Part performance (in the context of contracts)

An equitable doctrine which allows a person who has partly performed an oral contract to have it specifically performed or to sue for damages even though legislation would usually render the contract unenforceable unless evidenced by writing. The doctrine does not allow the person to enforce the contract itself, but to enforce the equities arising out of the acts of part performance.

When determining whether remedies in part performance should be made available, the court will consider:

  1. Whether the acts imply the existence of an agreement; and
  2. If so, what are the terms of the agreement?

As per the case law of McBride v Sandland, the following requirements must be satisfied to achieve a remedy for part performance.

  • The acts must be done by a party to the agreement
  • The agreement must have been complete
  • The acts must have been done in compliance with the terms of the oral agreement
  • The acts relied on must be unequivocally linked to or indicative of some agreement of the general nature of that alleged
  • The performing party must have been acting in reliance on the agreement, and the other party must have permitted those acts to be done because of the existence of the agreement

For example, in the case of Mason v Clarke there was an oral agreement for hunting rights. Clarke (the lessee) tried to prevent Mason (the hunter) from exercising these rights by citing the lack of a written agreement. The court held that Mason’s hunting conducted to date constituted acts of part performance. He had acquired a relevant interest in the land, and had legal standing against Clarke who had tried to prevent these rights from being exercised.

Further examples of where part performance is often recognised include:

  • Taking possession of title deeds (for deposit)
  • Improvements made to property
  • Taking possession of land