CONTRACT LAW NOTES

It is a legal enforceable agreement entered into by two or more different persons with legal capacity. The parties should have
serious intention to create legally binding obligations. Their agreement needs to be within parities contractual capacity.
Furthermore, parties should communicate such intention without vagueness each to the other and being of the same mind to the
subject matter.
Essentials of a contract
a) it should be lawful
b) possible of performance
c) within contractual capacity
d) with the serious intention to contract
e) union of minds of parties consensus ad idem
f) it should not be vague
g) intention of both parties should be communicated
- contract does not necessarily have to be in writing unless there is a specific statutory re!uirement that it
be in writing.
- verbal contract is as e!ually valid as a written one, provided that the party alleging the contract can prove
agreement on certain terms.
- "riting is only important for evidence purposes although its not a re!uirement.
- The presence of an agreement is determined by there being an offer and an acceptance. This is only a
general rule and does not follow that every contract has to be constituted by a clear offer and acceptance.
OFFER AND ACCEPTANCE
Offer
#efinition
statement by a person, called the offeror, indicating his willingness to contract which statement is made in the awareness that it
shall become binding an acceptance by the other person called the offeree.
An offer must meet/have the followin re!uirements
$. It must be consistent with all the essentials of the contract, otherwise it is void.
% .It must clearly define all the terms in which an agreement is sought. Therefore it must not be vague, Levenstein v Levenstein
1955 (3) SA 615 (SR)
& It must be communicated to the offeree. The offeree must have 'nowledge of the offer if his acceptance is to constitute a valid
contract.
(ase law
Bloom v American Swiss Watch Company 191 A! 1"". It was held that there was no offer made to the plaintiff when he
volunteered the information and did not 'now that there was an offer of reward money. )ee also Lee v American Swiss Watch
Company 191 A! 1#1$
1
* It must be made with intention of being accepted. This means serious intention to create legal relations. This embraces
the following+
- it must not be mere social arrangement or offers made in gest which lac's the animus contrahendi. )ee
Bal%o&r v Bal%o&r '1919( )B(#) 5*1$
- It must not be binding in honour or gentlemens agreements i.e. e,cluding the jurisdiction of the courts.
-where the offer) it cannot constitute a legally binding contract. (Rose an+ ,ran- Company v Crompton an+
Brothers Lt+ (19##) (#) )B #61$
- It must not be an offer to negotiate or treat i.e. it must be an offer to enter into a binding contract and not
merely an invitation to do business or receives offers -i.e. tenders). )ee Crawley v Re. 19"9 /S 11"5$
- It may be to one definite person, or to the world. If the offer is made to a definite person or to a number of
definite persons, acceptance should be by that person or those persons only. If it is made to the public
anyone else may accept.
. The offer must not have been revo'ed or lapsed.
n offer is revo'ed if it is withdrawn by the offeror.
The following should be noted+
- /evocation is not effective until the offeree is aware of it.
- n offer can be revo'ed to any stage before it is accepted
- The offeror must ta'e reasonable steps to find and inform the offeree of the revocation
0 "here an offer was accompanied by an option, the latter must not have e,pired. n option is a separate contract to 'eep
the contract open for a specific period. The offer must be accepted within the stipulated period Boy+ v 0el 19## A! 1$
1 The offer may be verbal, written or implied. Thus if a person boards a bus, the owner of a bus impliedly ma'es an offer to
the person to ride in the bus and the passenger accepts the offer by ta'ing bus seat and tending his fare.
(ase law
,er1&son v 2erens-y 19"3 /S 65* /ransvaal S&preme Co&rt where F was an,ious to buy 2s first two farms. F wrote a letter to 2
in the following terms+
3If you still desire to dispose of your two farms, I shall be pleased to have your price and terms4.
2 replied and said+
3I have no objection to sell the two farms in !uestion and as there are coals on the farm and a railway line I will be passing
near them, I as' &5 shilling per acre4.
In that letter on the referred F to his lawyer with reference to the terms of the contract. "hen F sued 2 saying that the latter had
sold the farms to him, the (ourt held that 2s reply to Fs letter did not constitute a firm offer from which he could not withdraw and
which F was entitled to accept 2s lawyer had written to F declining the offer made by the plaintiff and at the same time ma'ing new
proposals. 6n behalf of the defendant 2 which the plaintiff had refused to accept.
2
W"AT CONST#T$TES AN OFFER
There is a distinction between a firm offer and invitation to treat or negotiation. firm offer is the one which is unconditional and
un!ualified, it states all the terms and the material facts on which the offer is based. It must become a contract upon an acceptance
of the offer as it stands. Thus a 3come lets negotiate4 is not a firm offer if a shop displays an item for sale at 7 dollars can we say
that is a firm offer8 In the case of Crawley v Re. 19"9 /S 11"5 state that the complainant, a shop 'eeper had advertised a sale of a
particular brand of tobacco at a very cheap price in order that he might attract the custom of a large number of the public. 9e put a
placard outside his shop on which the price was shown, the ppellant entered the shop, bought the tobacco and went away. fter
some minutes he came bac' again as'ed for another pound of the same tobacco, unfortunately the complainant declined to serve
the ppellant with the tobacco and told him to leave his shop, the ppellant refused to leave the shop whereupon he was arrested for
trespass. The ppellant had argued that he had a contract of sale with the complainant but the court thought otherwise and held that
there was no contract between the parties. It emphasi:ed that the mere fact that a tradesman advertises the price of the goods he
sells does not mean offer to any member of the public. It does not mean the right to enter the shop and purchase at the displayed
price. The court also held in the case that+ contract is not constituted when any member of the public comes in and tenders the
price mentioned in the advertisement. In summary therefore display of goods at a certain price is not a firm offer but only an
invitation to treat. 6n the contrary, it is the customer who ma'es the firm offer by presenting goods at the till and when the shop
owner accepts the offer to buy, a contract then comes into being.
(ase
)ee further Lee v American Swiss Watch Company 191 A! 1# !ietrichsen v !ietrichsen 1911 /3! 46$
;. To whom may an offer be made<addressed8
- n offer maybe addressed to a particular person, to a group of persons or to the world at large depending
on its terms.
TER%#NAT#ON OF AN OFFER
Firstly an offer can be terminated by rejection by the offeree. It can lapse on the e,piration of fi,ed period within which it was meant
to be accepted. If there is no such fi,ed period within which an offer should be accepted an offer lapse after the e,piry of some
-reasonable time).
What constitutes a reasona&le time 'e(en's on the facts an' circumstances of each case
n offer can also be terminated by revocation but this presupposes<presumes that the offer is an ordinary revocable offer as opposed
to an option.
- n 6=TI6> is an offer coupled with a stipulated period of time during which the offeror is not free to revo'e
it.
- "hen an option ma'e an offer to ? and gives a stipulated time within which he must accept to it also is
not allowed to ma'e the same offer to ( within the same.
- Thus in an option there will be two contracts<conditions to be observed i.e. that of time and that of not
having made the same offer to another third party.
3
- n ordinary revocable offer can simply be terminated by the offer by revocation but before it has been
accepted the revocation must be communicated with the offeree.
@astly an offer is also terminated by death of the offeror.
Who can acce(t an offer)
s far as ordinary revocable offers are concerned the general rule is that, 3an offer made by may be accepted by ( or #4.
(ase
Blew v Sno.ell 1931 /3! ##6
?lew wrote to /ichard (urle @td offering to buy a certain piece of land of a certain piece. The land was owned by /ichard (urle @td
but by )no,ell who indicated to /ichard (urle in writing that he accepted the offer. /ichard (urle @td thereupon notified ?lew that
the owner of the land had accepted his offer. "hen )now,ell later sued ?lew for damages for alleged breach of contract ?lew
e,cepted to the summons on the ground that there was no valid agreement between him and )no,ell. The court held that, 3>ow it is
trite law -i.e. simple legal principle), and an offer made by one person to another can not be accepted by a third party for the simple
reason that there was no intention on the part of the one person to contract with the other.
"hatever the subject matter of the contract maybe+
AThe (ourt held further that it was perfectly clear and the offer was made to /ichard (urle @td and that the plaintiff purported to have
accepted that offer but there was nothing to show any acceptance by /ichard (urle @td. That being the case, there was no contract
on which the plaintiff was entitled to come to court as the offer was never made to him.
(ase
5ersh v 0el 194(3) SA 646(A) where >el owned two farms and he gave 2r "est an option to purchase the two farms and the
together with another person ceded the option to 9ersh who then accepted >els offer before its e,piry. "hen 9ersh accepted the
offer >el refused to sell the farms. "hen sued, the rule made in the case of ?lue v )no,ell was applied i.e. an offer made by to ?
may not be accepted by (.
- The court however distinguished an option made in a case sale. The sale of the two farms was on a cash
transaction thus in accordance with the principles outlined above the court ruled and the cession to 9ersh
was valid and his accepted gave him a contract with >el.
cceptance+
- The acceptance of an offer must result in a binding contract and not further negotiations. n acceptance
must be unconditional<une!uivocal and clear.
- counter offer is not a valid acceptance
- counter offer is where the offeree instead of unconditionally accepting the offer ma'es his or her own offer
to the offferor.
- This happens in a case where offers to sale a thing to ? at a price of B. 555 then ? in response to that
offer from tells that he is prepared to buy that thing for B* 555. ?s conduct in such a situation
constitutes<is what is called counterAoffering.
4
- counter offer may also be in the form of e,traneous conditions attached to the acceptance.
- The effect of a counter offer is to terminate the original offer. If the offerees acceptance is also shrouded in
ambiguity<vague it does not constitute an acception.
(ase+
Boerne v 5arris 199(1) SA *93(A)
In which the ppellant was the lessee at premises owned and leased by the respondent. The contract lease agreement contained
an option under which the appellant could renew the lease agreement for a longer period of . years, the period was to be recognised
from $. pril $C*1 and the option was to be e,ercised by 6ctober $. $C*0. 6n 6ctober . $C*0 the lessees attorneys<lawyers
addressed a letter to the lessor in the following terms, 3"e refer to the lease in respect of the 9otel D and have to advise you that
our client intends to renew the lease for a further period of . years from $. 6ctober $C*0 in terms therefore acceptance of the court
held that the purported option was ambiguous in that it was not in accordance with the terms of the option and because of that the
e,ercising of the option was held to be invalid.
(ase
Water 2ayer v 2&rry 1911 (A!) 61
"ater 2ayer owned the farm which 2urry wished to buy. 2urry wrote a letter to "ater 2ayer offering to buy his farm for $ 155
pounds. "ater 2ayer wrote bac' and said, I accept the offer to sell the farm at $ 155 provided you pay all the e,penses and $ 555
pounds is paid at the time of signing the agreement. 2urry wrote bac' and said, 3Fine, but the price is not payable at the time of
signing D "ater 2ayer wrote bac' and said he was no longer interested in selling the farm. "hen 2urry sued "ater 2ayer the
court ruled that 2urry had no case because he had made counter offer therefore no contract had been concluded between the
parties.
- It must be underscored however that a re!uest for modification of terms is not a counter offer and it does
not destroy<terminate the original offer.
- s a general rule a contract is concluded when and where communication of acceptance reaches the mind
of the offeror -however, there are e,ceptions to this general rule). Thus if the offer is communicated to the
offeree by telephone in a situation where the offeree is in 9arare and the offeree is in (ape Town the
contract would be deemed to have been conducted in (ape Town.
- This general rule is subject to change by the parties to the contract i.e. they may agree otherwise the
offeror may decide to do away with the need to communicate acceptance. The offeror may also prescribe a
particular mode of acceptance e.g. the offerer may say if you wish to accept the offer send it by registered
post< through email or at such and such an office.
(ase
R v 0el 19#1 A! 339
In this case the /espondent >el had licence to sell li!uor in Transvaal. 9e received an order form rmstrong who was resident in
(ape Town the order was delivered to >el in the Transvaal -is the written order) and the bottles of li!uor were then allocated to the
purchaser in (ape Town. >el was prosecuted for selling li!uor in (ape Town without licence as it was necessary for court to ma'e a
finding as to when and where the contract of sale had been concluded. The offeror was in the (ape and the offeree in the
Transvaal.
5
The nature of the transaction was that the offeror had dispensed with the need for communication of acceptance and the court
concluded that the sale agreement<contract had been sealed in the Transvaal, the moment >el decided to sell the li!uor and he was
not guilty.
(ase
2c)en6ie v ,armers Coop 2eat 7n+&stries Lt+ 19## A! 16
2cEen:ie applied for shares in the cooperative company the application form read in part, 3I agree to accept the above number of
shares or any lesser number and may be allotted to me4. 2cEen:ie was ma'ing the offer to buy the shares and concurrently
dispensed with the need for communication of acceptance in that he had e,pressed the intention that the cooperative should on
receiving his application forthwith proceed to allot shares to him. contract would come into e,istence as soon as the share transfer
secretaries sing a share certificate giving 2cEen:ie any number of shares.
The leading case on the F,pectation theory is that of+
Cape 8.plosive Wor-s v SA 9il : ,at 7n+&stry 19#1() C3! # where the first defendant wrote a letter on the $5
th
of Guly $C$0 and
sent it by post from #elmore in Transvaal to the plaintiff in )ommerset in (ape Town. The letter contained an offer to
sell certain !uantities of glycerine oil. 6n the $*
th
of Guly $C$0 the plaintiff replied accepting the offer. Then on $$
)eptember $C$0 the second defendant of #urban sent a letter by post to the plaintiff in (ape Town containing another
offer to sell a certain !uantity of glycerine oil. The letter of acceptance was the posted on $0 )eptember by the plaintiffs
in (ape Town. In an action of the DD the defendants too' e,ception to the jurisdiction of the court on the ground that
they were not entered into in the (ape but in the Transvaal and >atal respectively where the defendants had received
the letters of acceptance. This argument did not find favour with the court which held that the contracts had been
concluded in (ape Town where the letters of acceptance had been posted.
- "hen the offeror ma'es the offer by post the immediate inference is that acceptance can also be by post so
it is open to the offeror to indicate that he will not consider himself bound unless and until he receives the
letter of acceptance.
- If the offeror does not ma'e this special provision the e,pedition theory will be applied without any
e,ception. The basis of the rule is that by using the post first the offeror by implication authorises the
offeree to use the same method of communication.
(ase
Smeiman v ;ol-ers6 195() SA 1*"
The pplicant and the respondent made an option to sell some shares to the applicant. The option was verbal and it was to remain
open till $. February $C.*. 6n the $.
th
of February a lawyer acting for the applicant phoned the respondents office in the (ape only
to be told that the respondent was not in the (ape but somewhere in 6F).
- pplicants lawyer then !uic'ly wrote a letter e,ercising the option on behalf of the applicant. copy of the
letter was sent to respondents (ape Town office and another to where the respondent was thought to be.
- ?oth copies were posted on the $.
th
of February but neither reached the respondent on the date. If the
e,pedition theory is applied then the option had been e,ercised timeously but if it did not apply, then it was
not e,ercised on time because it had lapsed. The !uestion was, 39ad the respondent impliedly authori:ed
the use of the post84 @oo'ing at the facts and what was the appropriate method of replying8 The court held
6
that the mere fact that parties reside at a distance does not per se warrant the use of post, the e,pedition
theory therefore did not apply.
- ?y using the post one of the ris's the offeror assumes is precisely that the offeree had an option of using a
more e,peditious means of communication in respecting the offer.
- )imilarly, a faster means of communication would neutrali:e a posted acceptance.
(ase
A to < Ba6aars (3vt) Lt+ v 2inistry o% A1ric&lt&re19*5(3) SA 64
A The offer contained in a notice of e,propriation in terms of )ection % of the F,propriation ct -)) re!uires the offeree to
signify his acceptance or rejection of the offer of compensation. In accordance with the provision of )ection 0-$)of the ct.
A This )ection provided that the owner of the property in !uestion should deliver or cause to be delivered a statement
indicating whether or not he was accepting. (ourt interpreted this )ection to mean that the owner was re!uired to
physically deliver to the 2inistry concerned a written acceptance for a contract to come into e,istence.
A There was accordingly no room for the applicant of the e,pedition theory.
Gansen G said, ?ut even under the law the !uestion whether the alleged agreement has been conducted by posting must
depend upon particular circumstance of each case. The F,pedition Theory does not hold without e,ceptions.
- It is important therefore to establish the precise limits of the application of the F,pedition Theory.
- Thus the judge emphasi:ed that it is not clear that all whether the F,pedition Theory, mainly condemned for
the protection of the offeree, should necessarily produce the possibility of a neutrali:ation of the posted
acceptance before it is received by the offeror.
%#STATE AND *$AS#+%$T$AL ASSENT
><? First there must be offer and acceptance -i.e. in the formulation of a contract).
AThe second re!uirement that ought to be present is that of agreement of which can either be actual apparent. s regards actual
agreement there has to be a meeting of minds of the parties involved in a coincidence of wills. This is referred to as a consens&s a+
i+em on the subjective theory.
A"hat it means is that if the terms of the contract are different as 'nown by and ? then there is no contract.
(ase
=or+an v /rollip (196") (1) 35 4#5
AIn a /obert G reiterated "essels train<trial of thought that in order to determine the e,istence<otherwise of a contract. It is the
manifestation of the parties wills and not the une,pressed will which is of importance.
AThis point was further emphasi:ed in the case of Gones v nglo frican )hipping (ompany $C&0 -$C1%) ) H%1 of H&*, where the
court held that, 3In the interpretation of a contract the general rule is that the court should determine what the true intention of the
parties was.
As regards apparent agreement it has come to be accepted that a contract can also come into e,istence in the absence of actual
agreement. If one of the parties conducts himself in a manner that ma'e the other party believe that he is agreeing to a proposed
term of contract. This is referred to as ;uasi 2utual ssent or the objective theory of contract.
7
AThe doctrine of ;uasi 2utual ssent was clearly articulated in the case of )mith v 9ughes -$H1$) 0;? .C1 of 051 where ?lac'burn
G had this to say, 3If whatever a mans real intention maybe he so conducts himself and reasonable men would believe that he was
assenting to the terms proposed by the other parties terms4.
AThis is sometimes referred to as greement by conduct.
AThe following relevant factors must be ta'en into consideration when dealing with matters relating to ;uasi 2utual ssent+
-a) has instead of ? into believing that he is prepared to contract on terms a, b, c if the answer is no then the court
should consider the following !uestion
-b) "as ?s belief reasonable8 If the answer is Ies then there is a contract as understood by ? on the basis of ;uasi
2utual ssent.
A(ourts have often as'ed this !uestion, 3Is there any difference between ;uasi 2utual ssent and Fstoppel8
A?efore addressing the !uestion it is imperative to define what estoppel is.
AFstoppel is a general principle of law whereby, if a person either negligently or fraudulently misrepresents facts and another relies
on the misrepresentation to his detriment the person ma'ing the misrepresentation is prevented from ascertaining and providing that
the true state of affairs is different.
AFor a person to establish estoppel he has to prove the following four factors+
-i) That there was a misrepresentation -i.e. either negligent<fraudulently).
-ii) That there was fault on the party of the representor either in the form of negligence.
-iii) That the other party relied on the misrepresentation.
-iv) That there was detriment which was caused by a reliance upon such misrepresentation.
Differences &etween Esto((el an' *uasi %utual
$. Fstoppel can only be relied upon as a defence and not a cause of action whereas !uasi mutual assent can found a cause
of action
%. ;uasi mutual assent does not re!uire fault, fraud and detriment to found a claim. Instead there should only by
misrepresentation and a reliance on misrepresentation which reliance need not be detrimental.
(ase
Spes>ona Ban- Lt+ v 3ortals Water Lt+ SA3!? Lt+ (1943)19*4
>? >ot only does the courts confine themselves to the four corners of the contract but at times they go further in loo'ing at the
particular conduct of the parties as they<at the time they entered into the contract -i.e. objective approach of which may include either
representation by one party)
>? Freedom of contracting i.e. within the confines of the law.
&. Anim&s contrahen+@ it refers to the intention to create legally binding obligations when an offer is accepted.
AIt is the yardstic' -i.e. () that usually distinguishes a contract from social agreement. It is important to note that our courts have
derived agreements into two categories in order to ascertain legal effects, these are commercial transactions and social
arrangement.
)ocial arrangements+ It is true that social arrangements are not meant to be legally binding unless there are special arrangements
which allows for that.
8
(ase
Bal%o&r v Bal%o&r
The plaintiff was the wife of the defendant. The defendant was employed in (eylon. "hen the plaintiff went there she decided that
she did not want the weather there and opted to stay in Fngland instead. The defendant offered to pay her $55 pounds as
maintenance periodically. The defendant then flouted the promise and plaintiff sued him for maintenance on the basis of the
arrangement they had made. The courts dismissed the claim on the ground that by holding that this was a social arrangement which
did not create an intention to be legally bound.
(ase
=ones v 3a+a>aton 1969 # ALL 8R 166
(ommercial transactions+ these are presumed to create legally binding obligations. 9owever, some commercial transactions can
specifically e,clude anim&s contrahen+ by what are called 3honorp clauses4.
n honor clause specifies that an agreement is only supposed to be binding in honor and not give rise to any legally enforceable
obligation. This position was confirmed in the case of 8lectronic B&il+in1 8lements v 5&an1 (199#) # SA 34 o% 34* where @evy G
held that 3if the parties choose to e,clude from legal enforceability any arrangements arrived at between them, it can then become no
more that a moral obligation or an obligation of honor but unforceable in court of law.
Rose an+ ,ran- Co v =R Crompton an+ Brothers Lt+ an+ Anor 19#3 # )B #61
=ossibility to person+ n agreement cannot be deemed to be a contract if the performance of the obligation is impossible . This
position was captured in the case of+ =eters, Flamman and (o v Eo'stad 2unicipalities where the court held that by the civil law a
contract is void if at the time of its inspection its performance was impossible. This rule<principle is however subject to the following
!ualifications.
a) The impossibility must be absolute as opposed to probable.
b) The impossibility must be absolute as opposed to relative
c) The impossibility must not be fault of one of the parties to the contract
>? =arties should not agree upon anything unlawful nor outside human capabilities
,- Contractual Ca(acit.
For an agreement to valid the parties to a contract must be legally entitled to enter into such agreements. In Jimbabwe the law has
divided persons into artificial persons and natural persons.
rtificial persons+ this refers to companies and private business organisation and sometimes state cooperatives.
(ompanies for a companies to enter into an agreement it must be represented by a natural person who is empowered by its
rticles of ssociation to enter into contracts on behalf of the company.
lso the contract itself must fall within the parameters of the memorandum of ssociation.
>? Thus if contracting with any company one should chec' on the above two re!uirement otherwise the contract would be deemed
and void.
9
=artnership
s regards a partnership the capacity to contract is found in the partnership deep. 9owever, it is generally accepted that any partner
can enter into a contract on behalf of the partnership if the contract furthers the interests of the partnership.
>atural =ersons
In Jimbabwe the legal age of majority is $H years and any person who has reached that age can enter into a binding contract. The
following people are dis!ualified from contracting+
a) 2anors+ this refers to people who have not reached the age of legal majority and are not tacitly emancipated.
b) minor does not have contractual capacity at all unless he is assisted by guardian. The reason for this was
established in the case of 8+elstern v 8+elstern (195#) 35A1 at 111 where the court held that 3In /oman #utch law
the judgment of a minor is considered immature turnAout his minority and he is conse!uently not bound by his
contract4 s a general rule children below the age of 1 do not have contractual capacity at all this means that the only
contract that can bind them is that which was made by his guardian on his behalf.
It is important to note that if a minor entered into a contract with a major unassisted by his guardian such a contract is called a
@imping contract i.e. The minor will not be bound by the terms therefore but the major will be bound.
This position was well captured in the Fdelstern case at p$&f where the court held that Koet e,plains that in all contracts in which
mutual obligations are assumed the guardians assistance is necessary, failing with the contract limps. The other party to the
contract is bound by it. If that appears to be in the interest of the minor the minor on the other hand is not bound by the contract but
may resile from it.
If the minor wishes to enforce the contract he will have to perform his understanding. This seems self evident. For he will either sue,
assisted by his guardian or when he has attained his majority either of which will imply ratification of the contract.
>? 9owever there are circumstances in which a minor can be bound by a contract which he enters without the assistance of
the guardian. The minor that can be bound are follows+
a) Tacitly emancipated minor i.e. refers to one that is either living apart from his parents or living with them but paying for
their up'eep. (arrying out his own trade or generating his own account.
b) The 2arriages ct provides that when a minor gets married she can be allowed to enter into binding contracts without
the assistance of the guardian. In this respect such a minor can be referred to as a tacitly emancipated minor see
case+ #ic'ens v #aley -$C.0) % )$$.
c) 2arriage on its own confers majority on a woman
d) Tacit emancipation is usually relied upon for children between the ages of $* and $H and marriage as for girls is
recognised at law as from the age of $0 years.
e) minor can be bound if at the time of contracting he misrepresents his age to the other party or misrepresents his
age to the other party misrepresents that he has<had been given the guardians consent when in assence he has not
been given such.
,o&che v Battenha&sen an+ Company (1939) C3! ##4
minor can be bound if he is unjustly enriched unjust enrichment. In this regard occurs when a minor unduly benefits from a
contract with major. 9ere he is obliged to restore the things that he has benefited.
9owever in a bid to protect minors the courts have restricted the e,tent to which the minor should restore the things that he has
benefited.
10
It is true that a minor can only restore the things that are in his possession at the time when the suit of unjust enrichment is instituted.
This position was understood in the Fdelstern case where the court held that 3the other e,ception is that a minor is under an
obligation<is obliged to ma'e restitution to the other party to the e,tent to which he has been enriched. 9owever the minor is not
obliged to restore whatever he has received pursuant to the contract but only so much as still remains in his possession at the time
of the action or the surrogates of such residue.
a) "hen he ratifies the contract upon majority<when his guardian ratifies the contract and the minor entered into the effect of
such a ratification is to render the contract valid and effective from the time of the purported agreement.
St&tta%or+ an+ Company v 9>erhol6er 19#1 C3! 455
>? The building effect is ratification will have a retrospective effect that is from the time the minor entered into a contract.
In Jimbabwe boys under the age of $0 years should get approval from the 2inister responsible for marriages for his marriage to be
regarded as a valid marriage.
2arried women
b) Their capacity depends on the type of marriage that they enter into. There are basically two types of marriages namely+
-i) 2arriage in community of property+ here the husband and the wife own the property jointly and is referred to as a joint
estate. The husband is the administrator of the marriage estate and he can enter into any contract in respect of that estate without
the consent of the wife but the wife cannot enter into a contract in respect of that particular estate without the consent of the
husband, the only e,ception is when the wife enters contracts in respect of necessacive and -i.e. day to day basic necessities e.g.
food.
mendment >o.$1 of the dministration of Fstate cts come with the ruling in 2agaya v 2agaya of which did away with the concept
of perpetual minority of the women.
-ii) 2arriages out of community of property+ under this institution the husband and the wife own the property separately and
the wife can enter into any contract without the consent of the husband.
In 9 v 9 it was held that a husband can not at law rape his wife. In Jimbabwe marriages are presumed to be out of community of
property unless parties enter into an nteAnuptial contract.
9owever, there has been a !uestion of whether or not customary marriage are in<out of community of property. This issue was
however addressed in the case of+
=ena v 0yem>a 1996(1) <LR 134 where the court held that, even though the very nature of a customary marriage reveals that it is in
community of property, the promulgation or enactment of the @egal ge of 2ajority ct -i.e. @2) conferred majority status on
women that are married customarily.
"hat this means is that such women enter into a valid contract without the consent<assistance of the husband.
c) Insane =ersons
)ometimes referred to as imbeciles. The general rule is that any party who suffers from a mental illness or incapacity at the time of
contracting has no contractual capacity at all. This position was captured in the case of Lan1e v Lan1e (195) A! 33 o% 31 where
the court held that, 3It is clear of course, that if, owing to a mental disease, a contracting party does not understand or appreciate the
11
nature of the matter the contract will be void of the in!uiry of the court usually ma'es in case of insanity was crystalised in the case
of+ 3 v Warne 19## A! 41 at 44 where the court held that, 3 court of law that is called upon to decide a !uestion of contractual
liability depending upon mental capacity must determine whether the person concerned was or was not at the time of managing the
particular affairs in !uestion is whether his mind was such that he could understand and appreciate the transaction into which he
purported to enter.4
d) Into,icated =ersons
s a general rule an into,icated person lac's contractual capacity. s with insanity, the !uestion is whether the party in !uestion
was so into,icated as to be unable to reach consensus and not merely whether his judgment was affected. (ase 8ssa-ow v
Aal>raith 19*" 93! 53$
e) Insolvents
n insolvent is a debtor whose estate is subject to a se!uestration order owing to his inability to pay debts. s a general rule
insolvents can only contract through their trustees.
f) =rodigals
prodigal is a person who is declared by the court to be incapable of managing his affairs as a result of a propensity to s!uander his
property e.g. a spendAthriff is not allowed at law to enter into a contract in respect of his property without the assistance of a curator.
/- CERTA#NT0
For a contract to be valid it must be certain and where it lac's certainty such a contract is referred to as a contract void for
vagueness and it does not constitute a contract at all. "hen parties enter into a contract there must be sufficient content for the
court to enforce a particular contract.
"here detail<content is lac'ing such a contract can be deemed void for vagueness. The re!uirement of certainty is reflected in the
rule of offer and acceptance must result in certain terms. Lncertainty may rise in a number of different ways. It is often e,tremely
difficult to establish whether or not the uncertainty is such as to vitiate the transaction.
t the end of the day each case depends on its own facts.
In Levenstein v Levenstein 1955(3) SA 615 where in an answer to the plaintiffs claim for an ejectment order the defendant pleaded
that, 3In or about pril $C*0 a verbal agreement was concluded that )alisbury between plaintiff and defendant in terms of which the
plaintiff undertoo', in consideration of<for the understanding by the defendant hereinafter mentioned to giveM and transfer to the
defendant the said number C11 and the said business. The defendant in turn understood to maintain the plaintiff to the best of his
ability during the remainder of her life, and further undertoo' to maintain and educate, 3D till such a time as she was capable of
maintaining herself.4 The plaintiff e,cepted to this plea on the grounds that the agreement was void for vagueness and was
unenforceable. The word business was ambiguous and the words to maintain the plaintiff to the best of his ability were uncertain to
be capable of precise definition. In the same case, it divided contracts void for vagueness into four categories+
-i) (ontracts and are incomplete + 6n such cases the soAcalled contract is not enforceable e.g. In )in1 v 3ot1ieter 95"(3)
SA * where the plaintiff sued the defendant on a deed of sale. #efendant admitted having signed it but contended
that it was void for vagueness. /eason for this was illustrated in clause % of the agreement which provided that, The
purchase price is % 1.5 pounds payable by the purchaser to the seller as followsM $$,*. pounds per month as from D
12
as from D as and from the $
st
day of DDDD. the purchaser should be liable for interest at the rate of .N. gain
clause & of the same agreement read 3D =ossession of the property shall be given to the purchaser on D4. The
plaintiff argued that in reading these clauses the court has to consider the element of reasonableness i.e. the interest
should be payable within a reasonable time, the court dismissed this agreement and ruled in favour of the defendant
because it was not clear from what date instalments were payable where the interest was due to be calculated and
when the purchaser was to be given vacant possession. s a result the court deemed the agreement to be void for
vagueness.
(ontrast with Bl&n+ell v Bloom 195" # SA 6#9 it was involved with a contract of sale which had many blan' spaces e.g.
provided, 3I agree to pay the sum of DD., as deposit immediately on signing the agreement.4 "hen the plaintiff sud the defendant
argued that the contract was void for vagueness because it was incomplete but the court however thought otherwise and held that
the deposit was a term which could be waived by the seller as long as the purchase price was agreed.
It was well established that an agreement which is incomplete because the party or parties did not reach an agreement<consensus
on an essential<material aspect for vagueness and incapable of being enforced.
Schnei+er an+ Lon+on Lt+ v Bennett 19#* /3! 36 where the /espondent had been employed by the ppellant as the manager of
their timber company. They agreed on a monthly salary of *C pounds and a small commission to be agreed between the parties but
never agreed on the !uantum of the commission. "hen ?ennett was dismissed, he sued for the commission arguing that he was
entitled to a fifth of the turnover of the company because this was reasonable. The court however rejected his argument and held
that the phrase 3small commission was not sufficient to give rise to a contract in ?ennetts situation. There was of cause an
agreement but the court was not in a position to enforce the agreement.
(ontracts which give unlimited discretion to the persons bound thereby e.g. Sca&rnel v 9stern 191 AC #5* where the /espondent
bought a van from the ppellant. deposit was paid and the outstanding balance was to be paid over a period of % years.
(ourt held that the time period for payment of the outstanding amount was unnecessary long and the contract was therefore void for
vagueness.
In )antor v )nator 196#(3) SA #"# ?efore the plaintiff and the defendant got married and they entered into an nte nuptial
contract. The husband made an underta'ing to buy his wife all such furniture, linen and domestic effects as may then or thereafter
ac!uire at such time or such !uantity D Lpon marriage the husband failed to fulfill this and the wife brought a legal action against
him. (ourt held that the husband was not bound to do anything because there was unlimited discretion.
(ourts have devised the *
th
class of cases where the unspecified details of the contract are !uestions of fact which are capable of
determination by evidence.
An1ath v 2&nc-&nlal 8state 195 () SA 695 where the plaintiff was the #efendants nephew. #efendant had invited plaintiff to
assist in his shop and plaintiff was supposed to be paid something sometime. This meant that there was no agreement on plaintiffs
salary. 9owever the defendant died before paying the plaintiffs anything and plaintiff sued #efendants estate. The court held that
the plaintiff was to be awarded what the court considered as reasonable remuneration for his services..
(ontrast with 8llite 8lectrical Contractors v /he Covee+ Wa1on Resta&rant 19*5(1) SA where the /espondent had hired the
service of the ppellant. =arties had not agreed on a particular price and when the /espondent received a bill from the ppellant he
ignored it. The ppellant then sued for payment. (ourt held that although there was no agreement on the price there was an
13
implied agreement to pay a reasonable amount of money for the wor' done. The court was to rely on the reasonable element to give
content to the contract. (ourt also loo'ed for characteristic evidence in determining the price that was payable.
It is clear from the above cases that when courts are faced with contracts that are purportedly void for vagueness they have a
tendency of leaning towards enforcing a contract rather than stri'ing it down. This is in a bid to try it down. This is in a bid to try as
much as possible to preserve, sanctity of contract.
"hilst this approach is commendable it can be argued that the )upreme (ourt stretched it too far in the case of La>in an+ Anor v
Associate+ 3ac-in1 Company 1996(1) <LR where the third /espondent owned shares in the first and %
nd
/espondents companies
which he sold to the ppellant. The parties started negotiating and finally made a draft agreement which stated that it was subject to
the signature of both parties. They agreed on the price and method of payment. It was stated that the money had to be paid in a
way that was ta, advantageous to the seller. It was then left to the accountant to do his wor'. The document was sent to the third
/espondent for his signature who then refused to sign it and the contract could not go further. The 9igh (ourt was not vague at all
even the parties had not agreed on an amount that was ta, advantageous to the seller.
1- LE2AL#T0
For an agreement to be binding it should comply with the law. 9owever there were instances when a contract violates the law. )uch
a contract is deemed to be illegal and unenforceable. Illegality comes in two forms+
-i) statutory illegality
-ii) common law illegality
)tatutory illegality+ 6ccurs when an agreement contravenes a piece of legislation either in the form of a statute or statutory regulation
or byAlaw. )uch a contract is null and void.
This position was underscored in the case of Schlerhant v 2inister o% =&stice 196 A! 99 at 1"9 where the court that 3It is a
fundamental principle of our law that a thing done contrary to the direct prohibition of the law is void and of no effect4 (ontracts that
are illegal by virtue of an e,press statutory provision pose no problems because one simply has to read the statute and apply it to the
facts of the alleged contract, no important legal issues arises where illegality arise from statute.
)ee case 3atel v Si1a&-e an+ Anor 5C 55B55B199
"il'en v Eohler $C$& # $&.$ it was important to note that where a contract contravenes a statutory enactment which does not
e,pressly declare the contract void, the intention of the legislature must be asserted.
9owever, instances do occur when parties -conscious of the statutory prohibition) draft their contract in such a way as to circumvent
the statutory provision. )uch contracts will be held to be illegal.
<im>a>we Care v Arain 2ar-etin1 Boar+ SCB#1B9#$
In addressing the courts approach to these contracts of the case of
!a+oo v )r&1ers+orp 2&nicipality Co&ncil (19#") A! 53" at 53B4, (ourt adopted a three pronged approach+
-i) The court must interpret the statute in the ordinary way not during violence to it to the e,tent its meaning to cover its
supposed intention.
14
-ii) The courts must then determine whether or not the contract in !uestion falls within the armpit of the statute.
-iii) If it falls within then ca+it C&eastio Oend of storyP
-iv) Then if it falls without the armpit of the statute, then out the court should proceed to in!uire whether or not the said
contract has been craftly designed to circumvent statute.
t page *1 of the #adoo decision the court held as follows+
3n e,amination of the authorities therefore leads me to the conclusion that a transaction %ra&+em le1is. Oi.e. illegal by virtue of
contravening a statute or legislationP where it is designed to escape the provisions of the law but falls in truth within these provisions.
Thus the rule is merely a branch of the fundamental doctrine of the law regards, the substance rather than the form of things.4
CO%%ON LAW #LLE2AL#T0
This refers to contracts that are contrary to public policy<common law<good morals. c!uilius O/oman #utch )chdarP defines public
policy as+
36ne stipulating performance which is not pose illegal or immoral but which the courts, on the grounds of e,pedience, will not enforce
because performance will detrimentally affect the interests of the community.4
Qenerally a contract is said to be contrary to public policy if it is clearly detrimental to the interests of the community and runs counter
to social economic e,pedience. The position was underscored in the case of Sas%in (3ty) Lt+ v Be&-es 1949(1) SA(1)(A), where the
court held that+
3greements which are clearly detrimental to interests of the community whether they are contrary to law or run counter to social or
economic e,pedience will accordingly on the grounds of public policy not be enforced. >o court should therefore shrin' from the
duty of declaring the contract contrary to public policy. If it is clearly detrimental to the interests of the community<is contrary to law
or morality<runs counter social or economic e,pedience is plainly improper and unconscionable and unduly harsh and oppressive,.
It is important to note that the -iv) fourth criteria is not sharply defined especially when it is remembered that public policy is a
!uestion of fact and not a !uestion of law and it always changes with the general sense of the justice of the community or the ban
mores manifested in public opinion.
=rofessor (hristie convincingly argues that a distinction must always be drawn between superficial public opinion which can swing
li'e a weather and seriously considered public opinion on the general sense of justice and good morals of the community. It is the
later and not the former to which the courts should direct their attention and this limitation coupled with criteria -i) and -iii) above
maintains the stability of the law of contract by ensuring that contracts are not at the mercy of jic'le public opinion. "ords li'e clearly
detrimental to the interests of the community4 and 3runs counter to social<economic e,pedience4 must be relied on sparingly and only
in the clearest of cases.
>? t the end of the day what determines the public policy of the day is the philosophical outloo' of judges presiding over the
matter and this overstretches the position<power of the judges.
The following contracts have come to be accepted contrary to public policy.
a) (ontracts tendering to injure the public service
15
/omanA#utch law did not permit any contract in the nature of a bribe to a public official or which bound him of corruption and intri!ue
or which corruptly secured a promise of advancement, employment, office or any other advantage the main difficulty with a corrupt
contract with a public official is that he underta'es to e,ercise the discretion vested in him not in accordance with his public mandate
but for an obli!ue motive such as personal gain or a sense of obligation to a suitor, such contracts are void and unenforceable.
b) (ontracts injurious to the administration of justice e,amples are as follows+
-i) ousting of the jurisdiction of the courts. =arties to a contract are neither allowed to deprive the courts of their normal
jurisdiction nor confer the jurisdiction up on a court which that court does not possess. In terms of either common
law<statute this position was emphasi:ed in the following cases.
Schierhart v 2inister o% =&stice 19#5 A! 1 at # where the court held 3If the terms of an agreement are such as to
deprive a party of his legal rights generally or prevent him from see'ing redress at any time in the courts of justice for any
future injury or wrong committed against him, there would be good grounds for holding that such an underta'ing is against
the public law of the land.
Aol+ Schmi+t v ,olip (19*) 1 SALR 5*6 where the court held that+
3=rivate individuals cannot confer jurisdiction on the court which they do not possess in terms of the common law<statute,
nor can they impose tas's upon the courts which they are not legally obliged to perform. 9owever, this principle does not
apply to arbitration and honour clauses.
-iii) (ollusion this was defined in ?evin v ?evin. (ourt held that 3ordinarily spea'ing collusion in our law is a 'een
consiance and means that an agreement or mutual understanding between the parties that the one shall
commit<pretend to commit an act in order that the other may obtain a remedy at law as for a real injury.4 )uch
agreements are illegal and unenforceable.
-iv) (ontracts encouraging crime delict and other unlawful acts. These contracts are void and not enforceable. It will be
hopelessly self contradictory if courts treated a contract to commit an unlawful act as enforceable because the court
would be approbating or reprobating the same act, 3blowing hot and cold.4
-v) (ontracts injurious to the institution of marriage
F,amples of these are contracts and encourage<facilitate polygamy or in a monogamous marriage.
-vi) 2iscelleneous (ontracts . F,amples are gambling, contracts to commit acts of se,ual immorality of contracts to
defraud creditors, contracts lending to produce forced labour, pact&m s&ccessori&m Oi.e. a contract whereby a person
curtails his freedom of testation writing of a will by promising to be!uthe or not to be!ueth property to the promisee
or to a third partyP. These agreements are not enforceable.
-vii) (ovenants in restraint of trade
(ovenants in restraint of trade are important to the world of commerce. person may limit his freedom of carry out
business or to be involved in business by way of a covenant in restraint of trade.
Boo- v !avi+son 1944(1) <LR 365(S)
Boo- v !avi+son 1949(1) SA 634(#5)
2an1wana v 2para+6i 1949(1) <LR 9*(S)
8llis 194() SA 4*(A)
16
The reason why covenants in restraint of trade are invariably employed in contracts of employment is because the covenants -i.e. the
employer) will be see'ing to protect.
-i) his goodwill
-ii) his client
-iii) his business
In the case of 2a1&a an+ Research (SA) 3ty Lt+ v 8llis is the loc&s classic&s on covenants in restraint of trade.
=rinciples draw from this case are+
-i) a covenant in restraint of trade will be presumed to be reasonable unless the party wishing to escape from it can show
it to be unreasonable.
-ii) The onus to prove the unreasonableness of the (ovenant lies with employee covenantee.
-iii) The unreasonableness or otherwise of the (ovenant is a matter to be decided on the facts of the case -i.e.
circumstances of the case)
-iv) The facts circumstances to be considered are the facts and circumstances prevailing at the time of enforcement of the
(ovenant.
The 3lue Pencil Test
"hen a restraint is to be reasonable it is sometimes possible to enforce the restraint in party by cutting the unreasonable part -or
rather by restricting the (ovenant to the reasonable party).
0ew Dnite+ ?east !istri>&tors v Bro-es 1935 WL! at *5
"here broo'es and other yeast merchants formed a company to distribute yeast products. ?roo'es was bound by a (ovenant in
restraint of trade prohibiting him from having an interest in any other business involved in yeast production. The (ovenant
proceeded to restrict him from having any interest in any company or business whose objectives were similar to those of the
proposed company. The court held the stri'ing down the unrealistic part of the (ovenant can only ta'e place if the contract posses
the blue pencil test. The ?lue =encil test states that as DDD. can only ta'e place if the clause<(ovenant passes the blue pencil
test i.e. the test of ma'ing grammatical sense after removing the offending part of the (ovenant with no words being added to the
restraint must still carry grammatical sense. The blue pencil test only arises in relation to the changing grammar of the clause.
4O#D AND 4O#DA3LE CONTRACTS
The absence of any of the discussed above aspects said to be re!uirements of a valid contract means that the contract is void. Thus
a void contract is the opposite of a valid contract.
voidable contract is whereby a contract is valid because it has all the re!uirements of a valid contract but one of the parties may
dispute the contracts on any one of the additional points i.e. misrepresentation, duress, undue influence and mista'e.
4oi' Contracts
re of no legal force at all. It is a contract which lac's any one or more of the essentials of the valid contract. In the eyes of the law
the contract is a nullity. Restit&tio in inter1r&m i.e. restitutution remedy. This simply means in both parties return to their original
positions.
17
4oi'a&le Contracts
It is a valid contract in that it satisfies all the re!uirements of a valid contract serve for the fact that the innocent party to the contract
has the right to set aside the contract if he so chooses.
%#SREPRESENTAT#ON
Is a factual statement concerning a certain state of affairs but is not true -it however must be material). misrepresentation is a
statement made by one party to the other before the time of contractingM the statement must be material i.e. of much importance),
factual and relates to the subject matter of the contract. Further the statement must induce the other party into a contract -i.e. must
have relied upon it).
contract which is induced by misrepresentation is voidable. There are & types of misrepresentation+
-i) Innocent misrepresentation i.e. misrepresentation made in honest belief that a statement is true.
-ii) Fraudulent misrepresentation the statement made by a party 'nowing fully that it is untrue or are made rec'lessly
-iii) >egligent misrepresentation a statement made in belief that it is true but the circumstances of the contract
demonstrate that it is untrue. 6nce there is a misrepresentation a !uestion obviously arises.
;ilEoen v 5illier 19" /S 31#
The case lays out the re!uirements that the innocent party must satisfy in a claim for misrepresentation+
-i) that a false representation was made
-ii) it must be material
-iii) that the innocent party entered into the contract in the faith of representation.
The innocent party who establishes the three elements set out above is entitled to rescind the contract whether or not the
misrepresentation is innocent, fraudulent or negligent. /escission leads to restitution in integrum. Through rescission one would be
ta'ing the contract to the state of being void and thus restitution in integrum will be automatic and then finally leading to damages i.e.
with voidable contracts but such damages differ with negligent<fraudulent<innocent misrepresentation.
?y whom<who can ma'e a misrepresentation8
In a nature of things a misrepresentation is made by the other party to the contract but it may also be made by the agent of the other
party. The principale who is the party to the contract is however liable for any misrepresentation made by his agent.
misrepresentation by a third party is not actionable
"ho can ma'e a misrepresentation8
Lam> v Walters 19#6 A! 354
In this case the seller of a house assured the buyer<purchaser that the price was fair and reasonable. The buyer was not permitted
to rescind the contract when he discovered that the price was considerably more than the house was worth. This case raises the
debate between a representation and an opinion.
The law defines misrepresentation with some care in order to fit in which the realities of life. =eople do not usually assume that
somebody elses opinion is un!uestionable and the law does not treat an e,pression of an opinion that tends out to be untrue as
misrepresentation.
18
?ut as will be noted in the case of Feinsten v >igglian the e,pression of opinion by a party 'nowing it to be false amounts to
misrepresentation in that the opinion is a false statement of his state of mind.
,einstein 0i11li where the court held that fraudulent misrepresentation in the form of an opinion<forecast of future success of a
business may amount to<rather is actionable.
%isre(resentation &. Silence
In Spei1ht v ,lass (161)(1) SA **4 it was said+
3there is in our law no general duty upon contracting parties to disclose to each other any circumstances<facts 'nown to them which
may influence the other party in deciding whether to conclude the contract.4 In particular circumstances the law re!uires the truth to
be revealed. In those circumstances silence will amount to misrepresentation. In contracts such as insuranceM partnership and
agency -contracts &>errima %i+e -i.e. utmost good faith).
part from those particular contracts an attempt to lay down a broader duty to disclose was made in the case of 3retorio&s v 0atal
So&th Sea 7nvestments /r&st (1965)(3) SA 1" where = successfully applied for shares in the company in ignorance of the fact
that the directors had bound the company to a very burdensome contract -oppressive contract). 9e sought to rescind the contract on
the basis that the directors had not disclosed the burdensome contract. The court held that there was a fraudulent misrepresentation
by silence in that the directors had failed to disclose a material fact which was in their e,clusive 'nowledge.
Thus every case is determined on its facts and circumstances -i.e. in determining whether there e,isted an obligation to disclose).
%isre(resentation must in'uce a contract
misrepresentee is not entitled to rescind a contract unless the misrepresentation induced the contract. The misrepresentee must
go further and show not only that he was induced and any other reasonable person would have been induced -i.e. under the same
facts and circumstances). It will not avail the misrepresentor and the mispresentee could have easily discovered the truth.
Wiley v A%rican Reality /r&st 19"4 /5 1" where a lawyer bought some debentures -i.e. a loan by an outsider to the company). It
was misrepresented to him and after $5 years, he had an option to surrender the debenture in e,change for either land, a house or
cash. From the wording of the debenture it was such that he would have to accept land with no option for cash. 9e sought to
rescind the contract alleging misrepresentation. 9e sought to rescind the contract alleging misrepresentation. The contract was
rescinded.
The 2isrepresentatees right rescind
2isrepresentation does not destroy that contract altogether - ma'es the contract voidable) at the instance of the innocent party.
The significance of classifying a misrepresentation as fraudulent negligent<innocent is to enable the party not only to rescind but to
claim damages.
Lnder negligent and fraudulent misrepresentation delictual damages are claimable.
Bayer SA v ,rost (1991) SA where Frost was a former with vineyards intermingled with onions and wheat. The agents of ?ayer
)outh frica negligently misrepresented to Frost that its herbicide could be sprayed in the vineyards by helicopter without damaging
the onions and the wheat. Frost was induced into the contract on the basis of those representations the vineyard was sprayed and
which resulted in the onions and the wheat being damaged to the e,tent of /.. 555. The court allowed Frost to recover the /.. 555
as delictual damages.
19
%#STA5E
This refers to an error of a material fact made by either one<both parties to enter into a contract which they could not have entered
into had it not been for the mista'e.
For a mista'e to vitiate a contract the following have to be satisfied+
-i) it must be a mista'e of fact and not a mista'e of law. It has been accepted that a mista'e of law does not e,cuse a party
from a contract. The main basis of such a proposition is found in the ma, i1norantia E&ris neminen e.c&sat. -i.e. ignorance of the law
e,cuses no one<rather is no e,cuse).
2iller an+ 9thers v Belliville 2&nicipality 19*3(1) SA 91
This point was emphasi:ed in the case of Sampson v Dnion an+ Rho+esia Wholesale Lt+ 19#9 A! 41 where the court held that 3a
general proposition of the law is that if you thin' the meaning of a clause is such and such, you cannot get rid of your liability when
you discover that the legal meaning is different from what you thought for you cannot be heard to say that you did not 'now the law.
The propositions upheld in the Jimbabwe case of 0c&>e v 0+lov& 1945(#) <LR #41(SC) where the appellant seduced the
respondents major daughter. The appellant then signed an agreement underta'ing to pay the respondent damages for seduction.
9e latter on sought to avoid the contract on the basis of mista'e of law -he was mista'en as to the legal position that a father has no
right to sue for seduction in respect of a daughter who had reached the legal age of majority while relying on the Eate'we v
2uchabayiwa case 9is appeal was dismissed on the basis that a mista'e of law does not invalidate a contract.
In )outh frica the courts have departed on some occasions from the general principle that a mista'e of law does not vitiate a
contract. The courts have come to accept that not everybody 'nows the law and if they 'new the law there would not be any point in
training lawyers. The courts have in essence set aside some contracts on the basis of mista'e of law.
Willis ,a>er 8nthoven 3roperietary Lt+ v Re 7nlan+ Reven&e (199#)() #""# p## (>) F where the court held that, 3In my judgment
our law is to be adopted in such a manner as to allow no distinction to be drawn between mista'e in law and a mista'e of fact.
9owever, it is important to note that the Jimbabwean judiciary has not yet departed from the proposition that a mista'e of law does
not vitiate a contract.
The mista'e must be of a material fact or term. This simply means that the mista'e must refer to one of the essential terms of a
contract itself.
In this regard two categories of mista'e have evolved.
a) Frror in motive This occurs where there is a mista'e regarding the reasons why parties entered into a contract.
s a general rule a mista'e that relates to the reasoning or motivation of one of the parties does not render a contract
void.
!ie+ric-s v 2inister o% Lan+s (196)(1) SA 9(0)
b) Frror regarding the contents or e,istence of the contract Therefore these can be divided into four categories namely+
-i) error with regard to the person or the other party. n e,ample of such occurs where wishes to conclude a
contract of employment with ? who is trustworthy but mista'enly concludes the contract which -a criminal)
who he thin's is ?. This contract is null and void due to error with regard to the person of the other
contracting party.
20
-ii) error with regard to the identity of the other contracting party -i.e. his name) e.g. where employs Gohn
-whom he wants to employ but mista'enly thin's that his name is =eter, a contract which cannot be entered
void due to error. This 'ind of mista'e does not affect consensus and does not invalidate the contract
between and Gohn.
-iii) error with regard to the nature of the agreement F.g. where wants to sell his house to ? but mista'enly
enters into a contract of lease, such a contract will be invalid because there will not be any consensus -i.e.
ad idem).
-iv) error with regard to performance e.g. where wishes to buy a candle stic' made from silver but a
candlestic' made from silver there can be no consensus between him and the seller.
-v) The mista'e must be reasonable<justifiable
reasonable mista'e is 'nown as a Gustus error and can infact invalidate a contract.
Lo1an v Beit 149" * SCGAC 19 a mista'e made by one party to a contract which is due to his own
careless is not reasonable and cannot be relied upon as a basis for setting aside a contract. Aeor1e v
,airmea+ 3roperietary Lt+ (1954) # SA 65$
>? /easonableness<otherwise should be decided on the facts of each case ?elierton 19*#() SA 11$
-vi) person may not deny the e,istence of a contract where he is estopped from doing so i.e. the estopped
person cannot succeed if he sets up the defence that he entered into the contract while labouring under a
material mista'e.
T0PES OF %#STA5ES
There are generally & types of mista'es+
-i) Lnilateral mista'e
-ii) 2utual mista'e
-iii) (ommon mista'e
Lnilateral mista'e
This occurs where one party is mista'en and the other is not as a general rule the mista'en party must be bound by the contract on
the basis of !uasi mutual asset because, 3by his conduct he led the other party as a reasonable mean to believe that he was binding
himself4 as was held in the case of Aeor1e v ,airmea+ at *1 -supra).
9owever there are instances where a unilateral mista'e can vitiate a contract, these were spelt out in the case of 0ational an+
9verseas !istri>&tors Cooperation 3ty Lt+ v 3otato Boar+ 1954(#) SA *3 at *9(1)B(h) where the court hold as follows+
36ur law allows a party to set up his own mista'e, in certain circumstances in order to escape liability under a contract into which he
has entered but where the other party has not made any misrepresentation and has not appreciated at the time of acceptance that
his offer was being accepted under a misapprehension, the scope for a degree of unilateral mista'e is very narrow, if it e,ist at all. t
least the mista'e would have to be reasonable and it would have to be pleaded.4
From this passage & possibilities emerge where a unilateral mista'e can vitiate a contract mainly+
-a) where the other party 'new of the mista'e at the time of contracting
-b) where the other party induced the mista'e by misrepresentation
21
-c) where the mista'e is reasonable
9owever this -c) position was varied in the case of Lam+s>er1en v ;an +er Walt 19*#(#) SA 66* where the court held that even a
reasonable mista'e will not release the mista'en party from the contract unless the mista'e is material in the sense that he would not
have contracted if he had 'nown the truth.
2utual mista'e
This occurs when each party is mista'en about the others intention so that the parties are at crossApurposes. In solving this problem
the court usually applies the doctrine of !uasi mutual assent. (ourts have adopted two approaches namely+
a) if one parties understanding what has been agreed is unreasonable in that it conflicts with the impression he has
given to the other party, he will be deemed to have agreed in accordance with the impression he has given.
b) If each parties understanding<mista'e is reasonable then there will be no contract between the parties
2arit6 v 3ratley (149) 11 SC 35 where 32, was an auctioneer, called for bids lot $%5H which was the successful bidder but he
refused to pay because he thought he had bought the mantel piece together with a mirror which was standing on it. The mirror was
infact a separate lot $%5C. The court held that =ratleys mista'e in thin'ing that 2arit: intended to sell the 2antel piece and mirror
together was held to be reasonable and 2arit:s mista'e in thin'ing that =ratley was bidding for the mantel piece only was obviously
reasonable. The court held this to be a case of mutual mista'e and there was no contract.
Common mista-e
?oth parties will be mista'en concerning a particular thing. It occurs where both parties are labouring under the same mista'e. In
dealing with this problem the court usually considers two things namely+
a) where the common mista'e leads to initial impossibility, then the contract between the parties becomes void e.g.
where parties agree to buy and sell something which they both mista'enly thin' is still in e,istence when in actual fact
has been destroyed.
b) "here there is no initial impossibility the effect of common mista'e is that either party is entitled to rescind the
contract if the mista'e is sufficient serious.
!ic-inson 2otors (3ty) Lt+ v 9>aho6er 195#(1) SA 4(A) where 6baho:er paid %C$ pounds which was the amount that his son
owed on a car he had bought from the company. In return the company released to 6baho:er a car with both the company and
6baho:er mista'enly thought was the car concerned. "hen the true owner of the car successfully claimed it. 6baho:er relied on
common mista'e to justify claiming the repayment of %C$ pounds. This is what the court had to say, 3The %C$ pounds was paid
under a common mista'e in regard to a matter which was vital to the transaction and if either of them had been aware of the position,
the transaction would not have gone through4
s such the company was ordered to repay 6baho:er the %C$ pounds paid.
Rectification
It refers to the correction of errors with a contract -in most cases these are typing errors)
It can only be granted by the court when the written contract contains the e,act wording that the parties intended but the wording
produces an effect that the parties did not intend. This point was underscored in /es>en v SA Ban- o% Athens (199) A77 SA 396
p"1 where the court held as follows 3to allow the words that the parties actually used in the documents to override the prior
22
agreement or the common intention that they intended to record is to enforce what was not agreed and so overthrow the basis on
which contracts rest in our law.
D$RESS
It occurs when a person is forced into a contract by fear induced through either actual violent or threats of violence either on his
person<family or property.
contract obtained this way is voidable at the option of the innocent party i.e. innocent party can elect to set aside the contract.
White Brothers v /reas&rer Aeneral (1443) # SC 33*H at p35 the court had this to say+
3where a man is forced by menaces to his person to ma'e payments which he is not legally bound to ma'e it cannot be said that
there is a total absence of consent but in as much as his consent is forced and not free, the payment is treated as involuntary and
therefore subjected to restitution.4
In the same vain Sa>>i+es v Sa>>i+es (1946) # SA 3#1H 3#5 The court adopted Kan der @inderns observation and held as follows+
3"hen the consent of one of the contracting parties is e,torted by undue violence or fear provided the violence is of such actual
important that it would ma'e an impression upon a courageous person the judge must ta'e into consideration the circumstances of
both the person and of the things e.g. The fear which cannot be deemed sufficient to disturb the mind of a person of a mature age or
of a soldier may be !uite sufficient in the case of a woman or an old man.4 Broo+nE- v Sm&ts 19# /3! at *H 51 an+ 5#, the court
held that for a party to establish duress he must satisfy the following re!uirements.
-i) There must be actual violence or reasonable fear see the )abbies case
-ii) The fear must be because by threats of some considerable evil to the other party or his family. The !uestion has
been raised regarding whether or not thus re!uirement can he satisfied when the is a threat to ones property. In
addressing this !uestion Fnglish law provides that duress of goods is not sufficient to set aside a contract.
9owever the position is different in /omanA#utch law where economic duress<duress of goods can infact invalidate a contract. This
was stated in the case of Dnion Aovernment (2inister o% ,inance) v Aower 1915 A! #6 p3 where the court stated as follows+
3where goods have been wrongly detained and where the owner has been driven to pay money in order to obtain possession and
where he has done so not voluntarily as by was of gift or compromise but with e,pressed reservation of his legal rights, payments so
made can be recovered as had been e,erted under duress of goods.
The onus of showing that the payment has been made in voluntarily and that there has been abandonment of rights would of course
be upon the person see'ing to recover and hence the importance of a protect or an une!uivocal statement of objection made at the
time. "ithout such protest it is difficult to see how the plaintiffs state of mind could be established to the satisfaction of the court.
-iii) It must be a threat of imminent evil.
In determining this re!uirement courts usually assess whether or not -assuming that the threat was sufficiently serious
to affect the mind of such a person) he could by some method other than agreeing to the contract. If there was a way
to avert the threat other than agreeing to the contract than there will not be duress.
-iv) The threat must be unlawful<contra >onos mores -contrary to good morals) )ee Shapestone v Shapestone 191(1)
SA 11
-v) The threat must have caused damage i.e. the threat must have induced the party into a contract to his detriment. )ee
,ree+man v )r&1er 19"6 /S 41*H p4#1 an+ 4##. It has come to be accepted that duress by a third party can vitiate a
23
contract the essential elements for duress are satisfied. )ee Broo+ry- v Sm&ts. The effects of duress on a contract is
that such a contract is voidable at the option of the innocent party.
$ND$E #NFL$ENCE
party to a contract may rescind it if he can prove that the other party had ac!uired an influence over him when wea'ened his
powers of resistance and made his will probable and used this influence in an unscrupulous manner to persuade him to consent to a
transaction which is to his detriment end with which normal free will he would not have entered into.
3reller v =or+an 1956(1) SA 45 . The court held that a party leading undue influence should meet the following five things+
-$) That the other party obtained an undue influence over the other. In this regard the law recognises that such an undue
influence is more li'ely going to e,ist where there is a special relationship between the parties e.g. doctor and patient
lawyerA clientM guardian minor, religious advisorAdisciple relationships.
This point was emphasi:ed in the case of Armstron1 v 2a1i+ an+ Anor 193* A! #*6. where the court held as follows, 3wherever
two persons stand in such a relation that while it continues confidence is necessarily repossessed by one and the influence which
naturally grows out of that confidence is possessed by the other and this confidence is abused or the influence is e,erted to obtain
an advantage at the e,pense of the confiding party, the person so availing himself will not be permitted to retain the advantage
although the transaction could not have been impeached if no confidential relation had e,isted.4
-i) The influence must have wea'ened his powers of resistance and rendered his will compliant
-ii) The other party must have used his influence in an unscrupulous manner
-iii) The influence must have induced the conclusion of the contract
-iv) The contract must be prejudicial to the influenced party
Effects of $n'ue #nfluence
-i) Lndue influence ma'es a contract voidable at the instance of the influenced party
-ii) It can also ma'e a contract void a> initio only if the influence induced in the mind of the party see'ing relief such a
fundamental mista'e that apparent assent to the contract is in truth not assent at all.
TER%S OF A CONTRACT
These are promises agreed upon by the parties which together ma'e up the contract. term must be distinguished from other
statements which may have been made only to induce one of the parties to enter into the contract. )uch statements may be mere
puffs or representations which unli'e terms cannot grant an action for breach of contract in the event of them turning out to be
untrue.
This position was emphasi:ed in the case of 3etit v A>ramson 196 03! 6*3 at 6*9 where the court held as follows+
3It is notorious that statements made by parties when negotiating a contract may conceivably ta'e the status of either+
-i) mere puffing<commendation
-ii) representations
-iii) underta'ings commonly referred to as warranties
Classes of contractual terms
(ontractual terms can be classified into two namely+
24
-i) e,press terms
-ii) implied terms
F,press terms
This refers to contractual terms that are gathered from what was actually said by the parties either orally or in writing. s regards
contractual terms in a verbal agreement.
Small v Smith (195) 35 ALR 3H 3* held as follows+
3 statement made seriously and deliberately during the negotiation of a verbal contract becomes a term of the contract if the parties
by mutual intention either e,pressed or implied intended it to be a term of the contract.4
The usual challenge is to prove the e,istence of such terms
/egarding written contracts terms are easy to prove because they are reduced into writing. Gudges tend to uphold the position that,
3documents spea' for themselves4 "hat this means is that judges prima facie -i.e. on the fact of it) rely on a written contract unless
a justifiable reason is presented to prove otherwise.
Effects of a sinature on a written contract 6caveat subscripto).
This was well captured in the case of+ B&r1er v Central A%rican Railways 9"3/SH 5*1H 5*4 where the court held that
3It is a sound principle of law that when a man signs a contract he is ta'en to be bound by the ordinary meaning and effect of the
words which appear over his signature.4
This principle is referred to as caveat subscripto -i.e. let the signatory beware i.e. the signor should be weary).
This principle applies to the doctrine of !uasi mutual assent but in essence a reasonable person is entitled to assume that a person
who signs a contract intends to be bound by it, so he is bound even if that was not his true intention.
Aeor1e v ,airmea+ (3ty) Lt+ (1954) # SA 64
2ath+e v 2ath+e (1951)(1) SA #56
It is important to note that a person who signs a contract containing blan' spaces is prepared to be bound by that contract when the
blan' spaces are filled in by the other party.
0ational Arin+lays Ban- Lt+ v ?elviret&rn (19*#) () SA 11$
?ut if the signatory has in any way indicated how he wishes the blan' spaces to be filled in the other party must of cause comply with
the wishes.
Commercial Ban- o% 0ami>ia Lt+ v /rans Continental /ra+in1 (0ami>ia) (199#) # SA 66H *5H **$
9owever the caveat subscripto principle is not rigid 3(ourts will not apply it where there is misrepresentation, fraud, illegality, duress,
undue influence and influence.
Spin+&%ter (3ty) Lt+ v Lester !onorvan (3tyI Lt+ (1496) (1) SA 3"3
$nsine' Contracts/Tic7et Cases
It refers predominantly to notices, tic'ets and other unsigned documents. In dealing with these courts have adopted a three pronged
approach which was aptly summari:ed in )in1s Car 5ire (3ty) Lt+ v Wa-elin1 (19*")() SA 6"H 63 +B%
3The approach of the court is to en!uire whether the person who received a tic'et 'new that there was printing<writing on it.
)econdly if so a further !uestion 3#id the person who received the tic'et 'new that the printing or writing contained provisions or
references relating to the provisions of the contract in !uestion.4
If these % !uestions are answered in the affirmative then the provisions in !uestions are part of the contract.
25
If either of such !uestions are answered in the negative then a third !uestion becomes relevant namely, #id the person, giving the
tic'et do what was reasonably sufficient to give the other party notice of the conditions8
If the answer to such last mentioned !uestion is in affirmative then also the provisions or conditions are part of the contract. If not
then the conditions form no part of the contract.
customer is not bound by unreasonable terms printed on an unsigned written contract such as a tic'et.
E8em(tion Clauses
n e,emption clause is a term of a contract which e,empts one party from some specified liability or responsibility which would
otherwise fall on him.
n argument in favour of the e,emption clauses is that by shading some of his responsibility which would otherwise fall on him.
n argument in favour of the e,emption clauses is that by shading some of his responsibility the user of the standard form contract
will be able to obtain insurance at a cheaper rate and therefore charge less for the service he provides for the benefit of all his
customers. 9owever courts have not been impressed by this argument and have placed limits on the effectiveness of e,emption
clauses.
(ourts have developed a two pronged approach namely+
-i) Is the e,emption clause part of the contract. If it is not part of the contract then the stay ends there. The other party
would not be bound. ?ut if it is a part of the contract the courts will apply the caveat s&>scripto principle and raise the
following !uestion+
-ii) "hat does the clause mean8
9ere the court usually adopts a strict interpretation. In the event of either doubt or ambiguity, the court will interpret
an e,emption clause against the drafter of the clause. This is referred to as the contra pro%erentem rule.
Sh&>wa Ranch (3vt) Lt+ v Shiel+ o% <im>a>we 7ns&rance (3vt) Lt+ 1944(#) <LR 3"6
It is important to note that courts have held that a party who wishes to e,empt himself<itself form liability caused by his own
negligence should clearly state so in the e,emption clause.
Cotton 2ar-etin1 Boar+ v 0ational Railway o% <im>a>we 1944(1) <LR 3"
9owever the above mentioned principle does not apply where the other partys negligence amounts to breach that goes to the root of
the contract.
/ransport an+ Crane 5ire (3vt) Lt+ v 5&>ert !avies an+ Co (3vt) Lt+ 1991(1) <LR 19"
9owever this dispute has been settled by the promulgation of the (onsumer (ontracts ct -(hapter H+5&).
In terms of the said ct a consumer contract is defined as a contract for the sale or supply of goods or services or both in which the
seller or supplier is dealing in the course of business and the purchaser or user is not.
In terms of the ct the following e,emption clauses are prescribed+
-i) those that e,clude<limit negligence
-ii) those that e,clude<limit liability in the event that goods do not conform with any description or sample given in respect
of the goods
-iii) those that e,clude<limit liability for latent defects in goods
-iv) those that deny<limit the buyers right to re!uire the seller<supplier to either+
26
-a) reAimburse the goods
-b) replace the goods
-c) repair the goods
-d) reduce the price or amount payable in respect of goods
#NTERPRETAT#ON OF E9PRESS TER%S
It has generally been accepted that when a contract is reduced into writing the courts must rely on the provisions of the written
contract -not e,trinsic evidence) to deal with any dispute arising therefrom. This is referred to as the 3arole 8vi+ence R&le and was
underscored in the case of =ohnson v Lean 194"(3) SA 9#*H 93*, where the court held as follows+
3"hen a contract has been reduced to writing, the writing is regarded as the e,clusive embodiment or memorial of the transaction
and no e,trinsic evidence may be given of other utterances or oral acts by the parties which will have the effect of contradicting,
altering, adding to or varying the written contract.4
The rational for this is that if parties to a written contract are permitted to give you e,trinsic<e,ternal evidence written contracts will
lose much of their value.
9owever the parole evidence rule is not a hard and fast rule -i.e. rigid rule). In a bid to enhance justice between the parties courts
have developed the following e,ceptions to the application of the parole evidence rule+
-i) If the parties did not intend the written agreement to be the e,clusive embodiment of their contract the parole
evidence rule will not apply. This normally occurs where a contract is partly written and partly oral.
Bal+achin 19#" A! 31#
-ii) F,trinsic evidence can be allowed to show that the written contract was contradicted, altered, added to or varied by a
subse!uent oral contract.
)ee =ohnson v 0eil case
-iii) F,ternal evidence may also be given to an oral agreement the ma'ing of which induces the ma'ing of a written
contract provided the oral agreement does not conflict with the written agreement.
!&plesis v 0el 195#(1) SA 513
In Sti1lin1h v /heron 19"* /S 194H 1""3 the court pronounced the following e,ception 3but again evidence is
admissible of a separate oral agreement constituting a condition precedent to the attachment of any liability under the
written instrument. Thus is an e,ception to the general rule.
-iv) The parole evidence rule does not prohibit evidence in support of a claim of rectification of the contract not in support
of any defence which challenges the validity of the contract nor evidence to contradict the debt of signature recorded
in the contracts since this is not part of the agreement between the parties but an objectively determinable fact.
9tto v 5eymans 19*1() SA 14H 53B153
E8(ress terms: E8ce(tions to the Parole Rule
The first e,ception is not strictly one e,ception as such, it says =arole rule evidence does not e,clude the leading of evidence to
establish that the contract was subject to a suspensive condition.
$. 6ne will not be varying the terms of the contract.
27
%. The rule will not be applicable where it is the intention of the parties, that the contract should be
partly in writing and partly oral. The court will give effective to that intention of the parties.
)ee 9ersep&t v Avis(1) 93 A! 331 where the court too' the view that this was the situation that the parties had intended that their
contract should partly be in writing or oral. 9eld that the oral agreement would be given effect to -that the oral agreement would be
given effect to) or will be valid.
5artin1 3roperties an+ 9ther v Los An1eles 5otel 196#(3) SA 13 where a contract was held by the court to be constituted by the
lease agreement and a letter. To counter this problem when drafting a contract one would have to include an integration clause or a
whole contract clause. This will be a term to the effect that the document will be entire contract between the parties and all terms,
conditions, warranties or representations, not the included will be e,pressly e,cluded.
This means that one would be entrenching the =arole evidence rule into the contract. )ee the case of 2here v /&>>s 1946(#) <LR
1*9. The =arole evidence rule is designed to promote certainty, it reduces the costs should litigation arises, i.e. instead of leading
many witnesses, the contract document just serve all the purposes. 9owever the e,ceptions to the =arole evidence rule ma'es the
written document uncertain and ultimately the court had to balance the conflicting parties interests. The =arole evidence rule does
not apply where the validity of the contract itself is being challenged by the parties.
)o- v 9s>orn 1993() SA *44 where the court ruled one could not e,clude =arole evidence to establish the ground of invalidity the
contract e.g. mista'e, thus courts are prepared to disregard the intergration clause as it did in 2hene v /&>>s (s&pra). n
intergrational clause is often coupled with nonAvariation clause. If the parties intend to vary the terms of the contract it must be in
writing and signed. In such purported and evidence to vary the terms of the contract will be of no force or effect. There used to be a
doubt whether parties to a contract were bound by a non variation clause in their contract. The argument was that the parties are at
liberty to vary it orally if they intended to do it so. In $C0* the (=# decided that the non variation clause is binding on both parties
and any purported oral variation inconsistent with such a clause will be invalid. 9owever a non variation clause does not in itself
preclude a waiver. ccordingly a non variation clause is purported by a non variation clause.
)ince we are tal'ing of a term in which both parties have an interest they infact have to agree to waive it as well. "ith a nonAwaiver
any party which has a right can unilaterally waive that term. nonAwaiver or indulgence clause says that no indulgence made by the
party can be ta'en to be the waiver of his rights.
The )upreme (ourt considered this issue in the case of A ,inance C v 3orcoc- 1946(#) <LR ##9 SCB134B1946 where = was a
farmer who had borrowed some money from F( according to the contract, the F( could come at any time and possess the farm
and sell it. The contract had a nonAvariation and nonAwaiver terms. = fell into arrears, he went to F( and had discussions with the
manager of F(, one /, / agreed that instead of F( moving into the farm they would enter into arrangement with /, he was
surprised to see a letter from F( threatening that they would move in and sell the property. = argued that they had entered into an
oral agreement with /. )o F( cannot repossess the farm. It was argued on behalf of the F( that there was nonAvariation and
nonAwaiver clause hence they were supposed to proceed as they had done. = argued that the oral agreement constituted a waiver
by F( of its rights in terms of contract. = further tried to argue that the F( should be estopped from denying the e,istence of the
oral agreement with its general manager. =s argument were reflected by the court which ruled in favour of the F(.
E8em(tion clauses an' thir' (arties contracts
The issues arising are
28
(an a third party sue or rely on the contract between and ? whilst ( himself is not party of the contract. This issue arises
inevitably because of the doctrine of =rivity of (ontract which postulates that a contract is binding upon and creates rights and
obligations only.
Thus a third party cannot ac!uire any rights or obligation in the contract.
The case of A+ler v !ic-son 1955(1) JB 154. The case of and # -supra) illustrate the whole issue of third parties and e,emption
clauses.
lder was a passenger in a ship owned by = and (, when the ship arrived on a certain port most passengers got out of the ship and
upon reboarding whilst wal'ing upon the gang of ban's and fell due to the unstableness of the which e,pressly provided that the
company was e,cluded from liability as well as its servants for negligence. It is tried that the contract was between 2rs dler and
(o. Instead of suing the company 2rs dler sued the companys employees for negligence. #ic'son was manager of gang for the
plan's. The employee # relied upon the e,emption clause. The court held that the e,emption clause. The court held that the
e,emption clause e,empts the company not the employees. The employees no matter how efficacy was the wording of the clause
could not derive benefits from a contract to which they were not parties. The ship in which 2rs dler was traveling was called
9imalaya and the e,emption clause at issue in that case became commonly 'nown as 9imalaya (lause. fter the dler case
company went bac' to the drawing board and came up with an embracing clause which protected its wor'ers. The issue then came
up again for decision in the case of Scr&ttons v 2i+lan+s Silicons Lt+ 196# AC 6H 1961(#) LLR 365$ In this case @ord /aids
speech made it clear that it is possible for e,emption clause between and ? to ade!uately protect ( on condition that -$) the
e,emption clause must e,pressly ma'e reference to ( the employee. The one in the 9imalaya did not. -%) The company in entering
into contract with the customer must have acted both in its own rights and as an agent for its employee.
9aving considered the speeches in the 2idlands case appropriate clause was now drawn by the company.
Princi(les of inter(retation
The following principles have evolved in interpreting written contracts.
-i) The ordinary grammatical meaning it provides that the contract must spea' for itself through the ordinary
grammatical meaning of its words.
/otal SA 3ty Lt+ v Be--er 199#(1) SA 61* at 6#5 the court held that, 3the underlying reason for this approach is that
where words in a contract agreed upon by the parties thereto and therefore common to them spea' with sufficient
clarity, there must be ta'en as e,pressing their common intention.4
>? Iou can use the parole evidence rule principle to support the idea that our courts still uphold the principle of
)>(TITI.
9owever, the ordinary grammatical meaning will not be applied in the following circumstances+
-a) If the result with be absurd Scottish Dnion an+ 0ational 7ns&rance Co Lt+ v 0ative Recr&itin1 Coop Lt+ 193 A!
54H 65, the court held as follows, 3It however the ordinary sense of the words necessarily lead to some
absurdity<to some repugnants or inconsistency with the rest of the contract then the court may modify the words
just so much as to avoid the absurdity of inconsistency but no more.4
-b) If it is clear from the contract itself or from evidence that the words have been used in some special and technical
sense+
Ran+ Reit%ontein 8states Lt+ v Cohn 193* A!H 51*H 314, where the court held that 3gain if the words on the
contract have been used in a peculiar sense evidence of the sense in which the parties used the words may be
given.4
29
-ii) The conte,t+ words in a contract must not be read in isolation but in their conte,t. The courts approach was
summari:ed in the case of 2elmath /own an+ Boar+ v 2ario&s 2ostenrt 3ty Lt+ 194(3) SA *14H *#4 where the
court held as follows, 3s in the case of statutes the conte,tual approach phrase in a contract re!uires that regard
must be heard not only to the language of the rest of the provision concerned or the contract as a whole but also to
considerations such as the apparent scope of purpose of the provisions.
The evidence of surrounding circumstances this was aptly summari:ed in the case of !elmas Co$ Lt+ 1955(3) SA *H 5, where
the court held that, 3If the difficulty cannot be cleared up with sufficient certainty by studying the language recourse must be heard to
surrounding circumstances i.e. matters that were probably present to the minds of the parties when they contracted. The court can
also apply rules of interpretation these rules have evolved from common law and they include the following+
a) courts may always presume that the parties intended an interpretation that is fair to them both rather than
an interpretation that gives are party on unfair advantage over the other
b) an interpretation that avoids inconvenience is usually preferred
c) an interpretation that gives effectiveness to a contract is usually preferred to the one that renders at abortive
d) it will be presumed that every word in the contract was intended to have some effect to be of some use
e) the change of e,pression will be presumed to signify a change of meaning
f) general words will be given a restricted meaning to fit in with the conte,t in which they are used
g) greater weight will be given to special provisions rather than to general provisions
h) the e,press mention of one item will be presumed to e,clude similar items that are not mentioned unless it
appears that the one item was mentioned for the sa'e of caution.
#m(lie' Terms
These are terms that are imposed into a contract from its conte,t. They come in three forms namely+
-i) terms implied by law<
These refer to terms that are imported into a contract by operation of either common law or statute law regardless of
the intentions of the parties e.g. a sale of land has to be in writing i.e. The @abour ct imposes a number of minimum
conditions on an employment contract. Fvery contract of sale has an implied warranties against latent defects. lso
the 9igher =urchase ct re!uires every 9ire =urchase agreement to be reduced into writing. It also forbids a
purchaser in a 9ire =urchase greement to waive his rights given to him by the 9ire =urchase ct.
Terms #m(lie' &. Tra'e $sae
These arise where a specific trade has developed its own universally and uniformly observed rules which apply in contracts of that
trade or profession.
The re!uirements for implying a contractual term by trade usage were laid down in the case of Aol+en Cape ,r&its 3ty Lt+ v
,ootplate 19*3(#) SA 6"# as that the term should have universal, uniform, notorious, reasonable, certainty and should not conflict
with other provisions of the contract.
)uch a term can become a term of the contract in two ways namely+
a) if both parties are familiar with the usage they may be ta'en to have tacitly agreed that the usage
should be a term of their contract
30
b) if one of the parties is ignorant of the usage he can only be bound by the alleged trade usage if it
satisfies the re!uirements laid down in the Qolden (ape Fruits case.
Terms im(lie' from facts
Tacit terms
These refer to terms that become patently clear when regard is given to the language used in the contract and surrounding
circumstances.
In the case of Al%re+ 2calpale v /ransvaal 3rovincial A+ministration a tacit term was defined as, 3an une,pressed provision of the
contract which derives from the common intentions of the parties as inferred by the courts from the e,press terms of the contract and
surrounding circumstances.
4 !uestion that inevitably arises from the definition from is how are courts supposed to infer terms implied from facts8 This !uestion
is answered in the case of Wil-ins v ;o1es 199(3) SA 154 where the court adopted a four pronged approach namely+
a) whether the proposed implied fact has been written in the contract if not then the court will as' itself the following
!uestion+
b) whether the tacit term is necessary in the business sense to give efficiency to the contract
c) whether it can be competently that of that time the contract was being negotiated someone had said to the parties, 3of
course so and so will happen.4
This is called the official ?yA)tander Test
d) whether the term is capable of clear and e,act formulation. )ee also Rei1ate v Dnion 2an&%act&rin1 Co$ 1914 ()B)(1
59#H p6"5$
It should be noted that the courts are reluctant to imply terms into contract because+
$ for instance if there is a written contract the whole idea is to have certainty and it is unli'ely that the parties
will leave certain terms
% if a court started to imply certain terms hence destroy the idea of certainty
& the whole basis of the agreement of contract is agreement and parties are bound because they had agreed.
#octrine of sanctity and freedom of contract
The doctrine of freedom of contracts and the doctrine of sanctity of contract dictates that courts should not
interfere with parties contract.
* courts are also reluctant because, they do not want to be accused for ma'ing contracts for parties
. if implied terms became inconsistence with e,pressed terms there is no rational for implication.
>ote however that, there are certain implied terms which parties by mutual assent contract out of.
Free'om of Contract
This essential means that one is free to enter a contract or not to and having decided to enter the contract, to enter with whom
he<she ever wants and to decide upon which terms they want. The general law is that while it is formal true, in practice it is very
different, if you choose to contract in most cases depends on the strength of your bargaining power one does not have a choice
especially in cases of standard forms contracts i.e. mortgage bonds.
31
If one chooses to contract with a building society to borrow money from them there is no freedom to lent money on daily basis and
they draft standard form contracts, which the borrower may contract to or not. It must be noted however that those standard form
contracts, have merits for ban'ers who has to enter into one contract with thousands of customers will reduce their costs.
Sanctit. of contracts
This doctrine merely means that where parties had freely entered into the contract it becomes sacroAsanctity and the courts cannot
ma'e another contract for them. The statutes such as (onsumer (ontracts ct and (ontractual =enalties ct, see's to aid
interpretations of such contracts. ?y ma'ing e,emptions clause the party concerned see's to e,empt itself from which it should be
ordinarily be liable. This is interpretation the courts should try to uphold the doctrine of freedom of contract. The common law
position is that the court will not struc' down the e,emption clause on the basis of being harsh or unreasonable against the other
party. The court also loo's at the liability to which the proferens would be subject to where there is no e,emption clause. t
common law if there is no strict liability the other party will have to prove negligence C2B v 0R< 199"(1) SA 5##H 1944(1) <LR 3"
Transfer of Contractual Rihts
(ontractual rights can be transferred through+
a) cession
b) delegation or
c) novation
(ession
In regard to cession the contractual obligations are transferred to the other party 'nown as a cedent. (ession is sometimes
described as some 'ind of novation. (ession brings in commercial convenient and facilitates commerce by enabling the creditor to
account his rights to account by selling them instead of enforcing them himself.
(ession curtails circuit of litigation. >otice of cession to the debtor, is not necessarily re!uired but it is legally advisable that the
debtor who pays the ceded after the cession in good faith without notice of the faith, is considered as legal have settled the debt.
9owever a debtor who pays the ceded after notice of cession still remains liable to discharge the debt to the cessionary.
9e cannot reclaim the payment from the ceded. (ession is sometimes described as a 'ind of novation but it differs from novation in
that novation is re!uires consensus of the debtor and conse!uent of the novation will be that there will be a new contract to replace
the old contract.
"hereas cession result in novation the cessionary still sues on the old contract but cession does not do so. It is submitted that it is
legally improper to refer to cession as a form of novation. (ession is the opposite of delegation.
Deleation
It re!uires the agreement of the all parties concerned that a third party be substituted for the original debtor and the later become
discharged from the obligation of the debtor. The creditor had to agree the older debtor in replacement by the new one. The idea
behind delegation is to transfer burden to of the debtor i.e. irrecombly from the original to the new debtor. ccordingly the creditor
cannot sue the original debtor see the case of ;an Acher>ec- v Walters 195"(3) SA *3$ )ee also =aco>s v ,aw 194#(#) SA 463.
The common intention of all the & parties that a delegation should ta'e place may be e,press it may be implied from surrounding
32
circumstances including the contract of the parties. )ee 2etal>o. o% SA v !&stan (3vt) Lt+ 19*(#) #"4$ The introduction of a third
party to a transaction does not necessarily mean that there has been delegation e.g. where a debtor re!uests a third party on his
own initiative, promises the creditors to discharge the credit on behalf of the debtor. This does not reali:e the original debtor.
Novation
It means the replacement of e,isting contractual obligation by new obligations. The concept of novation arose during /oman times,
to alleviate the problems caused by supervening or initial impossibility. >ovation discharge the old obligation and a completely new
contract is created. There are % types of novation+
- Koluntary novation -novatio vol&ntaria) A where % parties to a contract mutually agree to enter into a new
contract to replace a e,isting contract.
- (ompulsory novation where an e,isting contract is superceded by a judgment of a court of law. This is
sometimes called novatio necessaria. )ee the case of ;an Copenha1en v ;an Copenha1en 19*(1) SA
5*6 , Barclays 0ational Ban- v Smith 19*5() SA 6*5 an+ S&ncli%% (3vt) Lt+ v !y-e 19*4(1) SA 194"$
Termination of contractual o&liation
contract is terminated after being performed. "hat 'ind of performance is re!uired8 =erformance means that each party must
perform its own obligations as envisaged by the contract.
=erformance should be made by the party upon whom the obligation is imposed and that performance must be rendered to the
person recognised by the law as being competent to receive the performance. )ee 5anorna1 SA (3vt) Lt+ v 9tto 19" C3! 3*.
"hat happens if the performance does not e,actly confirm to performance e,pected in the contract i.e. must a party performed
e,actly what he is obliged to do under the contract -informa specific) does it suffice if a party rendered e!uivalent performance.
For a court of law to decide this issue it is always difficult.
9owever this problem has been fairly settled in ) in the case of ;an !i11elen v !e Brain an+ Anor 195(1) SA 144 where the court
outlined the approach to the adopted.
First and foremost the court must establish the parties intention, tal'ing into account the surrounding circumstances and everything
which gives a due to that mutual intention.
The court must see' to find, what the parties would have wished to had their minds had been directed, whether the performance was
to be specific and e!uivalent.
)econdly should there be no clues as to the parties to mutual intention, the presumption that the performance was to be specific.
This is a rebuttable presumption.
Thirdly the court will in case of doubt be more li'ely to have a favour of e!uivalent performance.
If the manner of the act to be performed if it is immaterial or where performance, informa specific is impossible through no fault of the
promissor. )ee the case of 3eters 5ammon v )o-sr&+ 1999 A! #*
33
Impossibility of performance must be genuine
This that the promissor cannot simply tender e!uivalent, performance because specific performance is becoming e,pensively
difficult.
Fourthly the act of performance tendered where such as permissible must in the just instance be an e!uivalent to that mentioned in
the contract or be of such a nature that it can ma'e no material difference to the promisee.
)uch seems to be the position if any immaterial or ine!uality can be put right by compensation given to promisee by promissor.
Finally the courts paramount obligation is to be justice between man and man. It must to this be guided by the terms and
circumstances in the contract under consideration.
Thus in cases where the promissor had discharged the onus re!uired by number % he may be circumstances falling short of
impossibility and even where there may have been some fault on one party, the promisor and where the court may come to
conclusion that the promissors performance or tendered performance amounted to substantially performance or is such of a nature
that the promisee may be compensated damages for any shortfalls. )ee Reliance A1ency (3vt) v 3atel 196 C3! 65. )ee also
A+ler v 8liot SC 169 o% 1954$
Termination by mutual agreement
contract can be terminated by mutual agreement. The methods of discharge dealt with above all have one thing in common, they
are initiated and are a conse!uence of mutual agreement. If parties are free to enter into a contract on any terms and conditions
then it follows that they are at liberty to agree to discharge the contract. Thus where the parties by mutual agreement agreed to
discharge the contract that is legal !uite proper. For a contract to be discharged by agreement, it is not problematic if the contract
had not been performed, it is still e,ecuted. =roblems may arise where the contract had been partially performed. If the parties have
completely performed, then the !uestion of discharge by agreement does not arise as such a contract will be deemed to have been
discharged, through the first method dealt with i.e. discharge by performance. It is submitted therefore, that discharge by mutual
agreement is different from discharge by performance. In general an agreement to discharge the contract tacitly raises the
presumption of restitution of whatever performance have been rendered. )ee the case of Ael+enhnys v 2aree 196#(#) SA 5*1(9).
6nce a contract is discharged by agreement a part cannot be heard to argue that they see' to enforce the contract or some rights
arising therefrom. @astly under this rubric, a contract can be discharged through waiver by the promisee.
"hat are the re!uirements of waiver. The promisee<or the person who was supposed to receive the performance must have
'nowledge of his rights under the contract and the party alleging waiver must proof the fact of waiver, whether e,pressly or by
conduct. If a party alleges waiver by conduct, the promisees conduct must leave no reasonable doubt, as to his intention of
abandoning his rights in the issue. These re!uirements were underscored succinctly in the case of 5epner v Roo+epoortB
2arais>&r1 /own Co&ncil 196#() SA **(A), where the court stated the re!uirements as follows+
3The onus is on the appellant, -the promissor, he must show the respondent -promisee) with the full 'nowledge of her right decided
to abandon it, whether e,pressly or by conduct, plainly inconsistent with the intention to enforce it.
34
In 8. 3arte Sesse&s 11 /3! 15 the need for full 'nowledge was justified on the basis that waiver is a form of a contract, in which
the promise i.e. ta'en intentionally to have surrendered his rights. Intention to sole surrender can only e,ist where the promisee has
'nowledge of the facts of legal ramification of his conse!uences. )ee the case of Chi+6iva an+ 9thers v <iscosteel SCG13*G9*. )ee
also the case of 3atel v Controller o% C&stoms an+ 8.cise 194#(77) <LR 4#$
Termination of 'ischare &. o(eration of the law
9ow courts with supervening impossibility in Jimbabwe. Lntil the decision of 3ietersH ,lamman : Co$ v )o-sta+ 2&nicipality 1919
A! ##, they used to be no contract between Fnglish law and /omanA#utch law on the effect of supervening impossibility. Fnglish
law starts from the general proposition, that supervening does not e,cuse nonAperformance of the contract subject to several
e,ceptions which include the doctrine of frustration. In =ieters Flamman case the 2unicipality contracted that company to provide
streets lights for ten years.
#uring the substance of the contract, the partners were failed as enemy aliens for imprisonment and their business was wound up
under the relevance legislation.
The municipality claimed damages for breach of contract and forefeiture of the firms plant under the contract. The ppellate #ivision
dismissed the action.
The court held that if a person is prevented from pertaining his contract by this vis major cas&s %ort&it&o&s under which falls an act of
state i.e. person is discharged from liability. contract is void if at the time of its inception its performance is impossible. The same
apply to where the contract became impossible for performance.
Koid everything must be returned to original position status core. )upervening impossibility discharge the contract provided the
promissor proves that the contract has absolutely become impossible of performance. This does not mean that the promissor can
escape from his obligation simply because performance has become uneconomic<difficult. The Fnglish doctrine of frustration does
not apply in our law.
If only a part of a contract had became impossible for performance the court then loo's at the divisibility of the contract and if then
find that some obligation may be performed, then the promissor is discharged to the e,tent of impossibility. The creditor or promisee
had the option to cancel the contract or accept reduced performance. )ee Stan%el+ v )&hn 19" 03! 4, )ee also the case of L&p&
v L&p& #"""(1) <LR 1#" and the case of Bo>s Shoe Centre v 5eneways ,rei1ht Services 1995(#) SA #1. )ee also 2inister o%
7n+&stry an+ /echnolo1y v /ana-a 3owers SC 11G199". In )tanfeld there was the contract for the sale of land for .55 pounds per
acre, thus major in the form of e,propriation of or a national road, made it impossible for the seller to transfer more than 5,*1$ of an
acre, the court held that the buyer was entitled to demand transfer of 5,*1$ of an acre against a price of *1 pounds. If parties agree
to the performance of something which is ris' impossible, then the court will enforce the contract i.e. remedies of breach of contract.
In the same light, impossibility created by a party does not discharge the case of Wire952S v Areen>alt 1939(3) SA. )ee also the
case of 5ershman v Shapiro an+ Co$ 19#6 /3!H 36* and !ic-son 2otors v 9>erhol6er 195#(1) SA 3. )ee )o- v 9s>orne
1993() SA *44K BenEamin v 2yers 196 C3! L 655K Bayley v 5arwoo+ 195(3) SA 94. )ee )ell v 5enry '19"3( # )B *".
Set off ; Com(ansatio
35
It denotes a situation where two parties to a contract or generally where a creditor and a debtor have reciprocal obligations. If the
debtor or obligation are e!ual both are discharged and if they are une!ual, the smaller debt is discharged and the larger is reduced
proportionally. )ee the case of Scheirant v Dnion Aovernment 19#6 A! #56. )ee also /reas&re Aeneral v ;an ;&ren 19"5 /S 54#
and Baine v Barclays Ban- 193* SR 191. )et off is the principle of common law that is /omanA#utch law not Fnglish law. It has to
be pleaded and proved. For set off to be effective the reciprocal debts or obligation and fully due. @i!uid means that the debt must
be certain or capable of readily being ascertain i.e. over draft v interest miscalculations by a ban'.
The one debt e,tinguish the other as if performance or payment have been rendered. )purious defences based on bailey denial of
the debt will not defend set off. )ee the case of Bevcorp v 0yoni an+ 9rs 199#(1) <LR 35#$ )ee also Roman Catholic Ch&rch v
So&thern Li%e Ass&rance Ass 199#(#) SA 4"*. )ee also Central A%rican Railways v Williams 1963 Ran+ 0yasalan+ 1"6G166. )ee
also /rinity 8n1ineerin1 (3vt) Lt+ v An1lo Shippin1 Lt+ 1946(1) SA *""(#5).
3reach of a Contract
It can be rightly be classified as the method of termination or discharge. 9owever although breach is said to be a mode of
termination of contract. ?reach does not of itself automatically terminates a contract. ?reach has the effect of entitling the innocent
party to cancel the contract besides to give such entitlement the breach complained of must be either a major -material), or
fundamental breach, repudiation, or breach in circumstances where the contract provides that breach will provide an effect of
terminating the contracting. ?reach of contract is committed where one party who is bound to vendor performance at a later date
-future date) indicates that he<she will not tender performance when it falls due -anticipatory breach or repudiation).
Performance that shoul' have ren'ere' is not ren'ere' at all ; Non+(erformance or or'inar. &reach
)ome performance is rendered such performance is not in accordance with the terms of the contract, the debtor fails to perform
timeously. party who fails to perform timeously is said be in mora. )ee the case of Breyten>ac- v ;an WiE- 19#3 A! 31. )ee
also Bro+eric- 3roperty v Rhool 196#() SA *. )ee also Aol+stein an+ Wol%% v 2aison Blanc 194() SA 66 and the case of
2icro&B/sicos an+ Anor v Swart 199(3) SA *15$
Re(u'iation
part from the time element in breach, where does any other 'ind of breach terminate a contract8 /epudiation is where one party to
a contract evinces -discloses) an intention no longer to be bound by that contract, that repudiation can be e,press or by conduct.
/&c-ers Lan+ !evelopment Corporation v 5olves 194"(1) SA 65, the appellant property drew a plan of a township on which
appeared on % stands, which were then sold to the respondent 9olves. The appellant came up with new plan which two stands did
not appear. The court held that the drawing up of the new plan meant that the appellant have repudiated the old plan contract.
"here somebody e,presses an intention no longer to bound by his contract, that is fine. The innocent party has an election whether
to accept the repudiation thereby terminating the contract, or rejecting the repudiation<in which event the contract remains in force,
such an election however must be made within a reasonable time. )ee White an+ Carter Co&ncil v 2cAre1or 1961(3) A778R 11*4H
196# AC 13$ The city council were responsible for distributing litter bins and the defendant owned a garage, the city council, will
allow organi:ations and people to advertise on the bins. The initial contract between the council and the defendant was duly
performed. @ater one of the employees of the counternewed the contract for a further & years. The employer did not have the
authority to renew the contract. #efendant went to the council that advised then that he had cancelled the contract.
36
The council decided not to accept the repudiation, thus the contract remained in force from $C.1A$C05. The council later ratified
what its employer had done that is irrelevant in determining the outcome. The defendant did not ta'e advantage of advertisement
places but the council claimed payment. The court held that the contract remained in force for both parties and the council was
entitled to the & years of advertising. In that case the court did not ta'e about the mitigation rule. This rule means that any person
who suffers loss or damages should ta'e reasonable steps to mitigate that loss). 2itigate to reduce the detrimental. The council in
his ca&sa<case had not mitigated its loss. The mitigation rule applies to damages and not to cases of specific performance. nd it is
submitted that in the "hite and (arter case the court did not apply the mitigation rule because the council was see'ing specific
performance. It was fortuitous though that in that case the council was able to render performance without 2cgregors consent.
%aterial &reach
This is sometimes called fundamental breach. This is a breach that goes to the root of the contract, the analysis i.e. is a factual one.
Is the breach that had occurred is so serious that it undermines the contract. nd the innocent party is not reasonably e,pected to
continue with the contract. It amounts to nonAperformance. In terms of drafting a contract, parties tend to say or to provide that any
breach if not remedied within $* days will give the innocent party time to cancel the contract. The purpose of such provision is to
obviate the need to proof that the breach was fundamental or serious. Spies v Lom>ar+ 195"(3) SA 69 M Dniversal Car1o Carriers
v Citati '195*( # JB "1, )ee also An-emp v 2orton 199(3) SA 611. 6n repudiation see also the following cases Street v !&>lin
1961(#) SA . )ee also 3onisammy v ;ersailles 8state (3vt) Lt+ 19*3(1) SA 3*#$
Reme'ies for &reach of contract
"hen a distressed<distraught dashes client into your offices one had to decide what can be done, to enforce the contract or to secure
some remedies and how it is going to be done. If 7 does not pay under his contract you can sue him and get a contract judgment
which can be enforced by selling his property. There are five remedies of breach of contract+
$ cancellation and damages
% order for specific performance
& declaratory order
* interdict
. 8.ceptio non a+impleti contracts -I cannot perform because you had not performed your part)
$ )pecific performance
In /omanA#utch law an order for specific performance is the primary remedy. This is an order directing the defaulting party to
undertoo' what they had agreed to do under the contract. 7ntercontinental (3vt) Lt+ v 0estle <im>a>we 1993(1) <LR #1$ >estle had
underta'en to deliver certain !uantities of mil' and they failed to deliver the mil', then Intercontinental went to the contract for an
application for specific performance.
The principle that specific performance is the primary remedy is the way of contrast with Fnglish law, where, unless there are special
circumstances which ma'es specific performance appropriate, the court will award damages. In /omanA#utch law the court will
order specific performance unless there are special circumstances which ma'es it appropriate. )ee the case of )r&ntel Bro v
La6ar&s 199#(#) SA #3, 1991(#) <LR 1#5. )ee also 5aynes v )in1 Williams /own 2&nicipality 195"(1) SA 3*"M where the )
ppellate #ivision gave indication where the court will refuse the order of specific performance. The guidelines in this case re!uire
37
caution because of the influence of Fnglish law. The court will refuse specific performance where the damages are ade!uate. ->ote
that this neglects the primary purpose of specific performance in /omanA#utch).
% The court will refuse to give order where specific performance is difficult to enforce.
& "here the thing being sought in terms of the contract can be easily be found elsewhere. It is submitted that this is not
a valid ground, because li'e the first its nature is to undermine the nature of specific performance. The ) courts
have moved away from & and $. )ee Benson v SA 2&t&al Li%e Ass&rance Co$ 1946(1) SA **6, where the plaintiff
was see'ing specific performance of delivery of company shares when some were available at the Gorburg )toc'
F,change. The court ordered specific performance. The first ground was also rejected by court or the
Intercontinental case where the court ordered specific performance and also rejected by Jimbabwean courts.
* court will not order specific performance where that will entail services of personal nature.
. court will not order specific performance where such performance will operate unduly harshly over the defendant.
6r where the performance is impossible.
)ervices of a person nature will arise for instance in employment situations. The court may not order a wor'er to go and resume
wor' because one can not be sure whether the performance will be rendered fully.
t common law a court will not order a specific performance of a contract, )ee the case of Sheahoo+ v Dnion Aovernment 19#6 A!
#46$ )ee also the case of Commercial Careers Lt+ v =arvis 1949(1) <LR 3M Winterton 5olmes an+ 5ills v 3aterson SC 115G95
where the )upreme (ourt accepted that it will not order reinstatement specific performance where there has been a bitter
relationship between the employer of employee. In the case of 5ama v 0ational Railways o% <im>a>we, the court said that a part
who see's specific performance must have performed his part of the bargain or alternatively must tender performance and indicate
ability will to perform. The ratio of the 9ama case is however the court will not order specific performance where it is impossible to
perform<enforce<order. )ee also ,armers Cooperative Rea+ Berry 191# A! 33$
8.ceptio non a+impleti contract&s
@i'e said earlier on a party cannot see' specific performance from the other party from the contract if he has not performed his own
party. The party see'ing specific performance must tender his own performance. The essence of this remedy is, simply stated, that
my obligation to perform has not arisen because you have not performed your own obligation. It is submitted that this remedy must
be treated with caution as it will optimally apply to reciprocal obligation.
Interdict
There are % types of interdict temporary and final interdict. n interdict is an order stopping the other party from the doing of
something, which will jeopardi:e ones rights under the contract. final interdict is an e!uivalent of specific performance, where the
obligation sought to be enforced in character, i.e. negative prestation i.e. in a (ovenant /estraint of Trade, what the covenantor
underta'e not to do something in Jimbabwe or 9arare. The underta'ing is negative in character. 6ne is not underta'ing positively
to do 7. The only way to enforce the covenant is order -final interdict), stopping the covenantor from breaching the covenant.
temporary interdict -an interdict pen+ente lite). This literally means to free a situation pending litigation i.e. where a purchaser wants
to stop the seller from transferring a disrupted property pending litigation -legal action). ,lamelilly v <im>a>we Salva1e (3vt) Lt+ an+
Anor 194" <LR 3*4 where the interdict being sought was to stop the respondent from destroying a mining dump it until litigation
38
pertaining therefrom had been finali:ed. (hristie indicates that the re!uirements for a final interdict are the same of these specific
performance but are different to those of a final interdict. The re!uirements of temporary interdict are+
$ The applicant or the person who see's interdict must prove a clear prima facie right i.e. in the sense that the right
might be open to some doubts, if the averments<submissions made by the applicant ta'en together with averments
made by the respondents are such that given the possibility of providing further evidence the right will be proven.
% There must be a reasonable apprehension of irreparable harm if the interdict was not granted the Flamelilly case if the
respondent had proceeded to destroy the mining time is that there would be no mining dump at the end.
& There must be no other ordinary ade!uate remedy which would give the applicant some protection which would see'
through the interdict. The balance of convenience must be in the applicants favour, this means that the
circumstances must be such that the prejudice suffered by applicant if interdict were not granted would be greater
than the prejudice suffered by respondent if interdict were granted. The potential prejudice to the applicant should he
succeed in the main claim is that he will not be able to get an order for specific performance. )ee the case of Ai+eon
v 01&mo 19*3 RLR 19*. )ee also Setlo1elo v Setlo1elo 191 A! ##1$ 6n the other hand the prejudice the
respondent tend to suffer is being lend to free:e his affairs. )ee 8ricsson (3vt) Lt+ v 3rotea 2otors Lt+ an+ Anor
19*3(3) SA 655$
39