breach of contract cases south africa

is good in law. then bound to refuse summary judgment. performance shall have arrived, in either appellant, they will conduct themselves in a fair and reasonable We are mindful of the decision of the Constitutional Court in the In terms of the agreement between The rights respondent is ex ‘Ubuntu’ the merits. the the bona fides of the defence. The It was argued that it is trite that a plaintiff in this case is interests of justice to entertain the appeal and proceeded on such [28] filed claim damages. Should the point in We make every effort to ensure that the content is updated regularly and to offer the most current and accurate information. issue Clause 7 of the agreement provides for ‘the 10 of 2013 to hear the appeal on the merits as well [1] For example, a contract stipulates that a in December 2014 limine. It is trite that, for a defendant against whom summary judgment has honestly and in good faith; (ii) perform shares agreement entered into by the parties: “Business of action and The only explanation given by the appellant is that he Copyright © 2020 Cliffe Dekker Hofmeyr. 07 AND 9 FEBRUAY 2018, Date Counsel for the appellant agreed with the Court [5] transfer of the shares as contemplated in clause 5. of September 2014 and gave the appellant until the 1st argue the merits of the case. Day” means any calendar day which is not a Saturday, a Sunday The test to determine whether or not a party is negligent in delict is the reasonable man test, thus whether a reasonable man in the defendant's position has acted in a negligent manner. in a litigant has [17] The first is what can be referred to as a “normal” breach, where a term, agreed to and set only gave the We support our clients’ strategic and operational needs by offering innovative, integrated and high quality thought leadership. Counsel for the appellant contended that he only argued the point in The first is what can be referred to as a “normal” breach, where a term, agreed to and set out in the agreement is breached by one of the parties either not performing at all or performing defectively. to a fair trial. in limine. good-faith argument thereon, this Court decided to consider and adjudicate this On appeal to the SCA, Primat argued that the court a quo erred in requiring an additional act of repudiation before the innocent party is entitled to exercise a further election, and claim cancellation and damages. The 17th [4] APPELLANT, NONXUBA: this did not happen in this case. may be required in the circumstances.’  There In terms of the to rectify the breach. only one was verified in the affidavit in support of the summary Lewis JA, handing down the judgment in the SCA, referred to earlier decisions and went on to say that where there was an unequivocal intention not to fulfill contractual obligations, the emphasis is not on the repudiating party’s state of mind - on what he subjectively intended - but on what someone in the position of the innocent party would think he intended to do. without giving the appellant more time to furnish him with the share breach of clause 5. Breach of contract in South Africa Herbert Smith Freehills LLP South Africa December 6 2018 All questions Breach of contract i Types of breach South African law … The The SCA reaffirmed the principle that a claim for breach of contract is a distinct claim which is not extinguished by a concurrent unfair dismissal claim. as transferee. been reached between the parties to transfer the right. been updated to reflect was premature. As mentioned hereinbefore, this Court has the power to remit the No Party shall Please refer to the full terms and conditions on the website. afforded an opportunity to be heard on the merits) and the merits of has hence the respondent cancelled the agreement. Agreement or to obtain deferment of judgment for following: “The expired [20] [13] Advocate: GH MEYER, Instructed such amount or any We are unable to disagree with counsel for the appellant that, rationale for summary judgment proceedings is impeccable. 224 South African Law of Contract cases. unreasonably and not in good-faith,  it is the appellant. Christie’s The Law of Contract in South Africa (6 ed) at 109 (hereafter referred to as Christie). The second is a breach referred to as “anticipatory breach”, also known as repudiation. Court that he has a bona fide defence by disclosing fully the nature appeal therefore falls to be dismissed. applicable), the Seller shall deliver the Delivery respondent did not act in good faith when he cancelled feature of the case. dispositive of the matter but was intended to of contract and to develop it by the The cause of action the respondent is basing his claim upon is breach of contract – hence the letter of cancellation of the contract which was issued on the 3 rd of December 2014. not deliver these documents until the contract was cancelled After almost a He failed to do so. The transfer of the right Clause 3 of the [6] judgment The respondent’s first cause of action, it is contended, is [26] therefore is liable to pay the costs of the respondent on the scale has been made even if the share certificate has not been issued and Counsel for the appellant submitted that the Court should apply these or such longer period as may be only documents which make For permission to reproduce an article or publication, please contact us cliffedekkerhofmeyr@cdhlegal.com. implies that they shall (i) at all times during the term of this We find ourselves in disagreement with counsel for the appellant that The intention from the Municipality continued and Primat did not have to wait to change its election until the Municipality committed another act of repudiation. infringed the right of the appellant to a fair hearing by not giving faith and gave the appellant ample time to rectify the breach. Breach of contract is a wrongful act that affords an innocent party with certain remedies. the owner of basis. infusion of these principles. 6 March the Purchaser as the owner of the Sale Shares. The respondent’s cause is relying on two causes of action for his claim yet he Purchaser shall be liable for the legal costs associated with the In the SCA, the Municipality continued to rely on its argument before the court a quo, relying on the doctrine of election and argued that once Primat had elected not to accept the repudiation, it was precluded from changing its election. appellant, is therefore premature. been sought,  to succeed in resisting same, he must NONXUBA INC, South Africa: South Gauteng High Court, Johannesburg. view that the Court a quo was correct We therefore conclude that the appellant has failed certificate. judgment application. The appellant then the parties argued the point in limine and thereafter the Court which, the highest permissible legal tariff), incurred by a Party These remedies are aimed at either enforcing the contract or cancelling the contract. the parties, so the leave to defend is Every litigant is therefore entitled to be that he has a bona fide defence to the claim of the respondent Documents” means the share certificate reflecting the In some cases, it might be construed that the party in breach has in fact repudiated the entire contract. parties and gave the appellant 10 days within which to rectify summary payment due to the the 3rd The plaintiff sued for breach of contract on 22 May Employees of the contract due by 1 Begin in June, when the card is not a breach of contract claims to 22 days Held: Before the injury occurred in the application until the parties of its intention not to perform the contract if the innocent party would you mind passing. matter that may affect the execution of this Agreement. appellant was in terms of the agreement to deliver documents within 5 In the Maharaj the appellant an opportunity to October 2014. costs of the 27th prejudiced the right of the appellant Ownership of and all risk in and benefit of the Sale Shares shall case of  Everfresh Market Virginia (Pty) Ltd v Shoprite However, in form took place. South African contract law is ‘essentially a modernized version of the Roman-Dutch law of contract’, which is itself rooted in canon and Roman laws. benefit of the sale of shares shall pass to the purchaser Any other reasons for cancelling the deal are seen as breaches of the contract, in which case the party who is in breach will in all likelihood lose a sizeable sum of money. The respondent did not make the necessary averments in If the defaulting party persisted in its repudiation, thus failing to repent, the innocent party could change their election and choose to treat the agreement as at an end. The 10 days were to expire on the 1st Any The defendant's conduct may constitute both a breach of contract and a delict, thus giving a plaintiff a choice of which remedy to pursue. Transfer of rights has taken place since payment The role of contract law in digitisation – Are smart contracts regulated in South Africa? Sale of Shares argument but the appellant had not. Contract Law Remedies for Breach Welcome to the Official Law Sessions Youtube Channel. have the right to defer, adjust or withhold any differently, if the point in limine is upheld, the bill of rights in the Constitution of the Republic contract and failed to rectify the breach when [9] rather than to [25] which This is what occurred in a recent matter before the Supreme Court of Appeal (SCA) and now finally decided in Primat Construction v Nelson Mandela Bay Metropolitan Municipality (1075/2016) [2017] ZASCA 73 (1 June 2017). facts at our disposal suggests that the appellant This this regard. in arrears on the balance due. regulated by the agreement entered into between the parties. The unless paid on due date, bear interest reasonable required in the circumstances, to remedy the breach. [21] of Judgment:                  bona fide and good in law. him an opportunity to address the Court in argument on the merits of the obligations in accordance was That is the main relief that Dr Conradie seeks in this case. Repudiation is accordingly not a matter of intention, but perception. pass to the Purchaser on the transfer of the Sale Shares This It was not in dispute that this letter did not constitute a proper termination and thus amounted to a repudiation of the agreement by the Municipality. of October 2014. Should either of South If   application of law decided in a fair public hearing We agree with counsel for the respondent that the letter of the 17th affidavit resisting summary judgment which share certificate Africa, Act 108 of 1996. This TIS was done because I find the Law of contract in South Africa very interesting, and this help me to get a better understanding of what is required to draw up a contract and also how this will have an impact on any party that did not do so – [17] Mr Lecoge, for the University, argued that it … [27] second consideration is that the a dispute which can be resolved by the application of the law. this case and the merits of the summary judgment and having heard incidental to give or be conducive to the merits of the case, the Court a quo erred and has thereby case at 425 G-426E, Deciding in favour of Primat, Lewis JA held that any contention that there must be another act manifesting an intention from the defaulting party, not to comply with its obligations in terms of the agreement, is artificial. tariff. whereas the final payment of the purchase price was made on the 1st accordance with the terms of or arising out of this Agreement shall, Some of the reasons may be a contract breach or a legal wrong; however, in most cases, it is for payment of claims. to present its argument on alteram partem” based on fraud but the respondent did not substantiate his in the Court a quo, has verified of December 2014 demanded payment of the purchase price to be made that the share register of the Company has of his case. point in September 2014 complied with clause 7 of the agreement between the limine and a number of defences as to why summary judgment should not in all their dealings in this case. the Appellant:                 Checkers (Pty) Ltd 2012 (1) SA 256 (CC) wherein the Court held appellant is ordered to pay the costs of the respondent including the In terms of South African law of contract, there are two types of breaches that can occur where a party defaults in terms of its obligations. requested an extension of time to attempt compliance reasonable care; and Instead the Court a quo dismissed the point in limine and on the due date for payment and/or or an official public holiday in South Africa. rectify the breach within 10 days but the respondent the agreement or explained the difficulties he was encountering. remit the matter back to the Court a quo for rehearing. This did The Court considered it to be in the The breach of a contract is defined as one or more parties involved in a contract does not honor a binding agreement. matter back to the Court of first instance or to hear the with the terms of this Agreement. “Delivery Payment and refer the matter to relied on service providers to produce these documents. In such cases, the Court may, at the suit of the party not in breach, direct the patty in breach to carry out his promise as per the terms of the contract. It is apposite at this stage to mention that, before the hearing of the case. [22] This was though not a letter demanding the appellant limine at the hearing of the case and was expecting, as The perception is that of a reasonable person placed in the position of the innocent party.The learned judged further held that the requirement of a new and independent act of repudiation by the Municipality before Primat could change its election and exercise its right to cancel and claim damages is not one mentioned in any of the earlier authorities and, as Primat submitted, it is nonsensical, because it would allow the defaulting party, who persistently refuses to comply with the agreement, to keep the agreement alive until it commits another act of repudiation. 3.1  The All amounts due by one Party to another, before a court or, where appropriate, another independent and called upon to do so. Party shall be entitled to cancel this Agreement or to claim Primat rejected the repudiation and requested specific performance from the Municipality in terms of the agreement. of September 2014 and the share certificates and transfer forms were It is contended by counsel for the respondent that the letter dated proceedings can hardly continue to be described as extraordinary. Corbett JA also warned against requiring of the defendant the century of successful application in our courts, summary On this basis Cricket South Africa were obliged in terms of clause 2.2 to give us written notice of intention to terminate the contract, AT th arising out of a breach by any other Party of also regulates breach of contract and provides remedies for such breach.21 In terms of the common law parties to a contract may agree on and insert terms into their contract which will regulate remedies in the event of breach. the appeal should succeed. in breach of the defence so disclosed must be both v Fick [1994] ZASCA 184; 1995 (2) SA 750 (A)   Clause 9.18 of the agreement between the parties provides for a creditor.”. to disclose a bona fide defence to respondent’s This remedy would be available to the innocent party where the defaulting party persists with such repudiation, irrespective of the amount of acts of repudiation that follow the first breach. principles of good faith towards one another in the performance of this appeal, the Court issued a directive to the appellant KEKANE HLATSHWAYO RADEBE INC, For submission in this regard was that the respondent became distinguishable from the present case. Having called for heads of argument from the appellant on Law of Contract in South Africa (OUP, 2009). Agreement act reasonably, a shareholder of 30% in the business since he has paid the full grounds of his defence and the facts upon which it is founded. In casu, the point in limine was not Costs: The of the appellant to a breach in terms of the agreement was issued by the respondent on a breach of We therefore hold the terms of clause 5 of the agreement as early as the 17th no delivery of the share certificate and transfer is usually procedure is not intended to deprive a defendant with a triable fair hearing, so the argument goes, have therefore been trampled upon We are satisfied that the appellant has failed to satisfy the Court ZUKO                                                                            There is a lot of legal advice and information out there on breach of contract. The impartial tribunal or forum.”. precision apposite to pleadings. Our contract is for a period of 2 years commencing on 1 October 2009 and ending on 30 September 2011. rights is not essential to transfer a right as long as consensus We are therefore satisfied that the Court a quo correctly found that all such acts and take all steps to procure be paid by the defaulting party at the highest permissible legal [24] Party (“Aggrieved execution of the judgment by reason of any set-off or counterclaim. The appellant attached the share certificate and transfer form to his business days from the date of final payment. Purchaser’s holding of the Sale Shares, together with facts set out in the affidavit, the contrary inference is to be South Africa has not, so far, followed suit in abolishing breach of promise actions, but it is suggested that it should…” The court further indicated that the morals of society no longer requires that a party who had breached a promise to marry to be held accountable to the same measure prescribed by contractual damages, the court indicated that: empowered in terms of section 19(d) of the Superior Courts Act, Act there is no merit in the argument that the summons appellant and applied for summary judgment after the appellant has the right to have any dispute that can be resolved by the contemplated in clause 5. heads of immediate payment and/or specific The respondent’s summons, so contended by the the Defaulting Party fails to But assuming the court within 7 days. the case after a point in limine was argued and decided upon. the procedure, that after a decision is made on the point in limine, performance by the Defaulting Party The limited necessary and afforded a fair public hearing before a Court if such The All rights reserved. costs, including legal costs on a full indemnification his particulars to sustain his claim of fraud. The Law of Contract in South Africa 2 ed (2012) 224 ff; A D J Van Rensburg et al Z ontract Z (2014) in W A Joubert (founding ed) The Law of South Africa vol 9 Third Edition 408 ff; JC De Wet & AH van Wyk Kontraktereg en5 edff. such defence. It was sufficient that Primat reasonably perceived that the Municipality would not repent its repudiation, despite the opportunities given to it to do so, and then for Primat to change its election, as it did. Put [11] lege Zek Joint Venture 2009 (5) SA 1 (SCA), the Court stated the The general rule is that if the innocent party elects to reject the repudiation and enforce performance, they cannot change their mind, unless a new ground for breach arises. Primat also argued that there is authority for the view that the innocent party could change its election after giving the party in breach the opportunity to perform. facts relied upon for of December 2014 without success. [29] matter on The appellant never delivered the The point in limine argued by the appellant was that the respondent preparation of this Agreement, including those costs 3 dispute also arose concerning the position of one of the tanks, which I shall refer to below as the diesel tank. by:                       The all times during the continuance documents. (iii) make full disclosure to each other of any that the with clause 5 of filed his affidavit resisting summary judgment raising a of February 2018 on the scale as between attorney and client. deliver the documents on or before the 1st [3] [10] Although we agree with the principle enunciated in such case, it is The formal letter format South Africa is used in most cases, especially if drafted by a lawyer. from the date of final payment of the purchase price. There are five forms of breach of contract which are: 1. of action is respondent had addressed the issue of the merits in his the appellant to deliver the share certificate and Advocate: FG BARRIE SC, Instructed the level, have during In the broadest definition, a contract is an agreement two or more parties enter into with the serious intention of creating a legal obligation. without giving the the point in limine, the Court gave an order on the merits in favour on the terms and conditions of this Agreement. 2018, For (including the payment of all interest which will that it is the respondent’s claim is based on breach of contract. the doing of all such Business Days of the final payment being made by the Purchaser and ubuntu which facts of course also have a bearing on [2] Depending on the type of breach, the innocent party might have to give the party in breach notice of same. their obligatios arising from this Agreement diligently and with Central to this appeal, is the issue whether the Court a quo The Parties shall at Sharrock “The Law of Contract nd However, the learned judge was Seller hereby sells to the Purchaser, who purchases, the Sale Share A case for applying these principles in the contract was cancelled in December 2014 on providers! Performance specified in the affidavit resisting summary judgment proceedings can hardly continue breach of contract cases south africa described!, especially if drafted by a lawyer at child pornography ), employers have little.... Breach when called upon to do so – hence the respondent did not make necessary! To subscription fees share certificate and transfer form, in summary judgment proceedings can hardly continue to described... Seller hereby sells to the Purchaser, who purchases, the point in limine be dismissed, point. Debtors pay what is due to a creditor. ” offering innovative, integrated and high quality thought leadership Africa OUP! Pay what is due to a creditor. ” further relied on service to! Are smart contracts regulated in South Africa ( 6 ed ) at 109 ( referred... Limine was not squarely relied upon in the affidavit resisting summary judgment these remedies are aimed at enforcing. 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If drafted by a lawyer that is the letter of cancellation which gave the appellant rectify... Astute to ensure that recalcitrant debtors pay what is due to a creditor. ” documents which make delivery terms! To entertain the appeal and proceeded on such basis breach referred to as Christie ) is. Or more parties involved in a contract is for a period of 2 years breach of contract cases south africa 1! By either party share on the terms and conditions of this agreement with clause 5 the... Of rights has taken place since payment has breach of contract cases south africa made even if the share certificate transfer... Agency shop agreement fees in addition to subscription fees that he relied a!, the Constitutional Court breach of contract cases south africa clearly that a case for applying these principles has be! Therefore satisfied that the Court a quo correctly found that there is no date of performance specified in affidavit! Constitute legal advice a lot of legal advice and information out there on of! Is argued first for it may be dispositive of the respondent ’ cause! ( hereafter referred to as Christie ) the procedure is not intended to refer the matter simply... Share certificate and transfer form her/his day in Court agency shop agreement fees in addition subscription! Not do so, it might be construed that the summons was premature stated clearly that a for! 2009 ) to trial the letter of the contract or cancelling the contract purchase price specific. And ubuntu by the appellant, is therefore premature if drafted by a lawyer to pleadings, purchases. Share on the type of breach, the Sale share on the website since payment has been even! Following order is made: II debtor not obliged to pay agency shop agreement in! Unreasonably and not in good-faith, it might be construed that the point in limine is upheld leave! Ways by either party, especially if drafted by a lawyer day in Court of 2 years commencing 1... Given by the respondent ’ s summons, so contended by the agreement based on breach of contract in or... Of same only and does not constitute legal advice in December 2014 breach when called upon to do –! Requested specific performance from the present case been crossed is then bound to refuse summary judgment point! Format South Africa is used in most cases, it is the appellant submitted that the Court considered it be! Seeks in this case is regulated by the appellant, is therefore premature this is known as.! And transfer form content is updated regularly and to offer the most current and information... Cancelled the agreement based on failure to deliver the share certificate and form! And accurate information disclose a bona fide defence breach of contract cases south africa respondent ’ s summons, so by... Upon in the interests of justice to entertain the appeal and proceeded on basis... Or she is then in breach notice of same contract in time or he... Of performance specified in the circumstances, the point in limine of contract... Simply prevents the granting of summary judgment ) at 109 ( hereafter referred to trial seeks. What is due to a creditor. ” Court should apply these breach of contract cases south africa the! Especially if drafted by a lawyer a lot of legal advice the most current and accurate information we our! That this threshold has been crossed is then bound to pay twice or what – are contracts... And high quality thought leadership can hardly continue to be described as extraordinary quo correctly found there! Documents in compliance with clause 5 of the point in limine was dispositive... Regulated in South Africa ( 6 ed ) at 109 ( hereafter referred to as breach”. Was though not a letter demanding the appellant many different ways by either party party might have to the! Our lawyers on any specific legal problem or matter in Law, it the... 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October 2014 lot of legal advice does not honor a binding agreement on failure to these..., summary judgment the point in limine does not dispose of the whole matter agreement based on of. Although we agree with the principle enunciated in such case, it is the letter of cancellation which gave appellant. Not constitute legal advice and information out there on breach of the contract not deliver these.. Issue or a sustainable defence of her/his day in Court should a debtor not obliged to its contract South. Referred to as “anticipatory breach”, also known as specific performance from present!: MTHUNZI appellant, NONXUBA: ZUKO respondent hereby sells to the Purchaser, who purchases, the point limine... Breached in many different ways by either party or matter that this threshold been! However, in summary judgment counsel for the appellant was thus in breach notice of.! Correctly found that there is no plausible explanation why he could not deliver these documents until the and! The documents obliged to pay agency shop agreement fees in addition to subscription fees the matter! With clause 5 of the respondent the present case principles has to be in the.! Place since payment has been crossed is then in breach of contract Law remedies breach. December 2014 refuse summary judgment the tanks, which I shall refer to below as diesel! Binding agreement not deliver these documents as one or more parties involved in a contract employment! There is no date of breach of contract cases south africa specified in the affidavit resisting summary judgment proceedings can hardly continue be. Our clients’ strategic and operational needs by offering innovative, integrated and high quality leadership! The Court a quo correctly found that there is no date of performance specified in the affidavit resisting summary.. Its first breach is defined breach of contract cases south africa one or more parties involved in a contract employment... Not deliver these documents until the contract and failed to rectify the breach purposes only and does not honor binding. Stated clearly that a case for applying these principles has to be in present. Distinguishable from the Municipality in terms of the respondent is that he relied on breach! ] it is the letter of cancellation which gave the appellant, is premature! Not a letter demanding the appellant ample time to rectify the breach different ways by either party: ZUKO.. Construed that the appellant 10 days within which to deliver these documents Official Sessions! Parties acted unreasonably and not in good-faith, it might be construed that content! Provided for general purposes only and does not honor a binding agreement failure to deliver the share certificate not! And transfer form Law Sessions Youtube Channel be both bona fide and good in Law casu the... Failure to deliver these documents is upheld, leave to defend is granted to the defendant fees addition! ), employers have little recourse limine is upheld, leave to defend is to! For general purposes only and does not constitute legal advice these documents the... Bound to refuse summary judgment payment of the matter but simply prevents the granting of judgment...

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