Plaintiff Seeking Specific Performance Of Agreement To Sell Must Also Show Availability Of Funds : Supreme Court

The Supreme Court recently upheld the High Court's decision denying Specific Relief to the plaintiff because he was not able to prove his readiness and willingness to perform the contract.

The bench comprising Justice JB Pardiwala and Justice R Mahadevan observed that for the contract to be concluded, the plaintiff shall not only aver about his readiness and willingness to perform the contract but “is also obliged to adduce necessary oral and documentary evidence to show the availability of funds to make payment in terms of the contract in time.”

This was the case where the petitioner-plaintiff sought a specific performance of the agreement to sell, contending that the Respondent was not performing his part of the contract despite taking earnest money of Rs. 12.5 lacs out of a total consideration of Rs. 30 Lacs.

The trial court ruled in the petitioner's favor, granting a decree for specific performance. However, the High Court reversed the decision, ruling against the petitioner on the issue of readiness and willingness to perform the contract.

Affirming the High Court's decision, the Court explained the distinction between readiness and willingness to perform the contract.

The Court said that both the ingredients are necessary for the relief of specific performance.

“While readiness means the capacity of the plaintiff to perform the contract which would include his financial position, willingness relates to the conduct of the plaintiff.”, the court said.

The Court noted that the High Court's ruling was based on facts and cannot be termed as perverse, therefore it declined to interfere with the impugned judgment.

Accordingly, the appeal was dismissed.

Appearance:

For Petitioner(s) Mrs. Vaijayanthi Girish, AOR Mr. Girish Ananthamurthy, Adv.

For Respondent(s) Mr. Manjunath Meled, Adv. Mr. Sandeep Sharma, Adv. Mrs. Vijayalaxmi Udapudi, Adv. Mr. Ganesh Kumar R., AOR

Case Title: R. SHAMA NAIK VERSUS G. SRINIVASIAH

Citation : 2024 LiveLaw (SC) 947

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