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PVL3702 MCQ bundle
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2020/02Question 1
X advertises her car for sale in the newspaper for the amount of R40 000. Y reads the advertisement,
phones X and accepts her advertisement to sell her car. Which statement most probably reflects the
CORRECT legal position?
1 X and Y concluded a contract because an offer and acceptance exists.
2 X made an offer to the public at large.
3 Y is the offeree.
4 The advertisement is an invitation to do business.
5 Option 1, 2 and 3. (1)
Discussion
Option 4 is correct. The general rule in our law is that an advertisement constitutes merely an
invitation to do business rather than an offer. See Hutchison & Pretorius (eds) The Law of Contract in
South Africa 3rd ed (Oxford Cape Town 2017) 53; see also Eiselen GTS et al Law of Contract study
guide for PVL 3702 (University of South Africa) 23. Applying this to the facts above, means that the
advertisement is an invitation to do business, which allows Y (as offeror) to make an offer, and X (as
offeree) can decide whether to accept the offer. X and Y did not conclude a contract, because even if
there was an offer from Y, there is no evidence of X accepting an offer. Therefore option 1 is
incorrect. X did not make an offer to the public, as it was merely an invitation to do business.
Accordingly, option 2 is incorrect. X is the offeree, therefore, option 3 is incorrect. It follows that
option 5 is also incorrect.
Question 2
X and Y conclude a contract under circumstances wherein X threatened Y. This threat may be used to
prove an element of
1 duress.
2 undue influence.
3 misrepresentation.
4 contractual illegality.
5 material mistake. (1)
Discussion
You have to look at what the requirements of each option are to answer this question. The presence
of a threat is one of the elements that must be proved to establish duress (Hutchison and Pretorius
Contract 140-144; Eiselen et al Study Guide 59-60). None of the other options requires the existence
of a threat to be proven as a requirement.
Question 3
Tony, a petrol attendant, sells heroin to Samuel for R1 000. Tony delivers the heroin to Samuel, but
Samuel refuses to pay. Section 5 of the Drugs and Drug Trafficking Act 140 of 1992 provides that no
,person shall deal in (a) any dependence-producing substance or (b) any dangerous dependence-
producing substance or any undesirable dependence-producing substance, while section 4 prohibits
the possession of such substances. Section 13 makes the contravention of both sections 4 and 5 a
crime. Heroin is furthermore an undesirable dependence-producing substance. Tony approaches a
court to assist him, either for the payment of R1 000 from Samuel or the return of the drugs. The
material focus of this dispute rests on which requirement relating to the validity of the agreement
between Tony and Samuel?
1 Consensus
2 Formalities
3 Possibility
4 Legality
5 Certainty
Discussion
The contract entered into between Tony and Samuel is illegal because it is in contravention of
sections 4 and 5 of the Drugs and Drug Trafficking Act 140 of 1992. The material focus therefore is
likely to be on the legality requirement, which impacts on the validity of the agreement. Accordingly,
option 4 is correct. See Hutchison and Pretorius Contract 187-189, 199-201. It follows, that options
1,2,3 and 5 are incorrect.
Question 4
Assume the same facts as in question 3. Most relevant to the dispute would be to consider the
application of
1 the ex turpi rule and the par delictum rule.
2 statutory illegality and restraint of trade agreements.
3 public interest and rectification.
4 the par delictum rule and capacity of the parties to contract.
5 the ex turpi rule and stipulatio alteri.
Discussion
Based on the facts, the question does not relate to restraint of trade agreements, rectification,
capacity of the parties to contract, and stipulatio alteri. It follows that options 2, 3, 4, and 5 are
incorrect. Option 1 is the only combination that relates to the consequences of an illegal contract,
and therefore it is the correct answer. These consequences apply in accordance with the the ex turpi
rule and the par delictum rule, in circumstance where the illegal contract is deemed void (see
Hutchison and Pretorius Contract 199-201). Therefore, the first issue to address is whether the illegal
contract between Tony and Samuel is also void.
In terms of the Act, dealing in drugs (heroin) is prohibited, therefore a contract of sale for drugs is
illegal. Where a statute expressly states that such a contract is void, or is of no force or effect, then
clearly this will be the case. In the facts of the question, there is no mention that the statute
expressly renders a contract of this nature to be void. Therefore, it needs to be considered if the
,legislator impliedly intended that such a contract must be null and void. If it was impliedly intended
to be a nullity, then the contract will be void. To determine if the legislator impliedly intended the
contract to be void, the cumulative effect of a number of factors must be considered (see Hutchison
and Pretorius Contract 188, for a discussion of these factors). When these factors are applied to the
facts in the question, then it appears that the legislator impliedly intended that the illegal contract
between Tony and Samuel, be rendered void. The motivation for this is that the legislator clearly
prohibited the dealing and possession of undesirable dependence-producing substances like heroin
to deter members of the public from being exposed to the intake and harmful effects of this drug. To
validate such a contract will therefore bring about the harm that the statute is directed against,
which is an indication that the legislator intended the contact between Tony and Samuel to be void.
In terms of the Act, Tony’s conduct constitutes a crime (dealing and being in possession of an
undesirable dependence-producing substance). The Act does not merely serve to protect the
revenue of the state, as the prohibition of dagga is intended to protect the health of all members of
society from the harmful effects of this undesirable substance. As this entails protecting a public
interest, is a further indicator that the legislator intended the contract between Tony and Samuel to
be void. Nullifying the contract will definitely not cause greater inconvenience and injustice,
therefore the contract should be deemed void.
Having established that the contract between Tony and Samuel was both illegal and void, the next it
is appropriate to look at the consequences of a contract that is void for illegality. These
consequences are that, based on the ex turpi rule, an illegal contract is void and that no contractual
obligations arise out of it, which is relevant to this question. Where a contract is void in terms of an
illegal contract, restitution of what was performed may possibly be claimed, based on an unjustified
enrichment claim. However, where the parties are equally morally guilty, the par delictum rule can
operate to prevent restitution from taking place. As Tony has already performed by delivering the
heroin drugs to Samuel, he may want to claim restitution of this performance. Therefore, the par
delictum rule is also relevant to this question. Accordingly, the application of both rules, the ex turpi
rule and the par delictum rule are applicable to this question. Therefore option 1 is correct. See
Hutchison and Pretorius Contract 199-201.
Question 5
Assume the same facts as in question 3. The court hearing this dispute is likely to find that
1 Tony can claim R1 000 contractual damages from Samuel.
2 Tony will be granted an order for specific performance for the return of the heroin.
3 Tony’s request for the return of the heroin will fail because both parties were equally morally
guilty.
4 Tony’s claim for a R1 000 from Samuel will succeed, but his claim for the return of the heroin will
fail because the contract between both parties was only partially illegal.
5 In order to achieve justice between man and man, Samuel should pay Tony half of the claim, which
amounts to R500. (1)
Discussion
As alluded to above, the contract entered into between Tony and Samuel is illegal because it is in
contravention of sections 4 and 5 of the Drugs and Drug Trafficking Act 140 of 1992. This means that
the contract is void due to illegality. The first consequence of a void contract due to illegality is that
, the contract cannot be enforced. This is in accordance with the the ex turpi rule, which always
applies and cannot be relaxed. Therefore, contractual damages and a specific performance order
based on the illegal contract cannot be granted. This means that options 1 and 2 are incorrect.
Where a contract is void, but there has been performance, restitution should generally be granted in
principle. However, the par delictum rule provides that where two parties are equally morally guilty,
the one who is in possession is in the stronger position and in such circumstances, this rule will
prevent restitution from taking place. Both Tony and Samuel are most likely to have been aware of
the illegality of buying and selling heroin drugs and therefore they are both equally morally guilty. As
Samuel is in possession of the drugs, the enforcement of the par delictum rule is likely to prevent
Tony from reclaiming the heroin, because of the equal moral guilt of both parties. This is likely to be
the courts finding, therefore, option 3 is correct. Because this is a case of equal moral guilt of both
parties, the court will not be inclined to relax the par delictum rule to achieve justice between man
and man. Therefore option 5 is incorrect.
The entire agreement is illegal, and as such, it is not partially illegal. Accordingly, option 4 is
incorrect.
See Hutchinson and Pretorius Contract 181, 190-192.
Question 6
X places an advertisement in the newspaper in which he offers to sell his car, a Porsche Carrera, for
R800 000. X states that the Porsche is a 1995 model in the advertisement, while it is in fact a 1994
model which has been registered for the first time in 1995. X knows that this statement in the
advertisement is untrue. Y reads the advertisement, phones X and concludes a contract of sale with
X. The statement in the advertisement regarding the year model amounts to
1 fraud.
2 mere puffing.
3 a dictum et promissum.
4 a guarantee in the contract.
5 both fraud and a dictum et promissum.
Discussion
X knowingly made a false statement in the advertisement regarding the year model of the Porche.
This statement does not amount to mere puffing because it goes beyond singing the praises of the
Porche (see Hutchison and Pretorius Contract 123). The statement is not mere puffing, as it amounts
to a misrepresentation (see the discussion in the next paragraph regarding this). Option 2 is thus
incorrect.
Option 1 and option 3 are correct. Option 1 is correct because the statement complies with the
requirements for fraudulent misrepresentation (Hutchison and Pretorius Contract 129). There was a
false statement which X knew to be false, and intended readers to act upon and which indeed
induced Y to conclude a contract with X. Option 3 is also correct because the statement complies
with the definition of a dictum et promissum (Hutchison and Pretorius Contract 123). The statement
was made during negotiations, bearing on the quality of the Porche (because it related to the year
model) and was not mere puffing, as it went beyond mere praise and commendation. It was a
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