,PVL3704 Assignment 1 (COMPLETE ANSWERS)
Semester 1 2025 - DUE 13 March 2025; 100%
TRUSTED Complete, trusted solutions and
explanations.
C has paid D R30 000 by cheque. A day later C instructs her
bank, E to countermand (stop) the cheque. Despite the
countermand, E bank pays out the cheque to D when he
presented the cheque and debited C’s account. C wants the
debit reversed. Advise C and E about the validity of the debit
and whether either of them has an enrichment claim against D.
Refer to relevant case law. Discuss (by reference to relevant
case law) the requirement that the enrichment must have been
sine causa. (10) K rents a farm from L. K effected the following
improvements on the farm without L’s knowledge: (a) built a
dam at a cost of R30 000,00; (b) built a luxury lapa on the edge
of the dam at a cost of R100 000,00; and (c) sank a borehole at
a cost of R20 000,00. K also repaired the roof of the farmhouse
which had started to leak at a cost of R10 000,00. Discuss fully
the legal position with regard to these improvements when the
lease expires. Also briefly discuss whether the position would
have been different if the lease agreement between K and L had
been invalid. A is the owner of a car manufacturing factory in
Gqeberha (formerly known as Port Elizabeth). He recently
settled his electricity bill in full with the Nelson Mandela
Metropolitan Municipality. However, to his surprise he has just
received a letter from the same municipality in which they
threaten to cut his electricity if he doesn’t immediately pay his
, “arrear account” of R300 000. A knows that there must be a
mistake, because his account is paid in full, but also knows that
if there is a disruption in his electricity supply, he will suffer
severe losses. He pays the amount immediately and sends a
letter of complaint to the Municipality. Advise A whether he will
be able to reclaim the R300 000 he paid, and if so, in terms of
which remedy? In your answer discuss the requirements of this
remedy.
1. C and E – Validity of Debit and Enrichment Claim against D
Legal Position: C has instructed E to stop payment on the
cheque, but despite this, E paid D. In terms of the relationship
between the parties:
Validity of the Debit: According to section 45 of the Bills
of Exchange Act, when a cheque is stopped, the bank has
an obligation to honor that instruction and not process the
cheque. However, if the bank incorrectly pays the cheque
after a valid countermand, the bank (E) may be liable for
the unauthorized payment. In this case, the payment was
made despite the countermand, making the debit against
C’s account potentially invalid.
Relevant Case Law: In Crawford v First National Bank Ltd, the
court held that a bank is liable if it fails to comply with the
instruction to stop payment. The payment made to D, despite
the stop instruction, would likely be deemed wrongful, and C
could claim the reversal of the debit.
Semester 1 2025 - DUE 13 March 2025; 100%
TRUSTED Complete, trusted solutions and
explanations.
C has paid D R30 000 by cheque. A day later C instructs her
bank, E to countermand (stop) the cheque. Despite the
countermand, E bank pays out the cheque to D when he
presented the cheque and debited C’s account. C wants the
debit reversed. Advise C and E about the validity of the debit
and whether either of them has an enrichment claim against D.
Refer to relevant case law. Discuss (by reference to relevant
case law) the requirement that the enrichment must have been
sine causa. (10) K rents a farm from L. K effected the following
improvements on the farm without L’s knowledge: (a) built a
dam at a cost of R30 000,00; (b) built a luxury lapa on the edge
of the dam at a cost of R100 000,00; and (c) sank a borehole at
a cost of R20 000,00. K also repaired the roof of the farmhouse
which had started to leak at a cost of R10 000,00. Discuss fully
the legal position with regard to these improvements when the
lease expires. Also briefly discuss whether the position would
have been different if the lease agreement between K and L had
been invalid. A is the owner of a car manufacturing factory in
Gqeberha (formerly known as Port Elizabeth). He recently
settled his electricity bill in full with the Nelson Mandela
Metropolitan Municipality. However, to his surprise he has just
received a letter from the same municipality in which they
threaten to cut his electricity if he doesn’t immediately pay his
, “arrear account” of R300 000. A knows that there must be a
mistake, because his account is paid in full, but also knows that
if there is a disruption in his electricity supply, he will suffer
severe losses. He pays the amount immediately and sends a
letter of complaint to the Municipality. Advise A whether he will
be able to reclaim the R300 000 he paid, and if so, in terms of
which remedy? In your answer discuss the requirements of this
remedy.
1. C and E – Validity of Debit and Enrichment Claim against D
Legal Position: C has instructed E to stop payment on the
cheque, but despite this, E paid D. In terms of the relationship
between the parties:
Validity of the Debit: According to section 45 of the Bills
of Exchange Act, when a cheque is stopped, the bank has
an obligation to honor that instruction and not process the
cheque. However, if the bank incorrectly pays the cheque
after a valid countermand, the bank (E) may be liable for
the unauthorized payment. In this case, the payment was
made despite the countermand, making the debit against
C’s account potentially invalid.
Relevant Case Law: In Crawford v First National Bank Ltd, the
court held that a bank is liable if it fails to comply with the
instruction to stop payment. The payment made to D, despite
the stop instruction, would likely be deemed wrongful, and C
could claim the reversal of the debit.
