BK Tooling (Edms) Bpk v Scope Precision (Edms) Bpk 1978 (1) SA 391 (A)

BK Tooling (Edms) Bpk v Scope Precision (Edms) Bpk 1978 (1) SA 391 (A)

Issue: Whether a creditor who has been prevented from performing fully his obligations by the failure of the debtor's necessary cooperation is entitled to claim performance by the debtor, but that his claim will be subject to a reduction by the costs saved by the creditor in not having to perform fully his own obligation.

Facts:

BK Tooling (Edms) Bpk (BK Tooling) and Scope Precision (Edms) Bpk (Scope Precision) entered into a contract for the supply of two sets of precision blocks by BK Tooling to Scope Precision. The contract provided that the two sets of blocks were to be delivered and paid for separately.

BK Tooling delivered the first set of blocks to Scope Precision. However, Scope Precision rejected the first set of blocks on the ground that they were defective. BK Tooling then offered to supply Scope Precision with a replacement set of blocks.

Scope Precision agreed to accept the replacement set of blocks. However, before BK Tooling could deliver the replacement set of blocks to Scope Precision, Scope Precision cancelled the contract. BK Tooling then sued Scope Precision for breach of contract.

Held:

The Appellate Division held that BK Tooling was entitled to claim performance from Scope Precision, but that its claim would be subject to a reduction by the costs saved by BK Tooling in not having to perform fully its own obligation.

The Court reasoned that the contract between BK Tooling and Scope Precision was a reciprocal contract. In a reciprocal contract, the obligations of the parties are mutually dependent. This means that one party is not obliged to perform its obligations unless the other party has performed its obligations.

However, the Court also reasoned that the principle of reciprocity is not absolute. In some circumstances, a party may be entitled to claim performance from the other party, even though the party has not fully performed its own obligations. This is known as the exceptio non-adimpleti contractus.

The Court held that the exceptio non-adimpleti contractus applied in this case. BK Tooling had been prevented from fully performing its obligations by the failure of Scope Precision's necessary cooperation. Scope Precision had refused to accept the first set of blocks and had then cancelled the contract before BK Tooling could deliver the replacement set of blocks.

The Court therefore held that BK Tooling was entitled to claim performance from Scope Precision. However, the Court also held that BK Tooling's claim would be subject to a reduction by the costs saved by BK Tooling in not having to perform fully its own obligation. This is because BK Tooling did not have to deliver the replacement set of blocks to Scope Precision as a result of Scope Precision's cancellation of the contract.

Key Facts:

• A company entered into a contract to supply two sets of precision blocks to another company. The contract provided that the two sets of blocks were to be delivered and paid for separately.
• The company delivered the first set of blocks to the other company. However, the other company rejected the first set of blocks on the ground that they were defective.
• The company then offered to supply the other company with a replacement set of blocks.
• The other company agreed to accept the replacement set of blocks. However, before the company could deliver the replacement set of blocks to the other company, the other company cancelled the contract.
• The company then sued the other company for breach of contract.

Reasons:

The Court held that the company was entitled to claim performance from the other company, but that its claim would be subject to a reduction by the costs saved by the company in not having to perform fully its own obligation.

The Court reasoned that the contract between the company and the other company was a reciprocal contract. In a reciprocal contract, the obligations of the parties are mutually dependent. This means that one party is not obliged to perform its obligations unless the other party has performed its obligations.

However, the Court also reasoned that the principle of reciprocity is not absolute. In some circumstances, a party may be entitled to claim performance from the other party, even though the party has not fully performed its own obligations. This is known as the exceptio non-adimpleti contractus.

The Court held that the exceptio non-adimpleti contractus applied in this case. The company had been prevented from fully performing its obligations by the failure of the other company's necessary cooperation. The other company had refused to accept the first set of blocks and had then cancelled the contract before the company could deliver the replacement set of blocks.