LPL4801
LAW OF SALE AND LEASE
ASSIGNMENT 1 ANSWERS
SEMESTER 1 YEAR 2022
, QUESTION
Paul (P) concludes a written agreement purchasing a motor vehicle from S
(Suzie), a motor dealer, on 1 January 2020. The agreement is concluded at S’s
registered business address. The purchase price of the vehicle is R200,000
and is payable in 20 equal monthly instalments. The agreement also makes
provision for P to pay at 15% interest per annum to S in respect of the deferred
purchase price. There is a term in the contract that ownership in respect of the
vehicle will only pass to P once the last instalment has been paid. The motor
vehicle is delivered to P on 2 January 2020. P approaches you for legal advice
on 4 January 2020. P explains to you that although he can afford the vehicle he
has changed his mind and no longer wishes to continue with the agreement. P
also informs you that he paid the first instalment on 2 January 2020 and would
like to claim back this instalment without incurring any financial loss. S did not
do a proper credit assessment prior to the conclusion of the agreement.
Question 1 (a)
First, it needs to be ascertained whether the agreement is a credit agreement, which
is governed by the NCA.
Section 8(1) of the NCA, an agreement is a credit agreement if it is a credit facility,
credit guarantee or credit transaction.
LAW OF SALE AND LEASE
ASSIGNMENT 1 ANSWERS
SEMESTER 1 YEAR 2022
, QUESTION
Paul (P) concludes a written agreement purchasing a motor vehicle from S
(Suzie), a motor dealer, on 1 January 2020. The agreement is concluded at S’s
registered business address. The purchase price of the vehicle is R200,000
and is payable in 20 equal monthly instalments. The agreement also makes
provision for P to pay at 15% interest per annum to S in respect of the deferred
purchase price. There is a term in the contract that ownership in respect of the
vehicle will only pass to P once the last instalment has been paid. The motor
vehicle is delivered to P on 2 January 2020. P approaches you for legal advice
on 4 January 2020. P explains to you that although he can afford the vehicle he
has changed his mind and no longer wishes to continue with the agreement. P
also informs you that he paid the first instalment on 2 January 2020 and would
like to claim back this instalment without incurring any financial loss. S did not
do a proper credit assessment prior to the conclusion of the agreement.
Question 1 (a)
First, it needs to be ascertained whether the agreement is a credit agreement, which
is governed by the NCA.
Section 8(1) of the NCA, an agreement is a credit agreement if it is a credit facility,
credit guarantee or credit transaction.
