What is meant by "specific performance" as a remedy?

Specific performance is a legal remedy that requires the party in breach of a contract to fulfill their contractual obligations as originally agreed, rather than merely compensating the other party with monetary damages. This remedy is typically ordered in cases where the subject matter of the contract is unique or where monetary damages would not adequately compensate the injured party for the loss suffered due to the breach. A common example of where specific performance might be applied is in real estate transactions, where the property in question has unique characteristics that cannot be replicated or found elsewhere.

In contrast, the other answers outline different concepts in contract law. Monetary compensation is the standard remedy for breaches in many cases but does not encompass the unique nature of specific performance. Legal penalties for breaching a contract focus on punishments rather than enforcement of contract terms. Negotiation to reduce damages involves discussions to settle an issue amicably but does not inherently require the breaching party to act according to the terms of the contract, which is the essence of specific performance.