Case Note & Summary
The plaintiff, M/s. Gurudev Developers, a partnership firm, filed a suit against the defendant, Kurla Konkan Niwas CHS Ltd., seeking specific performance of an agreement dated 18th January, 1985, under which the plaintiff was appointed as builder/contractor to construct buildings for the defendant society. The plaintiff also sought a declaration that the termination of the agreement by the defendant's advocate's letter dated 21st January, 1992 was illegal, and in the alternative, claimed damages of Rs.1,83,07,410/-. The plaintiff had only completed some plinth work and erected 27 pillars before the defendant terminated the contract and awarded it to another contractor, who completed the buildings. The defendant admitted the agreement and the limited construction but denied any further work by the plaintiff. The court framed issues, including whether the plaintiff proved the illegality of termination, entitlement to specific performance, and entitlement to damages. The court found that since the buildings were already constructed by another contractor, specific performance was impossible. The plaintiff failed to prove damages beyond Rs.4 lacs, which was admitted by the defendant. The court dismissed the suit for specific performance and damages except for Rs.4 lacs, which was awarded to the plaintiff. The judgment was pronounced on 20th February, 2013 by Justice Roshan Dalvi.
Headnote
A) Contract Law - Specific Performance - Impossibility of Performance - Specific Relief Act, 1963, Section 10 - The plaintiff builder sought specific performance of a construction agreement after the defendant society terminated the contract and another contractor completed the buildings. The court held that since the buildings were already constructed by another contractor, specific performance was impossible and the plaintiff was not entitled to it. (Paras 1-2) B) Contract Law - Damages - Burden of Proof - Indian Contract Act, 1872, Section 73 - The plaintiff claimed damages of Rs.1,83,07,410/- in the alternative. The court found that the plaintiff failed to prove the extent of damages suffered, except for Rs.4 lacs which was admitted by the defendant. The court held that the burden of proving damages lies on the plaintiff. (Paras 2, 5) C) Contract Law - Termination of Contract - Validity - The defendant society terminated the agreement dated 18th January, 1985 by letter dated 21st January, 1992. The court held that the termination was not illegal as the plaintiff had not completed the construction and the defendant had the right to terminate. (Paras 1-3)
Issue of Consideration
Whether the plaintiff is entitled to specific performance of the agreement dated 18th January, 1985 and whether the termination of the agreement by the defendant was illegal.
Final Decision
The suit is dismissed except for the award of Rs.4 lacs to the plaintiff. The plaintiff is not entitled to specific performance or the claimed damages.
Law Points
- Specific performance
- Damages
- Termination of contract
- Impossibility of performance
- Burden of proof
