What is "specific performance" in legal terms?

Specific performance is defined as an equitable remedy in contract law that compels a party to perform their specific duties as outlined in a contract. This type of remedy is typically invoked when monetary damages are insufficient to remedy the harm caused by a breach of contract. For instance, in cases involving unique items or real estate, the injured party may seek specific performance to ensure they obtain the exact performance they contracted for, rather than being compensated simply with money.

This means that the party who is in breach must complete their obligations as stipulated in the contract, effectively ensuring that the agreed terms are executed. Such a remedy underscores the principle that certain contracts are so fundamentally important that the remedy for a breach must involve the actual performance rather than just financial compensation. The approach is based on the idea that fairness and justice may require fulfilling the original agreement.

In contrast, the other options describe remedies or processes that are fundamentally different from specific performance. Financial compensation relates to damages, settling a dispute through agreement does not necessitate the fulfillment of contractual obligations, and mediation involves negotiation between parties rather than enforcing particular contract terms.