Exam 2020, Questions and Answers Law of Contract (University of South Africa) Law of contract Exam questions and answers Chembe, Stacy 2019.

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Read this in conjunction with your study material Table of Contents STUDY UNIT : THE LAW OF CONTRACT Obligation: Types of obligations Contract: Types of agreements Distinguish between... a contract and other obligations List the requirements for the formation of a valid contract () STUDY UNIT : BASIS OF A CONTRACT What is the primary basis of contract in South African Law? • Case law dealing with eth subjective Approach Explain the theories of contract that have influenced the South African law of contract STUDY UNIT : CORNERSTONES OF CONTRACT Explain the concept of freedom of contract and sanctity of contract Discuss with the constitutional courts approach to the sanctity of a contract? • Barkhuizen v Napier () SA (CC) STUDY UNIT : THE CONSUMER PROTECTION ACT Discuss the Impact of the CPA STUDY UNIT : THE IMPACT OF THE CONSTITUTION Explain the effect of the constitution of RSA on contract law • PACTA SUNT SERVANDA FAIRNESS: BREDNKAMP CASE STUDY UNIT and : OFFER AND ACCEPTANCE Case law CRAWLEY REX Carlill v Carbolic Smoke Ball Co [] QB (CA) Bloom v The American Swiss Watch Company List the requirements of a valid offer State the ways an offer may be terminated PROBLEM TYPES QUESTION: OFFER AND ACCEPTANCE Problem type question: Expedition theory: Cape Explosive Works case STUDY UNIT : PACTA DE CONTRAHENDO: OPTIONS & RIGHTS OF PREFERENCE Discuss and distinguish between an option and a right of pre-emption Must the option meet the requirements of the main contract? STUDY UNIT : ABSENCE OF CONSENSUS Refer to George v Fairmead (Pty) Ltd, Sonap Petroleum (SA) Ltd (SA) (Pty) Ltd v Pappadogianis, and other relevant case law in your answer STUDY UNIT : MISREPRESENTATION State the requirements for restitutio in integrum Refer to ‘Trotman v Edwick’ and ‘Phame v Paizes’ () STUDY UNIT : DURESS State the requirements for duress as set out in “Broodryk v Smuts” () Problem type question (A) On what basis will Sipho be able to attack the contract? Briefly discuss with reference to the court’s requirements or elements of the cause of action in question () (B) Peter’s defence against Sipho’s action for rescission of the contract is that he, in fact, acted lawfully Will Sipho be successful with an action for rescission of the contract in the circumstances? Substantiate () (C) Will Sipho successfully be able to claim damages from Peter in the circumstances? Discuss () UNDUE INFLUENCE : UNDUE INFLUENCE State the requirements for undue influence () PROBLEM TYPE QUESTION STUDY UNIT : COMMERCIAL BRIBERY State the elements for commercial bribery as held in Extel Industrial (Pty) Ltd v Crown Mills (Pty) Ltd STUDY UNIT and : LEGALITY: ILLEGAL CONTRACTS THAT ARE VOID JAJBHAY V CASSIM AND OTHER RELEVANT CASE LAW [] State the test to determine if a restraint of trade clause is enforceable (Basson test) STUDY UNIT : FORMALITIES formalities Discuss X’s position with reference to Sa Sentrale Kooperatiewe Graanmaatskappy Bpk v Shifren STUDY UNIT : POSSIBILITY Distinguish between initial impossibility of performance, supervening impossibility of performance, and prevention of performance STUDY UNIT : TERMS Distinguish briefly between Essentialia, Naturalia and Incidentalia of a contract and give examples of each Discuss fully with reference to “Minister van Landbou v Scholtz” Don’t discuss the Aedilitian remedies for the latent defects Ticket cases STUDY UNIT : INTERPRETATION Explain briefly what you understand by the Parol Evidence Rule () STUDY UNIT -: BREACH AND REMEDIES FOR BREACH List the five forms of breach of contract Problem type question on Mora Positive malperformance: BK tooling Damages 6. List the requirements for the formation of a valid contract (5) 1. What is the primary basis of contract in South African Law? 2. Explain the theories of contract that have influenced the South African law of contract Explain the concept of freedom of contract and sanctity of contract . Discuss with the constitutional courts approach to the sanctity of a contract? 1. Discuss the Impact of the CPA Explain the effect of the constitution of RSA on contract law • PACTA SUNT SERVANDA STUDY UNIT 6 and 7: OFFER AND ACCEPTANCE Case law 1. CRAWLEY REX 3. Bloom v The American Swiss Watch Company 1. List the requirements of a valid offer 2. State the ways an offer may be terminated. 3. PROBLEM TYPES QUESTION: OFFER AND ACCEPTANCE 4. Problem type question: Expedition theory: Cape Explosive Works case STUDY UNIT 8: PACTA DE CONTRAHENDO: OPTIONS & RIGHTS OF PREFERENCE 1. Discuss and distinguish between an option and a right of pre-emption. 2. Must the option meet the requirements of the main contract? STUDY UNIT 10: ABSENCE OF CONSENSUS 1. Refer to George v Fairmead (Pty) Ltd, Sonap Petroleum (SA) Ltd (SA) (Pty) Ltd v Pappadogianis, and other relevant case law in your answer STUDY UNIT 12: MISREPRESENTATION 1. State the requirements for restitutio in integrum.  Misrepresentation by the other party  Inducement  Intention to induce  Materiality 2. Refer to ‘Trotman v Edwick’ and ‘Phame v Paizes’. (10) STUDY UNIT 13: DURESS Thus John won’t be able to rely on this clause due to the intention factor. 1. State the requirements for duress as set out in “Broodryk v Smuts”. (5) (A) On what basis will Sipho be able to attack the contract? Briefly discuss with reference to the court’s requirements or elements of the cause of action in question. (5) (B) Peter’s defence against Sipho’s action for rescission of the contract is that he, in fact, acted lawfully. Will Sipho be successful with an action for rescission of the contract in the circumstances? Substantiate. (4) (C) Will Sipho successfully be able to claim damages from Peter in the circumstances? Discuss. (1) 1. State the requirements for undue influence. (3) 2. PROBLEM TYPE QUESTION Mark is engaged to Jane. Mark has a very strong personality and eventually persuades Jane to sell and transfer her house worth R500 000 to him at a purchase price of a mere R20 000. After registration of the property in Mark's name he breaks off the engagement. Does Jane have a remedy available to her? Substantiate your answer with reference to case law. STUDY UNIT 15: COMMERCIAL BRIBERY 1. State the elements for commercial bribery as held in Extel Industrial (Pty) Ltd v Crown Mills (Pty) Ltd. STUDY UNIT 17 and 18 : LEGALITY: ILLEGAL CONTRACTS THAT ARE VOID. 1. JAJBHAY V CASSIM AND OTHER RELEVANT CASE LAW. [15] Tony, a petrol attendant, sells dagga to Samuel for R1000. Tony delivers the dagga to Samuel but Samuel refuses to pay. Section 5 of the Drugs and Drug Trafficking Act provides that no person shall deal in dagga while section 4 prohibits possession of such substances. Section 13 makes the contravention of both sections 4 and 5 a crime. Dagga is a substance as defined in section 5. Advise Tony if he can sue Samuel for payment of R1000 or the return of the dagga. Would your advice be different if Tony was an undercover policeman who sold dagga to Samuel during a police entrapment operation? Discuss with reference to Jajbhay v Cassim and other relevant case law. [15] 2. State the test to determine if a restraint of trade clause is enforceable (Basson test). 1. Is there an interest of one party worthy of protection? 2. If so, is that interest threatened by the conduct of the other party? 3. If so, does such interest weigh up against the interest of the other party to be economically active and productive? 4. Is there another aspect of public policy that requires that the restraint should be maintained or rejected? 1. formalities X has been leasing a commercial property from Z for the past three years. The leas will come to an end on 31 May 2010. On 5 March 2010, X phones Z and offers to renew the lease for a further three years, which offer Z accepts. During this phone call, the material terms of the renewal agreement are agreed upon and X and Z further agree that the said material terms must be reduced to writing and signed by both parties. Subsequently, on 5 April 2010, X is shocked to receive a letter from Z, advising X that there will be no renewal of the lease and that X should vacate the leased property on 31 May 2010. X and Z never reduced their oral agreement to writing. Advise X if a binding agreement with Z exists for the renewal of the lease for a further three years. Refer to Goldblatt v Fremantle. [15] Y let premises to X. The lease contained a clause prohibiting X from sub- letting the premises without the written consent of Y. A further clause of the lease required that any variation of the terms of the lease had to be in writing and signed by both parties. Later Y told X that he (X) could sub-let a portion of the premises. After X had sub-let a portion of the premises to a third party, Y changed his mind and informed X that both X and the sub-lessee (third party) must vacate the premises because X had breached the contract STUDY UNIT 20: POSSIBILITY 1. Distinguish between initial impossibility of performance, supervening impossibility of performance, and prevention of performance. 1. Distinguish briefly between Essentialia, Naturalia and Incidentalia of a contract and give examples of each.2. Discuss fully with reference to “Minister van Landbou v Scholtz”. Don’t discuss the Aedilitian remedies for the latent defects. S a breeder of stud bulls sold one to M. S knew that M intended to use the bull for breeding purposes, subsequently, the bull proved to be infertile and M claimed cancellation of the sale and a refund of the purchase price. On what basis will M be able to have the contract set aside? Discuss fully with reference to “Minister van Landbou v Scholtz”. Don’t discuss the Aedilitian remedies for the latent defects. (15) STUDY UNIT 24: INTERPRETATION 1. Explain briefly what you understand by the Parol Evidence Rule. (6) 1. List the five forms of breach of contract 2. Problem type question on Mora On 1 June M and Q conclude a contract whereby M undertakes to manufacture and install kitchen cupboards in Q’s home for R50 000. The parties agree that the price will be paid as soon as the kitchen cupboards are installed, but they do not determine a date for the completion of the work. M, however, informs Q during the negotiations that she has some other work to complete and that she will attend to the kitchen cupboards as soon as possible. Eight months has lapsed since the contract was concluded and Q has not heard from M. Q runs out of patience and hires W to manufacture and install the same kitchen cupboards for R60 000. After W has completed the job, M turns up to do the work. Q claims R10 000 damages from M, but M institutes a counterclaim for R30 000 from Q for her loss of profit. Who will succeed in this claim? Discuss 3. Positive malperformance: BK tooling Andy and Craig conclude a contract wherein Andy agrees to paint Craig’s office block by 31 August, and Craig agrees to pay Andy R10 000 upon completion of the work. When 80% of the work is completed Andy suddenly falls ill and he is unable to complete the job by 31 August. Craig refuses to pay Andy any money for his (Andy’s) services rendered, as Craig believes that Andy has breached the contract by not completing the work. Craig hires another contractor at an amount of R3000 to complete the job. Craig does not incur any other costs to complete the job, neither does his business make any losses. Advise Andy as to what amount (if any) he may recover from Craig for the services that he rendered, and on what basis. Discuss with reference to BK Tooling (Edms) Bpk v Scope Precision Engineering (Edms) Bpk and other relevant case law. [15] 4. Damages X contracts with Y for the latter (Y) to build and fit a security gate for the entrance of her (X’s) home. Y builds the gate and fits it with an electric motor, which is activated with a remote control. X is satisfied with the work and pays Y the contractual amount agreed upon. A week later, the gate gets stuck while it is halfway open as a result of defective materials used to build the gate. When X attempts to physically move the gate to close it fully, she suffers such severe damage to her left knee that she has to have a knee operation. Her medical costs are R20 000. The costs of repairing the gate amount to R15 000. X wants to claim both medical costs as well as the cost of repairing the gate from Y. Advise X if she will be successful with her claim. Refer to Shatz Investments (Pty) Ltd v Kalovymas; Holmdene Brickworks (Pty) Ltd v Roberts Construction Co, and other relevant case law in your answer. [15] [Show More]

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