Statute Law or Legislation

Question 1: (5 marks)

Discuss statute law or legislation as an important source of South African law.

Statute law or Legislation is an important source of law in South Africa. They are the written laws as set out by the parliament and provincial legislatures (competent authorities) and form the basis on which the law of South Africa is founded.

Statue law or Legislative law in South Africa comprises of the following:

The Constitution: This is the most important source of law in South Africa. If parliament were to pass a law in contradiction with the constitution, the law would be invalid. The Constitution was adopted in order to:

Heal the divisions of the past and establish a society based on democratic values, social justice and fundamental human rights (Havenga, P. et al. 2009).

Lay the foundations for a democratic and open society (Havenga, P. et al. 2009)

Improve the quality of life for all citizens (Havenga, P. et al. 2009)

Build a united and democratic South Africa (Havenga, P. et al. 2009)

Customary Law: This applies to laws that are not written laws, but rather are laws that have become accepted in community and have passed from generation to generation (Havenga, P. et al. 2009).

Judgment of the courts: The most important judgment of the courts come from the Constitutional Court, the Supreme Court of Appeal and the High Courts.

Old Authorities: Ancient Roman Law and certain Dutch laws still apply in South Africa today.

Foreign law: If none of the above sources can provide any guidance to a judge, he may turn to the laws of other modern countries for a solution.

Textbooks and Law journals: Although these sources may not have any authority on their own, they may be used as a persuasive tool (Havenga, P. 2009).

Question 2: (5 marks)

The Supreme Court of Appeal (SCA) is the highest court of appeal in South Africa, unless the appeal is regarding a constitutional matter, in which case the Constitutional court takes preference. Since its referrals come from the high courts, The SCA is composed of a president (currently the Honorable L.Mpati) and deputy president (currently the Honorable L.Harms), and consist of a number of judges which are determined and appointed by an Act of Parliament.

When sitting for a case of appeal, the panel will consist of 3 – 5 judges, determined by the case at hand. The senior judge on the panel is the presiding judge, and the decision of the majority is the decision of the court.

The SCA has absolute and final jurisdiction over all cases of appeal in South Africa, both civil and criminal, except those cases of appeal that involve constitutional matters, and may hear matter which fall within the jurisdiction of the high courts (Havenga, P. 2009).

Question 3: (10 marks)

3.1) In order for a contract to be valid, it should meet the following criteria…

– Consensus or agreement between the parties on the objectives of the contract

– Both parties must possess the capacity to act on the required objectives

– The agreement must be permitted by the law

– The agreement must be physically possible

– Prescribed formalities must be observed

(Havenga, P. 2009).

3.2) In the case in question, John and Peter did come to a consensus on the objectives of the contract, which is one of the requirement for as legal contract, however, Peter did not have a permit to shoot the Rhino and therefore was not in a capacity to act on the agreed objective. Furthermore, although the agreed upon objective was physically possible to achieve, the shooting of Rhinoceros in South Africa is a criminal offence and is therefore NOT permitted by law. In addition to the shooting of the Rhinoceros, any form of trade with Rhinoceros horn is also a criminal offence.

In conclusion, Peter was not in a position to enter into an agreement with John as he did not have permit (capacity to act). Furthermore, both parties entered into an agreement which was clearly not permitted by law, therefore the contract was not valid.

Question 4: (10 marks)

4.1) The Oxford online Dictionary (2011) defines ‘misrepresentation’ as ‘the action or offence of giving a false or misleading account of the nature of something’. Misrepresentation is defined in more detail by Havenga, P. et al (2009) in the definition ‘misrepresentation can be defined as an untrue statement or representation concerning an existing fact or state of affairs which is made by one party to the contract with the aim, and result, of inducing the other party into concluding the contract’.

It is clear when comparing the two definitions given above that any form of false or misleading information that is used as an attempt to force the second party into entering into a contract, can be seen as ‘misrepresentation’.

4.2) The requirements for misrepresentation to exist are as follows:

– An untrue statement regarding an existing fact must be made or inferred. The statement may be intentional, negligent or innocent.

– Misrepresentation must be made by one contracting party, or their representative, to the other party or parties.

– It must be unlawful, not just morally unacceptable.

– The misrepresentation must be the cause of the contract being entered into

– The party making the misrepresentation must be at fault.

Question 5: (7 marks)

5.1) The type of Breach of Contract in the given scenario is Repudiation. Repudiation is defined as ‘refusal to fulfill or discharge an agreement, obligation, or debt’ (Oxford Dictionary. 2011), which in this case is exactly what Peter did by informing John that he will no longer pay the installments.

5.2) Before deciding on whether or not a breach has occurred, it is important to inspect the validity of the contract in question. If the contract meets the requirements for a valid contract, then the requirements for repudiation is simply to gain the input and interpretation of a neutral and reasonable third person in place of the creditor. The neutral third party must conclude that the repudiating party has no intention of meeting his contractual obligations. If this is found to indeed be the case, then the remedies for breach of contract may follow.

Question 6: (6 Marks)

Terms of a contract can be classified into Essentialia terms, Naturalia terms and Incidentalia terms.

Essentialia terms are those term which are essential to be able to classify the type of contract.

Naturalia terms are those terms that are, by law, to be included in a contract of a certain class or type. Naturalia terms define the duties and responsibilities of each party, and should clearly indicate the consequences of entering into a contract.

Incidentalia terms are not required in a contract, but may be inserted at the discretion of both parties, and can be used to solidify special considerations or criteria.

Question 7: (6 marks)

In order to conclude a contract of sale, the merchandise needs to be delivery from the seller to the buyer. The delivery of such movables can take place in the following ways:

Actual delivery

Actual delivery of movable takes place when the seller hands over the merchandise to the buyer as soon as the payment is made.

Symbolic Delivery

Occasionally the merchandise is not physically possible to ‘hand’ over. A symbol of ownership is they used to symbolize the merchandise. This symbol is handed over at the conclusion of the contract of sale.

Delivery with Short Hand

When a person rents merchandise in advance of buying it (rent-to-buy), they are already in possession of the said merchandise when the contract of sale takes place. This is known as Delivery with Short Hand.

Question 8: (6 marks)

During a lease agreement or lease contract, both the Lessor and the Lessee are bound by duties as stipulated in the contract. These duties are:

Lessor

To deliver the leased property to the Lessee

To maintain the leased property. In other words, the lessor is responsible for maintenance and general upkeep of the leased property.

To ensure the undisturbed use and enjoyment of the leased property by the lessee

Lessee

To pay the agreed rental for the use of the leased property.

To take care of the leased property and to use it in a proper and ethical manner

To return the leased property back to the lessor at the end of the lease duration in the same condition in which it was received at the start of the lease agreement. In many cases this means undamaged.

Question 9: (10 marks)

In the case in question, the insurance company may dispute the validity of the contract and may in fact decide not to honor the terms of the contract. In other words, they will not pay out the R100 000.

During the application process that Piet completed three years previously, he failed to mention that he suffered from high cholesterol. Whether or not Piet felt this information was relevant due to his medication use, Piet had a ‘Duty of Good Faith’ to disclose all information that may increase the risk of the insured event occurring. High cholesterol is a major contributor to heart disease and heart attack, and taking medication does not eliminate the condition, but only controls it. If Piet had stopped taking the medications, the high cholesterol levels would have returned.

In other words, by non-disclosure of his medical condition Piet gave the insurance company valid reasons to not honor the contract.

Question 10: (8 marks)

The following marks are examples of marks that cannot be registered as a Trademark in South Africa, with the reasons attached…

You cannot register the name SHEEPSKIN for a leather jacket that is made from imitation leather, as it is inherently deceptive and indicates to the consumer that the jacket is made from real leather which it is not.

A companies attempt to register a laxative product called ‘COSMOPURGE’ might be seen not only as deceptive, as it indicates cosmetic changes to your body through the use of laxatives, but might be seen as being done in bad faith when taken into account that a local Cosmetic Surgery has already registered the name ‘COSMOSURGE’.

(COSMOSURGE is a Cosmetic Surgery Group based in the United Arab Emirates)

Attempting to register an energy drink called ‘NASA Fuel’ would probably be rejected on the grounds that it is too similar to an unregistered well-known international brand. In addition to that, it implies association with the NASA Space Agency in the USA which is a Federal Government Agency, of which there is no association present.

Attempting to register a new Nasal Spray called ‘COCAINE’ is not only deceptive, as the product cannot legally contain cocaine, but it implies the use of narcotics which is against the South African law.

Question 11: (4 marks)

The South African Copyright laws extend to South African citizens, or persons incorporated into the South African laws. The Copyright law is also only applicable to work made, or first published in South Africa (Havenga, P. 2009). Therefore, Theo is not protected by the copyright law in South Africa as he is NOT a South African Citizen, and his paintings were made (or first published) in Namibia, and not in South Africa.

Question 12: (6 marks)

12.1) The Parole Evidence (extrinsic evidence rule or integration rule) rule is used during the interpretation of a contract. This rule is only applicable to written contracts, and basically states that the written contract can be the only evidence used when interpreting the contents of the contract. All previously made verbal agreements are no longer valid as evidence and cannot be used to interpret the contract.

12.2) Although the Parole Evidence Rule is applicable to the written contract and agreements made before the written contract was put in place, it is NOT applicable if:

– Any agreements entered into between the parties after the written contract was entered into.

– Any previous agreements were made before the written contract was entered into, but these previous agreements do not contradict, alter, add or vary the contents of the written agreement, then the Parole Evidence rule is not applicable, and evidence of said prior agreements is not prohibited.

Question 13: (5 marks)

As a partner in a partnership, you have the following rights:

To claim delivery of the contribution a partner promised

To share in the profits of the partnership

To use partnership assets to further the aims of the partnership

To access the accounting records associated with the partnership

To participate in the management of the partnership (unless otherwise agreed upon).

Question 14: (6 marks)

‘A company has legal personality and exists separately from its members’. This statement basically states that the company is its own entity, and does not rely on the members of the company in order to function. In other words, the company can obtain its own rights and duties and is not accountable for the member’s actions. However, since it is primarily a business entity, it can generally only incur those rights and duties that are required for economic activity (Havenga, P. 2009).

However, should the company entity be found to be carrying out reckless activity, or activity with the intent to commit fraud, the courts are prepared to disregard the corporate entity and hold the members liable for the companies actions (Havenga, P. 2009).

Question 15: (6 marks)

For an interdict to be considered as a remedy for unlawful competition, certain requirements need to be present, namely:

There must be an act by the respondent, normally in the form of a threatening act or unlawfully competitive act (Havenga, P. 2009).

The act must be wrongful. In other words, the threatening or unlawful act must have infringed or threatened to infringe on the competitors right to the goodwill of his or her business (Havenga, P. 2009).

It should have been determined that no other remedy is available, as criminal sanctions are not regarded as a remedy for this purpose (Havenga, P. 2009).

Blame or fault is not a requirement for an interdict to be considered.