PVL 3704 EXAM/ASSIGNMENT PACK

Question 1 Discuss in general (without reference to a specific enrichment action) how the extent of enrichment liability (or the quantum of the enrichment claim) will be calculated. (10) Answer In principle the plaintiff is allowed to claim the amount he has been impoverished, or the amount by which the defendant has been enriched, whichever is the lesser. (1) See Study Guide 1, pars 1.1.4 and 2.3. The quantum of the enrichment claim is calculated at the time the claim is instituted. (1) That means that the defendant is not liable for benefits that he due to his enrichment could have gained, but didn’t. (1) If the defendant’s enrichment has been reduced or extinguished before the claim has been instituted, his liability will also be reduced or extinguished. (1) The onus to prove non-enrichment lies with the defendant. (1) In four instances the quantum will be calculated sooner, meaning before the date of institution of the action: (a) at the moment the defendant becomes aware of enrichment (1); (b) at an earlier stage if the defendant should have known that the benefit wasn’t justified (1); (c) when the defendant fell into mora (1); and an earlier date if the defendant acted mala fide (1). These exceptions do not apply in the case of minors. (1) In quantifying the claim all positive and negative side-effects should be taken into account. (1) Interest earned on money in the hands of the defendant before litis contestatio cannot be claimed by the plaintiff, (1) but after mora the plaintiff can claim mora interest. (1) See Study Guide 1, par 3.4. If the defendant spent the money on something he would not have done if it wasn’t for the enrichment, he can raise the defence of non-enrichment. (1) However, if all or part of what he spent the money on (eg goods) is still of value and in his hands, he must offer the goods or the value of the goods to the plaintiff. (1) If the goods are more valuable than the impoverishment, the difference should be paid to the defendant.(1) 2 [max 10] Question 2 A owns a factory manufacturing steel in a continuous process. His monthly electricity bill averages R100 000. He just received a letter from the Johannesburg Municipality in which it threatens to cut his electricity if he doesn’t immediately pay his “arrear account of R300 000”. A knows that there must be a mistake, because his account is paid in full, but also knows that if there is a disruption in his electricity supply he will suffer severe losses. He pays the amount immediately and sends a letter of complaint. Advise A whether he will be able to reclaim the R300 000 he paid, and with which remedy? In your answer discuss the requirements for this remedy. (10) Answer You should follow the following steps in answering this type of question: (a) You first need to identify the correct unjustified enrichment action. If necessary, explain why another enrichment claim cannotbe used. (2) (b) Then discuss the relevant requirements for a successful claim under the action and any defences against such claim. It is important here to refer to any relevant case law. (6) (c) Apply the requirements of the claim to the facts provided. (1) (d) Make a definite conclusion on thequestion asked. (1) (a) Identifying the correct action The correct action to be instituted by A is the condictio indebiti. This action is available in instances where a debt not owing was paid. (1) Incidentally no unlawful, ultra vires or void contract is relevant here and therefore it seems as if no other condictiones could be applicable. (1) (b) Requirements for the action and defences against it See Study Guide 1, par 3.4 for the requirements. State each of the requirements: (i) Transfer of ownership in the form of payment of money or delivery of a specific object (1/2) (ii) Payment has to take place under the mistaken belief that the performance was due.(1/2) (iii) The mistake, either a legal or factual mistake (1/2), must have been reasonable in the circumstances (iustus error). (1/2) In general, a party cannot reclaim performance with the condictio indebiti if he was aware that the performance wasn’t due. (1) Such conduct will be regarded as a donation (1/2), unless it was made under threat or protest. (1/2) See Study Guide 1, par 4.6. Case law In CIR v First National Ind