CHAPTER 1

LAW OF CONTRACT
INTRODUCTION
DEFINITION

A contract is an agreement between two or more people giving rise to obligations

on the part of the parties that are enforced or recognized by law.

The Law of Contract is a collection of legal rules, which govern contracts.

The Law of Contract is primary concerned with:

 Whether an agreement is in existence
 Whether the agreement is legally recognized or enforced.
 Remedy available to the injured party or how the agreement is
enforced.

The doctrine of Freedom of Contract

 This means that the law does not restrict the terms on which parties
may contract.
 The “Freedom of Contract” is considerably restricted, both by
legislation and judicial decision. Example in the landlord and tenant
relationship.
 The rationale for such restrictions is to afford maximum protection to
the weaker party with a lower bargaining status in contractual
relationship.
 Freedom of Contract may also mean that a person is not by law
compelled to enter into a contract.
 In conclusion therefore the law interference in the relationship of the
parties. This attempt to diminish the significance of agreement.

Why Enforce Contracts

 To avoid against enrichment- the law seeks to protect the restitution
interest of the agreement party.
 To protect the reliance interest where a party has relied upon a
representation by the other and thereby incurred expenditure.
 To protect the expectation interest.
 This seeks to promote stability.
An agreement may be realized by a process of the acceptance by one party of an
offer made by another.

There must be an intention to enter into a legally binding agreement. (Butter

Machine Tool Co. Ltd-v/s-Ex-cell Corporation (England) Ltd (1979) ALL E.R 965)

Offer + Acceptance = AGREEMENT

OFFER
 Is an expression of willingness to contract on certain terms made with the
intention that a Binding Agreement will exist once the offer is accepted.
 It is a proposal put by one person to another person made with the intention that
shall become legally binding as soon as it is accepted by the other person.
 The proposer is called the offeror.
 The person to whom it is made is called offeree (acceptor).
 An offer may be made-
 Expressly
 Impliedly

 It may be made to an individual or group of persons.

In Carlill vs. Carbolic Smoke Ball Co (1893) 1 QB 256
 Bilateral offer- Arises where one party promises to do something in return for
a promise made by offeree.
 Unilateral offer –Arise where one party the offeror promises to pay for the act
of another in a conditional promise.
 The terms of an offer must be clear.
 Offer must be made with an intention that it should be binding.
CHAPTER 2

OFFER COMPARED WITH OTHER TYPES OF TRANSACTIONS

Invitation to treat
 This is a statement made by one person asking the other to make an offer
to the first person.
 It is an “Offer to make an offer”
 Distinguishing feature between an offer and an invitation to treat it is the
intention with which the statement was made.
 If the statement is made with the intention that the other party on a
accepting the statement a binding contract will not arise, is mere
invitation to treat.
 If follows that if an individual is not willing to implement the terms of his
promise but is merely seeking to initiate negotiations then such statement
are mere invitations to treat.

Case: Fisher v/s Bell 1961 (1) QB 394

It was held that a shopkeeper who had displayed in his shop window “a
flick knife” with a ticket showing the price was not guilty “offering for
sale” but an invitation to treat.

ADVERSTISEMENTS
 Most advertisement that do not make a conditional promise does not
amount to an offer but an invitation to treat.
 Advertisement offering a reward. Like in the case Carlill v/s Carbolic
Smoke Ball (1983) or rewards are conditional promises and this
constitutes a valid offer.
 Advertisement also not amount to offer –case: Partridge- v/s Crittender
(1985) 2 ALL E.R .421
 Advertisement for Auction sale
Case: Harris vs. Nickerson (1873) L.R 8QB286.

- HELD: The claim must fail as the advertisement to hold a sale and
did not amount to an offer capable of being accepted and thus forming
the basis of a binding contract.
- The advertisement was a mere invitation to treat.

 Display of Goods for sale

 - The display of goods in a shop window or within the shop itself originality
amount to invitation to treat.
Case: Fisher vs. Bell (1951) 1QB394

Case: Pharmaceutical Society of Great Britain vs Boots Cash Chemists (Southern)

Ltd ALL.E.R 456

 Auction Sale
When bids are called for, by the auctioneers, this amounts to an invitation
to treat.
Case: Payne vs. Cave (1789) 3 Term pep 148
- Where goods are put up for sale without a reserve price, the
auctioneer is bound to sell the highest bidder, and if he refuses to
sell he may be sued for Breach of Contract.

Case: Mc Marms vs. Fortesae (1907) 2 KB 1

 TENDERS
- A statement that goods are to be sold by tender is not normally an offer.
- No obligation is created to sell to the person making the highest tender.
Case: Spencer vs. Harding (1870) LRS CP561
- In a similar respect, an invitation for tenders for the supply of goods or
services is not generally an offer but an invitation to treat and offers
submitted can be either accepted or rejected.
- In some circumstance, an invitation to tender may be held to be an offer.
Case: Blackpool and Fylde Aen Club Ltd vs. Blackpool
Borough Council 1990 3 ALL E.R 28.

Tender may take possible forms:

- Specific Tenders
- Standing Offer Tenders.

- Specific Tenders
Comprises a tender for a definite quality of goods to be delivered or sold at a
specific time. In this case the person requiring or selling the goods makes an
invitation to offer.
- Standing Offer Tenders
This arises when a person invites tenders for the supply of goods or services which
may be required within a specified time at some future date. Acceptance here does
not create a binding contract.

 Ticket sales
Two factors can influence a sale of tickets in contracts, namely
- Whether it was intended that the ticket should amount to
contractual documents.
- The mode and timing of the issue of the ticket.

In Chapellon vs. BARRY UDC (1940) 1 KB 532

Requirements for the Offer and Acceptance

An offer and acceptance will give rise to the formation of a valid contract only if
the following requirements are met:-
1. The offer must be made with the intention that the offeror will be legally
bound by the mere acceptance thereof by the offeree.
2. The offer must be complete.
3. The offer as well as the acceptance must be clear and certain.
4. Normally an offer and acceptance may be made either expressly (writing or
orally) or tacitly by means of conduct.
5. The offer must be addressed either to a particular person or persons, or in
general to an unknown person or persons or to the general public.

Termination of an offer.
1. When there is an acceptance
2. When there is a rejection
3. When there is revocation of the offer before acceptance
4. Lapse of time
5. Death of the offeror
6. Failure of a condition to the offer.
CHAPTER 3
ESSENTIALS REQUIREMENTS OF A VALID CONTRACT

-Formality
-Capacity
-Agreement
-Legality
-Consent
-Intention

If either of the above requirements is not present when entering in to the contract,
then the contract may be declared:-
-Void – Meaning the contract should have never existed.
-Voidable – Meaning the contract was valid initially but either party intends to
avoid it due to some reasons.

FORMALITY
The general rule is that no formal expression need be given to the will of the
parties. Provided their intentions are clearly communicated by the one to the other,
an agreement by word of mouth is perfectly valid and enforceable. It is even
possible to enter into a binding agreement without a word spoken.

But by statute some contracts are void if their creation has not been effected with
the necessary formality. Other contracts although valid between the parties, are not
binding on third parties, if they are concluded without the required formalities. The
formalities known to our law are writing and signature, notarial execution and
registration.

Contracts requiring formalities are:

 Alienation of land
 Credit agreement
 Learner ship agreement
 Lease of rights to minerals
  Executory donation
 Suretyship contract
 Acquisition of share block
 Lease of dwelling or land

If the parties agree specifically that their agreement will not be binding until its
terms are set out in a written document there is no contract until the document is
prepared.

After considerable controversy it is now settled law that if a written contract

provides that any if a written contract provides that any subsequent variation of its
terms should be in writing and that an oral variation will be of no force and effect
such provision is valid and a purported oral variation will be void.

The same applies to a subsequent oral agreement that does not have the effect of
adding material or essential term to the written contract. (Kaplan vs. Fountain
Park (Pty) Ltd 1972 (4) SA 193(T)

CAPACITY
Only persons who have the capacity to contract acquire rights and duties, can
contract. Also only natural persons can do so. Our law recognizes the existence of
artificial persons who can likewise acquire rights and duties. The most important of
these are companies incorporated in terms of the Companies Act Cap 42:01.

The general rule is that every person is able to contract freely, within the limits of
the law. But there are certain persons of limited contractual capacity whose power
to enter into binding agreements is limited. They are:

 Minors
 Mentally ill persons
 Drunken persons
 Prodigals
 Insolvent person

When these persons purport to contract beyond the limits of their contractual
capacity, the general rule is that the agreement is void.

 Minors
 A minor is a person who is below 18 years and has no legal capacity to
contract unless assisted by a guardian. A contract without assistance of his
guardian is not binding. Whenever a minor is unjustly enriched in terms of a
purported contract he is bound to the extent that he is enriched, thus he is
bound to restore the other party to the purported contract so much of what he
has received as remains in his possession or to pay a sum of money to the
value of the advantage received.

Also where a minor fraudulently misrepresents his age or pretends that he

has been emancipated and by so doing deceives another person who is
induced to contract with the minor, believing him to be of full age or
emancipated, the minor incurs an obligation. But again the obligation is not
contractual. The minor is not bound by the contract, it is void.

Pleat vs. Van Staden 1921 OPD 91

Where a minor purports to contract without his guardians consent, the
contract may later be ratified by the guardian or the minor himself on
attaining majority. Such ratification may be express or implied. It is implied
when the minor after attaining his majority continues to use as his own an
article that he purported to buy during his minority or indicates otherwise by
his actions an intention to be bound.

Wood v/s Davis 1934 CPD 250

The court set aside a contract under which the minors guardian bought
on his behalf a house for 1750 Pounds which was worth at the time 1550
Pounds and bound the minor to pay for it by instalments out of the
future income .

The minor was held entitled to all repayment of all instalments paid out
of his funds but the seller was given credit for a sum of money
representing the value of the use of the house during which the period
which the minor lived in it with the guardian.

N/B- A guardian may not alienate or mortgage any immovable property

belonging to the minor without the authority of the court.

 Mentally ill persons

A purported contract made by a mentally ill person is void if at the time of
agreement he could not understand and appreciate the nature of the
 transaction into which he purported to enter or if his consent was motivated
or influenced by an insane delusion by mental disease. All persons are
presumed to be sane, unless they have been declared mentally disordered or
defective. The burden is on the person who claims to be excused from
liability to prove that he could not understand and appreciate the nature of
the transaction or his consent was motivated or influenced by a delusion.

Lange vs. Lange 1945 AD 332 at 342

 Drunken persons
Where a person enters into a purported contract while he is so drunk he does
not know that he is entering into a contractor or has no idea of the terms of
the contract the consent is void.

Van Metzinger vs. Badenhorst 1953 (3) SA 291

 Prodigals
A prodigal cannot contract with regard to his property. If he purports to do
so, the contract is void. But outside the field of his property he is entitled to
contract freely.

Mitchell vs. Mitchell & others 1930 AD 217

 Insolvent persons
Certain restrictions are placed on his freedom to contract, but he is in all
other respects fully capable of contracting. The restrictions are the
following:
- He may not contract in such a way as to purport to dispose of any
property of his insolvent estate.
- He may not without written consent of his trustee, enter into any
contract in terms of which his estate is likely to be adversely affected.
- Without written consent of his trustee have any interest in or be
employed in, the business of a trader who is a general dealer or
manufacturer.
Estate louw vs. Credit Corporation of SA Ltd 1956 (3) SA 303 (C)
LEGALITY
All agreements are lawful unless they are prohibited by statute or by
Common Law.

An agreement maybe expressly or impliedly prohibited by statute

(Schierhout vs. Minister of Justice 1926 AD 99). The Prohibition may
refer to either the conclusion of the contract or the performance to be
made. Implied prohibition occurs where a statute, without expressly
prohibiting an act, provides penalty for the performance of the act.

Also agreements are prohibited by Common Law if they are against

public policy or contra bonos mores (against good morals). Public
policy may also render unenforceable an agreement that is not void from
its inception. The burden of proving that an agreement is prohibited by
Common Law is on the person seeking to avoid liability.

INTENTION
In entering into an agreement the parties must intend that binding legal
relations will follow from it. If they do not, the agreement is not a
contract.

In order that agreement should take place it is clear that the parties
should make each other aware of their reciprocal intentions. Some
communication must pass from one to the other.

This means that an agreement must not be so vague that its meaning
cannot be ascertained by a court. The mere fact that a contract appears to
be incomplete or uncertain does not render it void for vagueness if its
meaning can actually be determined by a court on the evidence before it.

AGREEMENT
There is no contract if the parties are not in agreement as to the material
terms of their agreement. The parties enter in to negotiations and reach
certain terms by which they allow themselves to be bound.
All contracts are agreements but not agreements are contracts.
Example: ‘A’ promises his 10 years old son ‘B’, that if ‘B’ improves in
class then ‘A’ will buy a bicycle for him.
Question; Can ‘B’ sue ‘A’ if he fails to honour the agreement.

A contract is a product of a simple statement embodying an offer and

one who purports to accept that offer.

Offer + Acceptance = Agreement

Offer
This is a proposal by which one party known as the offeror is aware of
the terms upon which he is prepared to enter into binding contract.

Acceptance
This is an indication by the other party known as the offeree that he is is
prepared to be bound by the terms proposed. Acceptance of an offer
leads to a binding contract.

Carlill v/s Carbolic Smoke Ball (1983)

In this case the defendant offered by advertisement to pay 100 pounds to

anyone who contracts the epidemic of influenza colds, after having used
the ball three times daily for two weeks, according to the printed
directions .

It was added that 1000 pounds was deposited with Alliance Bank to
show their sincerity in the matter.

Mrs Carllil (plaintiff) used the smokeball as per the directions but
subsequently suffered from influenza cold and sued the company for the
reward.
 An advertisement by a merchant that he sells a particular article at a
particular price has been held not to constitute a firm offer which any
member of the public can accept by tendering such price. Such an
advertisement merely amounts to an invitation to the public to do
business (i.e an invitation to treat ) and every time a customer appears
and tenders the said price as advertised can either accept or reject the
offer as he deems fit.
Fisher v/s Bell 1961 (1) QB 394
It was held that a shopkeeper who had displayed in his shop window “ a
flick knife” with a ticket showing the price was not guilty of “offer for
sale” but an invitation to treat.

Termination of an offer

1. When there is acceptance

2. When there is a rejection
3. When there is revocation
4. When there is lapse of time
5. Death of the offeror

ACCEPTANCE
The acceptance of an offer must be communicated to the offeror in all
cases, except in those he has dispensed ether expressly or impliedly to the
necessity for communication and has indicated the manner in which the
offeree, is to accept the offer

An offer which is intended to be accepted into a contract upon its,

acceptance by the offeree and did not know of its existence then he is
not entitled to its benefits.

Bloom v/s American Swiss Watch Co.1915 AD 1915

The respondent from whom diamonds and jewelry had been stolen,
advertises in the press, offered 500 Pounds for information which will
lead, to the arrest of the thieves and the recovery of the stolen goods.

The appellant supplied the information on ignorance of the offer and

afterwards, having heard of it claimed the reward. It was unsuccessful
because, in order to establish a legal tie between the parties the
information would have to be given in consequence of an advertisement
 by a person acting in good faith of the offer.

The offer and acceptance must correspond . A counter offer amounts to a

rejection of the offer.

Hyde v/s Wrench (1840)

Wrench offered to sell a farm to Hyde for 1000 Pounds. Hyde said that he would
give 950 Pounds. Wrench refused and then Hyde said he would give 1000 Pounds
and then Wrench declined to adhere to his original offer. Hyde tried to obtain a
specific performance of the alleged contract.

The court held that an offer to buy the farm for 950 Pounds in response to the
1000Pounds offer amounted to a rejection of the original offer therefore there was
no contract as the 1000 Pounds offer has been rejected.

An acceptance must be communicated to the offeror, and the contract is valid when
the acceptance is received by the offeror. If the acceptance is through the post, the
contract is valid as soon as the letter for acceptance is posted, provided the letter is
properly addressed

CONSENT
To every agreement there must be atleast two parties, to create a contract and the
parties entering it must be acting at their own free will, and in their full possession
of their mental capability. Example- A man agreeing with a pistol on his head
obviously acted under compulsion.

The voluntary will of the parties must be united with regard to the terms of their
agreement. A contract arises from an actual meeting of the minds of the parties.
CHAPTER 4

FACTORS AFFECTING A CONTRACT

Despite all the essentials being present and there is a result being valid contract,
one of the parties may set the contract aside if his consent has been induced by:
 Misrepresentation
 Duress
 Undue influence

These defects in consent render the contract voidable. The party who has been
induced to contract may claim restitutio in integrum in terms of which both
parties are restored to the position they were before the contract.

 Misrepresentation
A misrepresentation is a false statement of fact that is made by one
person to another, before or at the time of the contract, with the intention
of inducing the latter to contract and which actually induces him to do
so. It is not a term of the contract but merely an inducement.

Standard Bank of South Africa Ltd vs. Coeste 1981 (1) SA 1131 (A)

 Duress
Where a person is induced to contract as a result of fear caused by
violence or intimidation there is consent, but the consent is defective. So
the contract is voidable at the instance of the induced party.

Turnbull vs. City Council of Johannesburg 1967 (2) PH A 56 (W)

 Undue influence
Undue influence may be coupled with fraud or duress but not necessary
so. It may exist wherever one party to a contract is able to influence
other party to such degree that the latter is incapable of forming an
independent opinion on the subject matter.
 Preller vs. Jordaan 1956 (1) SA 483 (AD)

CHAPTER 5

DISCHARGE OF CONTRACTS
Discharge of contract generally means when both parties have to be relieved from
their obligations as they have expressly or impliedly agreed.

The contract may end and parties may be discharged from their obligation in
various way;-

-Performance
-Agreement
-Frustration
-Breach
- Set-off
-Merger
-Prescription
-Insolvency

-PERFORMANCE
A contract may be said to have been discharged when each party has completely
performed his duties and rights under the contract.
If either of the party has performed, then the contract is discharged but the
performance of each, party must be complete, and exactly in accordance with the
terms of contract.

If the contract is an entire contract and the party only performs half of it then he is
entitled to any payment at all.

On the other hand sometimes it is agreed between the parties that the contract
should be split up into sections and then the situation is that each instalment is
completed the other party is obliged to pay for that instalment. E.g Building
contracts.
Thus if the contract is performed as well as a reasonable man would expect then
the court will state that the contract has been performed with possibly some
adjustment to the actual price paid.

Case:- Hoeing v/s Isaac (1952) C.A

The plaintiff agreed to redecorate the defendants flat for 750 Pounds. The
defendants paid 400Pounds but complained that the contract had not been carried
to his satisfaction.

The Court of Appeal held that the plaintiff had substantially performed his part of
the contract and that he was entitled to his price less an amount to cover the
defects.

AGREEMENT
A contract comes into existence because of an agreement between the parties so it
must follow that it can also be discharged by agreement.

FRUSTRATION
This is when something occurs to make the contract impossible to perform.
If one party has given his absolute undertaking that something will be done by a
certain time then probably he will be liable for breach if he is unable to do what he
has promised to do.
If whatever happens to prevent the contract from being performed;-
- Has not been caused by either party
- Could not have been foreseen
- Its effect is to destroy the basis of the contract,
then the court will probably state that the contract has been frustrated. If that
happens the contract will have been discharged and neither party will have any
liability under it.

Case-: Taylor v/s Caldwell (1863)

Taylor had agreed that Caldwell could use “the Surrey Gardens and Music Hall”
on four named days for the purpose of holding concerts there.
Just before the time for the performance of the contract, the music hall was
destroyed by fire. Taylor wanted compensation from somebody so he sued
Caldwell. But the fire was not due to the negligence of Caldwell.

The Court held that as the hall ceased to exist, without fault of either party both
parties must be excused from performance of either contract.
A frustrating event will arise without any warning and it may be that each party
loses his rights to sue the other.

BREACH
A breach of contract will occur if one party:-
- Fails to perform his part of the contract by the agreed time
- Makes it impossible for himself to perform the contract
- Repudiates his liabilities under the contract.

In case a breach occurs before the stipulated period for performance of the contract
an action may be brought to court. This is known as “anticipatory breach”

Case:- Hochster v/s De La Tour (1853)

A travel agency decided to employ a person as a courier in the summer, the
appointment having been earlier in the year. Soon after the appointment the travel
agency wrote saying it would no longer require the services of the courier in the
summer.
The Court held that the courier had a right to sue immediately he knew the other
party had repudiated his liabilities.

STUDENTS TO RESARCH ON;-

- SET OFF
- PRESCRIPTION
- INSOLVENCY
-MERGER
CHAPTER 6

BREACH OF Contract
Where there is no real agreement or where the consent of one of the parties is
defective, the relations between the parties are governed by the rules applicable to
void or voidable contracts.

Void –Means no contract at all and there is no question of enforcement

Voidable –Means the parties have a choice he may abide by the contract, or he may
claim restitution in intergrum. He has the opinion of saying whether he will be
bound by the contract.

If there is a failure of one,

party to observe one or more, of the terms of the contract. This is Breach of
Contract.

Case:- Broderick Properties Ltd vs. Rood 1962 (4) SA 447 (T)

Breach may even occur in advance (anticipating breach) where there is unlawful
repudiation before the appointed time of performance.

Case:- Novick vs. Benjamin 1972 (2) SA 842 (A)

There are five different forms of breach of contract:

- DEFAULT BY THE DEBTOR

-DEFAULT BY THE CREDITOR
- POSITIVE MALPERFORMANCE
- PREVENTION OF PERFORMANCE
-REPUDIATION

N/B – Some of the forms of breach can be committed by both a debtor and a
creditor, while others are unique to the obligation of either a debtor or a creditor.

The debtor is the party who has to perform a specific obligation, while the creditor
is the party who is entitled to performance of the obligation in question. Where a
contact creates obligations for both parties, each will in turn be a debtor and a
creditor, depending on which obligations is involved . e.g In a contract of sale two
of the most important obligations are the obligation of the purchaser to pay the
purchase price and the obligation of the seller to deliver of the merx (property).In
respect of the obligation to pay the purchase price, the purchaser is the debtor and
the seller is the creditor. But when the delivery of the merx is involved, the seller is
the debtor and the purchaser the creditor. If the purchaser is in breach of the
contract by not paying the purchase price, it is the debtor who committing the
breach of contract.
Likewise, if the seller delivers a defective merx, he or she is breaching the contract
as debtor. However, when the seller refuses to accept payment or if the purchaser
destroys the merx so that it cannot be delivered to him, the breach of contract in
both instances is by the creditor.

1. DEFAULT BY THE DEBTOR

A debtor commits breach of contract in the form of default of the debtor, also
referred to as mora debitoris, if he or she does not perform at the agreed time, and
the delay is due to the debtors default. It is then said that the debtor is in mora or in
default.

Requirements

There are two (2) requirements that have to be met;-

(a) Performance must be delayed
(b) The delay must be due to the debtors default

2. DEFAULT BY CREDITOR
Default of the creditors or mora creditoris, as it is also referred to, occurs where
the creditor causes the debtor’s performance to be delayed. Mora creditors is a
form of breach of contract which can occur only where discharge of the debtor’s
obligation involves a bilateral juristic act that is, where the creditor’s co-operation
is required for the debtor to be able to render performance
Example, Peter and John contract that John will lay carpeting in Peter house and
where Peter will therefore has to co-operate in allowing John’s workmen access to
the house.

Requirements

(a) The performance must be dischargeable

 (b) The debtor must tender performance
(c) The creditor must fail to give his co-operation and thereby delay
performance
(d) The default must be due to the fault of the creditor

3. POSITIVE MALPERFORMANCE
Positive malperformance is that form of, breach of contract which occurs when the
debtor commits an act which is contrary to the terms of the contract. Performance
can be that a person must do something or that he must refrain from doing
something. For this reason there are two situations which can be distinguished with
regard to positive malperformance:-

(a) The debtor tenders defective or improper performance, for example the
house which he has undertaken to build is built with finishes inferior in
quality to those specified in the contract.
(b) The debtor does thing he may not do in terms of the agreement. For
example, the carries on business in competition which his former employer
in violation of a contractual term (restraint of trade) prohibiting such
contract.

4. REPUDIATION
Repudiation as a form of breach of contract is understood as any behavior by a
party to a contract indicating that he may not honor the obligations under the
contract. A party can behave in this way with regard to all his obligations in terms
of the contract, for example where the existence of the contract is denied where the
party tries without justification to withdraw from the contract or where the party
gives notice that he cannot or will not perform. However, it is also possible for a
party to repudiate only some of his obligations or part of the contract, for example
where the party offers inadequate or defective performance as proper performance.

5. PREVENTION OF PERFORMANCE

- Prevention of performance by the debtor

- Prevention of performance by the creditor

-Prevention of performance by the debtor

The debtor commits breach of contract in the form of prevention of performance
where he culpably renders his own performance impossible. In this case the debtor
is not release from the obligation to perform. Because the debtor can no longer
perform as agreed, he will have to pay damages instead of performing.

For example, the debtor has to develop and print a photographic film for the
creditor, but negligently exposes it to light before development is completed. The
photos can no longer be printed. Although performance has been made impossible,
the debtor can be held liable for the loss suffered by the creditor.

- Prevention of performance by the creditor

The creditor who culpably renders the creditor’s performance impossible commits
breach of contract in the form of prevention of performance. Example, the debtor
has to service the creditor’s motor vehicle, but before this can be done the creditor
negligently causes an accident in which the car is destroyed.

Where performance has become impossible through the fault of the creditor, the
debtor will be deemed to have discharged his obligation.
CHAPTER 7

REMEDIES OF THE INJURED PARTIES

The injured party’s remedies differ depending on whether breach is of a material
term or non- material term.
Where the breach is of material term the injured party has a choice: he may cancel
the contract and sue for damages or

- He may abide by the contract, sue for specific performance and claim for
damages as he has suffered. In the event of breach of a non-material term,
the injured party is not entitled to cancel the contract, but he may claim
such damages as he has suffered as a direct result of the breach of the term.

Case-: Scholtz vs. Thomson 1996 (2) SA 409 (C)

There are four remedies:

 Specific performance
 Cancellation
 Damages
 Injunction

a) Specific performance
A party to a contract who is in breach may be compelled to perform his
obligation in the manner required by the terms of the contract.

Case:- Woods vs. Walters 1921 AD 303 at 310

b) Cancellation
 Where one party repudiates the contract or is in breach of a material
term, the other party may if so wishes to cancel the contract and sue for
damages.

Case-: Mine Workers Union vs. Prinsloo 1948 (3) SA 831 (A)

c) Damages
Whether or not the term breached is sufficiently material to justify
cancellation, the injured party may claim from the defaulter such
damages as he can prove that he has suffered as a result of the breach of
the term. Damages are assessed as at the time of breach.

Case-: Culver well & another vs. Brown 1990 (1) SA 7 (A)

d) Injunction
This is an order of the court to refrain or to stop or to order the other
party to stop or to do what they have agreed upon.