PVL3704 Assignment 1 Semester 2 Unique number: 706118
Due date: 12 May 2021 Student number: 55612792 Ashleigh Hala
Question 1
In terms of South African law there are certain general requirements that exist for
any action that is based on enrichment. The third requirement for enrichment
liability is that the defendant’s enrichment must have of the plaintiff. The general
requirement for this will now be discussed below in more detail by considering the
different approaches taken in the Gouws, Buzzard Electrical and McCarthy cases.
In cases where a defendant is to be held liable for enrichment, it is necessary to
identify a causal link that exists between the enrichment and the impoverished.
Most cases involving this type of enrichment are straight forward, however
sometimes indirect enrichment can occur, whereby X and Y enter into a contract
and X renders a service to Y, but this service benefits Z. The question to be asked
in such cases is whether Z has been enriched at X’s expense, if Y fails to meet
performance to X due to being declared insolvent and unable to pay X.
De Vos is of the view that Y having no means to pay X affect the relationship
between X and Z, thus Z is enriched at Y’s expense and not at X’s. As this is the
case, X is not able to bring an enrichment action against Z. This view was
supported in Gouws v Jester Pools (Pty) Ltd 1968 3 SA 653 (T) (hereinafter the
Gouws case), whereby A and B had entered into a contract and A had built a
swimming pool for B on land he had thought belonged to B but was owned by C. A
brought an enrichment action again C after B had failed to pay for the pool and
disappeared. The judge held that this enrichment action cannot succeed, as C had
been enriched at B’s expense and not A’s.
The decision held by the court in the Gouws case is critiqued by many who are of
the opinion that A’s action should have succeeded, as C was enriched at the
expense of A because when looking at the transfer of assets, they are directly
transferred from A to C and by-pass B completely. This problem was dealt with in
Buzzard Electrical (Pty) Ltd v 158 Jan Smuts Avenue Investments (Pty) Ltd and
Another 1996 4 SA 19 (A) (hereinafter the Buzzard Electrical case), whereby an
important distinction was made between two situations. First is the situation where
A makes improvements to the property of an owner, but A has a contract with B
and not the owner and then sues the owner for enrichment. The second situation
is where B and C have a contract for B to make improvements to C’s property, but
B subcontracts the job to A. On completion of the job, A sues C for liability
Due date: 12 May 2021 Student number: 55612792 Ashleigh Hala
Question 1
In terms of South African law there are certain general requirements that exist for
any action that is based on enrichment. The third requirement for enrichment
liability is that the defendant’s enrichment must have of the plaintiff. The general
requirement for this will now be discussed below in more detail by considering the
different approaches taken in the Gouws, Buzzard Electrical and McCarthy cases.
In cases where a defendant is to be held liable for enrichment, it is necessary to
identify a causal link that exists between the enrichment and the impoverished.
Most cases involving this type of enrichment are straight forward, however
sometimes indirect enrichment can occur, whereby X and Y enter into a contract
and X renders a service to Y, but this service benefits Z. The question to be asked
in such cases is whether Z has been enriched at X’s expense, if Y fails to meet
performance to X due to being declared insolvent and unable to pay X.
De Vos is of the view that Y having no means to pay X affect the relationship
between X and Z, thus Z is enriched at Y’s expense and not at X’s. As this is the
case, X is not able to bring an enrichment action against Z. This view was
supported in Gouws v Jester Pools (Pty) Ltd 1968 3 SA 653 (T) (hereinafter the
Gouws case), whereby A and B had entered into a contract and A had built a
swimming pool for B on land he had thought belonged to B but was owned by C. A
brought an enrichment action again C after B had failed to pay for the pool and
disappeared. The judge held that this enrichment action cannot succeed, as C had
been enriched at B’s expense and not A’s.
The decision held by the court in the Gouws case is critiqued by many who are of
the opinion that A’s action should have succeeded, as C was enriched at the
expense of A because when looking at the transfer of assets, they are directly
transferred from A to C and by-pass B completely. This problem was dealt with in
Buzzard Electrical (Pty) Ltd v 158 Jan Smuts Avenue Investments (Pty) Ltd and
Another 1996 4 SA 19 (A) (hereinafter the Buzzard Electrical case), whereby an
important distinction was made between two situations. First is the situation where
A makes improvements to the property of an owner, but A has a contract with B
and not the owner and then sues the owner for enrichment. The second situation
is where B and C have a contract for B to make improvements to C’s property, but
B subcontracts the job to A. On completion of the job, A sues C for liability
