City Centre One Associates v. Teachers Insurance & Annuity Assn. of America

Brief Fact Summary.

City Centre One Associates v. Teachers Insurance (plaintiff) sued Teachers Insurance & Annuity Assn. of America (defendant) regarding a loan agreement.

Synopsis of Rule of Law.

Specific performance is available under contract law when a party’s damages cannot be estimated or the benefit which specific performance is sought for is unique.

Facts.

Defendant entered into a loan agreement to lend 14.5 million for a construction project. The party who was lent the money assigned their interest in the agreement to the plaintiff. The plaintiff argued the agreement was voidable and the defendant countered seeking specific performance of the agreement.

Issue.

Whether specific performance is available under contract law when a parties’ damages cannot be estimated or the benefit which specific performance is sought for is unique.

Held.

Yes. Specific performance is available under contract law when a parties’ damages cannot be estimated or the benefit which specific performance is sought for is unique.

Discussion.

Specific performance is an equitable remedy and therefore specific performance is only available under contract law when a party will not be made whole by any other remedy, such as when the benefit sought is unique. For example, if a buyer purchases land and the seller breaches the agreement, refusing to sell the land, the buyer can seek specific performance of the contract, and the seller will be forced to sell the land, because every piece of land is unique. Here, money is not unique because the amount of the loan plus interest is easily able to be calculated and money is not unique. Thus, the defendants are not entitled to specific performance of the contract.