The Argument for Self-Help Specific Performance: Opportunistic Renegotiation of Player Contracts
UVA Law Faculty Affiliations
It is hornbook law that "a promise to render personal service... will not be specifically enforced by an affirmative decree." The adoption of this position by the Restatement of Contracts, for very practical as well as legal reasons, has caused serious problems in the sports arena (pardon the pun). Because player contracts by their nature call for the performance of personal services, clubs are limited in the relief that is available to them if a player refuses to perform pursuant to the terms and conditions of a valid contract. These remedies are, however, of limited effect and may have no impact in controlling certain types of strategic or opportunistic behavior on the player's part. Thus, traditional contract law may be ineffective to monitor and control some inefficient behavior.
In particular, a club is left with few viable options when faced with a threat by a player who refuses to perform under an existing contract unless certain changes (usually financial, resulting in increased compensation for the athlete) are made. The club can refuse to accede to the player's demands and, as a result, lose access to presumably very valuable and unique services. More importantly, because the services of the player are extremely difficult to value and impossible to prove, the club may not be compensated adequately for its loss in the face of the player's blatant breach of contract.' The remedy provided by a negative injunction, which prohibits the player from performing for anyone else, is the club's only effective legal option to enforce its contract. This remedy, however, may not be viable if no other club is bidding for the services of the player. On the other hand, the club can yield to the player's demand and renegotiate the player's contract, notwithstanding that the new contract is substantially without new consideration. This article illustrates that there is a remedial strategy which has been underutilized by clubs in controlling opportunistic behavior by "superstar" players who are in the unique position to breach their contracts at will by exploiting defects in the legal system. The remedy, self-help specific performance, is novel and unfamiliar to many and, even at this introductory stage, requires some brief explanation. In an interesting article, Professor Narasimhan has posited a theory that in certain situations the courts have erroneously enforced what she terms "self-help" specific performance.