PVL3702/201/1/2019
Tutorial Letter 201/1/2019
Law of Contract
PVL3702
Semester 1
Department of Private Law
This tutorial letter contains important information
about your module.
Bar code
, CONTENTS
1 MEMORANDA OF ASSIGNMENTS .............................................................................. 3
2 COMMENTARY ON EXAMINATION ............................................................................. 14
3 EXAMPLES OF ERROR AND DAMAGES PROBLEM QUESTIONS............................ 14
2
, PVL3702/201
Dear Student
1 MEMORANDA OF ASSIGNMENTS
This tutorial letter contains the memoranda of the answers to the assignments.
1.1 Assignment 01
Question
Read the judgments in Bloom v American Swiss Watch Co 1915 AD 100; Laws v Rutherford
1924 AD 261 and The Fern Gold Mining Company v Tobias (1889-1890) 3 SAR TS 134.
Identify and read the relevant section(s) in the prescribed textbook. You can find judgments in
conventional law libraries, online at the website of the Southern African Legal Information
Institute (SAFLII) (www.saflii.org) or as an e-resource on the Unisa Library site (choose Juta
Law Online Publications and then South African Law Reports). Then use those cases and the
textbook to answer the following question:
In a cash-in-transit heist, a gang of robbers attacks a van of XYZ Security in broad daylight on
10 January and robs R3.5 million in cash. The next day, XYZ Security, a well-known security
company offers a reward of R100 000 on the TV news to anyone who gives information to the
police leading to the arrest of the robbers. H watches the news and notices that a reward is
being offered. On 14 January, XYZ Security withdraws the reward, which is reported on the TV
news. H does not watch the news and fails to hear about the revocation of the reward. On 15
January, H provides the police with information, which indeed leads to the arrest of the robbers
that very night. On 17 January, XYZ Security hears that the information has been provided to
the police. XYZ refuses to pay H the reward. Advise H fully. Substantiate your advice and refer
to relevant case law.
Answer
In order to identify the law, which you should apply to the problem, you were asked to:
(1) read Bloom v American Swiss Watch Co 1915 AD 100, Laws v Rutherford 1924 AD 261
and The Fern Gold Mining Company v Tobias (1889-1890) 3 SAR TS 134; and
(2) identify the relevant section(s) in the prescribed textbook.
(1) Read three cases
In Bloom v American Swiss Watch Co 1915 AD 100 the American Swiss Watch Co offered a
reward after a robbery at their shop for the giving of information to the police which lead to
the arrest of the thieves and the recovery of the stolen goods. Bloom did so without
knowing of the reward. He claimed the reward, but his claim was refused. On appeal,
the court held that the reward was an offer open to the public. It could be accepted by providing
information to the police. Bloom, however had no intention of accepting the offer because he did
not know of its existence when he gave the information to the police.
3
, In Laws v Rutherford 1924 AD 261 R gave L an option to accept an offer within 3 months
by written notice. L failed to notify R of his acceptance in the prescribed manner. The
court found that no contract arose.
In Fern Gold Mining Company v Tobias (1889-1890) 3 SAR TS 134 it was held that an offer can
be revoked at any time before acceptance and that acceptance must come to the notice of the
offeree.
(2) Identify the relevant section in the textbook
If the “Table of Cases” is consulted at the end of Hutchison and Pretorius (eds) The law of
Contract in South Africa 3rd ed (Oxford Cape Town 2017) you will find the pages where Bloom,
Laws and Tobias are discussed in the textbook.
The first page on which Bloom appears in the text, is 54. The paragraph deals with rewards. It is
mentioned that an advertised reward is an offer to the public. The offer is accepted by
performing the required act and the reward must be certain. A discussion of the requirements of
a valid offer and acceptance seems appropriate. The second page on which it is discussed in
the text is 58 which deals with the requirement that the acceptance must be a conscious
response to the offer. This is again an indication that the requirements for a valid acceptance is
relevant.
Laws appears in footnote 50 on page 58 as authority for the requirement that the acceptance
must be in the form prescribed by the offer.
Tobias appears in footnote 44 on page 56 as authority for the requirement that the revocation of
an offer must come to the notice of the offeror. Revocation of the offer is thus also relevant.
The relevant sections of the textbook are page 50– 54, 56 and 57-58 where the requirements of
a valid offer, the revocation of an offer and the requirements for a valid acceptance of an offer
are discussed.
Identifying the problem
First, we must determine whether the reward complies with the requirements for a valid offer.
Then if it does, we must determine whether the offer has validly been revoked. Only if it has not
been validly revoked, the question must be addressed whether the offer has been validly
accepted.
Discussing the relevant law applicable to the problem AND applying the law to the facts of
the problem
The offer of reward of XYZ Security complies with the requirements for a valid offer:
1 The offer was firm. An offer must be made with the intention that its acceptance will result
in a binding contract (Hutchison and Pretorius (eds) The law of Contract in South Africa
(Oxford Cape Town 2017) 50). In Bloom v American Swiss Watch Co 1915 AD 100 the
American Swiss Watch Co offered a reward after a robbery at their shop for the giving of
information to the police which would lead to the arrest of the thieves and the
recovery of the stolen goods. Bloom did so without knowing of the reward. He
claimed the reward, but his claim was refused. On appeal, the court held inter alia
that the reward was an offer open to the public. The offer of XYZ Security was on the
news and was not a tentative statement.
4
Tutorial Letter 201/1/2019
Law of Contract
PVL3702
Semester 1
Department of Private Law
This tutorial letter contains important information
about your module.
Bar code
, CONTENTS
1 MEMORANDA OF ASSIGNMENTS .............................................................................. 3
2 COMMENTARY ON EXAMINATION ............................................................................. 14
3 EXAMPLES OF ERROR AND DAMAGES PROBLEM QUESTIONS............................ 14
2
, PVL3702/201
Dear Student
1 MEMORANDA OF ASSIGNMENTS
This tutorial letter contains the memoranda of the answers to the assignments.
1.1 Assignment 01
Question
Read the judgments in Bloom v American Swiss Watch Co 1915 AD 100; Laws v Rutherford
1924 AD 261 and The Fern Gold Mining Company v Tobias (1889-1890) 3 SAR TS 134.
Identify and read the relevant section(s) in the prescribed textbook. You can find judgments in
conventional law libraries, online at the website of the Southern African Legal Information
Institute (SAFLII) (www.saflii.org) or as an e-resource on the Unisa Library site (choose Juta
Law Online Publications and then South African Law Reports). Then use those cases and the
textbook to answer the following question:
In a cash-in-transit heist, a gang of robbers attacks a van of XYZ Security in broad daylight on
10 January and robs R3.5 million in cash. The next day, XYZ Security, a well-known security
company offers a reward of R100 000 on the TV news to anyone who gives information to the
police leading to the arrest of the robbers. H watches the news and notices that a reward is
being offered. On 14 January, XYZ Security withdraws the reward, which is reported on the TV
news. H does not watch the news and fails to hear about the revocation of the reward. On 15
January, H provides the police with information, which indeed leads to the arrest of the robbers
that very night. On 17 January, XYZ Security hears that the information has been provided to
the police. XYZ refuses to pay H the reward. Advise H fully. Substantiate your advice and refer
to relevant case law.
Answer
In order to identify the law, which you should apply to the problem, you were asked to:
(1) read Bloom v American Swiss Watch Co 1915 AD 100, Laws v Rutherford 1924 AD 261
and The Fern Gold Mining Company v Tobias (1889-1890) 3 SAR TS 134; and
(2) identify the relevant section(s) in the prescribed textbook.
(1) Read three cases
In Bloom v American Swiss Watch Co 1915 AD 100 the American Swiss Watch Co offered a
reward after a robbery at their shop for the giving of information to the police which lead to
the arrest of the thieves and the recovery of the stolen goods. Bloom did so without
knowing of the reward. He claimed the reward, but his claim was refused. On appeal,
the court held that the reward was an offer open to the public. It could be accepted by providing
information to the police. Bloom, however had no intention of accepting the offer because he did
not know of its existence when he gave the information to the police.
3
, In Laws v Rutherford 1924 AD 261 R gave L an option to accept an offer within 3 months
by written notice. L failed to notify R of his acceptance in the prescribed manner. The
court found that no contract arose.
In Fern Gold Mining Company v Tobias (1889-1890) 3 SAR TS 134 it was held that an offer can
be revoked at any time before acceptance and that acceptance must come to the notice of the
offeree.
(2) Identify the relevant section in the textbook
If the “Table of Cases” is consulted at the end of Hutchison and Pretorius (eds) The law of
Contract in South Africa 3rd ed (Oxford Cape Town 2017) you will find the pages where Bloom,
Laws and Tobias are discussed in the textbook.
The first page on which Bloom appears in the text, is 54. The paragraph deals with rewards. It is
mentioned that an advertised reward is an offer to the public. The offer is accepted by
performing the required act and the reward must be certain. A discussion of the requirements of
a valid offer and acceptance seems appropriate. The second page on which it is discussed in
the text is 58 which deals with the requirement that the acceptance must be a conscious
response to the offer. This is again an indication that the requirements for a valid acceptance is
relevant.
Laws appears in footnote 50 on page 58 as authority for the requirement that the acceptance
must be in the form prescribed by the offer.
Tobias appears in footnote 44 on page 56 as authority for the requirement that the revocation of
an offer must come to the notice of the offeror. Revocation of the offer is thus also relevant.
The relevant sections of the textbook are page 50– 54, 56 and 57-58 where the requirements of
a valid offer, the revocation of an offer and the requirements for a valid acceptance of an offer
are discussed.
Identifying the problem
First, we must determine whether the reward complies with the requirements for a valid offer.
Then if it does, we must determine whether the offer has validly been revoked. Only if it has not
been validly revoked, the question must be addressed whether the offer has been validly
accepted.
Discussing the relevant law applicable to the problem AND applying the law to the facts of
the problem
The offer of reward of XYZ Security complies with the requirements for a valid offer:
1 The offer was firm. An offer must be made with the intention that its acceptance will result
in a binding contract (Hutchison and Pretorius (eds) The law of Contract in South Africa
(Oxford Cape Town 2017) 50). In Bloom v American Swiss Watch Co 1915 AD 100 the
American Swiss Watch Co offered a reward after a robbery at their shop for the giving of
information to the police which would lead to the arrest of the thieves and the
recovery of the stolen goods. Bloom did so without knowing of the reward. He
claimed the reward, but his claim was refused. On appeal, the court held inter alia
that the reward was an offer open to the public. The offer of XYZ Security was on the
news and was not a tentative statement.
4
