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MERCANTILE LAW TOPIC 1: COMPANY LAW THE TURQUAND RULE AND THE LIABILITY OF COMPANIES IN SOUTH AFRICAN LA...
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RRLLB81
ASSIGNMENT 2 SEMESTER 1 2024
, RRLLB81/103/1/2024
Research Report
RRLLB81
Semester 1
Department of Criminal and Procedural Law
IMPORTANT INFORMATION:
This tutorial letter contains important information
about your module.
, RRLLB81/103/1/2024
SECTION B
TOPICS FOR ASSESSMENT 2 AND ASSESSMENT 3
Below you will find the research topics from which you have to select one for your research
report. The topics are arranged by Department in the School of Law. Most topics are
supplemented with background information and references to preliminary sources based
on the topics. The preliminary sources are the minimum sources necessary – you must
supplement the sources indicated through independent research on the topic
selected.
NOTE: You are required to select one (1) topic from those listed and to base your both
Assessment 2 and Assessment 3 for RRLLB81 on that same topic. You may not change
topics once you have selected one. We are able to identify your specific assignment
submissions and to verify that you keep to the same topic.
The due dates and unique numbers for Assessment 2 and Assessment 3 will appear
on the myUnisa module site for RRLLB81.
MERCANTILE LAW
TOPIC 1: COMPANY LAW
THE TURQUAND RULE AND THE LIABILITY OF COMPANIES IN SOUTH AFRICAN
LAW
Background
Companies are managed by directors who have the liberty to enter into a contract with
third parties. Obviously, companies may have internal rules that provide certain individuals
with the authority to contract on behalf of the company. A company representative may
enter into a contract without complying with an internal formality to which his authority is
subject. Of course, lack of formality may entail that the company should not be held liable
for a contract that the company has not assented to. This would lead to a third party
rendering a performance that may not lead to a counter performance by the company. The
lack of consensus between the third party and the company renders the contract null and
void. However, a third party may argue that he/she relied on the company’s representation
to assume that there will be counter performance or that the representative had the
required authority.
Conduct research on this problem and provide your own opinion on whether it is fair to
hold a company to a contract it did not assent to. Equally, is it fair for a company to benefit
from a performance of a third party without rendering counter performance?
Suggested reading material
Cases
One Stop Financial Services (Pty) Ltd v Neffensaan Ontwikkelings (Pty) Ltd 2015 (4) SA
623 (WCC)
The Mine Workers’ Union v JJ Prinsloo; The Mine Workers’ Union v JP Prinsloo; The Mine
Workers’ Union v Greyling 1948 (3) SA 831 (A)
39
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