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Specific Relief Act Amendment Bill 2018

Specific Relief Act Amendment Bill 2018

Specific Relief Act Amendment Bill 2018

Parliament on 23 July approves the Specific relief Amendment Bill, 2018. The Amendment bill has changed the Specific Relief Act, 1963 significantly.

Changes in Section 6: Recovery of possession of immovable property

With the Act permitting a dispossessed person, and any person claiming through such dispossessed person, to file a suit for recovery of possession of immovable property, the Bill additionally allows a person through whom the dispossessed got possession of the immovable property, to file a lawsuit for recovery.

The specific performance made compulsory

One of the significant changes that have been introduced by the bill is that it has taken away the discretionary power of the court in ordering specific performance of the contract. Thus after the amendment comes into force, the specific performance of the contract is compulsory and not dictionary.

Changes in section 10

Section 10 of SRA (before amendment) gives power to the court that the court may provide specific performance at its discretionThe amended section 10 of SRA, says that “The court shall enforce the specific performance of a contract”.

The Bill proposes to do away with the broader discretion of courts to grant specific performance and to make the specific performance of contract a general rule rather than an exception subject to specifically limited grounds.

The effect of the amendment will be that the plaintiff can seek specific performance of the contract as a matter of course, without having to prove extraordinary circumstances.

Changes in section 11: Contracts in Relation to trust

Section 11 of SRA before amendment give discretionary power to the court in granting specific performance. By the bill, the discretion has been taken away.

Changes in Section 14: Following contracts cannot be enforced

The Main difference in section 14 is that before amendment it states “a contract for the non-performance of which compensation in money is an adequate relief” such contract cannot be enforced for specific performance,

It has been substituted to “where a party to the contract has obtained substituted performance of the contract in accordance with the provisions of section 20;”

Section 14A: Technical expert, Expert opinion

The Bill also inserts a new provision for engaging technical experts in suits where expert opinion may be needed. The court will determine the terms of payment of such expert. Both the parties will bear the fee.

Changes in Section 15: LLP after amalgamation can ask for specific performance

The new clause section 15 (fa) has been added which states “when a limited liability partnership has entered into a contract and subsequently becomes amalgamated with another limited liability partnership, the new limited liability partnership which arises out of the amalgamation.”

Changes in section 16: Personal bars to specific relief

Section 16 before amendment said “Specific performance of a contract cannot be enforced in favor of a person—(a) who would not be entitled to recover compensation for its breach

It has been substituted to “who has obtained substituted performance of the contract under section 20; ”

Changes in section 20: Substituted performance

Further Section 20 of SRA (before amendment) states that the jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so.

By the amendment, the previous section 20 has been wholly substituted.

The amendment introduces the concept of ‘substituted performance’. As per this, a party who is affected by the breach of contract can choose to get the contract performed by a third party, or by its own agency, at the cost of the contracting party at default.

Changes related to contracts related to the infrastructure project

20A: No injunction

No injunction shall be granted by a court in a suit under this Act involving a contract relating to an infrastructure project if the injunction would cause a delay in the progress or completion of such infrastructure project.

20B: Special Courts

The amendment bill states that special civil courts shall be set up by the state government with the consultation of the chief justice of the High court. The court will try the suit under this Act in respect of contracts relating to infrastructure projects.

20C: Period

Such cases must be disposed of within 12 months from the date of receipt of summons by the defendant.

Changes in Section 21

Section 21, which had earlier stated that “in a suit for specific performance of a contract, the plaintiff may also claim compensation for its breach, either in addition to, or in substitution of, such performance” has been amended by substituting the words “either in addition to, or in substitution of” with “in addition to” Therefore, compensation need not be sought for as an alternate relief, and can be claimed in addition to specific performance.

Section No. Before Amendment After Amendment
6 If any person is dispossessed without his consent of immovable property otherwise than in due course of law, he or any person claiming through him may, by suit, recover possession thereof, notwithstanding any other title that may be set up in such suit. If any person is dispossessed without his consent of immovable property otherwise than in due course of law, he or any person, through whom he has been in possession or any person claiming through him may, by suit, recover possession thereof, notwithstanding any other title that may be set up in such suit.
10 ….the specific performance of any contract may, in the discretion of the court, be enforced….. The specific performance of a contract shall be enforced by the court
11 specific performance of a contract may, in the discretion of the court, be enforced when the act agreed to be done in the performance wholly or partly of a trust. Specific performance of a contract may, Contract shall be enforced when the act agreed to be done is in the performance wholly or partly of a trust.
14 (a) a contract for the non-performance of which compensation in money is an adequate relief;

 

(a) where a party to the contract has obtained substituted performance of the contract in accordance with the provisions of section 20;

 

14A engaging technical experts in suits where expert opinion may be needed
15 Who may obtain specific performance Addition of clause (fa)

When a limited liability partnership has entered into a contract and subsequently becomes amalgamated with another limited liability partnership, the new limited liability partnership which arises out of the amalgamation.”.

16 (a)    who would not be entitled to recover compensation for its breach;

(c.) who fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms of the performance of which has been prevented or waived by the defendant.

 

Explanation II: the plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction.

(a) who has obtained substituted performance of the contract under section 20;

(c.) who fails to prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms of the performance of which has been prevented or waived by the defendant.

 

Explanation II: the plaintiff must prove the performance of, or readiness and willingness to perform, the contract according to its true construction.

19 Relief against parties and persons claiming under them by subsequent title Addition of Clause (ca)

“(ca) when a limited liability partnership has entered into a contract and
subsequently becomes amalgamated with another limited liability partnership, the new
limited liability partnership which arises out of the amalgamation.”.

20 The jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so. a party who is affected by the breach of contract can choose to get the contract performed by a third party, or by its own agency, at the cost of the contracting party at default.
20A No injunction shall be granted by a court in a suit under this Act involving a contract relating to an infrastructure project if the injunction would cause a delay in the progress or completion of such infrastructure project.
20B special civil courts shall be set up by the state government with the consultation of the chief justice of the High court.
20C Infrastructure cases must be disposed of within 12 months from the date of receipt of summons by the defendant
21 In a suit for specific performance of a contract, the plaintiff may also claim compensation for its breach, either in addition to, or in substitution of, such performance In a suit for specific performance of a contract, the plaintiff may also claim compensation for its breach, either in addition to, such performance
25 —The provisions of this Chapter as to contracts shall apply to awards to which the Arbitration Act, 1940 (10 of 1940), does not apply and to directions in a will or codicil to execute a particular settlement. —The provisions of this Chapter as to contracts shall apply to awards to which the Arbitration and Conciliation Act, 1996, does not apply and to directions in a will or codicil to execute a particular settlement.
41 Injunction when refused Insertion of the clause “(ha) if it would impede or delay the progress or completion of any infrastructure project or interfere with the continued provision of relevant facility related to it or services being the subject matter of such project.”

 

As per the Statement of Objects and Reasons of the Amendment Bill, the Act is not in tune with the rapid economic growth happening in our country and the expansion of infrastructure activities that are needed for the overall development of the country

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