As between two persons, where one of them has incurred an obligation and undertaken upon himself to do something for the other, the equity courts look on it as done and as producing the same results as if the obligation or undertaking had been actually performed.
Equity treats a contract to do a thing as if the thing were already done, though only in favour of persons entitled to enforce the contract specifically and not in favour of volunteers.
(b) Application and cases - The working of this maxim can be seen in (i) the doctrine of conversion, (ii) executory contracts, and (iii) the doctrine of part performance.
(i) Doctrine of conversion - The national change in the nature of property whereby realty is considered to be personality and person personality as realty, is known as the doctrine of conversion.
(ii) Executory contracts - (1) Assignment of future property - When an assignment of the property was made for consideration equity treated it as a contract to assign. When the property came into existence in such a contract it was treated as a complete assignment.
When the property has come into existence, equity on the principle of the maxim fastened upon the property and the contract to assign becomes a complete assignment.
(2) Agreement for a transfer - An agreement for a transfer did not by itself create any legal title at Common Law. But equity could not tolerate this unjust position.
It, therefore, conferred an equitable title upon the person having the agreement in his favour. In order that the doctrine may operate with full force, the following conditions must be fulfilled:
1) A contract to transfer a legal title must exist.
2) It should be capable of being proved, either by some acts of part-performance or by writing.
3) It should be capable of specific performance.
4) The suit should be filed within the prescribed time.
5) The title so sought to be acquired must have support at law.
6) The relief must be obtainable in the same court in which the legality of the act is questioned. (The principle contained in this case is not accepted in India, as Indian law does not recognise equitable estates.)
(iii) Doctrine of part performance - The working of the making can also be seen in the doctrine of part-performance. When agreements which could not be relied on in a court of law due to want of writing were brought before equity courts they were specifically enforced where sufficient evidence in regard to part-performance was satisfactorily adduced.
(c) Limitations of the maxim - This maxim does not work in favour of every person. It can help those and only those who hold some equitable right or who have performed some action against those on whom the duty with reference to such right or performance has devolved.
Equity treats a contract to do a thing as if the thing were already done, though only in favour of those entitled to enforce the contract specifically and not in favour of volunteers.
(d) Recognition in India - The principle contained in the maxim has been recognised in Indian law under the following enactments: (1) Section 40 of the Transfer of Property Act. (2) Section 12 of the Specific Relief Act. (3) Section-A of the Transfer of Property Act. (4) Section 91 of the Indian Trusts Act.
The equity recognised under English law is an active one capable of supporting a suit for specific performance or for an injunction to restrain eviction.
In short, the doctrine recognised in India can be used as a shield for protection but cannot be used as a sword to inflict injury.
Insofar as equitable assignments are concerned no equitable estate is recognised in India. A transfer of future property for consideration, however, operates as a contract to be performed in future.
As soon as such property comes into existence, the contract may be specifically enforced.