Willoughby’s Consolidated Co Ltd v Copthall Stores Ltd 1918 AD 1

Willoughby’s Consolidated Co Ltd v Copthall Stores Ltd 1918 AD 1

Issue: Whether a company can be held liable for the delictual acts of its directors, even if the directors were acting in their own interests and not in the interests of the company.

Facts:

Willoughby's Consolidated Co Ltd (Willoughby's) was a company that operated a chain of stores. Copthall Stores Ltd (Copthall) was a company that operated a competing chain of stores.

The directors of Willoughby's hatched a plan to drive Copthall out of business. The directors of Willoughby's offered discounts to customers who bought goods from their stores and they also offered bribes to shopkeepers who refused to stock Copthall's goods.

Copthall sued Willoughby's for damages. Copthall argued that Willoughby's was liable for the delictual acts of its directors, even though the directors were acting in their own interests and not in the interests of the company.

Key Facts:

• The directors of a company hatched a plan to drive a competing company out of business.
• The directors of the company offered discounts to customers who bought goods from their stores and they also offered bribes to shopkeepers who refused to stock the competing company's goods.
• The competing company sued the company for damages.
• The court held that the company was liable for the delictual acts of its directors, even though the directors were acting in their own interests and not in the interests of the company.

Characteristics of Personal Servitudes

A personal servitude is a real right that grants the holder of the servitude (the dominant tenement) the right to use the property of another person (the servient tenement) in a specific way. Personal servitudes are attached to the person of the holder, rather than to the dominant tenement.

The following are some of the key characteristics of personal servitudes:

• They are personal rights that are attached to the person of the holder, rather than to the dominant tenement.
• They can only be created by agreement or by will.
• They are not transferable or inheritable.
• They are extinguished when the holder dies or ceases to exist.

Vesting of Servitudes

A servitude comes into existence when it is registered in the Deeds Office. Registration is essential for the validity of a servitude.

There are two ways to register a servitude:

• By deed of servitude: This is a formal document that is signed by both the holder of the servitude and the owner of the servient tenement.
• By notarial bond: This is a document that is signed by the owner of the servient tenement and that is executed before a notary public.

Discussion of the Case in the Context of Personal Servitudes and Vesting of Servitudes

The case of Willoughby's Consolidated Co Ltd v Copthall Stores Ltd 1918 AD 1 does not directly deal with personal servitudes or the vesting of servitudes. However, the case does raise some interesting questions about the relationship between companies and their directors in the context of personal servitudes.

For example, the case raises the question of whether a company can hold a personal servitude. If so, how would such a servitude be created and registered?

The case also raises the question of whether a company can be held liable for the delictual acts of its directors in the context of personal servitudes. If so, what would the basis of such liability be?

These are complex questions that have not been definitively answered by the courts. However, the case of Willoughby's Consolidated Co Ltd v Copthall Stores Ltd 1918 AD 1 provides a useful starting point for discussing these questions.

Conclusion

The case of Willoughby's Consolidated Co Ltd v Copthall Stores Ltd 1918 AD 1 is a significant case because it clarifies the law relating to the vicarious liability of companies for the delictual acts of their directors. The decision also raises some interesting questions about the relationship between companies and their directors in the context of personal servitudes.

Boland Bank v Vermeulen 1993 (2) SA 241 (E)

Boland Bank v Vermeulen 1993 (2) SA 241 (E)

Issue: Whether a bank is entitled to exercise its right of set-off against a customer's deposit account to satisfy the customer's overdraft on a current account, even if the customer has instructed the bank not to do so.

Facts:

Vermeulen had a deposit account and a current account with Boland Bank. Vermeulen instructed the bank not to exercise its right of set-off against his deposit account to satisfy his overdraft on his current account.

Despite Vermeulen's instruction, the bank exercised its right of set-off and used the funds from Vermeulen's deposit account to satisfy his overdraft on his current account. Vermeulen then sued the bank for damages.

Held:

The Eastern Cape Division (ECD) held that the bank was entitled to exercise its right of set-off, even though Vermeulen had instructed the bank not to do so. The Court reasoned that a bank's right of set-off is a legal right that cannot be overridden by a customer's instruction.

Key Facts:

• A customer instructed his bank not to exercise its right of set-off against his deposit account to satisfy his overdraft on his current account.
• The bank exercised its right of set-off and used the funds from the customer's deposit account to satisfy his overdraft on his current account.
• The customer sued the bank for damages.

Reasons:

The Court reasoned that a bank's right of set-off is a legal right that cannot be overridden by a customer's instruction. The Court also reasoned that it would be unfair to allow customers to prevent banks from exercising their right of set-off, as this could put banks at risk of loss.

Conclusion:

The ECD's decision in Boland Bank v Vermeulen 1993 (2) SA 241 (E) is a significant case because it clarifies the law relating to the relationship between banks and their customers. The decision also emphasizes the importance of banks being able to exercise their right of set-off to protect their interests.

Van den Heever v Kahn 1961 (3) SA 17 (T)

Van den Heever v Kahn 1961 (3) SA 17 (T)

Issue: Whether a person who has been induced to enter into a contract by misrepresentation is entitled to rescind the contract, even if the misrepresentation was innocent.

Facts:

Kahn sold a farm to Van den Heever. Kahn told Van den Heever that the farm was 100 hectares in size, but the farm was actually only 75 hectares in size. Van den Heever relied on Kahn's representation about the size of the farm when he entered into the contract of sale.

After Van den Heever discovered that the farm was only 75 hectares in size, he demanded that Kahn rescind the contract. Kahn refused to rescind the contract. Van den Heever then sued Kahn for rescission of the contract.

Held:

The Transvaal Provincial Division (TPD) held that Van den Heever was entitled to rescind the contract. The Court reasoned that a person who has been induced to enter into a contract by misrepresentation is entitled to rescind the contract, even if the misrepresentation was innocent.

Key Facts:

• A seller told a buyer that a farm was 100 hectares in size, but the farm was actually only 75 hectares in size.
• The buyer relied on the seller's representation about the size of the farm when he entered into the contract of sale.
• After the buyer discovered that the farm was only 75 hectares in size, he demanded that the seller rescind the contract.
• The seller refused to rescind the contract.
• The buyer sued the seller for rescission of the contract.

Reasons:

The Court reasoned that a person who has been induced to enter into a contract by misrepresentation is entitled to rescind the contract, even if the misrepresentation was innocent. The Court held that this is because the consent of the person who has been misled is not genuine.

The Court also held that the person who has been misled does not have to prove that the other party to the contract intended to deceive them. The Court held that it is sufficient to show that the other party made a misrepresentation, even if the misrepresentation was innocent.

Conclusion:

The TPD's decision in Van den Heever v Kahn 1961 (3) SA 17 (T) is a significant case because it clarifies the law relating to the right of a person who has been induced to enter into a contract by misrepresentation to rescind the contract. The decision also emphasizes the importance of honesty and accuracy in contractual negotiations.

MCC Bazaar v Harris & Jones (Pty) Ltd 1954 (3) SA 158 (T)

MCC Bazaar v Harris & Jones (Pty) Ltd 1954 (3) SA 158 (T)

Issue: Whether a buyer can recover money paid for goods purchased under a contract that is invalid due to non-compliance with statutory requirements.

Facts:

MCC Bazaar (MCC) purchased a cash register from Harris & Jones (Pty) Ltd (H&J) under a hire-purchase agreement. The agreement was signed by MCC's agent, but not by MCC itself, as required by Section 4(1) of the Hire-Purchase Act, No. 36 of 1942.

MCC paid the full purchase price for the cash register but later claimed that the contract was invalid due to non-compliance with Section 4(1) of the Hire-Purchase Act and demanded a refund of the money paid.

H&J refused to refund the money, arguing that MCC had received the cash register and had therefore benefited from the contract.

Held:

The Court held that MCC was not entitled to a refund of the money paid. The Court reasoned that MCC had received the cash register and had therefore benefited from the contract, even though the contract was invalid.

The court also found that MCC had not suffered any loss as a result of the invalid contract.

Key Facts:

• A purchaser of a cash register under a hire-purchase agreement paid the full purchase price.
• The hire-purchase agreement was invalid due to non-compliance with a statutory requirement.
• The purchaser demanded a refund of the money paid.
• The seller refused to refund the money, arguing that the purchaser had received the cash register and had therefore benefited from the contract.

Reasons:

• The Court held that the purchaser was not entitled to a refund of the money paid.
• The Court reasoned that the purchaser had received the cash register and had therefore benefited from the contract, even though the contract was invalid.
• The court also found that the purchaser had not suffered any loss as a result of the invalid contract.

Conclusion:

The Court's decision in MCC Bazaar v Harris & Jones (Pty) Ltd 1954 (3) SA 158 (T) is a significant case in South African law. The Court's decision clarified the law relating to the rights of purchasers of goods under invalid contracts.

Standard Kredietkorporasie v Jot Motors h/a Vaal Datsun 1986 (1) SA 223 (A)

Standard Kredietkorporasie v Jot Motors h/a Vaal Datsun 1986 (1) SA 223 (A)

Issue: Whether a credit company has a right of retention over a motor vehicle in respect of the owner's outstanding debt.

Facts:

Jot Motors, a motor vehicle dealer, entered into a credit agreement with Standard Kredietkorporasie (Standard) for the purchase of a new motor vehicle. Under the terms of the agreement, Standard financed the purchase of the vehicle and Jot Motors was required to make monthly repayments to Standard.

Standard also had a right of retention over the vehicle, which meant that it could keep the vehicle if Jot Motors failed to make its repayments. However, Standard did not register its right of retention with the National Credit Regulator (NCR).

Jot Motors fell into arrears with its repayments and Standard repossessed the vehicle. Jot Motors objected to the repossession, arguing that Standard did not have a valid right of retention because it had not registered its right with the NCR.

Held:

The court held that Standard did not have a valid right of retention over the vehicle because it had not registered its right with the NCR. The court reasoned that the NCR Act required all credit agreements to be registered with the NCR, including rights of retention.

Key Facts:

• A motor vehicle dealer entered into a credit agreement with a credit company for the purchase of a new motor vehicle.
• Under the terms of the agreement, the credit company financed the purchase of the vehicle and the motor vehicle dealer was required to make monthly repayments to the credit company.
• The credit company also had a right of retention over the vehicle, which meant that it could keep the vehicle if the motor vehicle dealer failed to make its repayments.
• However, the credit company did not register its right of retention with the National Credit Regulator (NCR).
• The motor vehicle dealer fell into arrears with its repayments and the credit company repossessed the vehicle.
• The motor vehicle dealer objected to the repossession, arguing that the credit company did not have a valid right of retention because it had not registered its right with the NCR.

Reasons:

• The court found that the credit company did not have a valid right of retention over the vehicle because it had not registered its right with the NCR.
• The court reasoned that the NCR Act required all credit agreements to be registered with the NCR, including rights of retention.
• The court also found that the credit company had not made any attempt to register its right of retention with the NCR.
• The court concluded that the credit company's repossession of the vehicle was unlawful and that the vehicle must be returned to the motor vehicle dealer.

Conclusion:

The court's decision in Standard Kredietkorporasie v Jot Motors h/a Vaal Datsun 1986 (1) SA 223 (A) is a significant case in South African law. The court's decision made it clear that credit companies must register their rights of retention with the NCR in order for them to be valid.

Singh v Santam Insurance Ltd 1997 (1) SA 293 (A)

Singh v Santam Insurance Ltd 1997 (1) SA 293 (A)

Issue: Whether an insurance company can retain possession of a vehicle owned by the insured until the insured pays the costs of storage and repairs incurred by the insurance company.

Facts:

The plaintiff, Singh, owned a motor vehicle that was insured with the defendant, Santam Insurance Ltd (Santam). The insurance policy provided that Santam would be entitled to possession of the vehicle if it was necessary for Santam to repair the vehicle.

One day, Singh's vehicle was involved in an accident. The vehicle was damaged and Singh reported the accident to Santam. Santam instructed a panelbeater to repair the vehicle.

After the repairs were completed, Santam refused to return the vehicle to Singh. Santam argued that it was entitled to retain possession of the vehicle until Singh paid the costs of storage and repairs incurred by Santam.

Singh refused to pay the costs of storage and repairs, arguing that Santam was not entitled to retain possession of the vehicle. Singh argued that Santam's right to possession of the vehicle was limited to the period of time that the vehicle was being repaired.

Held:

The court held that Santam was not entitled to retain possession of the vehicle. The court reasoned that Santam's right to possession of the vehicle was limited to the period of time that the vehicle was being repaired. The court also found that Santam had not made a valid demand for payment of the costs of storage and repairs.

Key Facts:

• The plaintiff's motor vehicle was insured with the defendant.
• The insurance policy provided that the defendant would be entitled to possession of the vehicle if it was necessary for the defendant to repair the vehicle.
• The plaintiff's vehicle was involved in an accident and was damaged.
• The defendant instructed a panelbeater to repair the vehicle.
• After the repairs were completed, the defendant refused to return the vehicle to the plaintiff.
• The defendant argued that it was entitled to retain possession of the vehicle until the plaintiff paid the costs of storage and repairs incurred by the defendant.
• The plaintiff refused to pay the costs of storage and repairs, arguing that the defendant was not entitled to retain possession of the vehicle.
• The court held that the defendant was not entitled to retain possession of the vehicle.

Reasons:

• The court found that the defendant's right to possession of the vehicle was limited to the period of time that the vehicle was being repaired.
• The court reasoned that the insurance policy did not give the defendant the right to retain possession of the vehicle for any other purpose.
• The court also found that the defendant had not made a valid demand for payment of the costs of storage and repairs.
• The court reasoned that the defendant had not specified the amount of the costs of storage and repairs or the date on which payment was due.

Conclusion:

The court's decision in Singh v Santam Insurance Ltd 1997 (1) SA 293 (A) is a significant case in South African law. The court's decision clarified the rights of insured persons and insurers in relation to the possession of damaged vehicles.

Pretorius v Commercial Union Versekeringsmaatskappy van Suid-Afrika Bpk 1995 (3) SA 778 (O)

Pretorius v Commercial Union Versekeringsmaatskappy van Suid-Afrika Bpk 1995 (3) SA 778 (O)

Issue: Whether an insurer is liable for the full value of a stolen vehicle if the insured has failed to take reasonable steps to prevent the theft.

Facts:

The plaintiff, Pretorius, insured his motor vehicle with the defendant, Commercial Union Versekeringsmaatskappy van Suid-Afrika Bpk (Commercial Union). The insurance policy required Pretorius to take reasonable steps to prevent the theft of his vehicle.

One day, Pretorius's vehicle was stolen from his driveway. Pretorius had not locked the vehicle and had left the keys in the ignition. Pretorius claimed that the theft was covered by his insurance policy.

Commercial Union refused to pay Pretorius's claim, arguing that Pretorius had failed to take reasonable steps to prevent the theft of his vehicle. Commercial Union argued that Pretorius's failure to lock the vehicle and to remove the keys from the ignition had made it easy for the thief to steal the vehicle.

Held:

The court held that Commercial Union was liable to pay Pretorius's claim. The court reasoned that Pretorius's failure to lock the vehicle and to remove the keys from the ignition had not been the sole cause of the theft. The court also found that Pretorius's failure to take these precautions had not increased the risk of theft.

Key Facts:

• The plaintiff insured his motor vehicle with the defendant.
• The insurance policy required the plaintiff to take reasonable steps to prevent the theft of his vehicle.
• The plaintiff's vehicle was stolen from his driveway.
• The plaintiff had not locked the vehicle and had left the keys in the ignition.
• The plaintiff claimed that the theft was covered by his insurance policy.
• The defendant refused to pay the plaintiff's claim, arguing that the plaintiff had failed to take reasonable steps to prevent the theft of his vehicle.
• The court held that the defendant was liable to pay the plaintiff's claim.

Reasons:

• The court found that the plaintiff's failure to lock the vehicle and to remove the keys from the ignition had not been the sole cause of the theft.
• The court reasoned that the theft had also been caused by the actions of the thief.
• The court also found that the plaintiff's failure to take these precautions had not increased the risk of theft.
• The court reasoned that the vehicle would have been stolen even if the plaintiff had locked the vehicle and removed the keys from the ignition.

Conclusion:

The court's decision in Pretorius v Commercial Union Versekeringsmaatskappy van Suid-Afrika Bpk 1995 (3) SA 778 (O) is a significant case in South African law. The court's decision made it clear that an insurer is not always able to avoid liability for the theft of a vehicle simply because the insured has failed to take reasonable steps to prevent the theft.

Greenhill Producers (Pty) Ltd v Benjamin 1960 (4) SA 188 (EC)

Greenhill Producers (Pty) Ltd v Benjamin 1960 (4) SA 188 (EC)

Issue: Whether a clause in a contract that excludes the liability of one party for breach of contract is valid and enforceable.

Facts:

The plaintiff, Greenhill Producers, entered into a contract with the defendant, Benjamin, for the purchase of a quantity of potatoes. The contract included a clause that excluded Greenhill Producers' liability for any breach of contract.

Greenhill Producers failed to deliver the potatoes, and Benjamin claimed damages for the breach of contract. Greenhill Producers argued that its liability was excluded by the clause in the contract.

Held:

The court held that the clause in the contract was invalid and unenforceable. The court reasoned that the clause was contrary to public policy because it allowed Greenhill Producers to escape liability for its own negligence.

Reasons:

• The court found that the clause in the contract was contrary to public policy.
• The court reasoned that the clause was intended to allow Greenhill Producers to escape liability for its own negligence.
• The court also found that the clause was unfair and unreasonable.
• The court reasoned that the clause was not negotiated between the parties and that it was hidden in the fine print.

Key Facts:

• The plaintiff and defendant entered into a contract for the purchase of a quantity of potatoes.
• The contract included a clause that excluded the plaintiff's liability for any breach of contract.
• The plaintiff failed to deliver the potatoes, and the defendant claimed damages for the breach of contract.
• The plaintiff argued that its liability was excluded by the clause in the contract.
• The court held that the clause in the contract was invalid and unenforceable.

Conclusion:

The court's decision in Greenhill Producers (Pty) Ltd v Benjamin 1960 (4) SA 188 (EC) is a significant case in South African law. The court's decision clarified the law of exemption clauses and made it clear that such clauses will not be upheld if they are contrary to public policy.

Frame v Palmer 1950 (3) SA 340 (C)

Frame v Palmer 1950 (3) SA 340 (C)

Issue: Whether a contract for the alteration of a house was valid and enforceable.

Facts:

The plaintiff, Frame, entered into a contract with the defendant, Palmer, for the alteration of Palmer's house. The contract was oral and did not specify the scope of work to be undertaken.

After the work was completed, Frame claimed that Palmer was liable to pay for the work that had been done. Palmer refused to pay, arguing that the contract was void because it was not in writing.

Held:

The court held that the contract was valid and enforceable. The court reasoned that the contract was not required to be in writing and that it was valid because the parties had freely agreed to its terms.

Reasons:

• The court found that the contract was not required to be in writing.
• The court reasoned that the contract was a contract for the performance of work and that such contracts do not need to be in writing.
• The court also found that the contract was valid because the parties had freely agreed to its terms.
• The court reasoned that the parties had agreed on the scope of work to be undertaken and that the plaintiff had carried out the work in accordance with the agreement.

Key Facts:

• The plaintiff and defendant entered into an oral contract for the alteration of the defendant's house.
• The contract did not specify the scope of work to be undertaken.
• The plaintiff completed the work and claimed payment from the defendant.
• The defendant refused to pay, arguing that the contract was void because it was not in writing.
• The court held that the contract was valid and enforceable.

Conclusion:

The court's decision in Frame v Palmer 1950 (3) SA 340 (C) clarified the law of contracts and made it clear that contracts for the performance of work do not need to be in writing. The decision also made it clear that contracts are valid if the parties have freely agreed to their terms.

Dugas v Kempster Sedgwick (Pty) Ltd 1961 (1) SA 784 (D)

 Dugas v Kempster Sedgwick (Pty) Ltd 1961 (1) SA 784 (D)

Issue: Whether a person who has received a benefit from another person under a voidable contract is liable to make restitution for that benefit.

Facts:

The plaintiff, Dugas, entered into a contract with the defendant, Kempster Sedgwick, for the purchase of a motor vehicle. The contract was voidable because Dugas had been induced to enter into the contract by the defendant's fraudulent misrepresentations.

After the contract was entered into, Dugas used the motor vehicle for a period of several months. Dugas then sought to rescind the contract and recover the purchase price of the motor vehicle.

Kempster Sedgwick argued that Dugas was not entitled to recover the purchase price because he had been enriched by the use of the motor vehicle. Kempster Sedgwick argued that Dugas was therefore liable to make restitution for the benefit that he had received.

Held:

The court held that Dugas was entitled to rescind the contract and recover the purchase price of the motor vehicle. The court reasoned that Dugas had been induced to enter into the contract by the defendant's fraudulent misrepresentations.

The court also held that Dugas was not liable to make restitution for the benefit that he had received from the use of the motor vehicle. The court reasoned that Dugas had not been aware of the defendant's fraud at the time that he used the motor vehicle.

Reasons:

• The court found that the defendant had induced the plaintiff to enter into the contract by fraudulent misrepresentations.
• The court held that the contract was therefore voidable.
• The court also held that the plaintiff was not liable to make restitution for the benefit that he had received from the use of the motor vehicle because he had not been aware of the defendant's fraud at the time that he used the motor vehicle.

Key Facts:

• The plaintiff and defendant entered into a contract for the purchase of a motor vehicle.
• The contract was voidable because the plaintiff had been induced to enter into the contract by the defendant's fraudulent misrepresentations.
• The plaintiff used the motor vehicle for a period of several months.
• The plaintiff then sought to rescind the contract and recover the purchase price of the motor vehicle.
• The defendant argued that the plaintiff was not entitled to recover the purchase price because he had been enriched by the use of the motor vehicle.
• The court held that the plaintiff was entitled to rescind the contract and recover the purchase price of the motor vehicle.

Conclusion:

The court's decision in Dugas v Kempster Sedgwick (Pty) Ltd 1961 (1) SA 784 (D) is a significant case in South African law. The court's decision clarified the law of restitution and made it clear that a person who has been induced to enter into a contract by fraud is entitled to rescind the contract and recover the money that he paid under the contract.

Auby and Pastellides (Pty) Ltd v Glen Anil Investments 1960 (4) SA 865 (A)

Auby and Pastellides (Pty) Ltd v Glen Anil Investments 1960 (4) SA 865 (A)

Issue: Whether a clause in a contract that limits the liability of one party for breach of contract is valid and enforceable.

Facts:

The plaintiff, Auby and Pastellides, entered into a contract with the defendant, Glen Anil Investments, for the construction of a block of flats. The contract included a clause that limited Glen Anil Investments' liability for any breach of contract to R100.

After the block of flats was constructed, Auby and Pastellides discovered that it was defective. Auby and Pastellides claimed that Glen Anil Investments had breached the contract and sought to recover damages for the cost of repairing the defects.

Glen Anil Investments argued that its liability for breach of contract was limited to R100 by the clause in the contract. Auby and Pastellides argued that the clause was invalid and unenforceable because it was contrary to public policy.

Held:

The court held that the clause in the contract was valid and enforceable. The court reasoned that the parties had freely agreed to the clause, and that the clause was not contrary to public policy.

The court noted that the parties were both commercial entities and that they had had the opportunity to negotiate the terms of the contract. The court also noted that the clause was not hidden in the fine print, but was instead prominently displayed in the contract.

The court also found that the clause was not contrary to public policy. The court reasoned that the law does not prohibit parties from entering into contracts that limit their liability. The court also noted that the clause was not intended to encourage breaches of contract.

Key Facts:

• The parties entered into a contract for the construction of a block of flats.
• The contract included a clause that limited the defendant's liability for breach of contract to R100.
• The block of flats was defective.
• The plaintiff sought to recover damages for the cost of repairing the defects.
• The defendant argued that its liability was limited to R100 by the clause in the contract.
• The court held that the clause was valid and enforceable.

Reasons:

• The parties had freely agreed to the clause.
• The clause was not hidden in the fine print.
• The clause was not contrary to public policy.

Conclusion:

The court's decision in Auby and Pastellides (Pty) Ltd v Glen Anil Investments 1960 (4) SA 865 (A) is a significant case in South African law. The court's decision clarified the law of exemption clauses and made it clear that parties are free to agree to clauses that limit their liability. However, the court also noted that exemption clauses must be fair and reasonable, and that they will not be upheld if they are contrary to public policy.

Allen v Sixteen Sterling Investments (Pty) Ltd 1974 (4) SA 164

Allen v Sixteen Sterling Investments (Pty) Ltd 1974 (4) SA 164

Facts

Allen entered into a written agreement to purchase a property from Sixteen Sterling Investments (Pty) Ltd. The agreement was based on a misrepresentation by Sixteen Sterling Investments' agent that the property was a certain size. Allen relied on this misrepresentation and entered into the agreement without inspecting the property.

After Allen had entered into the agreement, he discovered that the property was actually smaller than he had been told. Allen sought to cancel the agreement on the grounds that he had made a mistake. Sixteen Sterling Investments refused to cancel the agreement and demanded that Allen perform his obligations under the agreement.

Issue

The main issue in the case was whether Allen was entitled to cancel the agreement on the grounds that he had made a mistake.

Reasons

The Durban and Coast Local Division of the Supreme Court of South Africa held that Allen was entitled to cancel the agreement. The court found that Allen had made a unilateral error in corpore, which is a mistake about the identity of the subject matter of the contract. The court also found that Sixteen Sterling Investments' agent had been negligent in making the misrepresentation about the size of the property.

Unilateral error in corpore

A unilateral error in corpore is a mistake about the identity of the subject matter of the contract. In this case, Allen made a unilateral error in corpore because he was mistaken about the size of the property.

Negligence

Sixteen Sterling Investments' agent was negligent in making the misrepresentation about the size of the property. The agent had a duty to take reasonable steps to verify the size of the property before making a representation about it. The agent failed to take reasonable steps to verify the size of the property and therefore made a negligent misrepresentation.

Conclusion

The court held that Allen was entitled to cancel the agreement on the grounds that he had made a unilateral error in corpore induced by Sixteen Sterling Investments' agent's negligent misrepresentation.

Summary

The case of Allen v Sixteen Sterling Investments (Pty) Ltd 1974 (4) SA 164 is a landmark case in South African contract law. The case is particularly important for its analysis of the following issues:

• The concept of unilateral error in corpore;
• The effect of negligent misrepresentation on the formation of a contract; and
• The right to cancel a contract on the grounds of unilateral error in corpore induced by negligent misrepresentation.

Concept of unilateral error in corpore

A unilateral error in corpore is a mistake about the identity of the subject matter of the contract. It is a type of material mistake that can render a contract void.

Effect of negligent misrepresentation on the formation of a contract

Negligent misrepresentation is a false statement made by one party to a contract to the other party, without any intention to deceive, but without taking reasonable steps to verify the truth of the statement. Negligent misrepresentation can induce the other party to enter into the contract and, if so, the contract may be voidable.

Right to cancel a contract on the grounds of unilateral error in corpore induced by negligent misrepresentation

If a party to a contract makes a unilateral error in corpore induced by the other party's negligent misrepresentation, that party may be entitled to cancel the contract. This is because the party's consent to the contract was not free and genuine.

Impact of the Case

The case of Allen v Sixteen Sterling Investments (Pty) Ltd 1974 (4) SA 164 has had a significant impact on the law of contract in South Africa. The case has clarified the concept of unilateral error in corpore, the effect of negligent misrepresentation on the formation of a contract, and the right to cancel a contract on the grounds of unilateral error in corpore induced by negligent misrepresentation.

George v Fairmead (Pty) Ltd 1958 (2) SA 465 (AD)

George v Fairmead (Pty) Ltd 1958 (2) SA 465 (AD)

Facts

George was a salesman for Fairmead (Pty) Ltd. One day, he was asked to sign a document that he believed was a receipt for his commission. However, the document was actually a contract of service that gave Fairmead the right to terminate George's employment at any time without notice. George signed the document without reading it carefully.

A few months later, Fairmead terminated George's employment without notice. George sued Fairmead for breach of contract. Fairmead argued that George was bound by the contract of service and that it had therefore not breached its contract with George.

Issue

The main issue in the case was whether George was bound by the contract of service, even though he had signed it without reading it carefully.

Reasons

The Appellate Division of the Supreme Court of South Africa held that George was not bound by the contract of service. The court found that George had made a justus error when he signed the document, and that he was therefore not bound by it.

Justus error

A justus error is a mistake that is made by a reasonable person in the same circumstances. The court found that George had made a justus error when he signed the document because he had believed that it was a receipt for his commission.

Consent

Consent is one of the essential elements of a valid contract. If a party to a contract makes a justus error, then they have not consented to the terms of the contract and the contract is therefore void.

Conclusion

The court held that George was not bound by the contract of service because he had made a justus error when he signed it. The court therefore granted judgment in favour of George.

Summary

The case of George v Fairmead (Pty) Ltd 1958 (2) SA 465 (AD) is a landmark case in South African contract law. The case is particularly important for its analysis of the following issues:

• The concept of justus error in contract law;
• The effect of justus error on the formation of a contract; and
• The requirement of consent in contract law.

Concept of justus error in contract law

A justus error is a mistake that is made by a reasonable person in the same circumstances. The concept of justus error is important in contract law because it protects parties to contracts from being bound by contracts that they have entered into under mistake.

Effect of justus error on the formation of a contract

If a party to a contract makes a justus error, then they have not consented to the terms of the contract and the contract is therefore void. This is because consent is one of the essential elements of a valid contract.

Requirement of consent in contract law

Consent is one of the essential elements of a valid contract. Consent means that both parties to the contract must understand and agree to the terms of the contract. If there is no consent, then there is no contract.

National and Overseas Distributors Corporation (Pty) Ltd v Potato Board (1958 (2) SA 473 (A)

National and Overseas Distributors Corporation (Pty) Ltd v Potato Board (1958 (2) SA 473 (A)

Facts

The Potato Board invited tenders for the erection of a steel shed. The National and Overseas Distributors Corporation (Pty) Ltd (NODC) submitted a tender, which was mistakenly accepted by the Potato Board. The Potato Board later realized its mistake and informed the NODC that it had accepted the wrong tender. The NODC argued that a contract had been formed between the two parties and that the Potato Board was therefore bound to proceed with the contract.

Issue

The main issue in the case was whether a contract had been formed between the NODC and the Potato Board, despite the Potato Board's mistake.

Reasons

The Appellate Division of the Supreme Court of South Africa held that a contract had not been formed between the NODC and the Potato Board. The court found that the Potato Board's mistake was material and that the NODC was aware of the mistake.

Material mistake

A material mistake is a mistake that goes to the root of the contract. In this case, the Potato Board's mistake in accepting the NODC's tender was a material mistake, because it went to the very essence of the contract.

Awareness of the mistake

The NODC was aware of the Potato Board's mistake because the Potato Board had informed the NODC that it had accepted the wrong tender. The NODC therefore could not claim that it had entered into the contract in good faith.

Conclusion

The court held that the Potato Board's mistake was material and that the NODC was aware of the mistake. The court therefore concluded that no contract had been formed between the NODC and the Potato Board.

Summary

The case of National and Overseas Distributors Corporation (Pty) Ltd v Potato Board (1958 (2) SA 473 (A)) is a landmark case in South African contract law. The case is particularly important for its analysis of the following issues:

• The concept of mistake in contract law;
• The distinction between material and immaterial mistakes; and
• The effect of awareness of mistake on the formation of a contract.

Concept of mistake in contract law

A mistake is an erroneous belief about a fact that is relevant to the formation of a contract. Mistakes can be either material or immaterial.

Material and immaterial mistakes

A material mistake is a mistake that goes to the root of the contract and renders the contract void. An immaterial mistake is a mistake that does not go to the root of the contract and does not render the contract void.

Effect of awareness of mistake on the formation of a contract

If a party to a contract is aware of the other party's mistake, then the other party cannot claim that they entered into the contract in good faith. If the other party cannot claim that they entered into the contract in good faith, then no contract will be formed.

Impact of the Case

The case of National and Overseas Distributors Corporation (Pty) Ltd v Potato Board (1958 (2) SA 473 (A)) has had a significant impact on the law of contract in South Africa. The case has clarified the concept of mistake in contract law, the distinction between material and immaterial mistakes, and the effect of awareness of mistake on the formation of a contract.