Topic: Drafting tips

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Government’s way of interpreting a statute may help to indicate meaning

In any marginal question of statutory interpretation, evidence that it has been interpreted in a consistent way for a substantial period of time by those responsible for the administration of the legislation is admissible. The evidence may be relevant to tip the balance in favour of a particular interpretation. It is consistent with the modern … Continue reading

Repudiation of a contract

Parties to contracts frequently allege that the other party has repudiated the contract by expressing an intention not to be bound by its terms and cancelling the agreement as a consequence. That step must be taken with care. The Supreme Court of Appeal in Braun Medical (Pty) Limited v Ambasaam CC pointed out that the … Continue reading

Arbitration by foreigners in South Africa

There is no reason why foreign companies and individuals should not arbitrate their disputes in South Africa according to South African law. The South African courts will encourage the selection of South Africa as a venue for international arbitrations. Where a dispute “arising out of” the relationship between the parties is subject to arbitration, the … Continue reading

Interpretation of clumsy laws

Clumsy laws must be constructively dealt with. Even where laws are clumsily and inelegantly drafted, the courts should be slow to alter the words actually used. In Kalil v Mangaung Metropolitan Municipality the court said that it must guard against the temptation to substitute what the court regards as reasonable, sensible or businesslike for the words … Continue reading

Don’t allow arbitrators to make the contract

An arbitration clause should never be drawn so broadly that the arbitrator determines the wording of the contract.  Arbitrators should be asked to interpret contracts and not make them for the parties. The consequences of such a broad arbitration clause could be that the arbitrator imposes contract terms on the parties which they would never … Continue reading

Drafting tips: vague contracts

When ascertaining the meaning of a contract, a court will first have regard to its wording. The wording must be considered in the context or factual matrix in which the contract was concluded. That is so even if, on the face of it, the words are clear. Where the words are ambiguous or lack clarity, … Continue reading

Arbitration: You get what you ask for

If you choose an informal arbitration you will usually have to accept the outcome whether you like it or not. In Reward Ventures 01 CC v Walker the arbitration agreement provided that the arbitration must be held “in a summary manner … on the basis that it shall not be necessary to observe or carry out … Continue reading

An arbitration clause may die with the contract

A clause in a contract requiring the parties to refer their disputes to arbitration is not necessarily enforceable if the contract itself is invalid.  Every arbitration clause should be coupled with a provision that the validity of the agreement may be determined by arbitration even though the existence of the agreement itself is being questioned.  … Continue reading

Definitions in context

Most definition clauses do (and should) start with the words “subject to the context” and these words are important when applying a definition. The supreme court of appeal said that definitions in an enactment (in this case a by-law) should not be slavishly applied.  Where the context requires it, the ordinary meaning of a word … Continue reading
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