The basis of any contract is consensus between the two parties.
The court in Vincorp (Pty) Ltd v Trust Hungary ZRT found that the two parties alleged by the plaintiff to be parties to a contract had different things in mind when they negotiated and that no contract came into being because it lacked the essential requirement of intention to contract (animus contrahendi).
The alleged contract related to the sale of Hungarian wine barrels in South Africa. The Hungarian plaintiffs’ evidence was that the wine barrels were sold to a local company for on-sale to customers. The South African company alleged that they had entered into an agreement of agency to sell the wine barrels on consignment, and their correspondence supported that case.
The decisive question is whether the parties intended to reach consensus and there was not sufficient evidence that they did so.
The plaintiffs also relied on a doctrine known as quasi mutual assent according to which one negotiating party may lead the other party as a reasonable person to believe that their declared intention evidenced by the nature of the communications represented their actual intention. If at the end of all the evidence there is uncertainty whether there was an intention to contract on the part of both parties on the terms alleged by the plaintiff, the plaintiff loses on that issue.
Because the evidence showed that the defendant did not intend to buy the wine barrels, it could never be held to have misleadingly expressed an intention to do so.
As it does not always arise so starkly, as in this case, we tend to forget that the basis of any contract is consensus between the two parties.
