Specific Performance & Irreparable Injury

1. Specific Performance & Irreparable Injury • Specific Performance = specialized form of an injunction where P asks the court to order D to perform her obligations under the contract. • Irreparable injury is a threshold issue here too • Ways to show irreparable injury in specific performance context when contract involves consumer goods: • Unique goods • Basic consumer goods • Shortage • Time is of the Essence • Unique contractual requirements (size of contract/number of goods)

2. Efficient Breach & Specific Performance • Some observers also argue that courts should NOT order specific performance because it interferes w/ “efficient” breach of contract • 3d party willing to pay $90 on spot market may have a more valuable use for carrots than Campbell which was only willing to pay $30 • OR Wentzes have found a buyer willing to pay $95. After Wentzes pay damages of $60 ($90-$30), they make a $5 profit, which is a better use of the carrots because it is more profitable • Scholars argue over whether such efficient breach should be allowed (and specific performance disallowed) • Most of the disagreement focuses on (1) whether price adequately reflects value, (2) whether damages/SP have higher transaction costs, and (3) whether damages really adequately compensate P’s damage • For your purposes: • Issue of efficient breach arises primarily in times of market distortion • This is when courts are MOST likely to order specific performance

3. Why can’t P always get specific performance when contracts are breached? • If damages and specific performance are usually equivalent, why don’t courts allow SP and damages interchangeably (i.e., why have an irreparable injury requirement)? • Are there reasons why courts might be reluctant to order specific performance short of impossibility or “extremely-difficult-to” cover situations?

4. Van Wagner – Difficulty in Valuing Damages & Specific Performance • Was the land subject to the rental contract in Van Wagner unique? • Why did the court refuse to grant specific performance? • Is Van Wagner’s reasoning consistent with the courts’ treatment of irreparable injury in Campbell Soup or Pardee?

5. Difficulty in Valuation & Irreparable Injury • One important factor re whether P has shown irreparable injury is that damages are hard to value. • This factor is a corollary to uniqueness – “That which is hard to replace is usually difficult to value.” • Just because difficulty of valuation is a consideration re irreparable injury, however, DOESN’T mean it is the only way to show irreparable injury. • What else might have caused the court to deny the injunction?

6. Balancing the Equities/Undue Hardship to the Defendant Even if P can show irreparable injury a court may still deny an injunction if hardship on D is too significant Court must ask whether: hardship on D of granting the injunction disproportionately outweighs hardship on P of not granting the injunction (aka benefit to plaintiff of granting the injunction)

7. Balancing of Equities/Undue Hardship, cont’d • This is a defense = must be raised by D or it’s waived. • How to give content to this test? • What kinds of harm to P if injunction is not granted (or what benefit to P if it is granted) does court weigh in the balance? • What kinds of harm to D if injunction granted does court typically weigh in the balance?

8. Balancing the Equities in Whitlock • Does the burden to the D (Hilander) if the injunction is granted disproportionately outweigh burden on P (Whitlock) if injunction is not granted (or benefit if granted)? • What is harm to D if granted? • What is harm to P if not granted? • Why doesn’t appellate court uphold lower court’s REFUSAL to grant injunction?

9. To what extent should D’s culpability factor into the court’s balancing of equities? • How should courts deal with D’s culpability during the balancing? • Should it matter that D acted intentionally if D’s harm from granting the injunction is disproportionate to P’s harm? • What outcome in Whitlock ifD didn’t know the addition was over the property boundary but also didn’t bother to check?

10. To what extent does P’s culpability weigh in the balancing? • If P does something to aggravate the situation, courts can weigh P’s actions in the balance as well. • Example – if P refused to allow surveyors on land to find out where lot lines between P & D’s land were • To what extent is D trying to argue that P (Whitlock) has acted in a manner so as to be undeserving of relief? • P’s claim is barred by laches • The Doctrine of Laches: Equity aids the vigilant, not those who sleep on their rights. • Courts deny relief if • P’s neglect to assert a right or claim • Together with the passage of time or other circumstances • Substantially prejudices D • Do P’s actions fit this definition?

11. Comparing Whitlock & Boomer Plaintiff’s harm: Defendant’s harm: Defendant’s culpability: Plaintiff’s culpability: