Topic: Drafting tips

The difference between ‘significant’ and ‘substantial’

By Patrick Bracher (ZA) on June 16, 2020 Posted in Drafting tips

In April 2020 the UK Supreme Court had reason to discuss the difference between ‘significant’ and ‘substantial’ in the context of what is a ‘significant reduction in life expectancy’. The court said that ‘like the skin of a chameleon, the adjective takes a different colour so as to suit a different context’. The word ‘significant’ … Continue reading

Contracts interpreted according to wording, context and purpose

By Patrick Bracher (ZA) on June 8, 2020 Posted in Drafting tips

We have published a number of blogs about modern concepts of interpretation of legislation and contracts. A June 2020 decision of the Supreme Court of Appeal sets it out well. There is nothing new in what is said but it is a nice little package of how to interpret an agreement: ‘It is trite law … Continue reading

Sign of the times: Electronic signatures in South Africa

By Lisa Ellefsen, Steve Chemaly and Rosalind Lake (ZA) on May 11, 2020 Posted in Drafting tips

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

By Patrick Bracher (ZA) on March 11, 2020 Posted in Drafting tips

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

Extension of time for arbitration for undue hardship

By Patrick Bracher (ZA) on February 16, 2020 Posted in Drafting tips

Section 8 of the Arbitration Act 1965 allows a court to extend the period allowed for arbitration in terms of an arbitration agreement if ‘undue hardship would otherwise be caused’. The Johannesburg High Court held that it would cause ‘undue hardship’ to refuse to extend a time-bar in circumstances where the events that caused the … Continue reading

Claim ‘in respect of’ the death of the passenger includes psychiatric harm to the family (AUS)

By Patrick Bracher (ZA) on February 5, 2020 Posted in Drafting tips

The Australian High Court found that a claim for psychiatric harm made by the widow and children of a man killed in a helicopter accident is a claim ‘in respect of the death of the passenger’. The phrase ‘in respect of’ is a broad relational phrase and it does not confine the claim to a … Continue reading

Separating good from bad in a statute

By Patrick Bracher (ZA) on July 30, 2019 Posted in Drafting tips

It has been reaffirmed that where part of a law is invalid for being beyond the powers of the lawmaker (ultra vires) the good in the law will not be separated from the bad if it is complicated and impractical to do so. If there is an incoherent remainder, the entire law will be set … Continue reading

Importing a tacit term into a contract

By Patrick Bracher (ZA) on May 28, 2019 Posted in Drafting tips

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

Take implementation, good faith and disclosure clauses seriously

By Patrick Bracher (ZA) on May 28, 2019 Posted in Drafting tips, General

Where one of the parties to a contract had secretly entered into agreements with third parties to gain an unfair advantage for itself, the court held that it was in breach of the good faith and non-disclosure provisions and liable for damages. The implementation clause required the parties ‘to do all such things, perform all … Continue reading

Principles of contract for the benefit of a third party (stipulatio alteri)

By Patrick Bracher (ZA) on April 16, 2019 Posted in Drafting tips

A recent academic article by Dr Rika van Zyl argues persuasively that, where there is a contract for the benefit of a third party, the third party accepts the benefit of the contract between the other two parties and not to become a party to the contract. In drafting such contracts you must make sure the … Continue reading

Interpretation of contracts: Wording, context & purpose

By Patrick Bracher (ZA) on April 3, 2019 Posted in Drafting tips

The Supreme Court of Appeal has yet again reaffirmed the principles dealing with the interpretation of contracts. Interpretation of contracts is a unitary exercise which starts with the text to be interpreted and considers it within the contract as a whole, and in context. It requires consideration of text, context and purpose of the contract. … Continue reading

Interpretation of contracts – Don’t relegate the written text

By Patrick Bracher (ZA) on March 26, 2019 Posted in Drafting tips

The Supreme Court of Appeal has decried the growing tendency to lead evidence about what experts think a contract means and about the subjective intention of the parties and details of their negotiation. The written text must not be relegated, but must be considered having regard to the context in which the agreement was entered … Continue reading

Interpretation: Useful definition of ‘spouse’

By Patrick Bracher (ZA) on February 27, 2019 Posted in Drafting tips

The following definition of ‘spouse’ was included in recent draft legislation. The definition may be useful when you need to define the term in a contract. The definition will have to be adapted to the specific requirements and wording of the rest of the document. ‘spouse’ in relation to any person at the relevant time … Continue reading

Interpretation: Meaning of ‘in terms of’ and ‘under’ in a contract

By Patrick Bracher (ZA) on January 21, 2019 Posted in Drafting tips

In the context of a tax dispute the court held that the phrases ‘in terms of’ and ‘under’ a contract can have an ordinary or wide meaning of ‘by virtue of’ or ‘in consequence of’, or a narrow meaning requiring a direct and immediate connection between the contract and the money earned under the contract. … Continue reading

Interpretation: ‘Litigation pending’ means awaiting a decision

By Patrick Bracher (ZA) on January 13, 2019 Posted in Drafting tips

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

Interpretation of sanctions clause in a policy

By Patrick Bracher (ZA) on November 29, 2018 Posted in Drafting tips

In reaching a decision regarding the sanctions clause in a policy, the UK High Court made a number of useful comments on how a policy is interpreted: When a dictionary definition is relied on (in this case for the meaning of ‘expose’) it is a useful starting point but is not necessarily determinative of the … Continue reading

Rules of interpretation of contract

By Patrick Bracher (ZA) on April 25, 2018 Posted in Drafting tips

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

Interpretation: The nature of a deeming provision

By Patrick Bracher (ZA) on April 22, 2018 Posted in Drafting tips

In a curious case relating to the escape of wild animals the court analysed the nature of a deeming provision in a statute. It found that a deeming provision may deem things to be what they are not. But something which is deemed may also be regarded as an exhaustive description of the subject matter. … Continue reading

Contracts need consensus

By Patrick Bracher (ZA) on April 17, 2018 Posted in Drafting tips

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)

By Patrick Bracher (ZA) on April 15, 2018 Posted in Drafting tips

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

Assignment of main agreement included past and future addenda

By Patrick Bracher (ZA) on April 5, 2018 Posted in Drafting tips

The Supreme Court of Appeal rejected what it called a highly technical defence that the cession of all right, title and interest in a master equipment rental agreement only carried with it a cession of the hired equipment addenda at the time of the cession and not future addenda. At the time of the cession … Continue reading

Reciprocal performance under reciprocal contracts

By Patrick Bracher (ZA) on February 26, 2018 Posted in Drafting tips

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)

By Patrick Bracher (ZA) on October 1, 2017 Posted in Drafting tips

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

By Patrick Bracher (ZA) on August 17, 2017 Posted in Drafting tips

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