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10.

BREACH OF CONTRACT

Breach of contract is non fulfilment of contractual promises and undertakings, where there is no
acceptable excuse or justification in law for this. It is not breach if non fulfilment can be exonerated
under the law, for example, due to operative mistake or a supervening event rendering fulfilment
impossible. Common examples of breach include attempted fulfilment outside agreed time limits,
(mora); purposeful or intentional non fulfilment, (repudiation); and poor or unsatisfactory fulfilment,
(positive malperformance).
10.1

Mora debitoris

[1]

GOLDSTEIN AND WOLFF v MAISON BLANC (PTY) LTD 1948 (4) SA 446
(Cape Provincial Division, South Africa, 24 September 1948)

In November 1944, the defendant Company, Maison Blanc (Pty.) Ltd., placed an order in Cape Town
with the plaintiffs, Messrs. Goldstein and Wolff of Johannesburg, manufacturers of ladies clothing,
for 9 frocks of a total value of £52 13s. The order also stated under the words “Forwarding
Instructions”: “January/February 1945 F.O.R. Johannesburg”. As the goods were railed from
Johannesburg only on the 16th April 1945, the defendant refused to accept delivery. The plaintiff
brought action in a Magistrate’s Court to recover the purchase price, and tendered redelivery of the
goods. The defendant pleaded that as time was of essence, and the plaintiff had failed to deliver
timeously, it was entitled to reject the goods and repudiate the contract. During the trial, the
defendant pleaded in the alternative that delay in the delivery of the goods was unreasonable, and this
was proper justification for repudiation of the contract. The Magistrate found for the defendant on the
alternative plea, but deprived it of costs for late filing of the plea. The Divisional Court held on
appeal that judgment should have been entered for the defendant on the original plea and, in that
event, there would have been no legal justification for depriving it of its costs.
HERBSTEIN, J.:
[452] “… I address myself therefore, in the first place, to a consideration of the natural and
grammatical meaning of the words ‘Forwarding Instructions . . . Johannesburg’. In my opinion, they
mean exactly what they say, namely, that the instructions for forwarding are that the goods shall be
forwarded by being dispatched from Johannesburg 'F.O.R.' during the months of January or February.
Mr. Lang suggested that they meant that defendant would give forwarding instructions during January
or February. This reading is not only farfetched, but it gives no effect to the words 'F.O.R.
Johannesburg'. It seems to me that if the parties had intended that the defendant should be obliged to
give 'Forwarding Instructions', the phrase would have been worded very differently. It should also be
noted that, in fact, no forwarding instructions were ever given and that plaintiff has at no time
suggested that the delay in forwarding was due to the absence of instructions. It is without hesitation
that I reject the reading suggested by Mr. Lang.
No evidence was given justifying a departure from the natural and grammatical meaning of
the words of the contract. Le Roith, however, stated that the plaintiffs had the right to forward after
the end of February. This appears to have been an assertion of a legal conclusion unrelated to any
agreement that a special or peculiar meaning attached, or should attach, to the words. But even if it
were such an attempt, it could not have succeeded, for the evidence to that effect was neither clear nor
consistent, nor sufficient to prove any agreement or a usage in the trade.
The next question that arises is whether, if the contract be read as obliging the plaintiffs to
forward the goods in the months of January or February, failure to do so entitled the defendant to
reject the goods. Mr. Lang contended that time was not of the essence of this contract, and that
consequently defendant had no right to refuse acceptance of the goods when they were tendered
towards the end of April.
Our law is clear - stipulations as to time are not regarded as of the essence of the contract
unless they are made so by express terms or it appears from the nature of the contract, or from [453]

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the surrounding circumstances, that that was the intention of the parties. ( Mitchell v Howard Farrar
& Co . (5 E.D.C. 131 at p. 140); Bernard v Sanderson (1916 TPD 673); Mayne v Wattle Extract Co .
(1920 NPD 89), and many other decisions).
Having regard to the magistrate's finding, I will assume in plaintiff's favour that there was no
express term making it essential for the goods to be forwarded by the end of February. There is,
however, a strong presumption that time is of the essence in a mercantile transaction proper ( Reuter v
Sala (1879, 4 C.P. at p. 249); Durr v Buxton White Lime Co . (1909, T.S. 876 at p. 879); Concrete
Products Co. (Pty.) Ltd v Natal Leather Industries (1946 NPD 377 at p. 380); Mackeurtan (2nd Ed., p.
289)). The contract in this case was one between a manufacturer and a retail dealer and clearly
constituted a mercantile transaction. Furthermore it related to fashion goods which to the knowledge
of both parties were purchased for re-sale during a season which admittedly was limited in time though there was a serious dispute as to the exact extent of the period of profitable sales of such
goods. It was admitted by Le Roith that delivery in February was specially asked for; and, therefore,
he at least knew that defendant attached some importance on the time it would receive the goods. All
these considerations lead to the conclusion that in this contract the stipulation as to the date of
delivery was of the essence of the contract. If that be so, delivery some 6 to 7 weeks later was clearly
not a compliance with the contract. There was no obligation on the defendant, as alleged in the
replication, to intimate at the end of February that it no longer required the goods. It was entitled to
wait until delivery was tendered and then to repudiate ( Federal Tobacco Works v Barron & Co .
(1904, T.S. 483); Strachan & Co. Ltd v Natal Milling Co. (Pty.) Ltd. , (1936 NPD 327)).
I come to the conclusion that the magistrate should have upheld the main plea. It follows on
this view that the appeal fails.
It thus becomes unnecessary to deal with the alternative plea, and I refrain from expressing
any view thereon, except to remark that the fact that it was filed late caused only a negligible increase
in the costs. Attention must now be directed to the cross-appeal.

[454] … I have already pointed out that the magistrate deprived the successful party of its costs on
the ground that an alternative plea on which it succeeded was filed late. The magistrate, however,
refrained from deciding the validity of the main plea, on which I have held the defendant was entitled
to succeed. That a great deal of the evidence led on the main plea would in any event have been
necessary and material had the alternative plea been part of the main plea, seems to have escaped the
magistrate's notice. The circumstance that the alternative plea was filed late was therefore no ground
for depriving defendant of its costs; it could only afford such ground if it were held that the main plea
was bad. Consequently the justification, if any, for the magistrate's order as to costs must rest upon his
finding that the witnesses for defendant gave false evidence.
[455] … It seems clear to me that there was no deliberate attempt on the part of Mrs. Lee or Miss
Visser to mislead the Court; they were deposing to something which had happened two years
previously, and may well have been honestly mistaken. This explanation does not appear to have
occurred to the magistrate. In these circumstances I do not think that the mere fact that they deposed
to a version which proved unacceptable regarding the relatively minor question - which was never a
direct issue - of who was present when the typed order was signed, justified the magistrate in
depriving the defendant of its costs.
The other point on which the defendant's witnesses were disbelieved was whether it was made
an express term of the order that if the goods were not delivered in February they would be of no use
to defendant and would not be accepted by defendant. The magistrate accepted Le Roith's evidence
that no such express agreement was made. I can see no reason for rejecting this finding of the
magistrate. But here again the record of the evidence does not satisfy me that this was a deliberate
attempt to mislead the Court. It is admitted by Le Roith that Mr. Lee and Mrs. Lee both asked for
delivery in February; the order specifically mentions January or February as the date of delivery.
The defendant did not in para. 2 of its plea set up the case that it had been expressly agreed
that upon failure to deliver in January or February the contract would fall away. The witnesses for the
defence, being business people, may well however have believed that such a result was the natural
corollary of the obligation to deliver January/February: and I am inclined to think that many passages
in the defence evidence which literally appear to assert an express agreement that the contract should

The importance of a due demand prior to cancellation of contract in which time of performance was not expressly or impliedly made of essence was underscored by the High Court of Botswana in at least two cases. or it may appear to be so from the nature of the contract or the surrounding circumstances. The second proposition is that time may be made of the essence of the contract by an express stipulation. or any party liable to perform under the contract. expressly or impliedly. was dismissed by a Provincial Division on the ground that the period of two months was unreasonable. One of the main grounds .. It held that period of two months allowed in the demand for performance was reasonable. on several points he accepted it in preference to that [456] of Le Roith. A. rather than to any attempt deliberately to mislead the Court. The respondent. The balance of the purchase price was to be paid by means of a building society bond. In Abe’s Canteen (Pty) Ltd and Others v Chouhan . otherwise the appellant would resile from the contract and demand repayment of the deposit and damages. Where a Court has acted on a wrong view of the facts it cannot be said to have exercised its discretion judicially. and was still in mora when appellant exercised his right to withdraw on 26th August. NOTES 1.concurred. An action for repayment of the deposit. Before this application was ready.e. On 12th August transfer had not yet been effected. It further held that the alleged impossibility of complying within the reasonable time fixed by the demand was due to respondent's own fault.35 fall away upon failure to deliver January/February are in truth referable to the expression of such a belief by the witnesses. etc. the appellant's attorney sent a letter of demand to the respondent demanding that transfer should be effected within two months. The magistrate did not reject the whole of the defendant's evidence. This is delayed performance by the debtor. therefore. on 12th August. he wrote to the respondent on 26th August that the sale must be regarded as cancelled. 2. The third proposition is that where time initially is not of essence. damages. What is a reasonable period of time obviously will depend on the circumstances of each case.the more so if the considerable period which elapsed before the date of demand was also taken into account. The first is that failure to perform timeously may not justify repudiation of the contract unless time is of essence of the contract. had been in mora on the termination of the period of two months. When the appellant learnt on 22nd August that the building society had decided to withdraw the loan because of the delay. i. The Appellate Division reversed this decision on appeal.the late filing of the alternative plea . In Nel v Cloete1972 (2) SA 150 the English translation of the summary of the case reports that the appellant agreed to purchase a house from the respondent on 3 October 1968. Transfer dragged on because the title deeds could not be found. and paid an amount of R1 750 as a deposit. and the cross-appeal allowed with costs. A contract therefore may be repudiated or cancelled for delayed performance if the debtor does not perform after being given a reasonable period within which to perform. it may still be made of essence through a due demand. 3. The appeal is dismissed with costs. …” OGILVIE THOMPSON. Although not specifically mentioned anywhere in the judgment. if delay due to the fact that respondent's deed of transfer could not be found was not taken into account . 1969. 1969. The respondent's attorney eventually decided to apply for a copy. In all the circumstances of the case I do not think that the rejection of the defendant's evidence on one point justified the Court in depriving it of all its costs. this case is authority for at least two propositions on mora debitoris.J. the other is greatly minimised with the result that the basis of the award largely disappears.falls away entirely. The respondent replied that the title deeds had not yet been found. on 13th June 1969.

South Africa. This does not mean that the respondents might not have a cause of complaint. a loan agreement incorporated an acceleration clause. It contended that such contracts were subject to an implied term that an employer could unilaterally terminate the contract and stop a builder from continuing with the work. (See Microutiscos and Another v. stipulating that in the event of default by the debtor in payment of one or more of the monthly instalments provided for. My conclusion is that the respondents' conduct in cancelling the agreement and taking transfer of the shares was wrongful and of no effect. Martin Horwitz Ag. 10. and insisted on continuing with the contract. The Court held that it would be unsafe to grant summary judgment. 17 April 1984) Ranch International was awarded a contract for the construction of a pipeline. I find that the cancellation of the agreement between the parties is of no effect. 1993 BLR 382 the respondents purported to cancel the sale and transfer of shares in Abe’s Canteen to the applicants and to reinstate themselves as shareholders and directors upon being dissatisfied with implementation by the applicants of other aspects of the agreement. the whole of the amount outstanding . he will regard the contract as at an end. 730 that: ‘Where a time for the performance of a vital term in a contract has been stipulated for and one party is in mora by reason of his failure to perform it within that time. I make no comment or pass any opinion on that matter. This of course is not so because they had cancelled the agreement before the letter annexure L was written and it was merely to inform the applicants that the agreement had in fact been cancelled. It terminated the subcontract and engaged another subcontractor to continue with the work.’ It was submitted by Mr. allowing a reasonable time. time was not of the essence and the purported cancellation is therefore of no effect. Under the circumstances therefore. In an application for summary judgement. together with interest thereon. in my analysis of the contract. making coordination of the contract works difficult. the applicant did not specifically plead that a demand had been made. LMG CONSTRUCTION (CITY) (PTY) LTD v RANCH INTERNATIONAL PIPELINES (TRANSVAAL) (PTY) LTD AND OTHERS 1984 (3) SA 861 (Witwatersrand Local Division. It subcontracted with LMG Construction for excavation of the trench and backfilling. The High Court held that this was unlawful as the respondents had caused the company to meet and to pass the resolution at a time when they were no longer shareholders in the company. but "time is not of the essence of the contract".2 Mora creditoris [2] RANCH INTERNATIONAL PIPELINES (TRANSVAAL) (PTY) LTD v LMG CONSTRUCTION (CITY) (PTY) LTD.36 and Others. Swart 1949 (3) SA 715(A) where the Appellate Division of South Africa held at p. Setlhake [2001] 2 BLR 286. as the debtor would have a legitimate defence at trial. The builders remedy would be to recover damages for any loss suffered. “would become due and payable on demand”. said at pp 389 -390: “In any event. …” In Standard Chartered Bank of Botswana v. the other party can make it so by giving notice that if the obligation is not [390] complied with by a certain date. Matswetu that the letter of 9 November 1992 had the effect of putting the applicants in mora. It alleged that damages in the . LMG denied the existence of such an implied term. Ranch International alleged that the relationship LMG had broken down. Ranch International later launched an application seeking an order that LMG vacate the construction site and be restrained from entering on it. J.

In making the allegation. It cannot be withheld arbitrarily or capriciously. The rights and remedies of the debtor in such a case are to be found under this rubric. which was denied. the engineer. specific performance. The Court a quo held that such a term as framed was not established. The Court held that there was no implied or tacit term giving an employer in such contracts the right to unilaterally terminate a construction or building contract. COETZEE J: [876] “… Coming to the contract in casu . were of the opinion. which is an important and valuable doctrine in our law. that the appellant should be allowed to rely on a different form from that in which it had cast the suggested term and actually framed the term which they believe the appellant ought to have relied on. It was not necessary for the purpose of giving efficacy to imply such a term into such contracts.37 circumstances would not be an adequate recompense. He dealt with it as if it were an invention of De Wet and Yeats. … The remedy which is sought in casu is. indirectly. Ch 4. The right of an ordinary servant who had been dismissed . The matter could be resolved by applying the principle of mora creditoris. there is no reason to regard it in a different light. it remains to investigate the remedies allowed to the debitor in such event. An employer or creditor who does not cooperate or fulfil his obligations so that the debtor or builder may perform is in mora. however. whilst also agreeing. There is no fundamental difficulty in granting such an order under South African law.175 of the fourth edition of their well-known work]. This makes it necessary that I deal briefly with this concept. The problem is then resolved systematically (as it is in English law) instead of casuistically. no special facts or circumstances were relied on to suggest that in this particular contract such a [877] tacit term was probably agreed to. Nor is there any particular feature of the terms of the contract which might point in this direction and I therefore cannot find that this suggested tacit term has been proved by Ranch. Ranch must persuade me that the tacit term exists. … [879] … [The learned judge then referred to several authorities. JANSEN JA and CORBETT AJA. De Wet and Yeats. … [878] … An Appellate Division decision which leaves no doubt about the duty of co-operation on the part of the creditor is Alfred McAlpine & Son (Pty) Ltd v Transvaal Provincial Administration 1974 (3) SA 506 (A). the creditor operis (Ranch) refuses to co-operate with the debitor operis (LMG). and National Union of Textile Workers and Others v Stag Packings (Pty) Ltd and Another 1982 (4) SA 151. If Ranch is thus in mora creditoris. Many legal problems can arise from the failure of the creditor to co-operate with the debtor which prejudices him in his efforts to perform his bargain. The employer may be compelled in forma specifica to cooperate with the builder and comply with the contract. On appeal the majority of the Court agreed with the Court a quo in this respect. and continued:] … The law is clear. … The essence of mora creditoris is contained in the [passage in De Wet and Yeats at 163 . including a thesis by AB De Villiers. How then is this type of problem dealt with by our common law? I mentioned to Mr Schutz in argument that it seemed to me to be a case of mora creditoris and that its principles should be applied. This is another of the important differences between our law and English law which starts off on the premise that a building contract is not specifically enforceable unless … [certain conditions] are satisfied. This is a remedy to which a party is entitled as of right. 1951 (2) SA 371. Counsel however eschewed this legal concept and still persisted therein at the stage of the application for leave to appeal. One of the contractor's complaints was that the builder's agent. In casu . failed to provide drawings timeously and it relied on a tacit term as framed by it in its pleadings. It further alleged that lack of cooperation by Ranch International was the main cause for alleged breakdown in the relationship between the contractor and subcontractor. What is important for present purposes is that both these Judges refer to the duty of co-operation which is so much of the essence of mora creditoris. It in turn sought at an order interdicting the replacement subcontractor from performing under the subcontract. Haynes v Kingwilliamstown Municipality. Gokal v Moti and Another 1941 AD 304.

was in issue in the National Union Textile Workers case. almost immediately. The Court's difficulty of supervising the performance is traditionally in the forefront of the objection to such an order. during the trial of the action. the prospect of a plaintiff who has obtained a decree of specific performance in his favour. the learned Judge said the following. when he engaged the other supplier to install his equipment or even at the later stages.G. with which I find myself in complete agreement: “It seems to me that a Court should avoid becoming supine and spineless in dealing with the offending contract breaker. but who has to perform his part of the contract. from which it appears that the learned Judge had great difficulty because he “considered many authorities. by giving him the benefit of paying damages rather than being compelled to perform that which he had undertaken to perform and which. The contention that the Court would not order the reinstatement of the servant as this would amount to an order for specific performance of an employment contract involving the rendering of personal services was rejected. in order to bring about payment. The correct solution which he nevertheless found (in "a practical manner") would surely have come more easily. [880] See at 607E . Is it not imaginary rather than real? I could not find a case on record where such a difficulty actually arose in practice and which had to be dealt with by the Court after an order to perform a building contract had been made. That it would be inconvenient for him is likely. the case of Industrial and Mercantile Corporation v Anastassiou Brothers 1973 (2) SA 601 (W) is cited with approval. at 609A. his problem would have disappeared.” In the process of deciding whether specific performance should be refused in casu as contended by Ranch. the learned Judge had been apprised of the systematic approach of our common law to mora creditoris. would do otherwise than perform properly. This case is very interesting as it provides a typical example of mora creditoris where the creditor was compelled in forma specifica to cooperate with the debtor (see 610H) without the learned Judge apparently realising that he was applying one of the principles of this doctrine. . a few general observations about building contracts may first be made.” If. that he will suffer some financial loss is likely. when he was called upon to perform by summons. particularly in a case where it is a matter of forcing the creditor to cooperate so as to make it possible for the debtor to perform his contract. with respect. This is to my mind not a case where it can be said to be impossible to perform either at the time when the summons was issued. I do not contemplate. I wonder if this so-called difficulty is not grossly over-emphasised. As far as specific performance is concerned. he would do so properly in order to earn his money. but that he has brought on himself by an arrogant denial of his commitments and I do not believe he should earn particular sympathy for that.38 to enforce his contract. in the ordinary course of events. and he chose to defy the claim of the plaintiff. both South African and English and found none which exactly matches this situation. with any degree of anxiety. It is his business to install equipment and I would assume that. …” And at 610A: “There is no reason by way of evidence to assume that the seller and the supplier of this equipment will not perform his part adequately. At 156E of the report. He went to the extent of engaging another person to supply the same services for him.” He therefore proposed to mention authorities “which are in some way apt to this case and seek to apply them in what seems to me to be a practical manner. Cf the judgment of MAHON J supra.

and came to the conclusion that it must be refused with costs. the owner took when he asked the Court for this order. I decided however not to make a final order but to issue a rule nisi operating as an interim interdict. If it does not pay LMG.1 Proof of repudiation [3] MOLEBATSI v. 2 February 1989) The plaintiff purchased from the defendant a vehicle that had been procured for her from South Africa. Why should different considerations then apply to building contracts? Accurate performance of them with the requisite skill or workmanship is irrelevant in this context. and agreed that the balance of R1 700 would be paid by monthly installments of R100. The keys and documents relating to the vehicle were apparently given to him by a little girl. Orders ad factum praestandum are made all the time. why. without permission. She paid P2 500 as an initial payment. He contended that it was the plaintiff who had repudiated the agreement and authorized the young girl to fetch and . she intimated that she no longer wanted the vehicle and demanded a refund of her money. If it refuses to give LMG instructions. to take appropriate action. The appropriate method in this case is by prohibitory interdict. If it consciously seeks to achieve this result. that is its affair. It is his affair. They are frequently the only practical remedies and their enforcement seldom raises problems. He drove the vehicle away and thereafter began to use it for personal purposes. on the return day. it is still free to do so at any time in the future and. When the defendant returned from one of his many trips to South Africa. Prohibitory interdicts abound in our law and practice. If LMG commits any breach of contract which entitles Ranch to resile. The plaintiff sued for the return of the part payment she had made for the vehicle. Botswana. If the owner has elected to claim this remedy and he is prepared to take these risks.” … [The learned judge then considered the application for leave to appeal against this order.39 Why should there be any difficulty? What is the need of supervision anyway? Does the Court ever supervise the execution of its judgments? Surely not. she would not be able to pay the balance of R1 700. The interdict which enforces this duty is negative in form as it simply prohibits Ranch from interfering with LMG. Lobatse. The judgment does not replace the contract. these considerations apply with much greater force. The defendant alleged in response that when he demanded from the plaintiff payment of the balance of R1 700. The judgment creditor will surely cancel the contract when it is unintentionally incorrectly performed. in the mouth of the defaulting builder to advance any reason connected with the quality of his performance or his general unwillingness. This is simply another one. The so-called impasse on which Ranch relies is unimpressive. MOLEBATSI [1989] BLR 1 (High Court. it will leave itself open to an action for damages by both LMG and Fluor. as a basis for avoiding an order compelling him to perform his bargain? In the instant case where the builder claims his right to perform and seeks only the employer’s co-operation to make this possible. There is no supervision thereof and no intervention by the Sheriff. thereupon.3. The agreed price was R4 200. as a matter of logic.3 Repudiation 10. without having a locus paenitentiae. contempt proceedings may follow. in the sense of allowing him to perform. The defendant was annoyed and aggressively demanded the return of the vehicle. This will make it possible for Ranch still to contend. and prove. also as is threatened. After all. that is the latter's problem to deal with in its own way.] 10. She experienced problems with the vehicle. that it was for some valid legal reason entitled to resile from the contract. As it is in the [881] case of every other order ad factum praestandum. This kind of dog in the manger attitude however strikes me as childish and not worthy of serious consideration as a socalled impasse. I have therefore come to the conclusion that there is no reason why Ranch's duty to co-operate should not be enforced in forma specifica. as is threatened. should it lie. the plaintiff allegedly informed him that as the vehicle had been giving her problems. as well as that of not succeeding in contempt proceedings. this risk. If there is an intentional refusal to perform. one may ask.

the keys and the documents. According to the evidence. I hold that the agreement has been repudiated. CJ: [3] “… The main issues for determination therefore are: (i) (ii) (iii) (iv) what were the terms of the agreement between the parties? was there a repudiation of the agreement? who repudiated the agreement. [6] Who repudiated the agreement? This is the most crucial question. I believe his evidence. 10. I find that by demanding the . and driving the vehicle away and using it for his own purposes. LIVESEY LUKE. With regard to the evidence of the defendant I do not believe his evidence on this issue. by word or conduct. para. Repudiation occurs where a party envinces an intention. … The plaintiff impressed me as a truthful witness. The father (the plaintiff's third witness) was an impressive witness. as where by his own act a party disables himself from performance. and acceptance thereof. See Weeramantry. The innocent party has an option either to accept the repudiation or to regard the contract as still subsisting. Put in another way.). the keys. It must be established that the defaulting party has made his intention clear beyond reasonable doubt no longer to perform his side of the bargain. Dublin 1961 (2) S. the test as to whether conduct amounts to such a repudiation is whether fairly interpreted it exhibits a deliberate and unequivocal intention no longer to be bound. I believe her evidence that in March 1986 the defendant demanded the keys and documents from her in an aggressive manner. I believe that it was in that mood that he demanded the return of the vehicle. Preferring the plaintiff’s testimony and evidence. In the instant case. He admitted that he was annoyed at the time and spoke aggressively. vol. Each party has claimed in his or her pleadings that the other party has repudiated the agreement. The Law of Contracts.A. See Halsbury's Laws of England (4th ed. the vehicle changed possession from the plaintiff to the defendant in March 1986. It is also not in dispute that the plaintiff failed to pay the monthly instalments to the defendant. He could have taken other action to enforce payment of the balance of the purchase price. On the basis of the evidence and of the pleadings.e. 920. 4 per Williamson J.40 handover the keys and documents for the vehicle. para. I sensed that he did not find any pleasure in giving evidence in a dispute involving two of his [7] children. or makes it impossible for the other party to render performance. It may occur either expressly. This leads me to the next question. the Chief Justice continued:] … [5] Was there a repudiation of the agreement? Each party alleged in his or her pleading that the other party has repudiated the agreement. the Court held that the defendant had repudiated the contract. II. was entitled to recover as damages the P2 500 initially paid for the vehicle. This was repudiation of the agreement. Indeed he had made efforts to settle the dispute within the family circle but without success. of repudiating his obligations under the contract. the vehicle) is no longer in the possession of the plaintiff. The plaintiff. having accepted the repudiation. the documents. 546. 9. or impliedly. the subject matter of the contract (i. as where a party states in so many words that he will not discharge the obligations he has undertaken. vol. and did the other party accept the repudiation? if there was repudiation of the agreement. See Street v. I also believe that the girl handed the keys and documents to the defendant without the permission of the plaintiff. he exhibited a deliberate and unequivocal intention no longer to be bound by the agreement. By demanding the return of the vehicle. and the answer to it will determine liability for the repudiation. In my opinion he was a truthful witness. what is the liability of the guilty party? … [ After establishing the terms of the agreement as summarized above. at p.

In any case I do not believe that he expended R700 to respray the vehicle.) at p. Dohne 1951 (1) S. I accordingly give judgment for the plaintiff for the refund of P2 500. See Gibson. 31 January 2001) . What is the liability of the guilty party? The defendant took possession of the vehicle for which the plaintiff had given him P2 500 as partpayment of the purchase price. CAPITAL GROWTH (PTY) LTD. About five weeks after the sale the plaintiff repudiated the sale. I therefore make no award in respect of those purchases. bought a new tyre for £8. and four days thereafter he returned the car to the defendant. [8] The defendant said that after he took possession of the vehicle from the plaintiff he paid R700 to respray it and R500 for another engine. I also find that the plaintiff accepted the repudiation. It was held that the prior conduct of the plaintiff (i.” [4] KUBU INVESTMENTS (PTY) LTD v. in my view. inter alia. R1 200. Thereafter he spent 30 shillings on repairs. But the defendant did not counterclaim to be compensated for such use. 736 a case which went on appeal to the Natal Provincial Division. The legal position is that an aggrieved person who has accepted the repudiation of a contract is entitled to damages and may sue at once. drove the vehicle for a total distance of 44 miles and paid an instalment of £10 on account of the price. In that case the defendant sold and delivered a car to the plaintiff for £150. the re-payment of the sum of £80 (i. and it accordingly fails. Judgment for the plaintiff. Lobatse. As a result of the repudiation of the agreement. and March 1986. The plaintiff testified that she bought a spare wheel. If indeed he sprayed the vehicle. the defendant was not obliged to take possession of the vehicle. She made no claim for those items. and the balance was to be paid by instalments. The result is that the plaintiff has lost the vehicle and the defendant has refused to refund the P2 500 or any part thereof to her. Costs of the claim and the counterclaim to the plaintiff. the plaintiff has lost the P2 500 she paid to the defendant.e. spark plugs and clutch plate for the vehicle. He had his remedy if the plaintiff failed to pay the instalments. [2001] 1 BLR 213 (Court of Appeal. He could have sued the plaintiff for the balance of the purchase price. in exercising acts of ownership over the car) did not preclude him from repudiating the contract.e. The plaintiff paid £70 down. He counterclaimed for the total amount. South African Merchantile and Company Law (6th ed. The defendant did not produce any receipt for either of the payments. Judgment was given for the plaintiff for. That boast was another manifestation of the unreasonableness and high-handedness that the defendant displayed when he demanded the return of the vehicle. I also do not believe that he bought another engine for the vehicle. 11. Instead of pursuing his remedy. the £70 down payment and the £10 instalment). A similar situation arose in Trytsman v. the counterclaim has not been proved. used it for his own purposes and boasted that the plaintiff would lose both the vehicle and her money.e. But even if the keys and documents relating to the vehicle were handed to the defendant with the permission or on the instructions of the plaintiff (which I do not believe). The plaintiff became aware of defects in the car two days after the sale.A. the plaintiff's claim succeeds. he took possession of the vehicle. i.41 return of the vehicle and driving it away and using it for his own purposes. He thereby by his conduct evinced an intention to repudiate his obligations under the agreement. In my opinion she is entitled to that amount. In the result. The counterclaim is dismissed. for his own purposes and convenience. he exhibited a deliberate and unequivocal intention no longer to be bound by the agreement. he did so. The measure of damages is the loss suffered as a direct consequence of the breach. It is not in dispute that the plaintiff used the vehicle for her own purposes on a few occasions between December 1985. nor was any evidence adduced as to the purchase price of any of them. In the circumstances. Botswana.

Clause 9 gave the seller the right to cancel the sale if the purchaser failed to fulfill on the due date all the terms and conditions of the deed of sale. On 22 September 1999. Mr Du Plessis.3 was not a collateral warranty. He further submits that clause 6. Parts of the property had been let to tenants. in response.3 of the agreement the seller warranted that there are no lease agreements for the tenants and that they occupied the premises on a monthly basis. I accept that the proper test for repudiation is an objective one. The purchaser successfully instituted action in the High Court to declare the contract valid and enforceable. He wrote the letters of 15 September and 22 September. But apart from that I find the appellant’s submissions untenable. . It required fulfillment of the contract by the seller. J. J. but in clause 6. in the context of the letter written on 15 September and the deed of sale indicated that it was not repudiatory in nature. called on the purchaser to pay the full consideration within three days. the seller was cancelling the contract.6 million. the seller’s attorney.2 of the agreement. I further find that the seller was in clear breach of this warranty. He has failed to persuade me. He submitted that it is necessary to consider repudiation objectively. the purchaser’s attorney. stating that failure to do so would be regarded as unreasonable and a breach of the agreement. A careful reading of the letter of 16 September read in context with the sale agreement and the letter from the seller of 15 September convinces me that far from being a letter of repudiation. Lot 1276. It was the seller’s letter of 22 September that purported to cancel the agreement. Before the matter could be sorted out. The court agreed that whether the letter amounted to repudiation must be assessed objectively. reiterated that the seller should sort out the problem of tenants with written lease agreements. Like the trial judge I would reject his explanation. but a careful reading of that letter. The proper test was to consider objectively if the letter amounted to repudiation. The purchaser indicated that he wished the seller would sort out the matter quickly. [217] I note that Mr Thipe gave an explanation for his actions in relation to this fixed-term lease which was carefully considered by Collins Ag. He submits that this letter is a clear repudiation of the contract. the seller contended that contract had been repudiated by the purchaser’s letter of 16 September of 1999. I find that his case has totally collapsed. He submitted before this court that the sale was repudiated by the purchaser's attorney in their letter of 16 September 1999. Gaborone. His submissions were in broad terms the same as those he put before Collins Ag. He further submitted that it was immaterial what the intention of the writer of this letter was. and the purchaser would within 14 days after request furnish the seller with an acceptable bank guarantee for the payment. for the appellant at all times in his submission conceded that if he failed to persuade the court that that letter is a letter of repudiation then his whole case collapses. looked at objectively. When the seller and the purchaser wrote jointly to the tenants advising them about the sale of the property and of the fact that they were on a month to month tenancy. He conceded that three days might be too short a period. in a letter dated 15 September 1999. this was a letter requiring fulfillment of the contract by the seller. clause 6. SIR JOHN BLOFELD JA: [216] “… The appellant's attorney is Mr Du Plessis. In clause 5. On 16 September 1999. The purchaser therefore undertook either to formalise the tenancy or to give them one month notice to vacate. and as soon as that was done. at least two tenants produced copies of their written fixed-term lease agreements. He submitted that once the purchaser accepted rents from the tenants he exercised his right of ownership of the property and that by so doing he was liable to pay the full purchase price within a reasonable period. the seller’s attorney wrote stating that purchaser was in breach of the agreement. a banker’s guarantee for the payment would be available. to Capital Growth (Pty) Ltd for P1. contrary to his submission. I also find that.3 which relates to the tenancies was a collateral warranty only and that in any event it is so worded that there was no breach of this clause by the seller as the wording is ambiguous. The purported cancellation came from the seller alone in that letter of 22 September. On appeal. and in terms of clause 9 of the agreement.42 On 12 Septemeber 1999 Kubu Investments (Pty) Ltd agreed to sell its property. the purchaser undertook that its conveyancers will arrange to transfer the property within a reasonable period. at trial.

43 The fact that there were undoubtedly written fixed-term agreements with tenants was a clear and obvious breach of this warranty. “Prima facie every party to a binding agreement who is ready to carry out his own obligation under it has a right to demand from the other party. As remarked by Kotze CJ in Thompson v Pullinger (1894). the respondent sold to the applicant under a written agreement his lease rights over Farm Q0 45. On 24 June 2002. The innocent party’s entitlement to specific performance of the contract is settled and comes out clearly in the following passage by Innes J. It is settled law that a breach of the nature with which this Court is presently concerned does not necessarily terminate the contract. On 29 June 2002 the respondent informed the applicant by telephone hat he was cancelling the agreement. And there are many cases in which justice between the parties can be fully and conveniently done by an award of damages. In Sweet v Ragerguhara. not repudiation.A. J.’ It is true that Courts will exercise a discretion in determining whether or not decrees of specific performance will be made. and that as the contract was conditional upon approval by the Chobe land board. They will not. The applicant refused to accept the cancellation. But that is a different thing from saying that a defendant who has broken his undertaking has the option to purge his default by the payment of money. and perhaps clearer illustration of repudiation of a contract for the sale or disposal of rights in immovable property is the unreported Botswana Francistown High Court decision in Access Holdings (Pty) Ltd v Setuke and Another (MISCA F256/2002). failure the seller to give vacant possession of immovable property was in the circumstances of the case regarded as an example of breach by defective performance. said: It is clear to me that the refusal by the first respondent to go ahead with the terms of the agreement constitute a breach of the same. Marumo. to elect whether to accept the cancellation and claim damages. of course. In my view this is enough to dispose of this matter.” KUMLEBEN J. This was confirmed in a letter of 9 th July 2002 written by the respondent’s attorneys.A. A more recent. or to keep the contract alive and enforce it. and LORD WEIR J. agreed NOTES 1. The respondent alleged in his Court papers that he cancelled the contract because his daughter would not let him sell the farm. ‘the right of a plaintiff to the specific performance of a contract where the defendant is in a position to do so is beyond all doubt. 1978 (1) SA 131. 2. (See Myers v Abramson 1952 (3) S. summarised and reproduced below. be issued where it is impossible for the defendant to comply with them. for a purchase consideration of P80 000. The innocent party is entitled. subject to the overriding discretion of the Court. it could be cancelled by either party before such approval had been granted. For in the words of Storey (Equity Jurisprudence. From pp 7 – 9 of the typed transcript of the judgment. and applied for orders confirming that the contract was binding and enforceable. This appeal is dismissed with costs. performance of his undertaking in terms of the contract. The Court regarded these arguments as untenable and held that the applicant was entitled to specific performance of the contract.A 121). so far as it is possible. sec 717 [8] (a)) ‘it is against conscience that a party should have a right of election whether he would . Pandamatenga. The price was payable upon transfer by the Chobe Land Board of the rights to the applicant. and the purported cancellation of no force or effect. in Farmers' Co-op Society (Reg) v Berry 1912 AD 343 at 350. OR at p301.

The appellant was therefore not in breach of the audi alteram partem rule LORD ALLANBRIDGE JA: [133] “… When Mr. The High Court held that he had been wrongfully dismissed. extending over 14 years. he challenged the assessment of his efficiency and the need to extend the probation by 3 months. on account of poor appraisals and lack of professional qualifications. contrary to the audi alteram partem rule. his service was poor and he generally refused to cooperate with his colleagues and supervisors. He alleged victimization. he refused to be transferred to another post in his department. And there are no circumstances rendering the performance of his obligations impossible. It also wants the process of transferring the rights to be commenced before the second respondent. Ministry of Local Government and lands. he refused to cooperate with a properly and legitimately conceived job rotation scheme. The application consequently succeeds. subject to the discretion of the Court. He was suspended from duty for 15 days without pay. … ” 10.’ The election is rather with the injured party. The Court of Appeal held that the respondent’s conduct and attitude throughout the period of employment had undermined the confidence and trust on which the contract of employment is founded. he sought intervention of the Permanent Secretary. or face dismissal. In 1985. Spilg for the appellant appeared before this court he did not attempt to argue that the respondent had been dismissed in accordance with the provisions of the appellant's . This was contrary to clearly laid out procedures requiring such complaints to be routed through his superiors in the corporation.2 Constructive repudiation [5] BOTSWANA HOUSING CORPORATION v. regarding it as a ploy to demote him and deny him promotion. terminating his employment in the manner described above. He was paid one month’s salary in lieu of notice. contrary to grievance procedures. LEMPADI. On 18 January 1991. and he was served with a letter dated 17 January 1991. On the other hand the first respondent cannot simply be permitted to evade his contractual obligations because his daughter wants him to. he indicated that he would not resign.3. In 1990. When he took up the post after the suspension. At the end of his six months probation. In the light of the above factors justice would be served by the Court exercising its discretion in favour of the enforcement of the agreement. On 17 January 1991. nor can he do so by making the unfounded claim that the agreement is conditional and that material conditions of it have not been met. Again. While holding the position of credit controller. sought intervention of the Minister of Local Government and Lands. “in the corporation’s interest and with immediate effect”. that he had not been given an adequate opportunity to answer allegations against him that finally led to his dismissal. he was summoned to a staff committee meeting and advised to take early retirement with full benefits. and that the corporation had not followed its own procedures when the decision was taken to dismiss him. It is not. [1998] BLR 131 (Court of Appeal. he accused his supervisors of malice.44 perform his contract or only pay damages for the breach of it. Lobatse. which did not involve any change in salary or terms and conditions of service. alleging victimisation by his superiors. Botswana. his employment was terminated on 17 January 1991.” The applicant has demonstrated its readiness to perform its obligations by paying the purchase price into the Trust Account of the first respondent’s erstwhile attorneys. and instructed his lawyers. the Court considered that he had numerous disputes and disagreements with his employers throughout his period of employment. and the appellant was in the circumstances entitled to terminate the employment. The Court further held that the respondent had been given every opportunity to make his own submissions. When the corporation refused to accede to his requests for promotion. The employee by his conduct had effectively caused repudiation of his contract. which he summarily rejected. 30 January 1998) The respondent was employed as an accounts assistant by the appellant on 1 September 1976. On appeal. for example.

the radical and fundamental approach that the respondent’s conduct so undermined and damaged the working relationship between himself and his employer that the latter was entitled to cancel the contract without more ado and dismiss him. Keeping that possible situation in view I will now consider what the conduct of this respondent was as revealed in the evidence presented in the court a quo. I will return to this case later when I come to consider the law on this topic in greater detail.” The learned judge said at a later stage in his judgment. at p. with misconduct under the employer’s disciplinary code that forms part of the conditions of service. Mr. In any event. that the employer is entitled in law to dismiss the employee. The correct approach. (The Fijen case). That was because in these letters the respondent made it clear that he wished to remain in the employ of the appellant. 26D-G: “It is well established that the relationship between employer and employee is in essence one of trust and confidence and that. a breach that entitled the appellant to cancel it. Mr. always provided that it was a fair dismissal. (Angehrn & Piel v. If such a situation did arise in the present case there will then be no necessity for this court to consider further the nature of the alleged procedural irregularities. In the Industrial Court and the Labour Appeal Court it was held in this case that the letters did not amount to a repudiation of the contract. in this somewhat lengthy judgment. However. there followed correspondence which indicated that in view of what had happened. The respondent employee in that case faced a disciplinary inquiry on a charge of misconduct. Fijen (1996) 17 ILJ 18 (A). Such matters would be irrelevant if the respondent had effectively repudiated his contract of employment in such a way as to entitle his employer to dismiss [134] him. The case of Fijen was decided in the South African Court of Appeal in November 1995. for the first time in this case. His submission was that the respondent’s conduct did not constitute such a material breach of contract as to be considered a repudiation of it. He and Botes both refused to testify at the disciplinary hearing and both were found not guilty on the basis that the charges had not been found proved beyond reasonable doubt. conduct clearly inconsistent therewith entitles the ‘innocent party’ to cancel the agreement. I am now in a position to consider the ratio of Fijen's case and then decide whether it can be applied to the facts of this case. This view did not [151] find favour in the Court of Appeal who indicated it was too narrow an approach. Mawere said he did not dispute the law as set out in the Fijen case. He adopted. at common law. At long last.45 disciplinary code. Botes. was: “The correct question to ask appears to me to be whether the respondent's ‘attitude’ constituted a material breach of his contract (repudiation in the wide sense). He was charged along with a co-worker. He was a marine pollution engineer who had allegedly offered to do private work for remuneration without the consent of the appellant employer. Ltd 1908 TS 761 at 777-8). For present purposes it is sufficient to note that the Fijen case now establishes that in certain circumstances the conduct and attitude of an employee can be such as so to damage the relationship of trust and confidence required on both sides of a contract of employment. The authority for this approach is to be found in the recent case of Council for Scientific and Industrial Research v. Federal Cold Storage Co. In these circumstances the lower courts took the view that he did not evince a clear and unambiguous intention not to go on with his contract of employment. as set out by Harms J. Lord Allanbrigdge JA continued:] [150] … The legal question now arises whether the appellant was entitled to treat the respondent’s conduct as amounting to a repudiation by him of his contract of employment with the appellant. he said that this case was clearly one where the employer had dismissed the respondent for disciplinary reasons but had failed to follow the proper procedure for such dismissal as decided by the judge a quo.A. at page 25 H-I. On that basis it . … [After considering the conduct of the respondent as revealed by the evidence presented in the Court a quo and the summary of it by the judge a quo. the respondent wrote that he had completely lost faith in his immediate supervisor and his divisional director and that their working relationship was totally and permanently damaged.

It does seem to me that. The final recommendations made by the Divisional Accountant.m. in our law. The Divisional Accountant and the Finance Manager both recommended. Were the circumstances of that dismissal fair? I have no doubt that they were. It was concurred in by three of the other judges of appeal. Scholtz. The duties referred to simply flow from naturalia contractus. the Finance Manager [152] and the General Manager all demonstrate that by January 1991 the conduct of the respondent was such that it could no longer be tolerated in his own and the corporation’s interests. The respondent was not persuaded at that stage to accept such a reasonably generous offer and asked for and was given the .) I may add that this much was not placed in issue for the respondent by Mr.” The General Manager again saw the respondent at 2.m. After a lengthy discussion. to whom the respondent had previously complained directly. Their respective memoranda bear eloquent testimony to the fact that the substratum of the respondent’s contract of employment had been so undermined by his attitude and conduct that the appellant was entitled to cancel it and dismiss the respondent. Lempadi to accept the first option. The following day was an eventful one. although the remaining judge gave a dissenting judgment. the members came to the conclusion that: “In view of the above (the General Managers’s Memorandum) and in consideration of his age and length of service with the corporation. Failure to accept this proposal he should be dismissed. based as it must be on trust and confidence between the parties. the dismissal of the respondent in their respective memoranda forwarded to the General Manager.” I gratefully accept and agree with these quotations from the learned judge who gave the leading judgment in this case.30 a. to follow the ratio of the majority decision of the South African Court of Appeal in the Fijen case. it is not necessary to work with the concept of an implied term. It is unnecessary to repeat the outline of the appellant’s conduct.46 appears to me that our law has to be the same as that of English law and also that a reciprocal duty as suggested by counsel rests upon the employee. The General Manager asked the respondent if he had any comments on such a proposed course of action.30 p. Half an hour later at 9 a. Applying this test to the somewhat exceptional circumstances of the present case I am more than satisfied that the respondent’s attitude throughout the period of his employment. The appellant corporation did not rush to judgment. of course. was one which finally resulted in a complete destruction of the very foundation of the relationship between himself and the appellant. The respondent was summoned to the General Manager’s office at 8. the Committee resolved that Lempadi be asked to retire with full benefits. Thus the test to be applied in cases of this nature is whether the “attitude of either the employer or employee constituted such a material breach of the employee’s contract of employment that the innocent party was entitled to cancel it. which demonstrated such an attitude. Humphries & Jewel (Pty)Ltd v. necessary to go on to consider whether the method of cancellation adopted by the innocent party was a fair dismissal and was in accordance with the audi alteram partem rule. where appropriate. Federal Council of Retail and Allied Workers Union & others (1991) 12 ILJ 1032 (LAC) at 1037G. on 12 November 1990. The respondent replied he had nothing to say. In these circumstances I am of the view that the courts of Botswana should be prepared. Even at this stage the respondent’s superiors were prepared to be reasonable and give him the opportunity to depart on the most favourable financial terms. He was told of the intention of the General Manager to submit a full report to board members.m that same afternoon and told him of the board's decision. The two Deputy General Managers present pleaded with Mr.. Having applied this test it is. There are some judgments in the LAC to this effect (for example. the General Manager attended a meeting of the board members to whom he had circulated his own memorandum. and especially during the latter stage of it. He did not write his own memoranda recommending the respondent’s dismissal until 16 January 1991. as it has already been fully and very carefully outlined by the judge a quo as shown in the extracts I have narrated from his judgment.

5 which covers “any other reasons in the interest of the corporation’s operation”. This was anticipatory breach.” TEBBUTT J. as [153] this was a case where the Fijen ratio applied. a reasonable person would conclude that the appellant did not intend to fulfill its part of the bargain. and HOEXTER J.3 he was entitled to “two calendar months notice. I would therefore allow this appeal. he was dismissed with a period of only one month’s notice.4 of these General Conditions which relates to a “Termination of Employment with Notice. 1980 (1) SA 645 (Appellate Division. The Court held that as soon as the new plan was submitted. JANSEN JA: . The contract had been repudiated. in a proposed township. went further than the normal employer could be expected to go in terms of patience towards. 19 November 1979) The respondent bought two erven from the appellant. ‘Klippoortjie Residential Township. On this plan the respondent’s erven disappeared and were superceded by a school site. It was subject to the due proclamation of the township.” he was entitled to two months’ notice. out of genuine concern for the welfare of the respondent. the next day at 8.15 a. One last matter remains.m. is a very marginal amount and will not affect the award of costs in favour of the appellant. They dismissed him in a reasonable manner. however. agreed 10. However.A. I would also make an order for payment to the respondent by the appellant of an additional one month's salary in lieu of notice. They acted with a compassion which was spurned by the respondent. an undeserving employee. After giving the respondent every opportunity to make his own submissions to them which he summarily rejected. The appellant experienced difficulties in obtaining the proclamation. approval by the Township Board of the new plan. but the respondent was required to pay R2 639.47 right to sleep on it.3 Anticipatory repudiation or breach [6] TUCKERS LAND AND DEVELOPMENT CORPORATION (PTY) LTD v HOVIS. By virtue of the terms of paragraph 21. they were clearly not in breach of the audi alteram partem rule.A. and as a result thereof a new plan had to be prepared and submitted. This. 19 prior to the proclamation of the township. a doctrine that was part and parcel of South African law. He had more than 10 years’ service and in terms of paragraph 21. He was dismissed in terms of 24 . true to his character and attitude which had been demonstrated so often in the past. the respondent refused to accept the opportunity of premature retirement and.’ The contract incorporated a suspensive condition. with costs. at the earliest.3. The respondent was dismissed by having his services with the corporation terminated in the corporation’s interest. The respondent successfully sued in the Witwatersrand Local Division for the return of the sum he had paid. South Africa. he refused to resign and said that he had again placed matters in the hands of his lawyers.4. Whilst the situation in this case did not require the disciplinary procedure laid out in paragraph 16 of the revised General Conditions of Contract. a township developer. In such a situation I am of the view that not only did the appellant corporation act reasonably but. The respondent was entitled to rescind and claim back what he had paid under the contract. and concern for. The appellant contended on appeal that the respondent was not entitled to claim a return of the monies before.” As he only received one month’s notice he is accordingly entitled to a further month’s salary calculated on his monthly earnings at the time.

” On the previous page he points out that “an anticipatory breach may arise even though the promisor cannot be said to have repudiated the contract. in order to obtain clarity of thought. or so it seems.) Once the existence by operation of law of an obligation not to commit an anticipatory breach is accepted.” [651] There can be little doubt that. but an existing obligation’ (Furmston Cheshire and Fifoot's Law of Contract 9th ed at 569 . the question remains as to how that obligation can be violated. that in all fairness there should be a duty upon a promisor not to commit an anticipatory breach of contract. It is interesting to note that according to Williston Law of Contracts 3rd ed para 1337A the German law has developed along somewhat similar lines (and cf De Wet and Van Wyk ( op cit at 152 . In a review in the Law Quarterly Review 1973 465 . All our contracts are said to be bonae fidei (cf Wessels Law of Contract paras 1976. D Tiplady. no doubt under the influence of the English law.” . It should therefore be accepted that in our law an anticipatory breach is constituted by the violation of an obligation ex lege . and such a duty has in fact often been enforced by our Courts.but not without the expression of certain reservations by Prof Williston. The answer generally given is: by repudiation. but.90. that the duty flows from the requirement of bona fides to which our contracts are subject. to jettison the terminology of offer and acceptance in this regard. The nature of the obligation thus imposed will depend on the circumstances of the particular case. It could be taken as an obligation ex lege. It would not then be inapt to say.3)). supra at 468. Tiplady. and its trammels of 'intention. by operation of C law. and that such duty is implied in law and not in fact. the view that such a breach is the breach of an existing obligation would be consonant with our law. felt in our domain. It would also be desirable. … [652] … It could be said that it is now. (Cf Kerr Law of Contract 2nd ed at 289 . but at least in its country of origin. from the bona fides underlying contractual relations in our law. to construe this as an application of the wide jurisdiction to imply terms conferred upon a court by the Roman law in respect of the judicia bonae fidei.469 at 467 the author. mentions that “one would welcome the release of the doctrine of anticipatory breach from the confines of repudiation. it has also spread inter alia to the United States . a promisor will be liable if he evinces an intention not to be bound by the contract. says: “The better view would therefore seem to be that anticipatory breach so called is the actual breach of an implied obligation of present performance. generally speaking. elliptically. It would be consonant with the history of our law.48 [650] “… The issue involves the so-called doctrine of anticipatory breach. and has been for some time. in grafting the doctrine of anticipatory breach upon our law. flowing from the requirement of bona fides which underlies our law of contract. It originated in England and has been received by us. the view is now favoured that the anticipatory breach is a violation of ‘not a future. and to denote a creditor’s decision to act upon an anticipatory breach not as an ‘acceptance’ but as an election. 1997). however. ie implied by law … [T]here appears … to be no real difficulty in ascribing such an obligation to flow.70). Its true basis has been contentious. and also legal principle.

It follows that the appellant did commit an anticipatory breach of the contract. 9 September 1977) The applicant purchased from respondents immovable property described in the deed of sale as Lot 4 Glen Anil Township for the sum of R160 000. The question to be answered may then be posed as follows: did the appellant repudiate his contract with the respondent? He certainly did not do so explicitly.” The test here propounded is both practicable and fair. and this is the test which I propose to apply in the present case. for present purposes. The question in the present case is therefore whether. what appear to be. as a well recognised form of anticipatory breach. generally accepted that a promisor may do so by conduct. seems to have gravitated in the direction of an objective test based upon the reasonable expectation of the promisee. KOTZÉ JA. NO. 10.49 There is much to be said for a wider view of anticipatory breach and to recognise a classification of the modes of violation along the lines [653] suggested by Nienaber ( supra at 36). … In Ponisamy and Another v Versailles Estates (Pty) Ltd 1973 (1) SA 372 (A) at 387B the following passage from the judgment of DEVLIN J in Universal D Cargo Carriers Corporation v Citati (1957) 2 QB 401 at 436 is cited with approval: “A renunciation can be made either by words or by conduct. conflicting dicta in this regard. as there are. the inquiry may be directed at ‘repudiation’. As it related to the whole of the contract. A sum R10 000 was payable at the conclusion of the sale. have inferred that the appellant no longer intended to deliver erven 95 and 97? In my view. in that position. JOUBERT JA and VILJOEN AJA concurred. Would he. By a letter dated 7 March 1977. It is. AND OTHERS 1978 (1) SA 131 (Durban and Coast Local Division. The test of whether an intention is sufficiently evinced by conduct is whether the party renunciating has acted in such a way as to lead a reasonable person to the conclusion that he does not intend to fulfil his part of the contract. however. provided it is clearly made. the appellant has ‘repudiated’ the contract. the respondent was entitled to rescind and to claim back what he had paid. The question is therefore: has the appellant acted in such a way as to lead a reasonable person to the conclusion that he does not intend to fulfil his part of the contract? Obviously.4 Defective performance [7] SWEET v RAGERGUHARA. by drawing up a new plan for submission to the authorities. the ‘reasonable person’ must be placed in the position of the respondent. Vacant occupation was not given on that date. the . What the proper test is to be applied to the promisor’s conduct is not obvious. it would have been obvious to him that. However. and a guarantee was to be furnished for the balance of the purchase price on or before 10 December 1976. The intention can be evinced either by words or by conduct. however. and therein allocating the respondent’s erven to a school site. South Africa. in an attempt to obtain proclamation of the township by submitting the new plan for approval. This Court. It is often put that the party renunciating must ‘evince an intention’ not to go on with the contract. … … [654] … The appeal is dismissed with costs.” MULLER JA. The agreement stipulated that vacant occupation of the property will be given on 1 January 1977. the appellant was sacrificing his rights to transfer of the erven.

] Hence the introduction of such a right in certain circumstances by notice of rescission. on the facts of this case. 619). On the other hand. puts it: Mora est solutionis faciendae vel accipiendae frustratoria dilatio. This is recognised and emphasised in Cloete's case.A. The notice of rescission required for this form of breach had to relate to the materiality of the breach. ready and willing to proceed to completion. that both counsel were wrong in submitting with different objectives in view . The notice of rescission was also ineffective because it was equivocal.) … It may appear to be somewhat anomalous that a party to a contract.] Defective performance. 170G. It follows. 170 and 173. In the light of this conclusion it is not necessary to deal with the various submissions. 22. who fails to carry out a vital term of a contract. op. vol. which questioned the validity of the notice of rescission. As one would expect. The Court held that failure by the respondents to give the applicant vacant occupation by 1 January 1977 was a breach of the agreement. 3rd ed at p. The applicant applied in motion proceedings for an order declaring that the agreement had been lawfully cancelled. It was not clear whether the contract had been cancelled or it would remain in force if vacant occupation would be given within the time set. briefly discuss one of the arguments advanced by Mr. on the other hand. As Voet . Aucamp v Morton. It held that the case involved the latter form of breach. the notice of rescission has any relevance at all. is better placed than one whose timeous performance is materially defective. relates to timeous performance not in accordance with the terms of the agreement … [cf. The Court distinguished between breach through mora and defective performance. p. cit . a breach of the time factor of a promise". In the former case the defaulting party must receive a notice of rescission before a right to resile accrues. I [139] shall.1. 729 – 730. … a right to cancel. 123]. ( Mulligan. however. the defective performance is not of that order no right to cancel exists. which called upon them to give vacant occupation of the property within 30 days. Whether it was a material breach could only be decided upon by viva voce evidence. 61.as “one which evinces an intention on the part of the defaulter no longer to be bound by the terms of the contract for the future” ( Aucamp v Morton. ] Thus it clearly emerges that these two forms of breach of contract are different in character and that different rules relating to the right to cancel apply to each. 74. At the expiration of this period. however. when such performance is materially defective has always been recognised in our law without any preceding notice of rescission. … [ 1949 (3) SA 611 (AD) at p. Our common law did not recognise any general right to resile when a debtor was in mora … [Nel v Cloete 1972 (2) SA 150 (AD) at p.: 138] “Mora is “the failure without lawful excuse to perform a promise timeously. In the present case we are in fact dealing with defective performance and not with a mora situation. J. … [Microutsicos and Another v. the mere failure to carry out such an obligation on time. "Damages for Breach". is not viewed in the same light. Cf. Swart 1949 (3) SA 715 (AD) at pp.Kontraktereg. one of the requirements relating to such a notice is that “the party giving the notice must be able. appears to lie in the fact that in the latter case the breach is construed . If. (See pp. 611. if the above reasoning is correct. an issue to be resolved through viva voce evidence. however.24. which was directed at the form of the notice of rescission in the instant case. The rights of the innocent party are then limited to other forms of relief. 283). Law Journal . In such a case.50 applicant’s attorney gave respondents a notice of intended rescission.that. mora is. KUMLEBEN. Raftesath in this regard. in essence. one person was still in occupation of one of two buildings on the property. De Wet and Yeats. The respondents contested the legality or effectiveness of the notice of rescission for what may or may not have been a material breach of the contract. S. p. supra at p.. Mulligan. which in certain instances may be due to an oversight.no doubt in some cases somewhat artificially or constructively . The explanation for this.” .

namely.D. the innocent party has purported to cancel. he remains under duty to retract his act of cancellation. If the agreement has in fact been cancelled the agreement is at an end and cannot be unilaterally revived. supra at p. A notice will normally either expressly or impliedly signify such ability and willingness and. The fourth paragraph thereof. a notice of rescission ought to be clear and unequivocal. Amod Bayat v Doherty . in the ordinary course. if not wholly inconsistent. In the result the appropriate order is the one to which counsel agreed. It is possible that other admissible evidence. expressly or impliedly. V. cited with approval in Cloete's case. without in any way conceding that the agreement between the parties has not been validly cancelled our client hereby calls upon your client to give vacant occupation of the property to our client within 30 days from date hereof” It will be seen that on the face of it there is no clear indication that the applicant. KOKSTAD MUNICIP ALITYI1Y 1919 A.51 This is a quotation from Stonham. If. if it has not been preceded by any communication of cancellation. will not still rely on his cancellation. no problem is likely to arise. the Kokstad Municipality contracted with a partnership for the lighting of the streets of Kokstad with acetylene gas for a period of 20 years. However. An acceptance by performance on the part of the defaulting party in accordance with the terms of such a notice would then revive it. In fact he expressly persists in his attitude that the agreement has been validly cancelled. Ponisammy and Another v Versailles Estates (Pty. However. 427 (Appellate Division. ex facie the notice as contained in the letter.) In the present case the applicant has purported to cancel but whether this has had the effect of bringing the agreement to an end is still to be determined by viva voce evidence. 8 August 1919) In 1906. In 1916 a Treasury Order restricted the business of the partnership and a Controller was appointed to supervise and carry out its terms. contain an offer of waiver or abandonment of such cancellation or. supra at p. (See Chesterfield Investments (Pty. A further Order for the winding up of . In such a case the duty. 1967 (4) SA 459 (AD). however. in my opinion there is much to be said for the view that it was not a valid notice.) F Ltd . Neethling v Klopper en Andere . v Venter. however. a notice requiring performance will. 1973 (1) SA 372 (AD) at p. This. In such a case the notice must. the notice of rescission sent in this case appears to be equivocal. 117. (Cf. is to my mind a distinction of no consequence.5 Impossibility of performance [8] PETERS. In 1915 partners in the firm were declared enemy subjects and interned by the Minister of Finance.F. which is the relevant one. at this stage not before me. 385). For this reason I refrain from any final pronouncement on this question. positively viewed. De Wet and Yeats. 1919 NPD 44). and thereby evince a willingness to perform. another firm. In this regard. whatever the reaction of the respondents might be. the agreement will be acknowledged by the other contracting party and that he will carry out his obligations under it. 171E .) Ltd. Even if the agreement is in fact not validly cancelled. an offer to reinstate the agreement. the maxim interpretatio charterum begnigne facienda est ut res magis valeat quam pereat would no doubt be applied. The Law of Vendor and Purchaser . is a higher one since an unlawful cancellation is in itself a repudiation of the agreement (cf. expressly or impliedly. two situations may exist. if anything. may reveal the letter in a different light or establish that due notice of [140] rescission was given. South Africa. and generally. Even if it is somewhat ambiguous. FLAMMAN AND CO. A defaulting party is entitled to know that.. The contract was ceded to the defendants.” 10. should he respond to the notice (which may involve him in expense and inconvenience). reads as follows: “However. As already stated. that the matter be referred for the hearing of oral evidence on the disputed issues and that the costs of the application be reserved for decision at such hearing. (Cf. 26). in 1910. 1972 (2) SA 19 (W) at p. imply such acknowledgment of willingness to perform.

however. however. and forfeiture of plant and machinery erected and installed by the firm in pursuance of the contract. and his evidence was clear that “it was not necessary to carryon the working of the plant for the purpose of winding up the estate. and the second defendant was appointed to carry out the order. … [435] … It is true that there are exceptions to the general rule laid down in the lex of the Digest cited above.114. the Municipality initiated action in the Cape Provincial Division claiming £20 000 damages for breach of contract. A.140. The position therefore. By the Civil Law a contract is void if at the time of its inception its performance is impossible: impossibilium nulla obligatio (D. there was no basis for invoking the forfeiture order. Nor was the second defendant in any better position.52 the business was made in 1917. it is not necessary to discuss the exceptions. and if there was no breach. 1911. and paid over to the Custodian of Enemy property the sum of £31.R. In these circumstances it is clear that by virtue of this Act of State it became impossible for the first defendants to perform their obligations under the contract.” Later on.” … Thereafter in accordance with his duty as controller he proceeded to realize the property of the partnership.D. SOLOMON. The learned Judge held that.C. By the order of the 18th May. where the Appeal Court stated the ordinary rule of law to be “that when the law creates a duty and the party is disabled from performing it without any default of his own by the Act of God or the King’s enemies. 50. Marshland (L. SMITH.” … .. 2 Exchequer Div.J. Nor is it necessary to consider generally what are the circumstances in which it can be said that a contract has become impossible of performance. as there is no suggestion that the present case falls within any of them. notwithstanding the contingency that has arisen was caused by vis major or actus Dei. 4). v. … Unfortunately the rules of the Civil Law appear to have been ignored in several cases on this subject which have come before our Courts. The Appellate Division granted judgement for the defendant on both counts. Thus in Hay v. As an Act of State had rendered the contract impossible of performance. was that by the order of the Treasury winding up the business of the partnership it became impossible for the defendants to carry out the contract with the plaintiff. as it is called [436] in the law books.: [434] It will be convenient to deal first with the cross-appeal of the plaintiff against the judgment of absolution from the instance on the claim for damages for breach of contract. the learned Judge says: “I wish to guard myself against being supposed to imply that a party who has imposed upon himself to charge by his own contract is under the Roman -Dutch law bound in every case to make it good.” For the purposes of this appeal. and ordered the plaintiff to pay costs. which have been guided entirely by the decisions of the English Courts. In my opinion that was a perfectly right decision. which concludes thus: “Non tamen hoc in omnibus verum est. this was a good answer to the claim for damages. they themselves having been previously interned as enemy subjects.1. he is discharged from liability. Jane (Aleyn 26) and in Nicol.185). It held that the forfeiture clause in the contract was in the nature of a penalty for breach contract. the law will excuse him: but where a party by his own contract creates a duty he is bound to make it good notwithstanding an accident by inevitable necessity. Divisional Council of King William’s Town (1 E.17. There could be no breach if it could not be performed. inasmuch as the defendants had been deprived by the action and authority of the State of the power of carrying out their contract. 100).C. So also where a contract has become impossible of performance after it had been entered into the general rule was that the position is then the same as if it had been impossible from the beginning: etsi placeat extingui obligationem si in eum casum incideret a quo incipere non potest: (D. J. under Act 39 of 1916. under which would be included such an Act of State as we are concerned with in this appeal. With nearly 10 years of the contract to run. the contract had expired. and the question is whether in these circumstances they can be held liable for damages for breach of contract. 2). the business of the first defendants was ordered by the Treasury to be wound-up. The Court granted absolution from the instance on the claim for damages. For the authorities are clear that if a person is prevented from performing his contract by vis major or casus fortuitus. quoted with approval the law as laid down in Paradine v. but gave judgement for the plaintiff on the second claim. For his authority under Transvaal Act 31 of 1909 was limited to carrying on the business of the partnership only in so far as might be necessary for the beneficial winding up thereof. 45.

And indeed. important to bear in mind the principle which really underlies all cases in which a contract has been held to determine upon the happening of some event which renders its performance impossible. 1 A.a party has expressly contracted to do a lawful act come what may . which is based upon the Civil Law. and consequently no action would lie for damages for breach of contract. and indeed it has been considerably modified by later English decisions. I think. Thus in Horlock v. Sometimes it is put that the parties contemplated a certain state of things which fell out otherwise. 433). Ltd.C. which declared a forfeiture of the plant cannot stand. But. therefore. then upon such a cause occurring both parties are excused from performance.” And LORD LOREBURN said: “An examination of the decisions confirms me in the view that.” . and that it was not inequitable that the plant should be declared forfeited.” Now it is clear that this was a provision for a penalty in case of [438] breach of contract by the defendants of their obligation to light the streets of the Municipality.if in other words he has taken upon himself the risk of such a supervening cause .J. that although the English law looks at the subject from a different point of view from ours. in the result the difference between the two systems is not very great. It follows. 458). In that case a condition is implied that. (L. however. would arise only if the contract had been still alive: as. It remains then to consider the appeal of the first defendants against the declaration of forfeiture of their plant under clause 46 of the contract. however. [437] LORD PARKER said: “My Lords in considering the question arising on this appeal it is. the contract shall not remain binding. however that may be. the plaintiff to pay the costs of the action. E. with costs against the respondent.53 [ The learned Acting Chief Justice then referred to restatements of the law in other cases such as Norden v. 2 A. He comes to the conclusion that it was. and the cross-appeal is dismissed. Jane. and Morgan and Ramsay v. In his judgment the learned Judge discusses at some length the question whether the penalty clause was a reasonable one or not. is not consistent with the principles of the Civil Law. If there was no breach of contract. but it would have been better to have given judgment for the defendants.. and as has been already pointed out. it had expired. As regards the form of the judgment in the court below absolution was granted on the claim for damages. however. a contract which has come to an end cannot be broken. however. if this case had been tried in an English Court of Justice. 1916.D.he is liable if it occurs because by the very hypothesis he has contracted to be liable. That clause stipulates that “should the contractor fail to provide street lighting for a period of 6 months the said contractors will and do hereby agree to forfeit their entire rights and interest in the said plant to the said Municipality. when our Courts have held innocent parties absolved from further performance of their promises. it follows that no penalty had been incurred. LORD WRENBURY said: “Where a contract has been entered into and by a supervening cause beyond the control o:f either party its performance has become impossible. it seems clear that by our law. 525).D. Beal (1916. . Coombs v. therefore. 422). Muller (1913. it has been upon the ground that there was an implied term in the contract which entitled them to be absolved.R. This principle is one of contract law depending upon some term or condition to be implied in the contract itself and not on something entirely dehors the contract which brings the contract to an end.D. The order will therefore be altered to read as follows: the Court grants judgment for the defendants on both claims. That part of the judgment. therefore. I am disposed to think that the defendant would have been held to have been discharged from their obligations under the contract. if performance becomes impossible. Cornelius and Hollis (31 N..P. and continued thus:] … This rule.Metrican Petroleum Products Co. as laid down in Paradine v.C. Shaw (2 M. the contract was extinguished so soon as it became impossible for the defendants to carry it on owing to the order of the Treasury winding up their business.. that the cross-appeal of the plaintiffs against the judgment of absolution from the instance on the claim for damages fails. Sometimes it is put that performance has become impossible and that the party concerned did not promise to perform an impossibility.” It will be seen. v. there could be no breach and therefore no forfeiture. there could be no further breach of it. The result is that the appeal is allowed. But if he has not expressly so contracted and from the nature of the contract it appears that the parties from the first must have known that its fulfilment would become impossible if such a supervening cause occurred. 150). And if the contract had come to an end.” And in Tamplin Steamship Co. Anglo. I take the law to be as follows. That question.

the lessee at a certain time failed to have for sale on the premises sufficient or any supplies of petrol.A. plaintiff was debarred from cancelling the contract unless and until he proved that the impossibility had been created by defendant. 23 September 1946) The respondent. The premises were let out for a garage business. South Africa. Sub – sec 2 thereof is as follows: “Where a reseller is convicted of a contravention of these regulations and the Controller is satisfied that such reseller has in the conduct of his business been wilfully disregarding the provisions of these regulations in that he has not been taking all reasonably practicable measures to ensure that the provisions of these regulations are observed in the conduct of his business the Controller may prohibit the supply of petrol to such reseller for such period as he may deem fit or for an indefinite period. and for the ejectment of the lessee. In Clause 12 of the lease. . sell or barter any petrol ration coupon or special petrol permit shall be guilty of an offence.J. Plaintiff proved that defendant had been convicted of a contravention of Reg. defendant could not. holding that the doctrine of impossibility of performance may not be invoked where performance was made impossible as a direct result of a party’s own wrongful conduct. For the moment I shall assume.” By War Measure 110 of 1943. 18 (4) of 'War Measure 53 of 1943 which as originally promulgated read: “Any person who buys. The plaintiff alleged that contrary to clause 12. G.54 C. in consequence of which the supply of petrol to the lessee as a reseller was prohibited for an indefinite period.A and DE VILLIERS. The lessee contended on appeal that failure to stock petrol on the premises was due to an act of state. Clause 13 provided for cancellation of the lease in the event of breach of any of its conditions. But Mr. therefore. the cancellation by plaintiff was justified and entitled him to eject the defendant.: [660] “… The onus of establishing a breach of a condition of the lease which would justify a cancellation was on the plaintiff. Gordon for the defendant argued that the evidence led for the plaintiff established that the defendant’s failure to have available sufficient supplies was due to an Act of State which made it impossible for him to perform this term of the contract and that. HERBSTEIN.J. and [661] did not. A. I am satisfied that he discharged such onus for the evidence showed that on the 16th November 1944 there was no petrol available for sale and that from that date onwards. That he may have received supplies from another source is a possibility but not a probability in view of the provisions of Reg 11 (5) of War Measure 53 of 1943 as amended by War Measure 108 of 1943. hat the onus was on the plaintiff to show that the impossibility of having sufficient petrol available for sale was due to the act of the defendant. Prima facie. receive any further supplies from the oil companies. concurred. The Court dismissed the appeal. The lessee was in 1945 convicted of a contravention of Petrol Control Regulations. barters or offers to buy.. without deciding the point. J. sued in a Magistrate’s Court for cancellation of a lease of certain premises in Port Elizabeth. The Magistrate gave judgement for the plaintiff with costs. MAASDORP. sells. [9] BENJAMIN V MEYERS 1946 CPD 655 (Cape Provincial Division. Reg. therefore. 11 of War Measure 53 of 1943 was deleted and a new regulation substituted. He submitted that the plaintiff did not discharge this onus is inasmuch as there was nothing to show that the act of the Controller in prohibiting further supplies to defendant was the direct result of the defendant’s conviction. as plaintiff. A. the lessee undertook that he would have at all times for sale sufficient supplies of such brands of petrol and oils as he was permitted to stock and sale.

1. Flamman & Co. a doctrine designed to avert unintended led burdens would operate to enable one party to profit by the event and to hold the other. appears to their Lordships to be determined by the elementary proposition that if further performance of a contract becomes impossible by legislation having that effect the contract is discharged. therefore. I do not deem it necessary to express any opinion on the correctness or otherwise of the magistrate’s decision admitting the letter. The defendant must. It seems to me.D. If so. 11 (2). If this be so. … So far as the rights and obligations rested on contract. Kokstad Municipality (1919. the further conclusion becomes inevitable. that the defendant either had wilfully disregarded the provisions of the regulations or was not taking all reasonably practicable measures to ensure that the regulations were observed in his business. The controller may have acted on either of these grounds. If it were not so. in either event. New Zealand Insurance Co. 497 at 507) LORD SUMNER said: “An event occurs. A. It will be noticed that I have come to the above conclusion without out any reference to the letter from the Controller to the defendant. that the judgment in the Court below can be justified on another on another ground. For the above reasons the appeal is dismissed with costs. at p. however. Scholtz (1933. 262)) one is driven to the conclusion that the prohibition order was issued because (a) the defendant’s conviction and (b) his conduct on one or other of the grounds set out in Reg. Evidently it is their common object that has to be frustrated not merely the individual advantage which one party or the other might have [663] gained from the contract.55 Provided that before prohibiting the supply of petrol to any reseller under this sub-regulation the Controller shall give such reseller not less than 14 days’ notice of the grounds upon which such prohibition is contemplated and shall consider any representations made or information or evidence submitted to him by such reseller within that period”. not contemplated by the parties and. A. A. he desires to invoke the doctrine of impossibility of performance not in order to put an end to the whole contract but to excuse himself from the performance of one term thereof. for. 176): “The present case. namely. (1925. at p. at p. It is unnecessary to add that discharged means put an end to and does not mean broken.C. Cheong Yuo Steamship Co. to a new obligation”. In Hirji Hulji v. On this ground alone. That he is not entitled to do so seems to me to flow from the rule that where one party proves that a contract has become impossible of performance the whole contract comes to an end ( Peters. it does not seem to matter upon which he acted. It seems to me that exactly describes what the defendant is attempting to do in this case.C. I must presume that an official like the Controller of Petrol did carry out the routine laid down by this regulation (Cape Coast Exploration Ltd. In my opinion the magistrate was correct in holding that the performance of the contract was made impossible as a direct result of defendant’s own wrongful act. and thus to hold the plaintiff to a different contract. and remembers that in a civil case a preponderance of probability is a sufficient basis for decision (West Rand Estates v. 434)). the appeal should be dismissed. he must have acted because of the conduct of the defendant. not expressly dealt with in their contract which. A. [662] This is the only regulation which gives the Controller of Petrol power to issue a “prohibition order”. what the law provides must be a common relief from this common disappointment and an immediate termination of the obligations as regards future performance. As was said by LORD ATKIN in Reilly v The King (1934. frustrates their object.” In my view the defendant cannot be heard to say that the contract has become impossible of performance and at the same time claim that the contract should remain in existence so as to enable him to carry on under it in a truncated form. When one takes all these facts into account. (1926. Defendant cannot rely upon a self-created impossibility (Wessels on Contract (Vol.D. This is necessary because otherwise the parties would be bound to a contract which is one they did not really make. 76). if he chose. v. secs 2669.” .D. therefore. be presumed to have had notice of the grounds upon which the Controller intended to act. further performance has been made by statute impossible and the contract is discharged. when it happens. that the plaintiff did establish that the impossibility relied upon by defendant was one created by himself. A. 2680))2630)). v.

It was only the timing which could not be foreseen or predicted. and were given salary advances or loans. [10] BOTSWANA MEAT INDUSTRY COMMISSION [2005] 2 BLR 397 WORKERS’ UNION v BOTSWANA MEAT (High Court. It is an extraordinary occurrence which could not or its effects could not have been guarded against. Casus fortuitous is also described as a species of vis major and it includes all direct acts of nature the effects of which could not reasonably have been foreseen or guarded against. 27 October 2005) The respondent operates abattoirs and other meat processing facilities in various parts of the country. it closed the Francistown abattoir. (iii) Whether the amounts paid to the employees during that period are loans or salary advances which must be recovered by the respondent. The respondent contended that foot and mouth disease had been an unforeseeable event which excused it from its employment obligations towards its employees. eventually to be deducted in the usual manner from their monthly wages. Botswana. Employees with accrued leave were required to proceed on leave. Other employees were told to go on unpaid leave. the respondent was in the circumstances liable to provide work to its employees and to pay wages for work provided or not provided. Vis major is often referred to as an act of God. Lobatse. It held that the outbreak of foot and mouth disease was a foreseeable event. It was also unlawful to force them to repay salary advances or loans when the employer had not paid salaries that should have been paid during the period of closure of the abattoir. It is however not merely that act of God but an occurrence which could not have been foreseen or guarded against. and not to pay their wages when they were ready and available to work. SARKODIE-MENSAH AJ: [399] “… The issues for determination arising out of the [case] are: (i) Whether the outbreak of foot and mouth disease in 2002 and 2003 can be described as vis major or casus fortuitous entitling the respondent to escape its obligations to the applicants under their contract of employment.. The closure of the abattoir notwithstanding. packing and canning same and other activities that are ancillary or automatically flow therefrom. J. (iv) Whether the employees who were temporarily deployed to Lobatse were entitled to be paid their usual allowances and other benefits for the period that they were in Lobatse. The respondent relies on cattle . concurred. The Court rejected this contention and granted the application. Some employees were temporarily reassigned to a different abattoir. The respondent was in the circumstances not entitled to plead vis major or casus fortuitous as justification for non fulfillment of its contractual or legal obligations towards its employees. particularly the person seeking to be excused from its effects could possibly not have anticipated it and with reasonable care and foresight could not have avoided its devastating effects or at the minimum reduced its effects and thus entitle him to escape of his liabilities. Following outbreaks of foot and mouth disease in the Francistown area. The sole nature of the respondent’s business is slaughtering cattle. (ii) Whether the fact that the abattoir had to be closed as a result of which the respondent could not temporarily provide work to the applicants relieved the respondent from paying the applicants their salaries or wages. The applicants sought orders from the High Court declaring that it was unlawful to force employees to go on unpaid leave during the closure of the abattoir.56 NEWTON THOMPSON.

Then came the present incidents. I have come to the conclusion that the outbreak of foot and mouth disease is a foreseeable event. The respondent in its own affidavit and in court stated that this was not the first time it had been faced with disease among cattle causing a disruption and closure of its abattoir and of course consequent losses to its operations.57 brought to it by farmers. They at all times stood ready and willing to go to work. It however did nothing about ‘damage control’ or disaster management in the event of such eventuality. for casus fortuitous to be applicable there must be both the elements of unforeseeability and inevitability. but a review of the situation would be made in March 2003. It was easy to proceed on the ‘let us sit and wait’ attitude because after all the damage and inconvenience was going to be passed on to the employees. The question is. This was almost conceded to by the defence counsel who found it difficult to stick to his assertion when the question was put to him. diseased cattle. Having thus failed is he obliged to pay wages? Section 17(2) implies that unless the [402] contract is terminated. Can such occurrences then. The second outbreak occurred within a period of just about 12 months after the first outbreak. The acting chief executive of the respondent reported that reopening would not happen until May 2003. The lack of preparedness and foresight on the part of the respondent cannot be relied on for them to plead vis major or casus fortuitous to the prejudice of its employees. be it foot and mouth. They were negotiating with South Africa. a train driver claimed his wages for the period in which he had reported for work but had done nothing because the service was hit by a strike. lung disease or others is inevitable. as rightly pointed out by the respondent’s counsel. it does not keep and rear cattle. The municipality argued that his right to remuneration depended on his actually doing work. . the Francistown abattoir was closed for five and a half months. It is common cause that if the farmers it relies on do not have cattle to bring or for some other reason such as disease. The first outbreak was in the Matsiloje area. it cannot by any principle of law be [heard to] argue that the 2003 outbreak was also vis major. A previous incident. or minimized by the respondent? Every operation has its peculiar risks. … [401] … Did the fact of the closure of the abattoir absolve the respondent from meeting its contractual obligations with its employees. Was the inability of the employees to perform due to the default of the employer? … Has the employer failed to provide work? The answer is yes. The press release to this effect is dated 7 February 2003. salaries and other entitlements? What is apparent is that at no time did the employees fail or refuse to go work. no cattle to slaughter. occurred in Maun. The Appellate Division found for the driver holding that as a proper construction of contract. one after the other. On its own. the applicants (the employees) have not broken their contract of employment. February 2002. and Sections 17 (2) and 21 (1) of the Employment Act (Cap 47:01) on the duties and responsibilities of an employer to provide work. the abattoir would start slaughtering at the end of April 2003. the most recent outbreaks. and stated that as a result both the Francistown and Lobatse abattoirs would be closed with immediate effect. it cannot operate. and if negotiations were successful. In the case of Johannesburg Municipality v O'Sullivan 1923 AD 201. continued to run. As stated already. It is subject to stringent regulations. That there will be disease outbreak among cattle. … [The Court then referred to Sections 16 (1) and (2). The announcement by the Department of Animal Health was made by way of press release on 9 February 2002. The first part of s 16(1) is therefore not applicable. That follows that the contract of employment between the plaintiff and the defendants. it shall continue to run. and to pay for the work provided or not provided. Even if the respondent could argue that 2002 was vis major. concerning lung disease. also in the Francistown area. and totally unexpected. and continued:] … In the present case. the subject matter of these proceedings which occurred on two occasions. are these acts vis major which could not have been guarded against with good planning and foresight? It looks to me that an occurrence which happens regularly cannot be said to be a vis major. … On the first occasion. ever be [400] anticipated by the respondent and could such occurrences and their effects be avoided. cattle cannot be brought to slaughter. principally that of paying them their wages. This time at Matopi. It is only the timing which cannot be foreseen or predicted. There is no doubt that the respondent was aware and could have anticipated such eventualities.

58 the consideration for the payment of wages was the mere tender by the train driver to work. The plaintiff sued for damages for breach of contract. a shirt manufacturer. union dues. One of the things the plaintiff was to do was to sell the various goods manufactured or sold by the defendant. The defendant’s manufacturing facility burnt down and so the defendant did not continue to employ the plaintiff. the applicants were told to do two things by the respondent: 1. It is pertinent to note that that letter was written over two months after the closure of the abattoir. and the court made reference to another case Taylor v Caldwell (1863) 3 B & S 826 at p 833 where the court held: ‘There seems no doubt that. The situation will be reviewed at the end of March 2002’. Things remained quite fluid. but were forced to take leave. On appeal the Court of Appeal allowed the appeal holding that the plaintiff was entitled to substantial damages and that the defendant was not excused from fulfilling his agreement [403] by virtue of the destruction of his manufacturing facility by fire. Having so found. and not subject to any conditions express or implied. the defendant. any staff member who needed money was to apply for a salary advance or loan.’ Flowing from this decision. thus making it impossible for the applicants to mitigate their burden by looking for temporary employment as was suggested in the ‘To whom it may concern’ letter from the respondent’s human resources manager dated 11 April 2002 marked annex AA13. This is contained in the minutes of 19 February 2002. where there is a positive contract to do a thing not in itself unlawful. What is important is the tender for service. the question of salary advances or loans can be decided without much difficulty. The following day (20 February) a circular was addressed to the applicants stating. Those who did not have leave were to proceed on unpaid leave. Could these payments be termed loans which must be repaid? The respondent’s [404] attorney submits that this was at the instance of the applicants in terms of the minutes of 25 February 2002 which reads. I find them nevertheless persuasive and offering the correct legal position. they remained employees of the respondent. By implication. ‘The Botswana Meat Commission will therefore not be able to pay salaries and wages of employees. which is what the applicants did. ‘Union asked if employees could be given advance. funeral policy and others. The applicants were then required to pay back this loan or salary advance upon resumption of duties over a period of 24 months. The applicants’ contract with the respondent is positive and absolute. stood ready to work. had a five year contract with the plaintiff. the performance of his contract has become unexpectedly burdensome. There was no certainty as to when the abattoir would re-open. Those who had leave were to proceed on leave. or even impossible. They tendered their services. … … The applicants did not cease to be employees of the respondent. the contractor must perform it or pay damages for not doing it although in consequence of unforeseen accident. this being equivalent to the staff member’s gross monthly salary less deductions such as income tax.’ Even though these decisions may not be binding. 2. The respondent also stated that ‘we are looking at a minimum of (3) months. the respondent was obliged to pay the applicants their agreed wages in terms of their contracts of employment. I have not been told of any conditions express or implied. their contracts were not terminated. such as that the applicants will not be paid in the event of disease outbreak resulting in the closure of the abattoir. Management agreed to salary . It is stated that closure is until further notice with no certainty in the circular of 20 February 2002. The rule is to apply when the contract is positive and absolute. During the period of closure of the abattoir. … … I thus find that the applicants were entitled to be paid their regular wages or salaries during the closure of the abattoir in 2002 and in 2003. There was also uncertainty as to how long the closure would endure. The non-payment is in breach of s 21(1) of the Employment Act. His plea of vis major failed. This could have been a matter of agreement in the contract which once agreed and specified would have been binding on the parties and these proceedings would never have commenced. In the English case of Turner v Goldsmith [1891] 1 QB 544. They tendered their services.

The respondent is to pay the applicant's costs on the ordinary scale. I therefore make the following declaratory orders: 1.’ Mr Boko for the applicants submitted that at that stage the applicants had no choice but to survive. I have thus come to the conclusion that the applicants must succeed in all respects. their being made to repay it back is improper and unlawful. By implication. That all unpaid allowances and benefits due to those employees who were deployed to Lobatse temporarily be paid with immediate effect. How else were the employees and their families to survive? I would hasten to ask if this affected managerial and other high ranking officials or were the applicants denied salaries so that managers and bosses would be paid? I do not have an answer to this question and I will not seek one now. why should they be made to pay tax and the other deductions? Income tax is paid out if income earned and not out of loans. That the decision by the respondent to send off its employees at its Francistown abattoir on forced unpaid leave and forced leave during the outbreak of the foot and mouth disease in February 2002 and February 2003 was unlawful.” . They did not have to forego their entitlements such as accommodation because BMC had no money and because they had no option to refuse. they remained regular employees entitled to remuneration and allowances. 4. they were in a panic situation. 3. why the deductions for tax and others? If the applicants were not on duty and thus not being paid salaries. and shall be made not later than 21 days from the date of this order. They needed to survive. 2. Non-payment by the respondent of these entitlements is equally unlawful. All amounts paid to the applicants and treated as either loans or advances are not loans or advances but salaries. Application granted. The payments made to the applicants during the closure were salaries and wages to which they were properly entitled. Five days prior to this meeting of 25 February 2002 they had been told they would not be paid salaries. The decision is unlawful and immoral. I agree. 2. That all unpaid salaries and wages for the said periods are to be paid to the affected applicants with immediate effect. Was that their creation? Additionally. … … [405] For those who were deployed temporarily to Lobatse. That the respondent’s failure to pay its employees’ wages during the closure of the Francistown abattoir in 2002 and 2003 as a result of the outbreak of foot and mouth disease in the Francistown areas was equally unlawful. All payments due in terms of this order shall not bear interest. In consequence all deductions made from the salaries of the affected are to be repaid with immediate effect. their overdraft had escalated and they had made huge losses. and all further deductions should cease forthwith. The only reason put forward by the respondent was that they were having financial problems. if the payments were advances.59 advances. In consequence. the applicants were being called upon to bear the brunt of such losses and provide the necessary cushion for same. 5. It is therefore ordered that: 1.