2020-SEM 1
Question 1
X advertises her car for sale in the newspaper for the amount of R40 000. Y reads the
advertisement, phones X and accepts her advertisement to sell her car. Which
statement most probably reflects the CORRECT legal position?
1 X and Y concluded a contract because an offer and acceptance exists.
2 X made an offer to the public at large.
3 Y is the offeree.
4 The advertisement is an invitation to do business.
5 Option 1, 2 and 3. (1)
Discussion
Option 4 is correct. The general rule in our law is that an advertisement constitutes
merely an invitation to do business rather than an offer. See Hutchison & Pretorius
(eds) The Law of Contract in South Africa 3rd ed (Oxford Cape Town 2017) 53; see
also Eiselen GTS et al Law of Contract study guide for PVL 3702 (University of South
Africa) 23. Applying this to the facts above, means that the advertisement is an
invitation to do business, which allows Y (as offeror) to make an offer, and X (as
offeree) can decide whether to accept the offer. X and Y did not conclude a contract,
because even if there was an offer from Y, there is no evidence of X accepting an
offer. Therefore option 1 is incorrect. X did not make an offer to the public, as it was
merely an invitation to do business. Accordingly, option 2 is incorrect. X is the offeree,
therefore, option 3 is incorrect. It follows that option 5 is also incorrect.
Question 2
X and Y conclude a contract under circumstances wherein X threatened Y. This threat
may be used to prove an element of
1 duress.
2 undue influence.
3 misrepresentation.
,4 contractual illegality.
5 material mistake. (1)
Discussion
You have to look at what the requirements of each option are to answer this question.
The presence of a threat is one of the elements that must be proved to establish duress
(Hutchison and Pretorius Contract 140-144; Eiselen et al Study Guide 59-60). None
of the other options requires the existence of a threat to be proven as a requirement.
Question 3
Tony, a petrol attendant, sells heroin to Samuel for R1 000. Tony delivers the heroin
to Samuel, but Samuel refuses to pay. Section 5 of the Drugs and Drug Trafficking Act
140 of 1992 provides that no person shall deal in (a) any dependence-producing
substance or (b) any dangerous dependence-producing substance or any undesirable
dependence-producing substance, while section 4 prohibits the possession of such
substances. Section 13 makes the contravention of both sections 4 and 5 a crime.
Heroin is furthermore an undesirable dependence-producing substance. Tony
approaches a court to assist him, either for the payment of R1 000 from Samuel or the
return of the drugs. The material focus of this dispute rests on which requirement
relating to the validity of the agreement between Tony and Samuel?
1 Consensus
2 Formalities
3 Possibility
4 Legality
5 Certainty
Discussion
The contract entered into between Tony and Samuel is illegal because it is in
contravention of sections 4 and 5 of the Drugs and Drug Trafficking Act 140 of 1992.
The material focus therefore is likely to be on the legality requirement, which impacts
on the validity of the agreement. Accordingly, option 4 is correct. See Hutchison and
Pretorius Contract 187-189, 199-201. It follows, that options 1,2,3 and 5 are incorrect.
,Question 4
Assume the same facts as in question 3. Most relevant to the dispute would be to
consider the application of
1 the ex turpi rule and the par delictum rule.
2 statutory illegality and restraint of trade agreements.
3 public interest and rectification.
4 the par delictum rule and capacity of the parties to contract.
5 the ex turpi rule and stipulatio alteri.
Discussion
Based on the facts, the question does not relate to restraint of trade agreements,
rectification, capacity of the parties to contract, and stipulatio alteri. It follows that
options 2, 3, 4, and 5 are incorrect. Option 1 is the only combination that relates to the
consequences of an illegal contract, and therefore it is the correct answer. These
consequences apply in accordance with the the ex turpi rule and the par delictum rule,
in circumstance where the illegal contract is deemed void (see Hutchison and
Pretorius Contract 199-201). Therefore, the first issue to address is whether the illegal
contract between Tony and Samuel is also void.
In terms of the Act, dealing in drugs (heroin) is prohibited, therefore a contract of sale
for drugs is illegal. Where a statute expressly states that such a contract is void, or is
of no force or effect, then clearly this will be the case. In the facts of the question, there
is no mention that the statute expressly renders a contract of this nature to be void.
Therefore, it needs to be considered if the legislator impliedly intended that such a
contract must be null and void. If it was impliedly intended to be a nullity, then the
contract will be void. To determine if the legislator impliedly intended the contract to
be void, the cumulative effect of a number of factors must be considered (see
Hutchison and Pretorius Contract 188, for a discussion of these factors). When these
factors are applied to the facts in the question, then it appears that the legislator
impliedly intended that the illegal contract between Tony and Samuel, be rendered
void. The motivation for this is that the legislator clearly prohibited the dealing and
possession of undesirable dependence-producing substances like heroin to deter
, members of the public from being exposed to the intake and harmful effects of this
drug. To validate such a contract will therefore bring about the harm that the statute is
directed against, which is an indication that the legislator intended the contact between
Tony and Samuel to be void. In terms of the Act, Tony’s conduct constitutes a crime
(dealing and being in possession of an undesirable dependence-producing
substance). The Act does not merely serve to protect the revenue of the state, as the
prohibition of dagga is intended to protect the health of all members of society from
the harmful effects of this undesirable substance. As this entails protecting a public
interest, is a further indicator that the legislator intended the contract between Tony
and Samuel to be void. Nullifying the contract will definitely not cause greater
inconvenience and injustice, therefore the contract should be deemed void.
Having established that the contract between Tony and Samuel was both illegal and
void, the next it is appropriate to look at the consequences of a contract that is void for
illegality. These consequences are that, based on the ex turpi rule, an illegal contract
is void and that no contractual obligations arise out of it, which is relevant to this
question. Where a contract is void in terms of an illegal contract, restitution of what
was performed may possibly be claimed, based on an unjustified enrichment claim.
However, where the parties are equally morally guilty, the par delictum rule can
operate to prevent restitution from taking place. As Tony has already performed by
delivering the heroin drugs to Samuel, he may want to claim restitution of this
performance. Therefore, the par delictum rule is also relevant to this question.
Accordingly, the application of both rules, the ex turpi rule and the par delictum rule
are applicable to this question. Therefore option 1 is correct. See Hutchison and
Pretorius Contract 199-201.
Question 5
Assume the same facts as in question 3. The court hearing this dispute is likely to find
that
1 Tony can claim R1 000 contractual damages from Samuel.
2 Tony will be granted an order for specific performance for the return of the heroin.
3 Tony’s request for the return of the heroin will fail because both parties were equally
morally guilty.
Question 1
X advertises her car for sale in the newspaper for the amount of R40 000. Y reads the
advertisement, phones X and accepts her advertisement to sell her car. Which
statement most probably reflects the CORRECT legal position?
1 X and Y concluded a contract because an offer and acceptance exists.
2 X made an offer to the public at large.
3 Y is the offeree.
4 The advertisement is an invitation to do business.
5 Option 1, 2 and 3. (1)
Discussion
Option 4 is correct. The general rule in our law is that an advertisement constitutes
merely an invitation to do business rather than an offer. See Hutchison & Pretorius
(eds) The Law of Contract in South Africa 3rd ed (Oxford Cape Town 2017) 53; see
also Eiselen GTS et al Law of Contract study guide for PVL 3702 (University of South
Africa) 23. Applying this to the facts above, means that the advertisement is an
invitation to do business, which allows Y (as offeror) to make an offer, and X (as
offeree) can decide whether to accept the offer. X and Y did not conclude a contract,
because even if there was an offer from Y, there is no evidence of X accepting an
offer. Therefore option 1 is incorrect. X did not make an offer to the public, as it was
merely an invitation to do business. Accordingly, option 2 is incorrect. X is the offeree,
therefore, option 3 is incorrect. It follows that option 5 is also incorrect.
Question 2
X and Y conclude a contract under circumstances wherein X threatened Y. This threat
may be used to prove an element of
1 duress.
2 undue influence.
3 misrepresentation.
,4 contractual illegality.
5 material mistake. (1)
Discussion
You have to look at what the requirements of each option are to answer this question.
The presence of a threat is one of the elements that must be proved to establish duress
(Hutchison and Pretorius Contract 140-144; Eiselen et al Study Guide 59-60). None
of the other options requires the existence of a threat to be proven as a requirement.
Question 3
Tony, a petrol attendant, sells heroin to Samuel for R1 000. Tony delivers the heroin
to Samuel, but Samuel refuses to pay. Section 5 of the Drugs and Drug Trafficking Act
140 of 1992 provides that no person shall deal in (a) any dependence-producing
substance or (b) any dangerous dependence-producing substance or any undesirable
dependence-producing substance, while section 4 prohibits the possession of such
substances. Section 13 makes the contravention of both sections 4 and 5 a crime.
Heroin is furthermore an undesirable dependence-producing substance. Tony
approaches a court to assist him, either for the payment of R1 000 from Samuel or the
return of the drugs. The material focus of this dispute rests on which requirement
relating to the validity of the agreement between Tony and Samuel?
1 Consensus
2 Formalities
3 Possibility
4 Legality
5 Certainty
Discussion
The contract entered into between Tony and Samuel is illegal because it is in
contravention of sections 4 and 5 of the Drugs and Drug Trafficking Act 140 of 1992.
The material focus therefore is likely to be on the legality requirement, which impacts
on the validity of the agreement. Accordingly, option 4 is correct. See Hutchison and
Pretorius Contract 187-189, 199-201. It follows, that options 1,2,3 and 5 are incorrect.
,Question 4
Assume the same facts as in question 3. Most relevant to the dispute would be to
consider the application of
1 the ex turpi rule and the par delictum rule.
2 statutory illegality and restraint of trade agreements.
3 public interest and rectification.
4 the par delictum rule and capacity of the parties to contract.
5 the ex turpi rule and stipulatio alteri.
Discussion
Based on the facts, the question does not relate to restraint of trade agreements,
rectification, capacity of the parties to contract, and stipulatio alteri. It follows that
options 2, 3, 4, and 5 are incorrect. Option 1 is the only combination that relates to the
consequences of an illegal contract, and therefore it is the correct answer. These
consequences apply in accordance with the the ex turpi rule and the par delictum rule,
in circumstance where the illegal contract is deemed void (see Hutchison and
Pretorius Contract 199-201). Therefore, the first issue to address is whether the illegal
contract between Tony and Samuel is also void.
In terms of the Act, dealing in drugs (heroin) is prohibited, therefore a contract of sale
for drugs is illegal. Where a statute expressly states that such a contract is void, or is
of no force or effect, then clearly this will be the case. In the facts of the question, there
is no mention that the statute expressly renders a contract of this nature to be void.
Therefore, it needs to be considered if the legislator impliedly intended that such a
contract must be null and void. If it was impliedly intended to be a nullity, then the
contract will be void. To determine if the legislator impliedly intended the contract to
be void, the cumulative effect of a number of factors must be considered (see
Hutchison and Pretorius Contract 188, for a discussion of these factors). When these
factors are applied to the facts in the question, then it appears that the legislator
impliedly intended that the illegal contract between Tony and Samuel, be rendered
void. The motivation for this is that the legislator clearly prohibited the dealing and
possession of undesirable dependence-producing substances like heroin to deter
, members of the public from being exposed to the intake and harmful effects of this
drug. To validate such a contract will therefore bring about the harm that the statute is
directed against, which is an indication that the legislator intended the contact between
Tony and Samuel to be void. In terms of the Act, Tony’s conduct constitutes a crime
(dealing and being in possession of an undesirable dependence-producing
substance). The Act does not merely serve to protect the revenue of the state, as the
prohibition of dagga is intended to protect the health of all members of society from
the harmful effects of this undesirable substance. As this entails protecting a public
interest, is a further indicator that the legislator intended the contract between Tony
and Samuel to be void. Nullifying the contract will definitely not cause greater
inconvenience and injustice, therefore the contract should be deemed void.
Having established that the contract between Tony and Samuel was both illegal and
void, the next it is appropriate to look at the consequences of a contract that is void for
illegality. These consequences are that, based on the ex turpi rule, an illegal contract
is void and that no contractual obligations arise out of it, which is relevant to this
question. Where a contract is void in terms of an illegal contract, restitution of what
was performed may possibly be claimed, based on an unjustified enrichment claim.
However, where the parties are equally morally guilty, the par delictum rule can
operate to prevent restitution from taking place. As Tony has already performed by
delivering the heroin drugs to Samuel, he may want to claim restitution of this
performance. Therefore, the par delictum rule is also relevant to this question.
Accordingly, the application of both rules, the ex turpi rule and the par delictum rule
are applicable to this question. Therefore option 1 is correct. See Hutchison and
Pretorius Contract 199-201.
Question 5
Assume the same facts as in question 3. The court hearing this dispute is likely to find
that
1 Tony can claim R1 000 contractual damages from Samuel.
2 Tony will be granted an order for specific performance for the return of the heroin.
3 Tony’s request for the return of the heroin will fail because both parties were equally
morally guilty.
