When Can You Sue for Specific Performance in Property Disputes?

Understanding If This Applies to You

Suppose you’ve entered into a Sale and Purchase Agreement (SPA) for a property in Malaysia. In that case, whether as a buyer or seller, and the other party refuses to follow through, you may feel stuck, frustrated, and financially exposed.

Maybe you’ve already paid the deposit. Perhaps you’ve made plans to move in. Or you’ve reserved the funds, and the buyer suddenly pulls out. When someone breaks a promise in a property transaction, you deserve clarity — and possibly legal action.

This article explains how to use the legal remedy of specific performance to protect your rights and enforce what was contractually agreed upon.

The Problem: The Other Party Refuses to Honour the Deal

In property transactions, a breach often arises when:

• A seller changes their mind after signing the SPA and tries to cancel or delay the sale.
• A buyer refuses to proceed despite having signed the agreement.
• A third party (e.g., a second buyer) enters the picture, which is common in double sale cases.
• The seller refuses to deliver vacant possession even after receiving full payment.

As the affected party, you may have spent time, effort, and money — including bank valuation fees, legal fees, and stamp duties — only to see the deal collapse. You may also risk losing your home, investment, or opportunity in a rising market.

In such cases, monetary compensation might not be enough. You may want the court to force the other party to complete the deal, and that’s where specific performance comes in.

Your Legal Rights Under Malaysian Law

Specific performance is a legal remedy under the Specific Relief Act 1950. It allows a party to ask the court to compel the other party to carry out their side of the contract. This is particularly useful in property sales where the subject matter (the land) is unique.

Here’s what you need to know:

• What is Specific Performance?
  A court order usually forces the defaulting party to complete the agreed transaction because financial damages wouldn’t be a fair substitute.
• When can you apply for it?
  You may sue for specific performance if:
  • There is a valid, signed Sale and Purchase Agreement.
  • You have fulfilled your contractual obligations.
  • The other party refuses to complete the sale without a lawful justification.
• The courts consider:
  • Whether monetary damages would be inadequate.
  • Whether both parties can still complete the contract.
  • Whether there was any fraud, misrepresentation, or unfair conduct.
• Key legislation that supports your rights:
  • Specific Relief Act 1950 – Primary law for this remedy.
  • Contracts Act 1950 – Governs the legality and enforceability of agreements.
  • National Land Code 1965 – Governs land ownership, registration, and transfer.

Note: Courts are generally more willing to grant specific performance in property cases, as land is considered unique and not easily replaced.

How Legal Support Can Help You Enforce the Agreement

Trying to enforce a property sale on your own can be overwhelming. A property lawyer can help you in several crucial ways:

• Review your Sale and Purchase Agreement to confirm its validity and enforceability.
• Send a letter of demand to the defaulting party as a formal warning.
• Advise if specific performance is suitable in your case or if damages are more likely.
• File a civil suit in court seeking an order of specific performance.
• Lodge a private caveat to prevent the seller from transferring the property to someone else.
• Apply for an injunction to stop any ongoing or potential transfer.

Legal representation strengthens your case and ensures your rights are presented effectively in court.

Your Next Steps: How to Take Action Effectively

If you’re dealing with a property dispute and want the agreement enforced, here’s a realistic plan to follow:

1. Gather Your Documents

Secure your signed SPA, payment receipts, bank approval letters, and correspondence with the other party.

2. Consult a Property Lawyer

A lawyer can help you evaluate whether specific performance is viable or if an alternative legal remedy, like damages or rescission, is more practical.

3. Send a Letter of Demand

This formal step may prompt compliance or reveal the other party’s reasons for defaulting. It also helps show the court that you acted reasonably.

4. Lodge a Private Caveat (if you’re the buyer)

If you suspect the seller might sell the property to someone else, this temporary caveat blocks any new registration at the land office.

5. File for Specific Performance in Court

If the defaulting party refuses to comply, your lawyer will initiate proceedings to enforce the contract. Be prepared for litigation timelines and possible settlement offers.

6. Be Open to Mediation or Settlement

Sometimes, a practical solution — such as compensation or a new completion date — may be more cost-effective than a full trial.

Take Control of Your Legal Options

When a property deal breaks down, you have legal tools to fight back — especially when you’ve held up your end of the agreement. Specific performance is a powerful remedy that lets you ask the court to enforce what was promised.

If you’re facing a dispute over a Sale and Purchase Agreement, don’t delay. Legal remedies like caveats, injunctions, and specific performance claims are time-sensitive.

Please speak to a property lawyer today to assess your rights and take action before it’s too late.

FAQ

1. What is specific performance in a property dispute?

Specific performance is a legal remedy in which the court orders the other party in a contract—typically a Sale and Purchase Agreement (SPA)—to carry out their contractual obligations, such as completing the sale of a property. It’s often used when money alone isn’t enough to fix the problem.

2. When can I sue for specific performance in Malaysia?

You can sue for specific performance if you have a valid and signed SPA, have fulfilled your part of the deal, and the other party refuses to complete the transaction without a valid reason.

3. What laws support my right to claim specific performance?

The main law is the Specific Relief Act 1950, which allows you to ask the court to enforce a contract. Other supporting laws include the Contracts Act 1950 and the National Land Code 1965.

4. Is specific performance available to both buyers and sellers?

Yes. While most commonly used by buyers when a seller refuses to transfer property, sellers can also seek specific performance if a buyer refuses to complete the purchase after signing the agreement.

5. Can I still claim specific performance if the property was sold to someone else?

If the property was sold to another buyer, your ability to claim specific performance depends on whether the second buyer was aware of your earlier deal. You may also need to lodge a caveat and seek an injunction to block further dealings.

6. What if the seller refuses to give vacant possession after payment?

If you’ve paid and the seller refuses to deliver the property, you may be entitled to sue for specific performance and/or claim damages. A lawyer can help you enforce the contract or freeze further actions by the seller.

7. What is a private caveat, and why should I file one?

A private caveat is a notice registered at the land office to prevent the property from being transferred to someone else. It helps protect your interests while you resolve the dispute legally.

8. How long does a specific performance case take in court?

It depends on the complexity of the case, court schedules, and whether the other party contests the claim. Some cases may take several months to over a year. An early settlement is sometimes possible through negotiation.

9. What happens if the court refuses to grant specific performance?

If the court finds that specific performance isn’t suitable — for example, if the contract is unclear or circumstances have changed — you may still be awarded damages (financial compensation) for the breach.

10. Do I need a lawyer to file for specific performance?

Yes. Specific performance cases involve complex property laws and procedures. A lawyer will help you assess your case, file the correct documents, lodge a caveat or injunction, and represent you in court for the best success.