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THE SOURCES OF LIABILITY

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Article by listed attorney: NICOLENE SCHOEMAN

The sources of liability

There may be various underlying causes for liability for an action or omission. These may be the breach of a contract or contractual term; committing a delict; contravention of a statute (legislation); or sui generis, which means those that do not involve any of the rest and are based on court decisions.

This article deals with the distinction between contract and delict.

1. Contract

A contract or agreement is entered into between two or more parties and has the effect of creating reciprocal obligations.

The following must be present to establish a legally valid contract:

  • Consensus, which is also known as the meeting of the minds

  • Contractual capacity, which means that parties should be able to contract and not be a minor or insolvent

  • Formalities must be complied with, for example reducing a contract of sale of immovable property to writing

  • It must be possible for both parties to perform the agreement

  • The contract must be lawful

In many instances contracts are void or invalid from the outset. In others the contract is only voidable. This is an important distinction as it may affect the aggrieved party’s ability to claim and is based on the specific contract terms involved. For example, in the case of an agency agreement, such as a sales representative, the principal will be liable to the client and not the agent or representative.1

Instances of void contracts:

  • Lack of consensus by, for example, mutual mistake;

  • A defect going to the root of the contract;

  • One or both party’s inability to perform from the outset; or

  • Unlawful contracts.

On the other hand, instances related to misrepresentation are voidable. This means that a party can approach a court to challenge the validity of a contract.

Despite the above, South African courts generally follow the maxim pacta sunt servanda (contracts shall be enforced); or the strict liability approach, which aims to prevent parties from not honouring their obligations.

In addition, the courts generally award damages for breach of contract on the basis of restitution in integrum, which means to be placed in the position one was in prior to the agreement. The courts will award damages as they are proven and quantified accordingly. Damages may be patrimonial, or monetary; or non-patrimonial, such as pain and suffering.

2. Delict

According to Neethling et al, a delict is defined as an “act of a person that in a wrongful and culpable way causes harm to another”. 2

The elements of delict are:

  • Conduct, which means an act or omission;

  • Wrongfulness — according to Neethling et al, ‘‘wrongful’ may be expressed as unreasonable or legally reprehensible”;

  • Fault, which can be either intent or negligence;

  • Causation, which means that there must be a causal connection between the wrongful act or omission and the damage suffered; and

  • Damage must be the result, the test for which is “but for conduct of the defendant would the event have occurred”.

3. Vicarious liability

A prime example of sui generis liability is vicarious liability. The term “vicarious liability” means that legal liability is not based on the employer’s fault, but on the fault of the employee.

Requirements for vicarious liability:

  • The wrongdoer must be an employee;

  • who must have committed a delict; and

  • the employee must act in the cause and scope of his duties.

The third requirement is that the employee must have been acting in the course and scope of his employment at the time when the delict occurred.

As is proven in the case of Bezuidenhout NO v Eskom (2003), this requirement can present problems. In this case, an Eskom employee offered a lift home to a third party (Roux) who accepted the offer. The two had an accident on their journey and Roux was seriously injured. His father sued Eskom for R2,5 million.

An essential point in this case was that the driver of the vehicle was expressly prohibited from giving lifts to other people without authority. Eskom would almost certainly have been liable had the instruction not been given. The Court held that “it would be unfair to hold the employer liable to the passenger who has associated himself, albeit innocently, with the forbidden act of the employee and who, in effect, assumed the risk of the association”.

Conclusion

It is advisable to have your attorney draft your contract or advise you on your options in claiming damages.

 

Nicolene Schoeman, Schoeman Attorneys (Cape Town)

Fax: 021 425 5604

Email: enquiries@schoemanlaw.co.za

Website: www.schoemanlaw.co.za

1 Fridman (1971: 8) describes the agency relationship as follows: ”Agency is the relationship that exists between two persons when one, called the agent, is considered in law to represent the other, called the principal, in such a way as to be able to affect the principal’s legal position in respect of strangers to the relationship by the making of contracts or the disposition of property.

 

 

2 Neethling, Potgieter and Visser (2006: 3).