High Court Upholds Trial Court’s Discretion in Property Sale Dispute: Plaintiff Failed to Prove Continued Readiness and Willingness

In a significant ruling, the High Court of Kerala, presided over by Justice Sathish Ninan, has upheld the decision of the Principal Sub Court, Alappuzha, in a contentious property sale agreement case (RFA No.392 of 2004). The court denied the specific performance of the agreement, instead favoring the return of advance sale consideration with modified interest rates.

The appellant, represented by the heirs of Khalid, had challenged the trial court’s decision, which declined the specific performance of a property sale agreement dating back to 2000. The court, in its judgment, highlighted, “the plaintiff has failed to prove his continued readiness and willingness to perform Ext.A1 agreement,” emphasizing the criticality of this aspect in contract enforcement.

Justice Ninan, in his detailed judgment, meticulously examined the evidence presented, including the bank account details of the plaintiff and the circumstances surrounding the contract’s non-fulfillment. The court observed that the plaintiff did not present sufficient evidence to demonstrate the financial capacity or the earnest intention to comply with the terms of the agreement. This lack of evidence was pivotal in the court’s decision to deny specific performance.

Furthermore, the court modified the interest rate on the advance sale consideration, stating, “Considering the banking rates of interest during the relevant period, I deem it appropriate that the plaintiff be granted interest at the rate of 12% per annum till the date of the suit and thereafter at the rate of 9% till the date of realization.” This modification reflects a balanced approach in dealing with the financial aspects of the dispute.

The High Court's decision In this case underscores the importance of the plaintiff’s obligation to demonstrate readiness and willingness in contract performance, a principle that is fundamental in specific performance suits. The ruling also highlights the discretionary power of trial courts in adjudicating complex civil matters, particularly in property disputes where the contractual intentions and capabilities of the parties involved are under scrutiny.

Date of Decision: 22^nd November 2023

Khalid VS Sarala