F
, BE2604 Assignment 1 Semester 1 2026 - Due 26 March 2026; 10
FBE2604 – Assignment 01 (2026)
Question 1
The issue is whether a valid partnership exists between Thabo and Lerato.
In South African law, the essentialia of a partnership were authoritatively
set out in Pezzutto v Dreyer. According to this case, three requirements
must be present:
1. Each party must bring something into the partnership (money, labour
or skill).
2. The business must be carried on for the joint benefit of both parties.
3. The object must be to make a profit.
Application to the facts
1. Contribution by each party
Thabo contributed R100 000 in cash. Lerato contributed her expertise,
industry contacts and managerial services. A contribution need not be
money; skill and labour are sufficient. Therefore, the first requirement is
satisfied.
However, Thabo insists that his R100 000 must be repaid in full even if the
business fails. In a partnership, contributions form part of the partnership
property and are not automatically repayable if losses occur. His insistence
suggests a loan rather than a partnership contribution. This may indicate
that he did not intend to assume the risk of loss.
2. Business carried on for joint benefit
The parties agreed to start a business selling organic skincare products.
This indicates a joint enterprise. However, Lerato will only receive 30% of
the profits if the net profit exceeds R200 000 per year. If profits are below
that threshold, she receives nothing. This conditional profit-sharing
arrangement suggests that the business may not have been carried on for
their joint benefit in the true partnership sense.
, BE2604 Assignment 1 Semester 1 2026 - Due 26 March 2026; 10
FBE2604 – Assignment 01 (2026)
Question 1
The issue is whether a valid partnership exists between Thabo and Lerato.
In South African law, the essentialia of a partnership were authoritatively
set out in Pezzutto v Dreyer. According to this case, three requirements
must be present:
1. Each party must bring something into the partnership (money, labour
or skill).
2. The business must be carried on for the joint benefit of both parties.
3. The object must be to make a profit.
Application to the facts
1. Contribution by each party
Thabo contributed R100 000 in cash. Lerato contributed her expertise,
industry contacts and managerial services. A contribution need not be
money; skill and labour are sufficient. Therefore, the first requirement is
satisfied.
However, Thabo insists that his R100 000 must be repaid in full even if the
business fails. In a partnership, contributions form part of the partnership
property and are not automatically repayable if losses occur. His insistence
suggests a loan rather than a partnership contribution. This may indicate
that he did not intend to assume the risk of loss.
2. Business carried on for joint benefit
The parties agreed to start a business selling organic skincare products.
This indicates a joint enterprise. However, Lerato will only receive 30% of
the profits if the net profit exceeds R200 000 per year. If profits are below
that threshold, she receives nothing. This conditional profit-sharing
arrangement suggests that the business may not have been carried on for
their joint benefit in the true partnership sense.
