Opinion ID: 895057
Heading Depth: 1
Heading Rank: 3

Heading: Tender of Performance vs. Readiness, Willingness, and Ability to Perform

Text: The dissent argues that a non-breaching plaintiff seeking specific performance satisfies the requirement of showing he is ready, willing, and able to perform by simply offering to perform in his pleadings as opposed to actually proving to the finder of fact that he is and wasin factready, willing, and able to perform. [11] This conflates two distinct concepts: (1) the tender (or offer) of performance and (2) the proof that one has actually been ready, willing, and able to perform. As noted above, in circumstances where a defendant has not repudiated or refused to perform, the law requires a plaintiff seeking specific performance to show both that he was ready, willing, and able to perform at the relevant time and that he tendered that performance. These two requirements are not the same thing. One can be perfectly capable of performing contractual obligations and yet not tender or offer that performance. Likewise, a party could very well tender or offer performance, but not be capable of performing. Offering to perform does not establish the ability to perform, nor does having the ability to perform demonstrate a tender of that ability. The law requires a demonstration of both before specific performance may be awarded unless the requirement of tender is excused. It is entirely reasonable for the law to distinguish between tender of performance and ability to perform when providing the remedy of specific performance. For example, it is sensible to excuse pre-suit tender of performance if it would be useless or if it has been frustrated by the defendant, such as in cases of repudiation by the defendant or an open declaration of a refusal to honor the contract by the defendant. A plaintiff need not actually tender performance when the defendant has repudiated his own obligations. Otherwise, the plaintiff would be required to go further than the defaulting defendant to obtain specific performance. On the other hand, ordering specific performance without requiring the plaintiff to show that he was capable and willing to perform at the time required by the contract grants the plaintiff more than he is entitled to under the contract. A plaintiff's pleading that he is ready, willing, and able to perform at the time the lawsuit is filed says nothing about whether he was ready, willing, and able to perform at the time required by the contract. A plaintiff who could not arrange funding in time for closing may be able to marshal all the funds he needs by the time he files pleadings in a lawsuit for specific performance. The dissent's view that merely pleading an offer to perform at the time the lawsuit is filed satisfies or replaces the need to demonstrate the ability to perform at the relevant time would essentially rewrite the parties' contract. It would, in effect, eliminate the plaintiff's contractual obligation to be capable of performance at the time the contract required, and grant the plaintiff the option to enforce the contract at any time he might become capable of performing before limitations runs. A defendant's breach or repudiation should not alter the contract and give the non-breaching party a contract different from what he had. The plaintiff must prove that he was ready, willing, and able to perform his obligations when they came due. Otherwise, he would be able to take unfair advantage of the defendant by requiring the defendant's performance without showing that he also could and would have performed as required by the contract. A standard requiring proof of ability to perform, rather than a mere pleading to that effect, is essential to serving the interest of equity underlying the remedy of specific performance. Allowing a plaintiff to simply plead a willingness to tender is no substitute for requiring him to produce evidence showing that he was ready, willing, and able to perform his contractual obligations at the relevant time. Whether a plaintiff was ready, willing, and able to perform his contractual obligations when they came due, and would have done so but for the defendant's breach or repudiation is a question of fact. A fact cannot be proved by a controverted pleading. The pleading simply puts the matter at issue. [12] In this case, DiGiuseppe alleged in pleadings that he was ready, willing and able to [fund the purchase of property from Lawler] on March 3, 2000, the date DiGiuseppe says his obligation to do so was triggered. The evidence on the subject was conflicting, and the jury was not asked to resolve the dispute. The dissent would hold that DiGiuseppe's pleading was all he needed, that a plaintiff satisfies the need to establish a relevant fact by alleging the truth of the fact. If allegations were the equivalent of proof, there would be no need for trials. The equivocal and conflicting evidence as to DiGiuseppe's ability to close illustrates one of the problems with the dissent's view. What if the evidence establishes that a plaintiff could not and cannot perform? Under the dissent's theory, such a plaintiff would be awarded specific performance based solely on his pleading even if he, in fact, could not and cannot perform. Without proof that he could perform as required by the contract, the plaintiff gets more than he bargained foran inequitable result. Without proof that he can perform at the time of the award, the award is pointless. By combining the pleading and proof requirements, the dissent would nullify the proof requirement and encourage gamesmanship. A purchaser who lacked funds to close a transaction when called for in a contract could later compel performance by a seller who balked. A seller who is unable to deliver title at the agreed time for closing could later compel performance by a remorseful buyer. If a plaintiff was, in fact, unable to perform at the relevant time, a defendant's breach or repudiation is harmless and equity should not provide a remedy in such a situation. The law does not and should not allow pleading readiness, willingness, and ability to perform to substitute for proof of that fact. The dissent's view is unique. There is no Texas case that has adopted such a rule and we have found none in any other jurisdiction. The dissent's discussion of the Texas cases that have addressed the issue raised by the dissent Burford, Corzelius, Parkway, Chessher, and Hendershot fails to distinguish between pleading tender of performance and proving readiness, willingness, and ability to perform. This distinction is crucial. In each of these cases, pre-suit tender of performance was excused due to a repudiation or breach by the party against whom specific performance was sought. None of the cases hold that the repudiation or breach relieved the party seeking specific performance from the obligation to prove readiness, willingness, and ability to perform. Each of these cases is entirely consistent with the rule that a plaintiff seeking specific performance must plead and prove (1) compliance with the contract including tender of performance unless excused by the defendant's breach or repudiation, and (2) the readiness, willingness, and ability to perform at relevant times. [13] The seminal case of Burford v. Pounders , upon which later cases rely, illustrates the point. 145 Tex. 460, 199 S.W.2d 141, 141-42 (1947). Beaird leased land to Burford, with an option allowing Burford to purchase the property for $ 1000, less the rent paid. Beaird ignored the option to purchase and, five months before the lease expired, sold the property to Pounders, who was aware of Burford's lease. Id. at 142. According to an undisputed finding by the trial court, Burford was not in a position at the time of the sale to Pounders to exercise his option to purchase the property. Id. at 143. Neither Beaird nor Pounders told Burford of the sale. Two months before the lease expired, Burford attempted to exercise his option and tendered $950 to Beaird, which Beaird refused. Id. at 142-43. Burford sued for specific performance and the case was tried to the bench. Because he did not know of the sale, Burford did not make any tender of performance on the option at the time of the sale. However, the lease did not specify when the option was to be exercised and the trial court did not find that Burford had failed to invoke his purchase right within a reasonable time. Id. at 145. The Court in Burford noted with approval the accepted general rules of equity relating to specific performance, stating that a plaintiff ordinarily is entitled to specific performance where he alleges and proves that he ... is ready, able and willing to perform. Id. at 144 (emphasis added). The Court agreed that it was not incumbent on Burford to make a tender in the matter of exercising his option within a reasonable time after learning of the sale, but that it was sufficient for him to offer to do equity in this pleadings.  Id. (emphasis added). The Court then held that since Beaird had repudiated the purchase option by selling to Pounders, a tender to Beaird by Burford was unnecessary. Id. at 145. At no point did the Court hold or suggest that proof by Burford of readiness, willingness, and ability to perform was unnecessary or waived by Beaird's actions. Burford was required to prove that he was ready, willing, and able to exercise his option to purchase, but because the parties had not specified a deadline for exercising the option, Burford was not required to prove his ability to perform at the time of the illicit sale to Pounders. Burford makes two things clear: (1) pleading an offer to perform is in lieu of tender; and (2) adducing proof that a plaintiff was ready, willing, and able to perform, as required by the pertinent authorities constitutes an entirely separate requirement from tender. This distinction is consistent with available authorities on the subject and has been consistently followed by Texas courts. The dissent reads the statements in Burford as confusing, but we do not. Burford was required to prove he was ready, willing, and able to perform, and he did so. The issue in the case was whether Burford would have to show he was ready, willing, and able to perform at the time of the sale to Pounders, or within a reasonable time. The lower courts held that Burford was required to show his capacity to perform at as of the time of the sale to Poundersa point at which it was undisputed Burford was not in a position to perform. This Court held that, because there was no deadline in the lease for the purchase option, Burford could meet his burden by showing the ability and willingness to perform within a reasonable time for exercising his option. Burford made this showing. The dissent also reads Corzelius as confusing and seeks to distinguish its holding by reference to the contractual period for performance in the contract at issue in the case. We view Corzelius as completely consistent with Burford and the other authorities cited above which point out the distinction between tender of performance and proof of ability to perform. The fact that Corzelius needed to show the ability to perform at any point in a contractually agreed time frame does not alter the fact that he needed to show the ability to perform as required by the contract. How such proof could be made rather than whether it must be made was at issue in Corzelius. The Court rejected the claim that Corzelius was obliged to produce binding commitments for financing in order to raise an issue of fact. The Court was careful to note other competent evidence in the record, including evidence showing the value of the property he sought to purchase via a mortgage and testimony from a bank officer and his brother on their willingness to lend money for the purchase, as evidence supporting a finding that Corzelius was in a position to perform per the contract. Corzelius v. Oliver, 148 Tex. 76, 220 S.W.2d 632, 635-36 (1949). The dissent also argues that policy considerations weigh in favor of its view because non-breaching buyers would be put at a disadvantage by having to demonstrate at the time of the lawsuit that they were capable of performing as called for by the contract. However, this overlooks the fact that if the buyer was not able to perform his obligations as required by the contract, the breach by the seller did no harm. From an equitable standpoint, it would be unfair to reward the buyer with a result that he could not have achieved specific performance at a later date based on later acquired capabilitysimply because of a breach by the seller. All of the language relied on by the dissent from Parkway, Chessher, Hendershot, and Regester v. Lang , as suggesting that a pleading alone is sufficient to satisfy part of the plaintiff's burden, refers to tender of performance when the defendant has repudiated. None of the cases stand for the proposition that merely pleading readiness, willingness, and ability to perform is sufficient to obtain an award of specific performance. The dissent's theory merges the concepts of tender of performance and proof of ability to perform. The cases do not. The dissent's view is inconsistent with established case law and would be unique to equity jurisprudence.