PVL3704___LATEST_ASSIGNMENT_PACK_2020. VERIFIED Q AND A.

2020 – SEMESTER 1 - ANSWERS TO ASSIGNMENT 1 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) [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 cannot be 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 the question 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 Industrial Bank Ltd 1990 3 SA 641 (A) (1) FNB paid stamp duties to the Commissioner for Inland Revenue which in fact were not due under protest. The court a quo held that the payment could be reclaimed on the basis of unjustified enrichment. (1) The Appellate Division found by majority that the money could be reclaimed on the basis of a tacit contract (1), but the minority found that where there is payment in such circumstances, the presumption of a donation falls away. (1) (c) Applying the requirements to the facts A made a payment under threat and protest, knowing that the debt wasn’t due. (1) The requirements for the conditio indebiti have thus been complied with. (For A to succeed with the condictio indebiti against the Johannesburg Municipality in these circumstances he, firstly, had to prove that he didn’t owe the Municipality the R300 000. Secondly, that the payment was made involuntarily under the threat that the electricity supply will be suspended if payment wasn’t made. Thirdly, that A protested against the amount to be paid at the time of payment by sending a letter of complaint.) (d) Conclusion A will be able to prove all three requirements under this exception and will therefore be successful with this enrichment action against the Johannesburg Municipality. (1) [max 10] 1.1 ANSWERS TO ASSIGNMENT 2 The correct answer to each of the questions below is the one that is highlighted. Brief explanations are given as to why each choice is right or wrong. Revert back to that part of the Study Guide if you still do not understand why a certain choice is right and the others wrong. Question 1 Answer: See Study Guide 1, Study Unit 14 Indicate which one of the following statements most correctly describes the existence of a general enrichment action in South African law: 1. In Nortjé v Pool 1966 (3) SA 96 (A) the Appellate Division recognised the existence of a general enrichment action in South African law. 2. In Nortjé v Pool 1966 (3) SA 96 (A) the Appellate Division rejected the existence of a general enrichment action in South African law. 3. In Willis Faber Enthoven (Pty) Ltd v Receiver of Revenue 1992 (4) SA 202 (A) the Appellate Division recognised the existence of a general enrichment action in South African law. 4. In Willis Faber Enthoven (Pty) Ltd v Receiver of Revenue 1992 (4) SA 202 (A) the Appellate Division rejected the existence of a general enrichment action in South African law. 5. Although the Appellate Division rejected the existence of a general enrichment action in South African law in Nortjé v Pool 1966 (3) SA 96 (A), the existence of such an action has since been recognised in the case law. (1) Question 2