2. Final Assignment CL2 August 11 2011

Introduction to the Theory of Law & Law of Contract

ASSIGNMENT NUMBER CL2

PART A

INTRODUCTION TO THE THEORY OF LAW

&

PART B

LAW OF CONTRACT

1 of 46 Assignment CL2 of Rakesh Kumar


PART A: INTRODUCTION TO THE THEORY OF LAW



TABLE OF CONTENT

PART A: INTRODUCTION TO THE THEORY OF LAW 2

QUESTION 1 5

ANSWER 1 5

Relevance of Legal Conviction of the Community in South African law 7

QUESTION 2 9

ANSWER 2 9

Hence the four types of capacities are as follows: 11

Name of the cases, where Capacity exists or Does not exists: 12

QUESTION 3 14

ANSWER 3 14

Comparison between Real Right and Personal Right (that is right arises from Conclusion of Contract) 18

QUESTION 4 20

ANSWER 4 20

QUESTION 5 23

ANSWER 5 23

Distinction between Onus of Proof and Evidentiary Burden in the context of civil litigation 25

PART B: LAW OF CONTRACT 27

QUESTION 1 28

ANSWER 1 28

First Circumstance 29



Second Circumstance 30

Third Circumstance 31

QUESTION 2 32

ANSWER 2 32

Impossibility at the time of conclusion of contract:(Initial Impossibility) 33

Impossibility after contract signature 34

QUESTION 3 37

ANSWER 3 37

QUESTION 4 39

ANSWER 4 39

Mora Debitoris 40

Mora Creditoris 42

BIBLIOGRAPHY 45



QUESTION 1

What does the expression “legal convictions of the community” mean?

What is the relevance thereof in South African law?

ANSWER 1

Bois et al (1100:2011) while clarifying what legal conviction of the community

state as follows:

“The reference to the ‘legal convictions of the community’ is better

understood as an acknowledgement of the fact that the court, in

exercising its judicial discretion to decide the wrongfulness issue, must

be sensitive to the boni mores of society.”

Hence the legal conviction of the community can also be understood as the

acknowledgement of good moral values of the community by the court, while

exercising the judicial discretion.

The Department of Water Affairs, Republic of South Africa in one of their

presentation “The Presumption of negligence” states that:



“The five requirements (or elements) necessary for delictual liability are: 1.)

Conduct 2.) wrongfulness 3.) fault (intention or negligence) 4.) causation 5)

Harm.”

Hence it can be seen that one of the requirements of delictual liability is

wrongfulness, which need to be proved for a person to have committed a

delict. For any conduct to be wrong, it must be legally wrong, just being

morally wrong is not enough. However, in case if there does not exists any

law with respect to particular issue, in that case the court asks, though there

does not exist any law with respect to particular issue, but whether the

conduct of the person is considered unreasonable, based on the legal

conviction of the community? Whether the community would have considered

the issue as just, not only morally wrong but legally wrong too.

Bois et al (1097:2011) also stated that:

“Negligent conduct giving rise to damage is …. not actionable per se. It is

only actionable if the law recognizes it as wrongful.”

Just that the conduct is unreasonable does not make it wrongful due to other

reasons attached to it. The reasonableness of conduct must be established

objectively.



Hence legal Conviction of the community is the guide to the court, to decide

what is wrong and illegal, when there does not exist any written legal guide.

Relevance of Legal Conviction of the Community in South African law

The changing values of the society, changing technologies and developments

create legal uncertainty and the law must adopt these changes in order to

remain effective. Kleyn & Viljoen (15:2011) while referring one case where the

court using the legal convictions of the community referred as follows:

“In Clarke v Hurst 1992 4 SA 630 (D) the court had to decide if a wife may be

appointed as her husband’s curator with the power to make decisions about

his medical treatment. The man was terminally ill, in a permanent vegetative

state and was unaware of his surroundings. There was no previous decision

in which a court allowed passive euthanasia. Justice Thirion, however, found

that the legal convictions of the South African community do not regard the

stopping of medical treatment as unlawful if a person is being kept alive

artificially. Accordingly, he granted the wife’s application. A 1997 discussion

paper of the South African Law Commission recommended that this position

should be confirmed in legislation.”

Further Kleyn and Viljoen (15:2011) referred that in another case of Van Erk v

Holmer 1992 2 SA 636 (W) the court decided that due to changing social



environment, the natural father’s inherent right extended to the child born out

of marriage.

Hence, we can see that where there is no previous decision exists to guide

the court, the South African court could guide them self based on the legal

conviction of the community about the subject matter in taking decision, which

is in accordance with the legal conviction of the community is lawful. In the

previous two referred cases too, the South African court took the decisions

that the wife can be appointed as her husband’s curator with the power to

make decisions about his medical treatment and in another case South

African court decided to extend the natural father’s inherent right to the child

born out of marriage.

Hence we can see that the South African courts time to time guides

themselves with the legal conviction of community.



Question 2

Explain the concept of “capacity”. In your answer address the different

types of capacity and name 3 cases where capacity exists or does not

exist.

Answer 2

Concept of Capacity has been defined by different legal experts and they are

as follows:

Bhana, Bonthuys & Nortje (75:2010) while defining the capacity states as

follows:

“In order to form the necessary animus contrahendi and to reach consensus

all the parties to the contract must have the necessary contractual capacity.

This means that they must be able to understand the nature of a contract

and the consequences of entering into a contract.”

Bois et al (146:2011) while defining capacity states that:

“The only capacity common to all persons is legal capacity in it narrow sense:

every legal subject, irrespective of his or her personal attributes, has the



capacity to have rights and duties, although the extent of this capacity and

the particular rights and duties proposed at a certain time by virtue of this

capacity may vary from one person to another. On the other hand, not all

persons have any or all of the other capacities. So, for example, infant

(children below the age of 7 years) and insane persons have no capacity to

perform juristic act or to litigate, while these capacities are subjected to

certain limitations in the case of minors above the age of 7 years.”

Hence capacity of a legal subject could be understood as his/her capacity to

contract, ability to understand nature and consequences of contract. But the

extent of legal capacity may vary from person to person. People having

mental illness, are in intoxication, minors less than 7 years of age does not

have contractual capacity and a person declared prodigal by court have

limited contractual capacity.

Kleyn & Viljoen (109:2011) while defining legal capacity states as:

“Legal capacity is the capacity to be the bearer of rights and duties, in other words

to be legal subject.”

Hence the legal capacity of a legal subject determines his capacity to bear

right and duties.



In addition Kleyn & Viljoen (109:2011) while defining capacity and its type

states as follows:

“Positive law provides legal subjects with the ability to participate in legal

activities. Such abilities are called ‘capacities’ and we differentiate between

four types of capacities.”

And Plessis & Hees (134:2009) while defining capacity and its type states as

follows:

“…., a legal subject needs certain basic “juridical means”, or capacities as

they are known in legal parlance, in order to participate in (the) “legal reality”.

In private law four such capacities are relevant, namely: legal capacity, the

capacity to act, the capacity to be a party to civil proceedings (locus

standi in iudicio) and accountability. These capacities mean that a legal

subject can participate in private law activities.”

Hence the four types of capacities are as follows:

1. Legal Capacity: It is the legal subject’s capacity to be the bearer of

right and duties to be subject in legal activities.

2. The Capacity to act: That is the capacity of a legal subject to perform

juristic acts such as signing contracts of purchase and sale, drawing up

wills, marriage etc. Different factors such as age and mental health



determines individual capacity to act. A child less than 7 years of age

does not have capacity to act. Minors between 7 to 18 years have

limited capacity to act.

3. The Capacity to be a part of civil Proceeding: The legal subjects have

a capacity to be part of legal proceeding as plaintiff or defendant.

Minors can appear in the court only with assistance of his parents or

guardian.

4. Accountability: The accountability is the capacity to act lawfully and to

be held liable for unlawful act. Insane people can not be held liable for

unlawful acts.

Name of the cases, where Capacity exists or Does not exists:

Edelstein v Edelstein 1952 3 SA 1 (A): Here it was stated that

the minor, through out his/her minority does not have capacity to

contract.

Dhanabakium v Subramanian 1943 AD 160 167: It was stated

that minor do not have capacity to contract without assistance of

his guardian subjected to certain qualification.

Buttar v Ault 1950 4 SA 229 (T) 239: It was stated that an

unassisted minor don’t have capacity to accept the donation

until he has reached the age of puberty.



Spangenberg NO and Another v De Waal (15226/2005) [2007]

ZAGPHC 233 (18 October 2007): It was stated that a person

who does not have proper mental capacity can not institute a

matrimonial action without the assistance of the Curator ad

Litem



Question 3

Ownership is a real right. Discuss what is meant by this statement and

compare the extent and characteristics of such a right with a right which

arises from the conclusion of a contract.

Answer 3

Study material of Association of Arbitration (Introduction to Theory of Law)

states that:

“Rights in property are referred to as real rights. Real rights attach to things

and are enforceable against the whole world. The most extensive of all the

real rights is the right of ownership. Possession, mortgage, pledge,

servitudes and liens are other real rights.”

Bois et al (427:2011) states the following:

“Real right or proprietary rights are those rights that a legal subject has with

regard to a particular item of property. Unlike personal rights, which concern

the relationship between parties to a contract or delict, real rights establish an

almost direct relationship between the holder of the right and the property.

In order to identify the basic characteristic of the real rights, real and personal

rights need to be distinguished clearly. Then the various categories of real



rights can be identified and the criteria for the recognition of new categories

explained. Only real rights with regard to land are registerable in terms of the

Deeds Registries Act.”

And Bois et al (470:2011) further states that:

“Ownership, in contrast to limited real rights like servitude and mortgage, is

potentially the most extensive private right that a person can have with

regard to property. In principle, ownership entitles the owner to deal with his

or her property as he or she pleases within the limits set by law. The

comprehensive right of ownership embraces not only power to use (ius

utendi), to enjoy the fruits (ius fruendi) and consume property (ius abutendi),

but also the power to possess (ius possidendi), to dispose of (ius

disponendi), to reclaim property from anyone who unlawfully withholds it (ius

vindicandi) and to resist any unlawful invasion of property (ius negandi). The

list is not necessarily complete, for if an owner grants all the list entitlements

to a third party, ownership is suspended only to the extent of the powers

granted and, once the grant is extinguished, ownership automatically

becomes unencumbered again, demonstrating the ‘elasticity’ of ownership

and why ownership is sometimes called a reversionary right’.”

Hence based on thought of different educational experts, we can see that real

right is the right associate with property/things. The right related to ownership

of any property is also related to right associated with things, and hence

ownership is considered as a real right. Ownership establishes direct relation



between owner and things/property. In case of real right of ownership of land,

the lands are registerable under deeds of registries act. This registration

allows the real right with respect to land/property to be legally secure. Further

right of ownership is associated with things such as land or home and this

right can be enforced against the whole world (against any one).

In addition Kleyn and Viljoen (112:2011) define real rights as follows:

“Real rights are the rights with respect to things, for example ownership.”

Hence we understand by the statement “Ownership is a real right” as the right

rights associated with respect to property/things. Hence the meaning of the

statement “Ownership is a real right” can be understood as ownership of any

thing such as house or car, gives the owner a real right that is his/her right to

use it, sell it, lend it, give it on hire, may dispose it, reclaim from anyone who

unlawfully withhold it. Further ownership is considered to be most extensive

rights among all other real rights. It is also noted that regarding ownership, if

owner of the house grants power of attorney to A for renting his house to

anyone for the duration of 5 years, till he (owner) is outside the country. The

ownership of A has been suspended only for renting the house, as he has

given this power to A, and A can not do any thing else then giving the house

to any one on rent. Further after 5 years, that is expiration of power to rent, A

looses the authority to rent the house and the owner gets the authority to rent

again.



Plessis & Hees (142:2009) states the following:

“The right of ownership (or ownership, in short) is real right – the only (real) ius in

re propria or ius in re sua (a right to one’s own thing). All other deal rights are

limited real rights or iura ius in re aliena (rights to the things of others). Examples

of such rights are:

the right of a pledge to movable property (in otherwords a pledge);

the right of a bondholder to immovable property;

the right to lessee of fixed property to that property;

a right of way; and

the right(s) of a usufructuary.”

Here we can see that Plessis & Hees also supported the statement and views

stated earlier that the ownership is the most extensive real right among all

other real rights.

Right arises from conclusion of Contract is personal right. Under a

contract one party is obliged to carry or not to carryout particular things for

another party, which gives another party personal right. For example in a

sales contract, buyer has right against the seller, that the seller will deliver the

goods on time to buyer.



Comparison between Real Right and Personal Right (that is

right arises from Conclusion of Contract):

Real Right Personal Right

Right related to Property/Things. This is concern with the relationship

between parties to contract or Delict.

Real right can be enforced against

large number of people, in case of

ownership; it could be against whole

world too.

Personal right can be enforced again

parties to contract or third party who

is engaged with the contract due to

any reason.

It established direct relationship

between holder of the right and the

property.

It talks about the relationship

between parties.

Real right refers to a right that is

attached to a thing rather than a

person.

A right that is based on one's status

as an individual and does not derive

from property.

Right to use it and/or sell it and/or

lend it and/or give it on hire,

depending upon type of real right.

In case of personal right for example

in case of sales agreement, for buyer:

Right to receive goods as per

agreement. Get warranty or

Guaranty, Servicing from the

suppliers as per Conditions of



Contract.

For seller: Right to receive payment

as per agreement.

Elasticity: Part of real right could be

passed to other for a certain period

and after that period that rights come

back to the real right holder.

This is not as flexible as real right.

Only real rights with respect to land

are registerable in terms of Deeds of

Registries Act.

No need of registration in terms of

Deeds of Registries Act.

Example: Ownership, Servitude,

Mortgage, right of way, rights of

bondholder to immovable property,

right to lessee of fixed property, use,

pledge, usufruct, habitation and

predial servitude

Example: Contract or Delict



Question 4

Give the meanings and respective importance of the ratio decidendi and

obiter dictum of a case.

Answer 4

The South African court follows the precedent system that is standing by with

the previous decision taken by other courts. However every word in the

judgment is not binding.

Plessis and Hees (240:2009) states that:

“According to the stare decisis rule, court A:

Is either absolutely obliged to follow the judgment of court B;

Or follows the judgment of court B because A can find no fault with it;

Or allow itself to be persuaded by the arguments of court B”.

Hence we can see that precedent system rules allow court A to consider the

decisions made by court B. The decision could be obligatory or persuasive.

Plessis and Hees (240:2009) while defining what is binding in the judgment of

a court states that:



“In a judgment a court normally makes finding on two kinds of issues – in other

words, two kinds of questions are answered:

Factual issues or question of fact, and

Legal issues or questions of law”.

A factual issue generally differs from case to case and is unique to a specific

instance. Hence the facts of one case can not be relevant to another case.

But at the same time the legal issues of one case could be relevant to another

case. A fact in a particular case is not binding in another case, but the courts

finding in respect of question of law of once case could be binding in another

case, in case if there is a significant similarity between the aspect of two

cases. This statement is substantiated by the statement of Plessis and Hees

(241:2009) which is:

“A court’s answer to the question of fact in a particular case cannot be

binding on a latter court; its answer to a question (or questions) of law

does, however, have binding force”.

Further it is to be noted that all decided by one court in previous decision is

not binding to the other court. Kleyn and Viljoen (60-61:2011) states that:

“Everything mentioned by a court in its judgment does not create a

precedent”

and



“Only ratio decidendi creates a precedent”.

And further defines obiter dicta and ratio decidendi as follows:

“Obiter dicta (the singular is obiter dictum) likewise do not create a

precedent. Obiter dicta literally mean ‘remarks in passing’. These are the

judge’s casual remarks concerning the law. They are not directly relevant and

applicable to the case before the court. It is not necessary for the court to

take them into account in order to reach its decision. The judge’s views

on a hypothetical case will, for example, be obiter dictum. Obiter dicta are

not binding, but they can sometimes have persuasive force.”

Hence ratio decidendi (reason for decision) is the legal principle

applied by the court to the material facts to reach the decision which is

binding. Obiter dicta that is remarks in passing made by the court is

not binding but persuasive evidence and as stated above courts

answer to the question of fact in a particular case is not binding but it

has persuasive evidence and is considered Obiter dicta.



Question 5

Define the concepts of “onus of proof” and “evidentiary burden” and

distinguish between them in the context of civil litigation.

Answer 5

Factoidz website states the followings:

“He who alleges must prove is the foundation of the evidentiary burden.

This must be distinguished from the burden of proof. The burden of proof

never changes; an accused must be found guilty beyond a reasonable

doubt, the plaintiff must prove on a balance of probabilities that the event

occurred according to his/her version. The evidentiary burden shifts from

party to party.”

Hence evidentiary burden is burden on the parties to provide evidence to

prove his case, while burden of proof burden on plaintiff that he/she must

prove on a balance of probability that, what he/she was alleging is right.

In a court case the plaintiff presents evidence to provide that what he is

alleging about defendant is right and he can prove this based on the evidence

he is presenting. At this stage the burden to present evidence (evidentiary



burden) to prove his allegation lies with the plaintiff. Here it is to be noted that

these evidence presented by the claimant is subjected to cross examined by

the defendant and in case plaintiff failed to present his evidence in support of

his allegation, there will be no case against defendant. Further in case the

evidence presented by the plaintiff is not enough to substantiate his case, the

defendant may not choose to present his case based on insufficient evidence

presented by the plaintiff and in this case he may force the judge to take the

decision, if he wants to dismiss the case or want the defendant to present his

evidence/case.

During cross-examination the burden of evidence (evidentiary burden) to

prove innocence shifts from plaintiff to defendant. At this stage the defendant

cross-examine the witness/evidence presented by the plaintiff and present his

evidence to prove that he/she is innocent and at this stage he/she/defendant

is responsible for presenting evidence to prove him/her innocent. Hence at

this stage the evidentiary burden lies with the defendant.

Plessis and Hees (101:2009) has stated about the onus of proof as follows:

“To be successful in court, a litigant has to prove his case. In a civil

case the nature of the dispute determines on whom the burden (or

onus) of proof rests: the one who avers must prove and the one who



denies must disprove. It is thus not necessarily always the

plaintiff/applicant who bears the onus.”

and Kleyn & Viljoen (131:2011) stated about the onus of proof as follows:

“The burden of proof (onus) in a criminal trail also differs. In a civil

case the onus is on the party that alleges. This will usually be the

plaintiff. In a criminal case the state initiates the prosecution, thus

the state carries the burden of providing the guilt of the accused.”

Hence the onus of proof can be defined as burden on the party who averts

must prove that other party was at fault. Generally the plaintiff has the

burden/onus of proof that what he alleges is right. In case of criminal case the

burden/onus of proof lies with the state to proof that guilt has been committed

by the accused.

Distinction between Onus of Proof and Evidentiary Burden in the context of civil litigation

Onus of Proof Evidentiary Burden

The burden of proof never changes.

The plaintiff must prove on a balance

of probabilities that the event

occurred according to his/her version

Evidentiary burden shifts from party

to party. In a civil court case, if

plaintiff alleges something about the

defendant. Then the burden to



Generally the onus is on plaintiff in

civil cases.

In case the plaintiff fails to provide

evidence, he will be said to fail to

discharge his burden/onus of proof.

provide the evidence lies with the

plaintiff, but during cross-examination

and while defending, it is

responsibility of the defendant to

provide the evidence to prove he

(defendant) is innocent.



PART B: LAW OF CONTRACT



Question 1

List 3 circumstances which may render a valid contract voidable.

For each of the 3 circumstances above, explain what requirements must

be satisfied before a party will succeed in having the contract voided.

Answer 1

Bois et al (772:2011) while defining the voidable contract stated as follows:

“A voidable contract is one which is valid, that is, it comprises all the

elements necessary to constitute a contract, but which one of the parties

is entitled to rescind because of some cause or defects which existed before

or at the time the contract was concluded. The chief of these causes are as

follows: (1) misrepresentation; (2) duress; (3) undue influence; and (4)

commercial bribery”.

Hence voidable contract is a valid contract and it has got all essential of valid

contract but the consensus obtained is based on improper method that is

defective and hence innocent party is entitled to rescind the contract due to

those defects that is (1) misrepresentation; (2) duress; (3) undue influence;

and (4) commercial bribery.



Based on the above mentioned explanation the three circumstances which

may render a valid contract voidable:

First Circumstance:

If A gets the consent of B for purchase of B’s car to A, based on undue

influence, which weaken B’s power to resist. In this case B is entitled to

rescind the contract, because of the undue influence made by A, before the

contract concluded.

Requirement that the party should satisfy before succeeding in contract

voidable:

If B wants not to rescind the contract then for him to succeed in making the

contract void he has to do the followings:

1. Give notice to A that since he has taken his consent based on undue

influence before signing the contract, he is not continue with the

contract that is going to sell his car to A, and due to that undue

influence he (B) considers the contract between A and B voidable.

2. However if the A goes to court to force B to sell his car to A bases on

the contract. B needs to prove that A has unduly influenced him/her to

take his consent to sell his/her car to B. B need to provide evidence to



court to substantiate that he has been unduly influenced by A to sell his

car to A, before contract signing.

Second Circumstance:

If, one party by providing false information about the condition/quality of

goods, sold to another. Until the person who purchased the goods, does not

rescind the contract, the contract is valid. There is no necessity of a court

order to declare the contract is rescinded.


voidable.

If one party (party A) provided false information about his car, that the car is

2005 model, while the car is actually 2000 model (where one of the basis of

sale is that car is of 2005 model). Based on this information the other party

(party B) purchased the car from party A. When party B comes to know that

the car he purchased is of 2000 model, not 2005 model as stated by Party A.

The party B can rescind the contract by sending notice to party A that since

the information (model of the car) based on which the car was sold by party A

and purchased by party B, was a false information, provided by Party A to

Party B to sell the car. The party B does not accept the goods provided and



claim back his money. If the party A does not returns the money to party B.

The party B can go to court and by providing evidence claim the money from

party A. Parties A and B may agree, that Party A will supply party B another

car of Model 2005.

Third Circumstance:

If A signs a contract to sell his 5 car to B for an amount of R 40,000, by

paying a bribe of R 2000 to agent (C) of B. But just after contract signature B

comes to know that A has paid bribe to his agent C (who was providing

suggestions to B on purchase of the Car from A) for getting this contract. The

contract of sell of car is voidable at the option of B.


voidable:

Just after coming to know about the information of bribe by A to C that is his

agent. B can give notice to A stating that, since he has fetched the contract by

providing bribe to his agent C. Hence B does not accept the contract and

consider the contract as void. If A goes to court, B has to provide evidence to

prove that A has paid bribe to C to get the contract.



QUESTION 2

One of the requirements for a valid contract is “possibility”. Discuss

this requirement, providing examples of each type of impossibility with

the consequences thereof.

ANSWER 2

Different educational experts has stated by possibility as follows:

Bois et al (753, 754:2011) while defining possibility of performance states as

follows:

“The contract must be possible of performance. If, at the time of

conclusion of the contract, performance is impossible on either side, the

agreement is a nullity and accordingly creates no binding obligations:

impossibilium nulla obligation est.”

.

Similarly Christie and Bradfield (97:2011) also states while referring another

court decision that:

“By the Civil Law a contract is void if at the time of its inception its

performance is impossible: impossibilium nulla obligation.”



Whereas Bhana, Bonthuys & Nortje (2010:16) while defining possibility states

that:

“At the time of conclusion of the Contract, it must be objectively

possible to perform in terms of the contract. If it is impossible to

carryout the terms of the contract, the contract will be invalid. If the

performances in terms of the contract are possible at the time of the

conclusion of the contract, but subsequently become impossible, the contract

is fully valid, but special rules apply to determine who must perform and who

bears the risk of impossibility.”

Based on above-mentioned view of educational experts, it was understood

that if performance is impossible at the time of conclusion of the contract, the

contract is void/invalid and it does not creates any obligation to the parties of

the contract. Further there is two cases of impossibility one is impossible at

the time of conclusion of contract and another one is impossibility after

contract signature.

Impossibility at the time of conclusion of contract: (Initial

Impossibility):

If the performance of the contract is impossible at the time of making the

contract, the contract is void and the party to the contract is not liable to

perform their duty under the contract. This is also called initial impossibility



and the party to contract is discharged from their responsibility from the

beginning of the contract. However for a performance to be impossible in this

cases four things need to be satisfied. That is impossibility must be absolute,

must be absolute as opposed to relative, must not be the fault of both party

and the principle must give way to the common contrary intention of the

parties.

If the parties by mistake form a contract and which they realize that it is

impossible to perform, the contract is void since the time it was form. Christie

& Bradfield (2011:340) supporting this statement states that:

“Common mistake will render the contract void ab initio only if it leads the

parties to make a contract which is impossible of performance, such as a sale

of res extincta.”

Impossibility after contract signature:

If the performance of the contract becomes impossible after the contract

signing due to force major (situation/power which can not be controlled by

ordinary individual) or casus fortuitus (inevitable accident) then the parties of

the contract is discharged from their obligation. However if the contract is

becoming impossible due to own fault of the party to the contract, then the

party is not discharged from the liability of the contract. For example: If A has

given his house to B on lease, but due to B’s fault fire broke in to the house



and it is impossible for B to use the house, B still has to pay the lease amount

to B as the impossibility is due to his fault.

But in case of sales of goods, if seller sells a good and dispatches to buyer’s

location and if the goods get destroyed during the transit, the buyer must

make the payment.

Partial Impossibility: If there is a divisible contract and one part of the

contract becomes impossible. In that case, one can accept part performance

or cancel the contract.

Material Impossibility: This occurs where the obligation is to deliver

property, and the property is destroyed before delivery. If the destruction is

due to vis major the obligation of the debtor is discharged; but not if it is due

to the fault or negligence of debtor. For example:

Another case is that if A has obligation to perform any services for B, however

due to vis major or by death or due to sever illness A was not able to perform,

B is still discharged from his performance due to impossibility of the

performance.

Another case of impossibility is that state prevents the party of contract not to

perform. For example A has to deliver the goods to B who is living in another



country and B has to pay. However in between the war broke up between

countries of A and B and there is state order from A’s state not to have any

business relation with country of B. In this case the performance of A became

impossible due to state order and hence he is discharged from his

performance.

If the impossibility of performance is due to the risk taken by the debtor, the

debtor is not discharged from performance.

Just becoming the performance difficult or change in commercial

circumstanced does not make performance impossible. And further if the

debtor is once discharged from his performance due to impossibility, it does

not entitle him/her to make a new contract and insist on making performance

on new term.

Legal Impossibility: Those contract which are legally impossible, such as

contract to perform illegal or immoral acts or invalid contract. The parties to

the contract are discharge from liability from the beginning of the contract.

Physical Impossibility: If the contract is physically impossible, for example

constructing a big multistory house by one person in one month. Due to this

physical impossibility of performance, the parties to contract are discharge

from the liability from the beginning of the contract.



QUESTION 3

One of the essentials of a contract is agreement or consensus.

In the following scenario, describe, in no more than one sentence for

each step, what is happening on the path to consensus.

(a) The employer issues a set of documents seeking a contractor to

build a hotel.

(b) A contractor responds, quoting a price to do the work on certain

terms.

(c) The employer accepts most of the terms, but rejects others.

(d) The contractor withdraws all of the terms to which the employer

objects, but increases the original price.

(e) The employer issues an order to the contractor to commence work,

but quotes the original price.

(f) The contractor moves onto site to start work.

ANSWER 3

(a) Employer requests an offer based on some defined conditions, from

contractor with an intention to create contract.

(b) Contractor submitted a Conditional offer for acceptance to the Employer

with an intention to create contract.



(c) Employer revised the initial conditions of the request for offer, considering

acceptable terms proposed by contractor and requested offer from the

contractor with an intention to create contract.

(d) The Contractor and Employer comes to same understanding of most of

the essential terms, except price.

(e) By issuing order Employer expresses his agreement and expressed

common understanding of all terms of the revised proposal but rejects the

change in Price (quotes same price).

(f) By moving to work on site the Contractor expresses agreement to the

issued order by his conduct, which leads to the mutual consent (same

mind or understanding) of the parties about change in requirement

with original price (essential or material factors of the agreement).



QUESTION 4

Explain the concept of “mora” in South African law. Include in your

discussion the meaning, different types, and application of mora.

ANSWER 4

Bhana, Bonthuys & Nortje (215:2010) while defining mora states as follows:

“Mora happens when performance is not made on time.”

Hence the term mora means delay or default in performance, while

performance is possible to be carried out. Under a contract a person is said to

be in mora, when he/she does not perform under stipulated timing in the

contract. However if the duration for the performance is not stated in the

contract, party to the contract must demand the performance to be done in a

reasonable time, and after that reasonable time, if other party fails to perform,

he/she will be said to be in mora.

Where the timing was stipulated in to the contract the mora is named as mora

ex re and where the timing was not stated in to the contract but the

performance was demanded by one party from another party by stipulating



reasonable time, in this case the party who fails to perform is in mora, and

this mora is named as mora ex persona.

Further Bois et al (858:2011) while defining the forms of breach states:

“The breach may take one of the following forms, each of which will be

discussed in turn: mora debitoris; mora creditoris; positive

malperformance; repudiation; and rendering performance impossible.”

Hence it can be seem that mora debitoris and mora creditoris are the forms of

breach, that is mora is of two types that is mora debitoris and mora creditoris,

which is further divided in to two types that is mora ex re and mora ex

persona as stated before.

Mora Debitoris:

It is defined as the late performance by a debtor, where the performance of

the debtor is due, enforceable under contract and possible for debtor to

execute. For example A has a valid contract with B, where A has to delivery a

car to B, before 31st of January 2012, however by 1st February 2012, A fails to

deliver the car to B, whereas there was nothing which was preventing him to

perform the contract, that is to deliver the car, and B was ready to receive the

car. In this case A is said to be mora Debitoris.



Mora ex re: In the above-mentioned case, if the date of delivery was

mentioned in the contract and A fails to deliver the car by 1st February 2011,

A is in mora ex re.

Mora ex persona: In the above-mentioned example, if the date of delivery is

not mentioned in the contract, in that case B has to give reasonable notice to

A to deliver the car. If after passing the reasonable time, A fails to deliver the

car, though there was nothing to stop him from performance, A is in mora ex

persona.

However in case where the contract does not state timing but the debtor

knows that the performance needs to be made urgently. For example calling

an ambulance from a hospital in case of emergency, if the hospital does not

sends the ambulance within reasonable time, the hospital is said to be in

mora.

As the mora is an ongoing breach of contract, when the party to contract fails

to perform, after the deadline stipulated in the contract or reasonable duration

notified to the party, the party is in mora and will remain more until he

performs the contract. If during the time when party is in mora, and the

performance becomes impossible, the party will remain in mora and failure to

perform will be considered as breach of contract and debtor may have to

face consequences of breach of contract.



Since, during mora if one party does not perform, he will be under breach of

contract. Other party has right to Specific Performance or Right to Damage or

Right to Cancel the Contract on basis of mora. The party can elect either

specific performance or cancellation but not both together, yes damages can

be claimed alone or either with specific performance or cancellation, if

applicable. For cancellation the party needs to satisfy few specific

requirements before canceling, such as the court directed specific

performance to the party in mora and again he fails to perform by the time

provided. Other party can cancel the contract. Or if the contract provides

provision of termination under certain circumstances and those circumstances

has been fulfilled, the party can cancel the contract.

Mora Creditoris:

In a contract both parties has right and duty, if the creditors does not provide

co-operation, which is required under the contract, so that debtor can fulfill

his/her obligation, creditor is said to be in mora. For example, the debtor

came to deliver the car (as per agreed specification) to creditor on agreed

date but creditor was not there to receive the car, though there was no

forced circumstances which was making him/her not to be present there to

accept the car, hence creditor is in mora from next day.



Since in this case creditor has obligation to receive on due date, debtor is

performing as per contract, however creditor failed to perform (receive), there

was no case of maior or casus fortuitus and performance was possible.

Hence the creditor is in mora

The day the party becomes mora creditor and if other party is in mora

debitoris, he comes out of mora. Further from the day creditor is in mora,

he/she is responsible for damage or impossibility of performance, the surety

for the debt is released and he/she becomes liable for payment of interest on

the debt.

In this case debtor has an option for specific performance, cancellation of

contract or damage.

The party can elect either specific performance or cancellation but not both

together, yes damages can be claimed alone or either with specific

performance or cancellation, if applicable. For cancellation the party needs to

satisfy few specific requirements before canceling, such as giving reasonable

notice to creditor or if the time is essence or if there is a provision in the

clause to cancel.

In case of mora creditoris too, when there if timing is clearly stated the

creditor does not perform he is in mora ex re and if debtor gave him



reasonable time and even after this reasonable time, the creditor does not

perform he is in mora ex persona.



BIBLIOGRAPHY

Anonyms (Time not stated). The presumption of negligence [online]. Website:

Department Water Affairs, Republic of South Africa. Available from:

http://www2.dwaf.gov.za/webapp/Documents/ForestFire/192.168.10.11/

nvffa.nsf/

1974327a06c616da42256dff0046dc16/4cebe8548525b66a42256dfe0074bee

d/$FILE/Presumption%20of%20negligence.ppt#283,1,The presumption of

negligence [Accessed 07 August 2011]

Anonyms (Time not stated). The Evidentiary Burden [online]. Website:

factoidz. Available from: http://factoidz.com/the-evidentiary-burden/

[Accessed10 August 2011]

Anonyms (2011). Introduction to the Theory of Law. South Africa: Association

of Arbitrators, Southern Africa

Bhana, Bonthuys and Nortje (2010). Business Transactions Law. 2nd

Impression. South Africa: Juta Law

Bois, Bradfield, Himonga, Hutchison, Lehmann, Roux, Paleker, Pope, Merwe

and Visser (2011). Wille’s Principles of South African Law. 9 th Edition. South

Africa: Juta Law


http://factoidz.com/the-evidentiary-burden/


Christie & Bradfield (2011). The Law of Contract in South Africa. 6 th Edition.

South Africa: Lexis Nexis

Kleyn and Viljoen (2011). Beginner’s Guide for Law Students. 4 th Edition.

South Africa: Juta Law

Plessis and Hees (2009). An Introduction to Law. 3rd Edition. South Africa:

Juta Law


2. Final Assignment CL2 August 11 2011

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Transcript of 2. Final Assignment CL2 August 11 2011