there is a remedy clause available in the contract.
What I need to do to avoid specific performance of sale of property.
Kiran Kumar
(Expert) 15 December 2012
the other party cannot be prevented from filing a suit.
you can mention entire set of facts and circumstances in your defence before the Ld. Court.
prove your case to the extent that you never ran away from the contract at the appointed time, rather the other party was at wrong end.
you will be required to prove your intention and willingness to conclude the contract at the relevant point of time.
prabhakar singh
(Expert) 15 December 2012
Your mistake lies here when you state "After the contract expired two weeks later I gave the buyer another chance to make full payment in 30 days."
Doing so you made things easy for him to plead that TIME ORIGINALLY FIXED WAS NOT ESSENCE OF CONTRACT.
If suit is filled you need to prove that you were ever ready and willing to perform your part of the contract and it was prospective buyer who was not ready and willing to perform his part of the contract at any point of time only then specific performance shall be refused.
ajay sethi
(Expert) 15 December 2012
agree with experts
Sashi Kumar
(Querist) 16 December 2012
Thank You for your Expert Advice. Can you please clarify the following:
According to Specific relief Act, 1963, Chapter IV, Section 14
Specific performance of any contract cannot be specifically enforced, namely:-
(a) a contract for the non-performance of which compensation in money is an adequate relief;
(b) a contract which runs into such minute or numerous details or which is so dependent on the personal qualifications or volition of the parties, or otherwise from its nature is such, that the court cannot enforce specific performance of its material terms;
(c) a contract which is in its nature determinable;
(d) a contract the performance of which involves the performance of a continuous duty which the court cannot supervise.
Based on this section point (a) and (c), the buyer and seller had agreed on a specified amount of money as a relief if either party breached the contract. Can the court still enforce specific performance in favor of buyer and ignore the fact that money relief clause is available to both parties in the contract.
Raj Kumar Makkad
(Expert) 16 December 2012
Despite of specific clause, the relief of money is to be pleaded as an alternate relief so the same shall be enforceable under the same Act.
V R SHROFF
(Expert) 16 December 2012
What I need to do to avoid specific performance of sale of property. :
u R FREE TO TRF TO UR CLOSE CONFIDENTIAL RELATIVE.. REGD IT.
ONCE COURT LITIGATION [IF ANY] GETS OVER, TAKE BACK..
3
AS clause iof double token there, court cannot order for specific performance , as alternate remedy is avl,
Over and above, before any injunction oreder, u sold off the property..
Sashi Kumar
(Querist) 18 December 2012
Thank You to all Experts
I have a question please advice
1.)Should I transfer the property via gift deed to my daughter or son-in-law before any injuction ordered, or should I showing as sale.
2.)If sale, should the sale amount have to be same as previous cancelled contract or should it be more or less.
Sashi Kumar
(Querist) 18 December 2012
Thank you Advocate Makkad.
Why do you suggest that it is no use to do so, can you please clarify so I don't take any wrong step.
