Topic: Drafting tips

Subscribe to Drafting tips RSS feed

Sign of the times: Electronic signatures in South Africa

Are electronic signatures valid? It depends: the parties must explicitly agree to the use of electronic signatures and must agree a signing method which complies with the requirements in the Electronic Communications and Transactions Act 2002 (ECTA). What constitutes an electronic signature and whether such signatures are valid in South Africa has become a question … Continue reading

Effect of settlement agreement

Ten years after the 2010 World Cup the Supreme Court of Appeal has given judgment in a dispute between the South African Football Association and a travel business relating to travel arrangements for the competition. The parties had a settlement agreement which was in ‘full and final settlement’ of the dispute relating to whether SAFA … Continue reading

Importing a tacit term into a contract

Where a non-variation clause and a whole agreement clause were included in a comprehensive contract dealing in detail with the subject matter between the parties, the court refused to import a tacit term into the contract. A tacit term is an unexpressed provision in the contract which derives from the common intention of the parties … Continue reading

Interpretation: ‘Litigation pending’ means awaiting a decision

Litigation is pending if the court still has the power to hear it and dispose of it. The pending proceeding remains undecided or is awaiting a decision or settlement. This principle also applies to administrative tribunals. In Malebane v Dykema the Spatial Planning and Land Use Management Act 2013 included transitional provisions that ‘all applications, … Continue reading

Rules of interpretation of contract

Clauses in a contract must be interpreted: by having regard to the language used in the light of the ordinary rules of grammar and syntax; in the context of the clauses being interpreted and the agreement as a whole; and taking into account the apparent purpose of the clauses so as to give the contract … Continue reading

Contracts need consensus

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 … Continue reading

Interpretation of contracts by giving extreme examples is not helpful (UK)

A recent UK case made the following point regarding interpretation of contracts based on hypothetical, extreme examples: ‘There was also, as there sometimes is in commercial cases that turn on points of interpretation, the temptation to provide illustrations of ‘commercial sense’ by the use of hypothetical, and occasionally extreme, examples of what any particular interpretation … Continue reading

Reciprocal performance under reciprocal contracts

The principle of reciprocity in contracts recognises the fact that in many contracts the common intention of the parties, expressed or unexpressed, is that there should be an exchange of performances. There is a presumption that interdependent promises are reciprocal unless there is evidence to the contrary. The common intention is that neither of the … Continue reading

Engineer’s fees are not ‘performed labour’ under a construction guarantee (US)

When an engineering company sought to recover under a contractors bond (construction guarantee) for unpaid fees for engineering services rendered, a court held that a bond which provided protection for entities that have ‘performed labour or furnished materials in the prosecution of the work’ did not include the engineer’s professional engineering services which were not … Continue reading

Interpretation of contract: A lawyer’s understanding must not always be imposed on non-lawyers

In an important development of the law of interpretation of contracts, the Constitutional Court held in July 2017 that where ordinary laypeople use ordinary words in a contract, their understanding of the meaning of the words used must not be overridden by a lawyer’s understanding based on their knowledge of legal principles not familiar to … Continue reading

Could v would (UK)

In a judgment in the lower court in a reinsurance non-disclosure case the judge referred to what ‘could’ have happened if certain loss statistics had been produced whereas the relevant test was what ‘would’ have happened in that situation. The appeal court held that people, including judges, do not always speak with precision in the … Continue reading
LexBlog