PVL3702 Law of Contract | The
Ultimate Practice Exam for
Assignment 1 (2026–2027): Most-
Tested Questions with Full Answers &
In-Depth Legal Rationales
QUESTION ONE
Z walks into a shop, places R10 on the counter, and points at a packet of
sweets. The owner takes the money and hands over the sweets. Which
statement is correct?
There is an oral offer and acceptance by conduct.
There is an express offer and an oral acceptance.
There is both an offer and acceptance by conduct.
There is an offer by conduct and an express oral acceptance.
There is a firm oral offer and an unqualified acceptance.
Answer: There is both an offer and acceptance by conduct.
Rationale: Z’s conduct (placing money on the counter and pointing)
constitutes an offer, and the owner’s conduct (taking the money and
handing over the sweets) constitutes acceptance. No express words are
used; the entire transaction is concluded through conduct. This illustrates
that consensus can be reached tacitly.
,QUESTION TWO
C, owner of a bicycle shop, advertises a limited-edition bicycle and invites
the public to make offers. J offers R150 000 and P offers R160 000. C
intends to accept P’s offer but erroneously writes to J accepting J’s offer. C’s
mistake is:
Not material.
An error in persona.
An error in motive.
Material.
Both an error in persona and material.
Answer: Both an error in persona and material.
Rationale: C mistook the identity of the offeree (error in persona) and the
mistake goes to the root of the contract – it relates to a fundamental
element (the identity of the contracting party) – making it material. A
material mistake excludes genuine consensus.
QUESTION THREE
In the same bicycle shop scenario, C’s mistake is material. Which statements
are correct?
a. C’s error was an iustus error.
b. C’s error was not an iustus error.
c. C misrepresented her intention to J by accepting J’s offer.
d. C, by accepting J’s offer, led J to reasonably believe that they had
reached consensus.
, a only
b only
c and d
b and c
b, c and d
Answer: b, c and d.
Rationale: Because C’s mistake was material, it is not a iustus (reasonable)
error. By accepting J’s offer, C created the impression that consensus
existed, which amounts to a misrepresentation of her intention, and J was
reasonably led to believe a contract had been concluded. This engages the
reliance theory.
QUESTION FOUR
In the bicycle shop scenario, which case has similar facts?
National and Overseas Distributors Corporation (Pty) Ltd v Potato
Board 1958 (2) SA 473 (A)
Brink v Humphries & Jewell (Pty) Ltd 2005 (2) SA 419 (SCA)
George v Fairmead Hotel (Pty) Ltd 1958 (2) SA 465 (A)
Answer: Brink v Humphries & Jewell (Pty) Ltd.
Rationale: In Brink, the court dealt with a situation where a party
mistakenly accepted the wrong offer, similar to C accepting J’s offer instead
of P’s. The case is authority on the reliance theory and iustus error.
, QUESTION FIVE
Which theory forms the foundation of the South African law of contract?
The reliance theory
The declaration theory
The will theory
The objective theory
Answer: The will theory.
Rationale: The will theory underpins South African contract law. It requires
subjective consensus – a genuine meeting of the minds (consensus ad idem)
between the parties. A contract is only valid if both parties seriously intend
to contract and are ad idem on all material terms.
QUESTION SIX
According to the will theory, which of the following is NOT an element of
agreement?
Agreement on the consequences the parties wish to create
Agreement on the intention to create legal consequences
Awareness of their unanimity
Agreement on the price only
Answer: Agreement on the price only.
Rationale: The three elements of agreement are: (i) agreement on the
consequences they wish to create; (ii) agreement on the intention to create
Ultimate Practice Exam for
Assignment 1 (2026–2027): Most-
Tested Questions with Full Answers &
In-Depth Legal Rationales
QUESTION ONE
Z walks into a shop, places R10 on the counter, and points at a packet of
sweets. The owner takes the money and hands over the sweets. Which
statement is correct?
There is an oral offer and acceptance by conduct.
There is an express offer and an oral acceptance.
There is both an offer and acceptance by conduct.
There is an offer by conduct and an express oral acceptance.
There is a firm oral offer and an unqualified acceptance.
Answer: There is both an offer and acceptance by conduct.
Rationale: Z’s conduct (placing money on the counter and pointing)
constitutes an offer, and the owner’s conduct (taking the money and
handing over the sweets) constitutes acceptance. No express words are
used; the entire transaction is concluded through conduct. This illustrates
that consensus can be reached tacitly.
,QUESTION TWO
C, owner of a bicycle shop, advertises a limited-edition bicycle and invites
the public to make offers. J offers R150 000 and P offers R160 000. C
intends to accept P’s offer but erroneously writes to J accepting J’s offer. C’s
mistake is:
Not material.
An error in persona.
An error in motive.
Material.
Both an error in persona and material.
Answer: Both an error in persona and material.
Rationale: C mistook the identity of the offeree (error in persona) and the
mistake goes to the root of the contract – it relates to a fundamental
element (the identity of the contracting party) – making it material. A
material mistake excludes genuine consensus.
QUESTION THREE
In the same bicycle shop scenario, C’s mistake is material. Which statements
are correct?
a. C’s error was an iustus error.
b. C’s error was not an iustus error.
c. C misrepresented her intention to J by accepting J’s offer.
d. C, by accepting J’s offer, led J to reasonably believe that they had
reached consensus.
, a only
b only
c and d
b and c
b, c and d
Answer: b, c and d.
Rationale: Because C’s mistake was material, it is not a iustus (reasonable)
error. By accepting J’s offer, C created the impression that consensus
existed, which amounts to a misrepresentation of her intention, and J was
reasonably led to believe a contract had been concluded. This engages the
reliance theory.
QUESTION FOUR
In the bicycle shop scenario, which case has similar facts?
National and Overseas Distributors Corporation (Pty) Ltd v Potato
Board 1958 (2) SA 473 (A)
Brink v Humphries & Jewell (Pty) Ltd 2005 (2) SA 419 (SCA)
George v Fairmead Hotel (Pty) Ltd 1958 (2) SA 465 (A)
Answer: Brink v Humphries & Jewell (Pty) Ltd.
Rationale: In Brink, the court dealt with a situation where a party
mistakenly accepted the wrong offer, similar to C accepting J’s offer instead
of P’s. The case is authority on the reliance theory and iustus error.
, QUESTION FIVE
Which theory forms the foundation of the South African law of contract?
The reliance theory
The declaration theory
The will theory
The objective theory
Answer: The will theory.
Rationale: The will theory underpins South African contract law. It requires
subjective consensus – a genuine meeting of the minds (consensus ad idem)
between the parties. A contract is only valid if both parties seriously intend
to contract and are ad idem on all material terms.
QUESTION SIX
According to the will theory, which of the following is NOT an element of
agreement?
Agreement on the consequences the parties wish to create
Agreement on the intention to create legal consequences
Awareness of their unanimity
Agreement on the price only
Answer: Agreement on the price only.
Rationale: The three elements of agreement are: (i) agreement on the
consequences they wish to create; (ii) agreement on the intention to create
