In a January 2025 judgment the Supreme Court of Appeal again affirmed the principle that where an agreement lapses automatically because of the failure to fulfil the suspensive terms of the contract, the lapsed contract cannot be amended or revived. The parties have to enter into a new agreement.

It was a condition of a contract for the sale of shares that the purchaser would procure financing by a stated date, which did not happen. According to the agreement, if the condition was not fulfilled “this agreement shall lapse and be of no force and effect”. The parties agreed that no variation or consensual cancellation would be of force and effect unless in writing and signed by the parties ‘in person’.

Before the lapse of the agreement, four addendums were entered into up to the last day for fulfilment of the conditions purporting to bring obligations alive but the date was not extended.

The court did not go into the law whether a lapsed agreement can be revived. The court said that whatever the arguments may be and even if it is assumed that the addendums somehow managed to revive the principal agreement, ultimately the whole of that agreement (inclusive of the addendums) would have come to an end and be of no force and effect when the suspensive condition was not fulfilled.

Any terms could be introduced to amend the obligations up to the lapse date but not thereafter. If a contract places a time limit for the fulfilment of a condition, the party for whose benefit it is imposed cannot waive it after the time limit has expired. A lapsed agreement may be revived by the parties according to some authorities but there was nothing in the agreements between the parties purporting to do so.

A R1 million payment made in terms of the lapsed agreement had to be repaid on the basis of unjust enrichment.

According to normal contractual principles, contracting parties can intentionally do what they like to create or revive agreements between them. Great care must be taken not to try to amend an agreement which has already lapsed. It is always advisable to start again with a completely new agreement, even if it matches the original one in most of its provisions.

[Vantage Goldfields SA (Pty) Ltd v Siyakhula Sonke Empowerment Corporation (Pty) Ltd and Another [2025] ZASCA 01 (9 January 2025)]