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MRL2601 Assignment 2 2024
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MRL2601 Assignment 2 2024
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MRL2601ASSIGNMENT 2
DUE DATE: 15 ARPIL 2024
, lOMoAR cPSD| 22631064
MRL2601
ASSIGNMENT 2 2024
DUE: 15 APRIL 24
This is an ordinary written or typed assignment. Do not use a mark-reading card.
Answering this question gives you practice in answering the type of problem- or
discuss-type questions that you may expect in the examination. Your answer per
question should not exceed one page. You may reference your sources as you wish, i.e.
in-text, or in footnotes. A bibliography is not needed but remember to include your
Honesty Declaration Form.
QUESTION 1
1.1 Lesedi and Simphiwe registered Furnmax (Pty) Ltd, a company that sells office
equipment. The Memorandum of Incorporation of Furnmax (Pty) Ltd indicates that the
board of directors, consisting of Lesedi, Simphiwe, Carol and Precious, can appoint a
managing director who would be authorised to contract on the company’s behalf. However,
the board has never formally appointed a managing director. Nevertheless, Lesedi, with the
full knowledge of the other directors, has contracted with Office Supplies Ltd for the
supply of office equipment to Furnmax (Pty) Ltd on two occasions. On the third occasion
that Lesedi contracted with Office Supplies Ltd, Furnmax (Pty) Ltd denied liability for the
payment for the equipment based on the fact that Lesedi was never appointed as the
managing director. Upon being sued by Office Supplies Ltd, Furnmax (Pty) Ltd opposed the
claim for payment in terms of the agreement based on the fact that Lesedi was not authorised
to contract on the company’s behalf.
Explain with reference to relevant case law what Office Supplies Ltd would have to
prove in order to rely upon the doctrine of estoppel.
For Office Supplies Ltd to use the estoppel rule, they have to show some things based on
past court cases. Estoppel stops someone from saying something different than what they
said before, especially if their earlier actions made someone else believe it was true and act
on it to their disadvantage.
Representation
Office Supplies Ltd must prove that Furnmax (Pty) Ltd made a representation, either through
words, conduct, or silence, that Lesedi had the authority to contract on behalf of the
company. This representation could be implied from the actions or words of Furnmax (Pty)
Ltd.
Reliance
Office Supplies Ltd must show that they reasonably relied on the representation made by
Furnmax (Pty) Ltd. They need to demonstrate that they entered into the contract with Lesedi
based on the belief that Lesedi had the authority to act on behalf of the company.
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