Types of Breach of Contract in South Africa

There are two recognized types of contract fraud, namely dolus dans locum in contractui and dolus incidens in contractum. If the contract would not have been concluded at all without the fraud, it is dolus in; if there had been a contract, but under different conditions, it is dolus incidens. Although this point has not yet been clarified, dolus incidens is likely to award only a claim for damages, and not for termination of the contract; this should also apply to a “random” misrepresentation without fraud. In order to reach a consensus, all parties must have the capacity to understand the nature of the contract and the consequences of entering into the contract. Examples of circumstances that nullify contractual capacity include: The integration aspect of the probation proof rule therefore defines “the limits of the contract.” [106] The parties “summarized” their negotiations in a single document, which must be seen as a complete and definitive expression of their will: an “exclusive monument” to their agreement. [107] The purpose of this rule is to prevent a party from asserting claims other than those set out in the document. In Le Riche v. Hamman,[108] for example, Hamman filed a lawsuit for the transfer of a Victory Hill that had been mistakenly sold to the Rich. Le Riche relied on oral evidence, but the parol rule of proof requires the court to first examine the ordinary meaning of the contract. As this was clear and unambiguous and did not refer to Victory Hill in his description of the country, Le Riche did not succeed. Other essential contractual conditions are presumptions, modal clauses, exemption clauses and prohibitions of derogation.

Often, these clauses include provisions on notification and the possibility for the infringing party to remedy its violation. If a contract does not include an infringement clause, common law principles may apply. In addition, a breach of contract generally falls into one of two categories: an “actual breach” – if a party refuses to comply fully with the terms of the contract – or an “anticipated breach” – if a party declares in advance that it will not comply with the terms of the contract. If a party materially violates a contract, the innocent party must decide to terminate or perform the contract. If the breach is not substantial, the innocent party can only choose to perform the contract. A claim for damages is available to the innocent party regardless of this choice. Termination of the contract – Termination of a contract is an extremely drastic means. They can be used if a breach is of a sufficiently serious nature or if the parties have agreed to a right of withdrawal in the contract. It is a difficult tool to implement and often the last resort in case of violation.

If the problem cannot be solved by reference to the language, a court may be informed of the context in which the contract was concluded. These are undisputed questions, such as. B the relationship in which the parties were with each other at the time of the conclusion of the contract, which may help to explain the context of the contract. They transmit “the origin and object of the contract, that is to say … Things were probably in the minds of the parties when they entered into contracts,”[120] but not the actual negotiations and similar statements. [121] The sole purpose of this evidence is to enable the Court to understand the general context in which the words requiring interpretation were used. Although “it is generally said that the court has the right to be informed of all these circumstances in all cases”[122], this does not allow it to arrive at a different interpretation if the meaning is already clear from the words themselves. Indemnification or exclusion clauses are the opposite of warranties that release individuals from liability that would normally be applicable to them under the law or limit their liability.

To be effective in an individual case, such a provision must, of course, form an integral part of the contract and also include the liability and circumstances in question. The law must also allow for the alleged exception or exclusion. Whether an exemption or restriction is part of a contract depends on whether it has been agreed or not, and usually depends on the application of the doctrine of quasi-mutual consent, which protects someone who reasonably believes that the other party agrees. Consent can be indicated: The rules of offer and acceptance are a useful but not essential analytical tool to understand the drafting of contracts. An offer is a letter of intent in which the supplier (to the person to whom the offer is transmitted) expresses the service and the conditions to which he is willing to commit. Since it is a unilateral declaration, an offer as such does not create a binding obligation. For an offer to be valid, it must be valid: the contract must be properly signed and dated to be effective. The contract may be dated in the introductory or performance clauses. Similarly, in cases where there are not two ancillary agreements but a composite contract, part of which is written and the rest oral, evidence may be presented to prove the additional oral part, provided that it is clear that the parties did not intend the written part to be the exclusive monument of the entire agreement. In such a case, called “partial integration”, the integration rule simply prevents the admission of extrinsic evidence that contradicts or modifies the written part of the agreement.

The court may hear evidence of accompanying circumstances, including hearings by the parties, to determine whether they intended the written agreement to be an integration of their entire business or only a partial integration. Since many, perhaps most, contractual disputes arise from disagreement over the meaning of contractual provisions, the interpretation of contracts is an important area. Explicit clauses may also be included in a contract by reference to one or more other documents. The effect of a contract or obligation often depends on the veracity of an assumption made by the parties about a past or present fact. For example, if Johann and Piet negotiate a contract for the purchase and sale of a painting, John may stipulate that he will only make the purchase if the painting is an original Rembrandt. You call on an expert. If their presumption is confirmed, the contract will be continued, otherwise, the contract will cease to exist. Similarly, Fourie v. CDMO Homes[70] was a sale by CDMO of land adjacent to a river in Fourie, the offer of which was subject to the following condition: that pumping rights existed in the river.

Although the parties were not sure whether this was the case, they concluded their agreement on the assumption that pumping rights existed. The contract must be structured in a logical and practical way. After the start, the recitals and the definition and interpretation clause, the operational provisions should appear. The nature of the contract may affect the rights of the parties if there is a condition precedent. [55] It has been established that if a contract of purchase and sale has been concluded under a condition precedent, no contract of sale is concluded and is concluded there; it only turns into a sale if the condition is met. [56] [57] [58] [59] When parties enter into distance contracts, the question arises as to when and where acceptance takes place. The general rule of South African law follows information theory, which requires a real and deliberate agreement between the parties, so that the agreement is not concluded until the supplier is aware of the target recipient`s acceptance. .