Contract Law in South Africa & Practicing as a Contract Law Attorney

In modern Roman-Dutch law of South Africa a contract may be defined as: An Agreement, (arising either from true or quasi-mutual assent) which is or is intended to be enforceable by law.
The following popular statement has often been repeated in respect of the doctrine of quasi-mutual assent adopted from English law of contract “If, whatever a man’s real intention may be, he so conducts himself that a reasonable man would believe that he was assenting to the terms proposed by the other party, and that other party upon that belief enters into the contract with him, the man thus conducting himself would be equally bound as if he had intended to agree to the other party’s terms.”
In accordance with the legal principle Pacta Sunt Servanda which has been adopted in South African Contract Law, contracts freely entered into by parties with capacity to do so are to be enforced.
To prove a contract it must be established that the intention was given to create legal relations.
In determining whether or not a contract has been reached South African Contract Law has found it useful to analyse the contract in terms of offer and acceptance.
An attorney focusing in this area of law must have a sound knowledge and keep themselves reasonably apprised of developments in this area of law.
Different considerations include proof of agreement (offer & acceptance, contracts without offer and acceptance), suspensive and resolutive conditions, unfair contracts, the basis for setting contracts aside, cancellation of contracts, contractual damages arising from breach of contract.
There are also a number of formalities in South African Contract Law applied by virtue of legislation failing compliance with which a person wishing to institute legal proceedings based on a contract may find the matter defended on the basis of non-compliance with formalities.
For example: the Alienation of Land Act provides that alienation of land must be addressed in a written contract to be valid and which Act provides for formalities to be addressed in the contract.
Further the General Law Amendment Act provides that a deed of suretyship must be in writing and signed by the parties.
South African Contract Law has recently been impacted by the Protection of Personal Information Act which requires that a Responsible Party parties conclude a contract with an Operator addressing security measures regarding information processed by an operator.
Prevailing circumstances at any given time may also impact contracting considerations such as the recent pandemic which has caused more focus to be placed on force majeure clauses which address performance in terms of a contract where such performance has become objectively impossible for the parties. The remission of rent doctrine forming part of South African Contract Law has also received attention in that it provides where a lessor cannot give a lessee beneficial occupation of the premises leased, the reciprocal obligation of the lessee to pay rental be extinguished in full or in part. This is particularly relevant to certain businesses which were forced to shut their doors and cease trading by virtue of regulations made issued in terms of the Disaster Management Act Whilst they may have still occupied the rental premises their beneficial occupation was disturbed in full or in part in that they could not conduct the trade in respect of which they concluded the lease.
South African Contract law is an interesting and challenging area of law. It makes commercial sense to take a preventative approach to commercial dealings and clearly record the intention of the parties at the outset rather than a defensive approach in having to resolve disputes based on a poorly drafted contract or having no written contract in place at all.
Article by L Boogaard, Boogaard Attorneys
GB Bradfield, Christie’s Law of Contract in South Africa (7th Edition, 2016 Lexis Nexis)
Harms, Amler’s Precedents and Pleadings (7th Edition, 2009, Lexis Nexis)
Case Law
Smith v Hughes (1871) LR 6 QB 597
Alienation of Land Act 61 of 1981
General Law Amendment Act 50 of 1956
Protection of Personal Information Act 4 of 2013