Specific Performance Remedy for Breach of Contract
One can never be too careful in drafting business and property contracts. Unless remedies for a possible breach of the contract are carefully prepared by a business lawyer, unexpected consequences can occur. On December 6, 2011, the North Carolina Court of Appeals interpreted a contract to purchase condominiums. In The Vue – Charlotte, LLC, et al. v. Sherman (COA 11-595), an agreement for the purchase of condominiums contained a liquidated damages provision. The purchasers argued that because the agreements provided only that the seller may recover liquidated damages in the event of the purchasers’ default but also provided that the purchasers were entitled to any available equitable remedies in the event of the sellers default, there were no remedies available to the seller other than the liquidated damages. The Court of Appeals agreed with that argument and concluded as a matter of law that the seller was precluded from enforcing the agreement by specific performance.