Bitcoin does not preclude the use of the legal system or other channels of recourse.
The law doesn't work like code. You don't get to go "Ha! I found a loophole if you read this in the strictest, most literal sense!" You get a human who will read right past your bullshit and nail you to the cross.
Somehow I think courts have dealt with this type of thing in the past.
That could be some years. http://abcnews.go.com/2020/story?id=8101209&page=1
> A 73-year-old Philadelphia lawyer walked out of prison July 10 after serving 14 years for contempt of court -- the longest term ever served for contempt.
> In a divorce proceeding in 1995 H. Beatty Chadwick said that he had lost his fortune of about $2.75 million and so could not make a significant financial settlement with soon-to-be ex-wife Bobbie.
There are plenty of powerful people who get off via such "loopholes", and plenty of powerless who get nailed up even though they are standing on straightforward legal reasoning.
It can, however, apply penalties for not doing what it says.
Now, there's a philosophical sense in which this doesn't force you to actually give back my dog. But you could say that about all court remedies. I recommend just giving back the dog.