What type of performance might one expect if a covenant is breached?

When a covenant is breached, the most suitable remedy often involves the possibility of rescission or specific performance. Rescission refers to the legal cancellation of a contract, which may be warranted when the breach significantly undermines the agreement's purpose, allowing parties to return to their pre-contractual positions. Specific performance, on the other hand, is a remedy that compels the party who breached the covenant to fulfill their obligations as outlined in the contract, rather than simply providing financial compensation. This is particularly relevant in real estate transactions, where unique properties or specific contractual obligations cannot easily be redressed through monetary means.

The choice of rescission or specific performance reflects the equitable nature of these remedies in ensuring that the injured party receives the benefit of their bargain or a fair outcome when a party fails to uphold their side of the agreement. This aligns with the principle that, particularly in real estate, the actual property involved is often unique, making specific performance a desirable remedy over mere financial compensation.