Law of Contract (PVL3702): Exam 2018, questions Law of Contract (University of South Africa) Contract Law Self-evaluation assignment NB for exam purposes

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Mary agrees to accompany John to the cinema and consequently John purchases the tickets. Mary, however, forgets about the arrangement and goes to visit a friend. Does John have a valid contract with M... ary on the basis of which he may sue Mary for not keeping their arrangement? Substantiate your answer in one sentence. (1) Question 6 Question 6.1 Alex is interested in purchasing Bob's house. The house has a swimming pool. Mindful of the cost of swimming-pool repairs Alex asks Bob if the pool is structurally sound. Bob assures him that it is, even though he is aware of the fact that the pool has a large crack in it which must he repaired. After the sale has gone through Alex notices the crack in the swimming pool. You may accept that the crack does not constitute a latent defect. Is any remedy available to Alex and if so on what basis? Answer in three sentences with reference to case law. (2) 38 Question 3 Question 3.1 Bill grants Angus an option which is valid until 1 February 2005, to purchase Bill's Volkswagen beetle for R6 000. The written option is personally handed by Bill to Angus on 15 January 2005. Angus posts a letter of acceptance to Bill on 25 January 2005. The letter reaches Bill on 1 February 2005 but he only reads it on 3 February 2005. Was a valid contract concluded between Bill and Angus? Substantiate your answer in two sentences. (1) Question 3.2 If Bill sold the car to Jack on 20 January 2005, would Angus have any legal remedy or remedies against Bill? Substantiate your answer in one sentence. (1) Question 4 Question 4.1 Al bought land from Pete. The property had been put up for auction on the day before the sale took place. In the advertisement of the auction, which Al read, the property was described as being at site A where the auction would also take place. In fact the property was situated at site B, some 200 to 300 metres down the road. The auctioneer realised this mistake and made an announcement to that effect before the commencement of the auction. Al, however, arrived late and did not hear this announcement. Al's bid was not accepted. The next day Al made a higher offer at the auctioneer's office. The auctioneer only pointed out the true position of the property on a street map, but this did not alert Al to the fact that the property was not the one for which the auction was held. Al's higher offer was accepted. Al avers that he is not bound by the contract because of his mistake. You may accept that the auctioneer acted throughout as Pete's agent and that his actions can be attributed to Pete. Is Al's mistake material? Substantiate your answer in one sentence. (1) Question 4.2 Would your answer to 4.1 have differed if Al's mistake had merely related to the exact size of site A? Substantiate your answer in two sentences with reference to case law. (1) Question 4.3 Is Al's mistake in 4.1 reasonable? Substantiate your answer in two sentences with reference to case law. (1) Question 2 Fred offers to purchase Peter's television set at a purchase price of R500. Peter agrees to the sale but tells Fred that he wants R600 for the set, whereupon Fred indicates to Peter that he is no longer interested. A week later Peter telephones Fred and tells him that he has accepted the offer of R500. In the meantime, however, Fred has purchased another television set. Did Fred and Peter conclude a valid contract? Substantiate your answer in two sentences. (1) Would your answer to 6.1 have differed if the statement by Bob that the swimming pool was structurally sound had been made in the bona fide and reasonable belief (on the part of Bob) that this in fact was the case. Substantiate your answer in three sentences with reference to case law. (2) Mark is engaged to Jane. Mark has a very strong personality and eventually persuades Jan to sell and transfer her house worth R500 000 to him at a purchase price of a mere R20 000. After registration of the property in Mark's name he breaks off the engagement. Does Jane have a remedy available to her? Substantiate your answer in three sentences with reference to case law. (2) Mike opens a bar and sells alcohol to the public before he has been granted a liquor license even though such activities are prohibited by statute. Mike supplies Ed with liquor on credit. Ed does, however, not pay his account with Mike. May Mike enforce the contract he has with Ed and claim the purchase price of the liquor he sold to Mike? Briefly substantiate your answer in two sentences. (2) Assuming that your answer to 8.1 is no, does Mike have any other legal remedy at his disposal. Substantiate your answer in two sentences. (2) May the parties to a written contract cancel the whole contract orally where the contract merely stipulates that dissolution may take place only in writing? Substantiate your answer in three sentences with reference to case law. (1) Question 10 Question 10.1 Land belonging to an estate A was sold by public auction. One of the terms of the sale was that all arrear rates owing on the property should be paid by the purchaser. After B bought the property the Municipality C of the area accepted the offer of having the arrear rates paid by the purchaser. May B revoke his offer? Answer in 2 sentences. (2) Question 10.2 Is an offer actually made to C? Substantiate your answer in 1 sentence. (1) Question 10.3 What is the juristic basis of C's right? Answer in 2 sentences. (1) Question 10.4 May a benefit be agreed to for a third party if the third party has not yet come into existence? Answer in two sentences. (1) Question 11 Question 11.1 A buys a ticket for a ride in a helicopter. On the back of the ticket there is a clause excluding the pilot's liability in the event of an accident. Is A bound by the terms of the ticket? Answer in four sentences. (2) C agrees to buy B's car tomorrow morning at sunrise. (1) Question 12 Question 12.1 Identify the following clauses and substantiate your answer in two sentences. C agrees to buy B's car if the Automobile Association (AA) approved the car yesterday. (1) C agrees to buy B's car if it rains in the Karoo next Monday. (1) Question 13.1 A leases a video camera from B, to be delivered on 23 March 2005. Distinguish which form of breach of contract took place in the following instances and substantiate your answer in one sentence. B fails to deliver the camera. (1) Question 13.3 B delivers the camera at the agreed upon time and place, but A fails to take delivery. (1) IDENTIFICATION OF THE TOPIC(S) IN PROBLEM-TYPE QUESTIONS (1) The main problem students experience with problem-type questions is identifying the legal rules of the law of contract which must be applied to the question. (2) All identification of problems pertaining to the law of contract can be done by a process of elimination. The facts of the problem will give an indication of which part of the law could be relevant. However, do not read more into the facts than what has specifically been given and also refrain from jumping to conclusions. (3) A contract is a legal act intended to create legal obligations. The problem therefore either relates to the elements of the legal act (the five requirements for a valid contract) or to the legal consequences of the contract (obligations). (4) By systematically asking yourself whether all the requirements have been met, you will be able to eliminate those requirements which have been met. To those which remain, you will have to apply the principles governing each particular requirement. (5) Should this process of questioning indicate that all the requirements have been met, you must then turn to the legal consequences in order to determine whether the question relates to this part of the law. (6) At this point in the process of elimination, the question will either deal with the contents of the contract, breach of contract and the remedies or extinction of the obligations. (7) With regard to the contents of the contract, the question arises whether a tacit term, a time clause, or a condition applies to the facts of the question or whether it is a case of interpretation of the contract. Furthermore it is important to identify the type of contract in order to determine which naturalia apply. (8) Should you decide the question deals with breach of contract, you must first identify the form of breach in order to be able to determine what the remedies will be. (9) Finally, once you have worked out what part of the law of contract is relevant to answering the problem, you must apply the principles of the law to the given facts. B delivers the camera but it takes unclear pictures. (1) It comes to A's knowledge that B has agreed to lease his only video camera to C for the same date. (1) Adam owes Eve R1 000 which she can claim immediately. However, they agree that Adam will pay an amount of R100 per month for 10 months. After 4 months Adam fails to pay the monthly instalment of R100. What amount is Eve entitled to claim from Adam? Substantiate your answer in one sentence. (1) Question 15 Question 15.1 Brian sells his showjumper Big Ronald to Adam for R50 000. Big Ronald had been killed by lightning the day before. Can Adam successfully institute a claim against Brian? Substantiate your answer in one sentence. (2) Question 15.2 Would your answer to 15.1 be any different if Brian had sold Big Ronald to someone else the day after the contract between himself and Adam was concluded? Substantiate your answer in one sentence (2) Question 16 On 1 April, X buys a house from Y for R500 000. It is a term of the contract that transfer will be given within a reasonable time after the buyer has lodged bank guarantees to secure payment of the purchase price. X lodges the required guarantees on 1 May, but on 1 August transfer has not yet been given. On this date X advises Y that he is resiling form the contract with immediate effect, and is claiming R25 000 damages. Discuss with reference to case law. You may assume that the contract of sale complies with all the formal requirements. Your answer should not be longer than 500 words (± 2 handwritten pages). (10) PREVIOUS EXAMINATION PAPER QUESTION 1 See further study guide 36-44. ANSWER See further study guide 27. QUESTION 3 See further study guide 72-73, 168. (b) Y let premises to X. The lease contained a clause prohibiting X from sub-letting the premises without the written consent of Y. A further clause of the lease required that any variation of the terms of the lease had to be in writing and signed by both parties. Later Y told X that he (X) could sub-let a portion of the premises. After X had Sub-let a portion of the premises to a third party, Y changed his mind and informed X that both X and the sub-lessee (third party) must vacate the premises because X had breached the contract. Discuss X’s position with reference to SA Sentrale Kooperatiewe Graanmaatskappy Bpk v Shifren 1964 (4) SA 760 (A). (10) See further study guide 141-142. (c) Assume that X and Y did sign a variation of the lease allowing X to sub-let a portion of the premises and thereafter Y changed his mind anyway and prohibited X from sub-letting. Discuss X’s position with reference to Tuckers Land and Development Corporation (Pty) Ltd v Hovis 1980 (1) SA 645 (A). (10) [Show More]

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