TUTORIAL LETTER 3

GUIDELINES FOR ANSWERS FOR ASSIGNMENT QUESTIONS

Year 2021
Semester SECOND SEMESTER
Module LAW OF CONTRACT
Module code LCN 301

1. DETAILS OF LECTURER/FACILITATOR OF LEARNING

Lecturer/Facilitator of Learning Adv J Nieuwoudt

Consultation times Monday to Friday 19:00 to 20:00

Telephone 082 391 0111 Rather use email communication

Email jnieuwoudt@sbs.ac.za

2. GUIDELINES FOR ANSWERS FOR ASSIGNMENT QUESTIONS

Question 1 [10]
1.1 The rendering of the performance is impossible. It is so serious that nobody can render the performance
and it is therefore absolute or objective impossibility.
It is supervening impossibility as the obligation can no longer be performed because performance has
become objectively or absolutely impossible after the contract has been concluded.

Office 101, The Village Square, c/o Oxford and Queen Streets, Durbanville, Western Cape, 7550
CPD Vorster – Director | S Totaram – Director | D Singh – Director | JJ Human – Director

Company registration number: 2004/031722/07

 Valid obligations arose but the obligations of the parties terminated. (4)
1.2 Initial impossibility (objective) before the conclusion of the contract – no obligations arise.
(2)

1.3 Performance made impossible through the fault of a party, the obligations do not terminate and Mr X
committed a breach of contract. Mr A can claim damages and/or cancel the contract.
(4)

Question 2 [10]
2.1 A contract that is aimed at circumventing the provisions of a statute prohibiting an act or contract (in
fraudem legis) is illegal and void. No contract as one of the requirements of a contract, namely legality is
not present. (2)

2.2 An illegal contract can’t be enforced as one of the requirements for a contract (legality) is not present.
An illegal contract creates no obligations.
Neither party can institute action for performance or claim damages because from an illegal cause no
action arises (ex turpi rule) (4)

2.3 Performance by one or both parties does not make the contract legal
Where both parties are guilty, the par delictum rule applies that the possessor is in the strong position and
restitution cannot be claimed
Mr A can therefore not claim his money back. (4)

Question 3 [5]
3.1 Sanctity of contract (freedom to contract) in conflict with fairness in contract dealings (good faith,
equity and public policy in contract)
Parties with capacity must be free to contract with minimal interference by the state.
(3)
3.2 He must show that if the court enforces the provision it would be offensive to law, public policy or to
broad community notions of what is fair and reasonable. (2)
Question 4 [20]
4.1 Memorandum of Agreement
Entered into by and between
Fast & Furious Cars (Pty) Ltd
A public company established and registered in terms of the Companies Act 71 of 2008 with
registration number 1234
Herein represented by Mr A duly authorised thereto by resolution.
(hereinafter referred to as the “Seller”)
Address: 112 Park Street, Willow Glen, Pretoria (2)
And
Mr B
Identity number 1234
Unmarried
(hereinafter referred to as the “Buyer”)
Address: 151 King Street, Krugersdorp (2)

4.2 Mr A leases car 1956 vintage Porsche from Mr B for the amount of R500 000. Mr A will pay import
cost and taxes.
Vehicle to be delivered to ______ premises
Delivery date 15 May 2020 (3)

4.3 Where Mr B fails to deliver the car on 15 May 2020, he shall pay the Purchaser R500-00 (Five
Hundred Rand) per day of delay. Mr A may choose/elect to claim the agreed penalty, or to claim
common law damages. (3)

4.4 Where any party commits a breach of contract, the aggrieved party shall be entitled, without prejudice
to any other rights that it may have in terms of this Agreement or in law, to
(1)
i) claim specific performance of the terms of the Agreement as well as damages which it may have
suffered; (1)
 ii) cancel this Agreement and claim damages; or (1)
iii) keep this Agreement in force and recover such damages ass it may have suffered as a result of
such breach. (1)

4.5 This Agreement, including this clause, may only be amended or cancelled if the amendment or
cancellation is in writing and signed by the parties hereto. (2)

4.6 This Agreement reflects the entire agreement between the parties. Each of the parties acknowledges
that, in entering into this agreement, it does not do so in reliance on any representation, warranty or
other provision except as expressly provided in this agreement, and any conditions, warranties or other
terms implied by statute or common law are excluded from this Agreement. Neither party will have any
right or remedy arising from any undertaking, warranty or representation not included in this document.
(4)
Question 5 [10] (Textbook pages 257-258)
Rule: Where parties intended their agreement to be fully and finally embodied in writing, evidence to contradict,
vary, add to or subtract from the terms of the writing is inadmissible. Governed by fundamental rule of law of
evidence – irrelevant evidence is inadmissible. (4)

Coopers & Lybrand Bryant: wording of a contract must be interpreted in the context of other provisions in the
document, read as a whole. (1)

Rule manifest in two ways: determines what evidence is admissible to prove the contents of the contract
(integration rule) (Is this a term of the contract?) (2)

Has limits: agreement does not reflect the whole agreement, lead evidence to prove agreement is part of larger
transaction.
Agreements may also be part written and part oral (Traub v Barclays National Bank Ltd) Integration rule does not
apply to oral agreement. Subsequent oral agreement varying agreement may be excluded by non-variation
clause.

Does not operate where aggrieved party alleges fraud, misrepresentation, mistake, undue influence, duress or
illegality
Secondly, it determines what evidence is admissible in proving the meaning of the words used by the parties to
express those terms (interpretation rule)(What does this term mean?) (2)

Delmas Milling Co Ltd v Du Plessis – meaning of contract sufficiently ascertained from written words, evidence
outside the contract is irrelevant, i.e. relevance rule governing the admissibility of all evidential material.
(1)
Question 6 [10]
The relevant principle in law pertaining to this question is the Shifren principle. (1)
It is common practise to insert a non-variation clause in a written contract. (1)
The standard wording is more or less as follows:

No variation of this agreement shall be of any force or effect unless reduced to writing and signed by the parties to the
agreement. (2)

Some doubt arose whether parties can amend an agreement orally. (1)
These doubts were put to rest by the Appeal Court in 1964 in the well-known case of SA Sentrale Ko-operatiewe
Graanmaatskappy BPK versus Shifren. (2)
The court held that a non-variation clause is not against public policy and that no oral variation was effective. (1)

The court also held that the purpose of the clause is to prevent disputes and problems of proof. (1)
Parties – by inserting a non-variation clause in their agreement – have limited their powers. (1)

Question 7 [10]
Not all agreements are binding contracts and can’t be enforced by law as such. (2)
Parties to social and domestic agreements don’t have intend that the agreement be lawfully binding
– for instance, a social appointment for tennis. (2)
The ingredient that is needed for a legally enforceable contract, is “animus contrahendi” which means that a party
has the serious intention to create legally enforceable obligations. (2)
A gentleman’s agreement is binding in honour and not in law and also a letter of intent. (1)
Serious intention can be proven in court by means of evidence although it can be quite difficult. (1)
The law can protect someone who was led by another person to genuinely believe that a contract was intended
although the other party lacked animus contrahendi to uphold the contract despite the absence of genuine
agreement. (2)
Question 8 [5]
Although an oral ante-nuptial agreement is valid between parties, it has to be notarial executed and registered
within three months of signature in order to be effective in terms of the Deeds Registries Act, 47 of 1937 as
amended. (1)
I will therefore advice my brother as follow:
• Visit a Notary (at attorney’s office) ASAP to assist the parties to put their oral agreement in writing
before the marriage. (1)
• The Notary will then request the parties to sign the agreement in his presence as well as two witnesses.
(1)
• The Notary will notarize the ante-nuptial agreement with his notary stamp and send it to the deeds
office for registration. (1)
• If the parties neglect to do so – they will be perceived by law as married in community of property. (1)

Question 9 [20]
The Consumer Protection Act 68 of 2008 (“CPA”) has introduced significant restrictions on the way suppliers
are permitted to market goods and services to consumers. The CPA is designed to protect consumers from
before they enter into a transaction and even if they do not ultimately transact with the supplier.
Given its breadth, the CPA should be very carefully considered.

Offers must be in plain and understandable language.

The offer must disclose whether goods are reconditioned or grey-market goods
Negative option marketing is prohibited (Section 31)
Consumers have the right to a cooling off period (Sect 16)
The CPA contains some very far-reaching provisions which can impact on every aspect of marketing. There is a
general prohibition on deceptive and/or misleading representations in any marketing practices. Some marketing
practices are prohibited and suppliers may not use them at all. The CPA also restricts marketing practices
relating specifically to catalogue marketing and promotional competitions. (Section 32(10)
• Not in person and cannot inspect goods
• Provide the supplier's name, license or registration number, supplier's address and sales record
information
The CPA becomes particularly relevant if a supplier’s marketing strategies rely on direct marketing. In this case,
suppliers must ensure that their procedures comply with the following, among others:
• Customers may only be contacted within certain times and not on Sundays or public holidays.
• Customers must be able to opt out of direct marketing free of charge.
• All existing customers should provide confirmation that they wish to continue receiving direct marketing
from the supplier. This provision means that the direct marketer must prove that he has paid the
prescribed fee and registered with the registry and that he has confirmation that he is allowed to contact
the consumer. Without the existing customer’s confirmation, it is presumed that the supplier may not
contact the customer.
In light of these restrictions, it is important that the supplier conducts an in-depth, detailed analysis of their
business and policies. The supplier should assess whether their company, their consumers and their goods or
services fall within the general ambit and application of the CPA.
It is essential that suppliers know and understand these provisions. If a supplier’s marketing practices do not
comply with the CPA, there is a risk that the transaction may not be enforced against the supplier’s consumers.
* Courtesy of de Rebus August 2011 – see pg 51 for the full article

TOTAL [100]
3. CONCLUSION
Dear Student

I sincerely hope you have learned a few lessons regarding the subject of Law of Delict, as well as concise essay
writing!

Good luck with your studies and the examination. Remember to study the topics as in your examination letter in
detail for the exam. Do not “spot” as law is a big puzzle where every topic fits as part of the puzzle!

Also remember that perfection works for those who work at it!!

Regards
Adv Jacques Nieuwoudt