LAW OF CONTRACT: ZIMBABWE

QUESTION: What is a fundamental breach of contract? Enumerate on the various forms

of breach of contract. In your answer, distinguish between those that are classified as

anticipatory and indicate circumstances under which cancellation is available as a remedy.

In our Zimbabwean law of contract, the general principle is that where parties have agreed on
certain terms, they are intending to be bound by the terms so agreed hence failure to honour
the obligations would amount to a breach of contract and a remedy is available on the part of
i
an innocent party. It is not however every breach which is regarded as a fundamental breach
thus the essence of this essay is to show among other things, what it that is referred to as
fundamental breach. The essay will also go a long way in showing the various types of
conducts (by omission or commission) that are regarded as breach of contract. A closer look
at all the recognised types of breach of contract shows that they can be classified into 2
different categories viz, anticipatory and mal performance. The writer is going to show the
types of breach of contract which fall under anticipatory in the course of the discussion.
Having discussed the types of breaches, the writer will also show in his final part of the
essay, circumstances which allow an order of cancellation as a remedy.

The definition of a fundamental breach can be drawn from the case of Transport and Crane
Hire (Pvt) Ltd v Hubert Davies & Company (Pvt) Ltd.1The appellant purchased a truck which
the respondent had assembled. The truck was involved in an accident due to negligence on
the part of the respondent. It appeared that in their contract, the respondent had incorporated
an exemption clause which he raised as a defence in the High Court which then ruled in his
favour. The appellant appealed and the Supreme Court reversed High Court judgement.

1
1991 (1) ZLR 190

Tatenda Madamombe (Mhofu)

Korsah JA @ 190 and 201 held that, “the breach of contract was a fundamental breach and
the exemption clause could not exempt the respondent from liability... In my view, upon a
proper interpretation of the contract, the breach of the contract was so fundamental as to go to
the root of the contract, and the terms of the exclusionary clause did not cover such breach”
respectively. [my emphasis]. It can be reasoned basing on the above contention that a
fundamental breach is that which goes to the root of the contract, it is that type of a breach
which defeats the reason for entering into a contract. In the above case, the point which was
stressed by the Supreme Court is that the exemption clause cannot be relied upon as a defence
where the breach goes to the root of contract therefore, it can be summed up in that a
fundamental breach is simply that which goes to the root of a contract, there won’t be no
answer as to why you enter into a contract when there was a fundamental breach.

There are numerous forms of breach of contract. It is imperative to note from the start that the
distinguishing line in the classification is the time of performance thus when before the
performance becomes due; it is called anticipatory breach of contract whereas when after
performance is due, it is called mal performance per Deeksha Bhana et al (2009)2. It cannot
be denied that all forms of breach fell under either of these two. There are 4 main types of
breach of contract and these are repudiation, mora, prevention of performance and defective
performance. It is vital before delving into a discussion of these forms to first state those
which fall under anticipatory, these are prevention of performance and repudiation. They
become anticipatory in the sense that breach is anticipated by another party before
performance becomes due. D. Tiplady in the Law Quarterly Review @ 467 also shades more
light on anticipatory breach. He had this to say, “the better view would therefore seem to be
that anticipatory breach so called is the actual breach of an implied obligation of present
performance.3” This is just but a summation of what has been said.

2
Bhana, D., Bonthuys, E. and Nortje, M. 2009 Student’s Guide To The Law of Contract @213

3
Tiplady, D. Law Quarterly Review @467

Tatenda Madamombe (Mhofu)

The first form of breach of contract which falls under anticipatory breach to be discussed is
repudiation. Deeksha Bhana et al (2009) clearly defined repudiation as, “the behaviour, by
either the debtor or creditor, which indicates that performance will not effectively be
delivered (repudiation by the debtor) or that performance will not be accepted (repudiation by
the creditor) i.e. the party acts (by words or conduct) in a way that clearly and
unequivocally indicates that she is not going to honour her obligations under the
contract.4” A party repudiated in a contract of sale in the case of Tuckers Land Development
Corporation v Hovis5. In this case, the appellant had sold two erven in a proposed township to
the respondent. After paying a considerable sum in terms of the contract, respondent became
aware that appellant who was also a town developer, had run into difficulties in obtaining
proclamation and as a result thereof had prepared a new plan for submission to the proper
authorities and on which plan respondent’s erven had disappeared being superseded by a
school site. He sought to claim for a repayment of the money he had paid and was successful
in his claim. The decision was also upheld in the appeal court. The party anticipated breach
and show his intention not to be bound by the contract in question as was held by the court,
“it should be accepted that in our law, an anticipatory breach is constituted by the violation of
an obligation ex lege flowing from the requirement of bona fides which underlies our law of
contract” A conclusion for this is hence that repudiation forms part of anticipatory breach by
virtue of it occurring before the performance becomes due!.

Another form of anticipatory breach is prevention of performance. It was again perfectly

defined by Deeksha Bhana et al saying, “…is conduct by either a creditor or debtor which
makes the delivery of his own or the other party’s performance impossible. 6 ” If,
however, the impossibility was brought about by the fault of the party to a contract, he cannot
claim remedies for prevention of performance. The position was summed in the case of
Grobbelaar v Bosch wherein the court held that, “in no case may a party plead discharge of a
contract through loss…where he by his deliberate or negligent act, has been responsible for

4
Ibid.( 2009 Student’s Guide To The Law Of Contract)
5
1980 (1) SA 645
6
Ibid.( 2009 Student’s Guide To The Law Of Contract)

Tatenda Madamombe (Mhofu)

such loss 7 ” In the case of Benjamin v Myers 8 , there was a breach by prevention of
performance. Myers sought to eject Benjamin from the property let to him. This was because
he had failed to stock sufficient supplies of petrol and oil as agreed. It was his own conduct
which prevented him from performing his obligations as stipulated under a contract. He had
been convicted for contravening measures governing the sale of petrol and was prohibited
from selling petrol for an indefinite period and as a result he was unable to obtain petrol from
the oil companies. The court held that this was breach of contract which arose from a self-
created impossibility. It was anticipated by the other party that since he was now convicted
(the other party), there would be no proper performance hence this type of is one which form
part of anticipatory breach of contract.

Another form of breach of contract is positive mal performance which is also known as
defective performance. It has been defined in the case of Sweet v Ragerguhara @ 138 as,
“timeous performance not in accordance with the contract9.” Parties to a contract concluded
a contract of sale of immovable property. The appellant had bought immovable property from
the respondent. When performance on the part of the respondent was rendered, the appellant
realised that it was defective though timeously rendered. It was defective in the sense that
there were two families which were still occupying two buildings on the property. This was a
thing which was never agreed by the parties hence it compromised performance. The
Convention for the International Sale of Goods (CISG), in particular article 35 stretched the
range of defective performance as to include non-conformity10 of any kind thus if we enter
into a contract of sale where the subject matter to be delivered is green in colour, delivering
the subject matter which is not green in colour would amount to non-conformity hence breach
of contract. In the above discussed case of Sweet v Ragerguhara, non-conformity came in the
sense the property was still occupied with some people, and in actual fact, the parties had
agreed that the property solely belonged to the respondent and no one else. This cannot form

7
1964 (3) SA 687 (E)
8
1946 CPD 655
9
1978 (1) SA 131 (D)
10
Article 35 of the C.I.S.G.

Tatenda Madamombe (Mhofu)

part of anticipatory breach of contract simply because performance was done timeously. It
must be recalled that what determines whether the said form of breach is anticipatory or not is
the time of performance thus all forms of breach which occur after or at the time when
performance is due does not fall into the category of anticipatory breach. These have their
class called mal performance.

Although it is understood as another name for breach, mora is also another type of breach of
contract. Evidence for this can be drawn from decided cases and texts for instance, Deeksha
Bhana et al @ 215. The authors defined mora as, “late performance by the debtor or
creditor.11” A debtor is said to be in mora by mere lapse of time of performance. The same
applies to the case of creditor if he fails to act timeously, he is said to be in mora. The fact
that it is not only the debtor who is said to be in mora for not rendering performance
timeously, this form of breach was subdivided into 2 main classes which came to be known
as mora creditoris and mora debitoris. The writer is going to look at them separately but
what must be borne in mind is that for one to be said to be in mora, he/she would have failed
to render performance timeously.

The most common type of mora is mora debitoris. In the case of Nel v Cloete12 where the
parties entered a contract of sale of a house on 3 October 1968 and a deposit amount was paid
to the respondent of R1750. The remaining balance was to be paid by means of a building
society fund. The process of transfer was dragged due to the unavailability of title deeds. The
attorney for the respondent wrote a letter on 13 June 1969 to the appellant demanding him to
effect transfer (payment of the balance) within 2 months otherwise the respondent would
cancel the contract. On 12 August 1969, performance had not yet been rendered (no payment
was made). The respondent then sued the appellant. The debtor denied payment of damages
to the respondent basing on the grounds that 2 months was not a reasonable time. He got
favour with the court of first instance but on appeal, the decision was reversed and he was
ordered to pay damages to the respondent. In this case, the debtor was in mora in the sense
that he failed to effect payment of the balance which was to be done by means of a building
society within 2 months.

11
Ibid.( 2009 Student’s Guide To The Law Of Contract)@215
12
1972 (2) SA 150 (A)

Tatenda Madamombe (Mhofu)

A second category under mora is mora creditoris that is where there was late performance by
the creditor as alluded before. In reciprocal obligations, for example, in contracts of sale, the
creditor owes some duties and obligations to the debtor. These include a duty to accept the
performance by the debtor. If a creditor delays in accepting performance, he is then said to be
in mora. The case of Wingerin v Ross13 summarises the circumstances when the creditor is
said to be in mora creditoris. The parties enter an agreement to the effect that the plaintiff
would purchase from the defendant a brickmaking business consisting of movable and
immovable property and goodwill. There was a misrepresentation prior to the conclusion of
the contract that the machine which formed part of the subject matter of the contract
(brickmaking business) was capable of producing approximately 20 000 bricks per day when
in actual fact, the plaintiff realises that the machine could not produce over 12 000 bricks a
day on approximate. The plaintiff decided to return the property to the defendant who refused
to accept it thereby rendering him being in mora creditoris. The court held @ 83 line 4 that,
“the seller who refuses to accept the tender of a purchaser after repudiation to return the
subject matter of the sale is in mora creditoris.” A conclusion can be therefore given that it is
a form of breach of contract to fail to timeously render performance and the creditor also can
be in breach if he failed to perform his duties as stipulated in a contract. This form of breach
of contract forms part of what are known as mal performance and not anticipatory breach.

As alluded before in the first paragraph of the essay, cancellation is a remedy for breach of
contract. However, it cannot be understood in such simplistic form. Deeksha Bhana et al @
259 underscored that, “…a remedy of cancellation is aimed at the termination of the
consequences of a validly concluded contract. It is therefore considered to be an
extraordinary remedy which can only be used in certain circumstances14” [my emphasis].
As can be seen from the quotation, for cancellation to be given as a remedy, there should be a
fulfilment of some certain requirements, some elements must be met. It is at this point when
the writer would show the circumstances which allows for grant of cancellation as a remedy.
These circumstances were set out in the above cited book page and these are; right to cancel,
exercise of right to cancel and ability to restore performances received. In Book v Davidson,
it was stated that, “the general principle governing determination of the incidence of the onus

13
1951 (2) SA 82 @83 (C)
14
Ibid.( 2009 Student’s Guide To The Law Of Contract)@259

Tatenda Madamombe (Mhofu)

is the one stated in the Corpus Iuris, simper necessitas probandi incumbitilli qui agit. In other
words, he who seeks a remedy must prove the grounds therefore 15 ” This means that for
cancellation to be effected the party who seeks this remedy must prove that one; he had the
right to cancel. Deeksha Bhana clearly postulates that breach per se does not warranty
cancellation as a remedy, the party must have acquired the right to cancel the contract. This
could be so either impliedly or expressly. Impliedly, this is where the plaintiff got the right to
cancel from the seriousness (materiality) of breach whereas express is by including a lex
commissoria (cancellation clause) and notice of rescission. These allow a person to get a
right to cancel. Two; that there was an exercise of right to cancel which is brought about as a
result of notices of cancellation that is when the plaintiff notifies that the defendant that he is
actually cancelling. Cancellation is a unilateral juristic act therefore there is no need for the
agreement of the other party as held in the case Stewart Wrightson v Thorpe16. And three,
that restoration of rendered performance is possible. If it’s not possible to return to
performance rendered by the wrongdoer, one cannot cancel, see Feinstein v Niggli 17 . In
conclusion, cancellation can be available as a remedy when the above are satisfied.

Conclusively, the essay shows the definition of a fundamental breach as a material breach
and an analysis of the forms of breach. In the analysis, the writer was showing those that are
anticipatory and finally circumstances where cancellation can be available as a remedy.

15
1988 (1) ZLR 365
16
1977 (2) SA 943 (A)
17
1981 (2) SA 684 (A)

Tatenda Madamombe (Mhofu)

REFERENCE LIST

Bhana, D., Bonthuys, E. and Nortje, M. (2009) Student’s Guide to the Law of Contract Print
Communications; Cape Town

Benjamin v Myers 1946 CPD 655

Book v Davidson 1988 (1) ZLR 365

Feinstein v Niggli 1981 (2) SA 684 (A)

Grobbelaar v Bosch 1964 (3) SA 687 (E)

Nel v Cloete 1972 (2) SA 150 (A)

Stewart Wrightson v Thorpe 1977 (2) SA 943 (A)

Sweet v Ragerguhara 1978 (1) SA 131 (D)

The Convention for the International Sale of Goods (CISG) (article 35)

Tiplady, D. Law Quarterly Review @ 467

Transport and Crane Hire (Pvt) Ltd v Hubert Davies & Company (Pvt) Ltd 1991 (1) ZLR 190

Tuckers Land Development Corporation v Hovis 1980 (1) SA 645

Wingerin v Ross 1951 (2) SA 82 @83 (C)

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