SPECIFIC CONTRACTS

TOPIC 1: INTRODUCTION

INTRODUCTION

1. Why rules relating to specific contracts?

● General principles of contract law = underlying framework. They are not how applied ito
Specific contracts
● With Specific contracts, parties have reason for conclude the contract (goal/purpose)
● General principles & rules are insufficient to deal with sp types of contracts
○ Sometimes reason to deviate given interests and concerns of parties
○ Sometimes silent (don’t deal with specific problems unique to contracts)
○ Specific leg Acts have far reaching impact on general rules of contract law (eg
CPA). They are relevant to specific types of contracts.
■ Example – The Rental Housing Act = governs lease contracts

2. Methodology of classification
● Deals with specific contract types (sale, lease suretyship, mandate)
● 2 broad approaches in SA law to classify / distinguish contracts
○ Its not an either/or, applied in CONJUNCTION with one another. Both
approached are used

(a) essentialia-naturalia model

Essentialia ● Characteristic rights and duties that distinguish one contract type
from another contract type.
○ Eg. Contract Of Sale agree on subj matter of sale (merx) +
agreement with the purchase price. Incorporated in this is
that any rights that the seller has will be permantely
transferred to the buyer
○ Difference between COS from lease?
■ COS is “permanent transfer of rights”
■ Lease, agreement on leased property is coupled
with intention of transfer of use and enjoyment is
“temporary”.
● Benefit of approach, once agreed on essentialia, law steps in and
reads in certain terms automatically Ex lege terms (naturalia)
○ Generally based on policy considerations unique to a
contract. Represent the laws attempt at an equitable
balance between the parties

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 Naturalia ● ex lege terms automatically read in, unspoken terms (unless
parties agree to vary the naturalia)
● Parties must just agree on essentialia for specific contract, as law
reads in terms based on policy considerations which balance the
interests of the parties.

● Model is easy to apply, leads to certainty & efficiency.

○ Because it results in certainty there is an argument that it is also fair.
● Shortcomings
○ “all or nothing” approach.
○ If can’t concudel that parties for eg agreed on merx and purchase price, then it
CAN’T be a COS, regardless of parties intention.
■ Can result in formalistic approach
○ Hides need for differentiation / sub-types
■ Does not have nuanced approach.
■ Hides need to differentiate btwn subtypes of contracts or mixed types of
contracts.
■ EG. Get agreements, like trade-in transaction. Trade in old car plus sum
of money. But what contract is this? COS? Or contract of exchange?
● Contract of exchange: thing in return of a thing which is also
present in EG.
● But the EN model does not help us classify the contract due to
mixed elements
○ Sometimes not enough
■ Applying EN model not helpful when essential terms of 2 contracts are
exactly the same
■ EG employment contract and independent contractor
● Essential terms are the same(service for remuneration)
● BUT big difference in the way the law treats employees VS
independent contracts
● Factors to differentiate the two?
○ Level of control, degree of supervision, own tools or
supplied by company, method of payment etc.
○ = TYPOLOGICAL APPROACH

(b) Typological approach

● Inherited from German law.
● essentialia-naturalia model: analysis ito “concepts” valuable, but insufficient
○ “Concept” ito EN closed notion
■ Essentialia-naturalia model:: There must be agreement on merx and
price iot comply with req of the concept
■ Typological: more fluid ideas/types
● EG: COS is a type, NOT a concept.
● When using Typological approach, will consider a number of diff
factors, which DON’T all have to be present, iot determines

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 whether the DOMINANT impression, is that parties concluded a
COS, or an employee VS independent contract.
o Therefore “types“: not all or nothing criteria/concepts

Application of typological approach

● Santos case (soccer coach)
○ Soccer coached employed for specific club. Quesitons was whther the soccer
club could get an order fro specific performance to force the coach to finish his
employement contract
■ Although relat btwn parties was an employment contract, due to Igesund
could determine own working conditions
■ Concluded, strictly speaking this is an employ contract but bc he is an
indep contractor, nothing prohibiting granting SP this is an EG of looking
beyond what contract looks like, but how did parties operate iro to
eachther (their purpose)
○ Less about what approach you are using, rather about being aware of the fact
that if you limit yourself to the essentialia you may miss something, in which case
not providing best advice

3. Sources

● Common law
○ CL rules irt specific contracts in SA law, those which come from Roman law, as
interpreted by RD authorities. Remained virtually unchanged in SA law since
1700s.
○ Lot of Roman law rules, are still applied exactly as is today (eg COS), but altered
in certain cases to cater for modern aspects.
● Legislation:
○ Formalities
■ EG Alienation of Land, suretyships etc.
○ Rental Housing Act 50 of 1999
■ Intended to balance interests of lessors and lessees
■ EG. But if landlord wants to cancel contract due to arrear rental, MUST
be listed in contract
○ Formalities in respect of Leases of Land Act 18 of 1969
○ Consumer Protection Act 68 of 2008
● Constitution
○ Values
○ Rights