Lectures 5 & 6A ]

LEGALITY// ILLEGALITY
CASES: MUST READ ALL CASES IN THIS SECTION :
Jajhbay v Cassim 1939 AD 537
Magna Alloys v Ellis 1984 (4)SA 581 (SCA)
Klokow v Sullivan 2006 (1) SA 259 (SCA)
Bafana Finance v Makwakwa 2006 (4) 581 (SCA)
Brisley v Drotsky 2002 (4) 1 (SCA)
Illegality– (traditional maxims in this section)

• -- 1– Ex turpi causa no oritur actio

• ---2-- Contra bonos mores ---
• -- 3– In fraudem legis
• ---4 -- Pactum de quota litis--
• --5– Par delictum rule) [In pari delicto est
conditio possidentis]
• 6--Pactum Successoria
Ex- Turpi causa non oritur actio

In pari delicto condictio est possidentis

 Chapter overview
Statutory
Illegality

Common
Law legality
 Normal Rule in contract:
Conclusion, performance & object of the contract must be
lawful

• Examples of contracts which are void by mere

conclusion…
• Contracts that are void on the basis of statutory
provisions;
• Certain pacta successoria;
• Contract with enemy subjects
• Agreements that oust the jurisdiction of the
courts.
 In consideration of the par delictum rule
court will consider
Par delictum evaluation in a case

• (a) whether defendant will

be enriched at the expense
of the plaintiff if the rule is
not relaxed;
• (b) whether relaxing the
rule would immediately
enforce the illegal contract
• (-c) any other consideration
of public policy.
 General consequences of illegality
• Illegality of the contract in general has potentially
two consequences in principle:
• (1) – The contract is either void (and thus
unenforceable);

• (2) --- Or Valid but unenforceable, depending on

the degree to which society regards a specific
contract as reprehensible
• (example: some wagers are valid; others are valid
but unenforceable; and still others are void).– [See
Gambling Act ].
 Public Interest -- in heterogeneous society
• (Sasfin v Beukes 1989 (1) SA 1 (A)
• -- Public interest includes:
• --voluntarily concluded contracts should be complied with;
• ---simple justice between individuals should be taken into
account;
• --- as far as possible, the parties to a contract should have
equal bargaining power;
• ---the administration of justice should not be defeated,
obstructed or prevented;
• --- the safety of the State
• ---The public service should function normally;
• ---The full exercise by persons of their legal rights should not
be interfered with.