Private Law 372
(Law of Contract)
notes
Compiled by Mari Louw in 2021. DO NOT DISTRIBUTE.
MARIA MAGDALENA Louw
, 1
Contents
1) The notion of contract..................................................................................................................6
Contract as an agreement to create enforceable obligations:.......................................................6
Agreement................................................................................................................................7
Contract as a subset of the law of obligations............................................................................11
Features of obligations...........................................................................................................11
Sources of obligations............................................................................................................16
Development and sources of SA contract law...............................................................................21
Statutory law and the impact of the Constitution.......................................................................22
1) Statutory law of contract: not codified...............................................................................22
2) Constitution........................................................................................................................22
3) Customary law...................................................................................................................25
Underlying constitutional values of law of contract......................................................................26
Bredenkamp v Standard Bank 2010 (SCA) (prescr)..................................................................27
Relationship between common law rules of contract and CPA.....................................................29
CPA: purpose and interpretation:...............................................................................................29
Consensus = offer and acceptance.................................................................................................33
1) Making of the offer:...............................................................................................................33
Requirements of a valid offer:................................................................................................33
Offer for reward.....................................................................................................................39
Termination of an offer:.........................................................................................................41
2) Acceptance of the offer:.........................................................................................................41
3) Breaking off negotiations.......................................................................................................46
4) Pacta de contrahendo............................................................................................................48
1) Option contracts.................................................................................................................48
2) Preference contracts...........................................................................................................51
, 2
Contractual liability where there is no consensus:.........................................................................59
a) Mistake/ absence of consensus:.............................................................................................59
1) Material v non-material mistake........................................................................................59
2) Relevant v irrelevant mistakes...........................................................................................67
3) Unilateral, common, and mutual mistake..........................................................................67
b) Liability in the absence of consensus:...................................................................................76
Theories of contractual liability:............................................................................................76
Relationship between 2 approaches and 3 theories in practice..............................................79
Saambou-Nasionale Bouvereniging v Friedman 1979 SCA (prescr):...................................79
Doctrines that establish objective liability:............................................................................81
c) Liability ito Consumer Protection Act...................................................................................92
Improperly obtained consensus:.....................................................................................................94
Misrepresentation.......................................................................................................................96
What are misrepresentations?.................................................................................................97
Remedies for misrepresentation:..........................................................................................103
Aedilitian remedies/ actions:................................................................................................114
Statutory remedies: Consumer Protection Act.....................................................................115
Misrepresentation as a defence:...........................................................................................116
Excluding liability for misrepresentation.............................................................................118
Duress:......................................................................................................................................121
Modern requirements of duress:...........................................................................................122
Undue influence.......................................................................................................................130
Requirements:.......................................................................................................................131
Remedies:.............................................................................................................................131
Origins:.................................................................................................................................132
Preller v Jordaan 1956 (A):..................................................................................................132
Commercial bribery:................................................................................................................134
, 3
Plaaslike Boerderdienste v Chemfos 1986 AD:...................................................................135
Extel Industrial v Crown Mills (prescr):..............................................................................135
Further grounds for improperly obtained consent?..................................................................135
Values guiding the development of the common law on improperly obtained consent.......136
Unrecognised grounds: abuse of circumstances.......................................................................137
Beadica 231 CC v Trustees, Oregon Trust 2020 (5) SA 247 (CC) prescr...........................139
Contractual capacity.....................................................................................................................141
Factors influencing lack of capacity.........................................................................................141
Persons with full contractual capacity......................................................................................143
Formalities:...................................................................................................................................145
Formalities in electronic contracts:..........................................................................................146
Spring Forest Trading CC v Wilberry Ecowash 2015 SCA:...............................................147
Sources of formalities:.............................................................................................................149
1) Statutory formalities:.......................................................................................................149
2) Self-imposed formalities..................................................................................................157
Remedies:.............................................................................................................................168
Requirements for validity of a contract........................................................................................175
Possibility as a requirement for a valid contract......................................................................175
initial impossibility, not supervening or making impossible through fault..........................175
Objective, not subjective impossibility:...............................................................................176
Exceptions: liability despite impossibility...........................................................................177
Consequences of impossibilitiy............................................................................................178
Certainty as a requirement for a valid contract:.......................................................................180
practical examples of how the rule works:...........................................................................181
consequences of uncertainty:...............................................................................................189
Legality.....................................................................................................................................190
Introduction..........................................................................................................................190
(Law of Contract)
notes
Compiled by Mari Louw in 2021. DO NOT DISTRIBUTE.
MARIA MAGDALENA Louw
, 1
Contents
1) The notion of contract..................................................................................................................6
Contract as an agreement to create enforceable obligations:.......................................................6
Agreement................................................................................................................................7
Contract as a subset of the law of obligations............................................................................11
Features of obligations...........................................................................................................11
Sources of obligations............................................................................................................16
Development and sources of SA contract law...............................................................................21
Statutory law and the impact of the Constitution.......................................................................22
1) Statutory law of contract: not codified...............................................................................22
2) Constitution........................................................................................................................22
3) Customary law...................................................................................................................25
Underlying constitutional values of law of contract......................................................................26
Bredenkamp v Standard Bank 2010 (SCA) (prescr)..................................................................27
Relationship between common law rules of contract and CPA.....................................................29
CPA: purpose and interpretation:...............................................................................................29
Consensus = offer and acceptance.................................................................................................33
1) Making of the offer:...............................................................................................................33
Requirements of a valid offer:................................................................................................33
Offer for reward.....................................................................................................................39
Termination of an offer:.........................................................................................................41
2) Acceptance of the offer:.........................................................................................................41
3) Breaking off negotiations.......................................................................................................46
4) Pacta de contrahendo............................................................................................................48
1) Option contracts.................................................................................................................48
2) Preference contracts...........................................................................................................51
, 2
Contractual liability where there is no consensus:.........................................................................59
a) Mistake/ absence of consensus:.............................................................................................59
1) Material v non-material mistake........................................................................................59
2) Relevant v irrelevant mistakes...........................................................................................67
3) Unilateral, common, and mutual mistake..........................................................................67
b) Liability in the absence of consensus:...................................................................................76
Theories of contractual liability:............................................................................................76
Relationship between 2 approaches and 3 theories in practice..............................................79
Saambou-Nasionale Bouvereniging v Friedman 1979 SCA (prescr):...................................79
Doctrines that establish objective liability:............................................................................81
c) Liability ito Consumer Protection Act...................................................................................92
Improperly obtained consensus:.....................................................................................................94
Misrepresentation.......................................................................................................................96
What are misrepresentations?.................................................................................................97
Remedies for misrepresentation:..........................................................................................103
Aedilitian remedies/ actions:................................................................................................114
Statutory remedies: Consumer Protection Act.....................................................................115
Misrepresentation as a defence:...........................................................................................116
Excluding liability for misrepresentation.............................................................................118
Duress:......................................................................................................................................121
Modern requirements of duress:...........................................................................................122
Undue influence.......................................................................................................................130
Requirements:.......................................................................................................................131
Remedies:.............................................................................................................................131
Origins:.................................................................................................................................132
Preller v Jordaan 1956 (A):..................................................................................................132
Commercial bribery:................................................................................................................134
, 3
Plaaslike Boerderdienste v Chemfos 1986 AD:...................................................................135
Extel Industrial v Crown Mills (prescr):..............................................................................135
Further grounds for improperly obtained consent?..................................................................135
Values guiding the development of the common law on improperly obtained consent.......136
Unrecognised grounds: abuse of circumstances.......................................................................137
Beadica 231 CC v Trustees, Oregon Trust 2020 (5) SA 247 (CC) prescr...........................139
Contractual capacity.....................................................................................................................141
Factors influencing lack of capacity.........................................................................................141
Persons with full contractual capacity......................................................................................143
Formalities:...................................................................................................................................145
Formalities in electronic contracts:..........................................................................................146
Spring Forest Trading CC v Wilberry Ecowash 2015 SCA:...............................................147
Sources of formalities:.............................................................................................................149
1) Statutory formalities:.......................................................................................................149
2) Self-imposed formalities..................................................................................................157
Remedies:.............................................................................................................................168
Requirements for validity of a contract........................................................................................175
Possibility as a requirement for a valid contract......................................................................175
initial impossibility, not supervening or making impossible through fault..........................175
Objective, not subjective impossibility:...............................................................................176
Exceptions: liability despite impossibility...........................................................................177
Consequences of impossibilitiy............................................................................................178
Certainty as a requirement for a valid contract:.......................................................................180
practical examples of how the rule works:...........................................................................181
consequences of uncertainty:...............................................................................................189
Legality.....................................................................................................................................190
Introduction..........................................................................................................................190
