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Contracts Semester 2 2019 Case Summaries
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In depth Contracts case summaries for semester 2 2019, compiled by a cum laude student.
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Bob’s Shoe Centre v Heneways Freight Services – SCAcase
Facts
o Bob’s shoe center imported consignment of shoes form Portugal
o Heneways provided freight services for importing shoes
o The contract with Heneways provides that there would be an
agent that would deal with the first part of the process
o The agent (A) will make sure that the shoes get from Portugal to
the plane and then get sent to Joburg
o Heneways will then deal with issues like paying A, getting the
goods into the warehouse to be kept, arrange for payment of
customs duty and to ensure that the shoes are delivered from
this warehouse to Bob’s premises
o The idea is then that Heneways will be reimbursed and paid a fee
for their services
o The shoes get stolen from the warehouse & Bob’s don’t get the
shoes
o the further performance by the respondent was objectively
impossible
Supervening impossibility
respondent discharged from further performance
Also, appellant’s corresponding right to claim further
performance was also extinguished
o Heneways says they have done their job, and demand payment
Says that the contract was divisible
he is entitled to payment for that
o Bob’s provides a counter claim for damages
The respondent’s obligation to deliver the shoes was an
indivisible part of the contract
The contract as a whole was extinguished when the
delivery became impossible
Said only obligated to pay the respondent when
there is complete performance
The respondent was relieved of further performance
because of the supervening impossibility
And because of the principle of reciprocity, the
appellant was also discharged from his counter-
obligaiton to pay
, Also, the appellant had derived no benefit from the partial
performance
Had in fact suffered damages as a result
LQ: should Heneways be entitled to payment for the work that they
did?
o Court said this depends on if the performances are divisible
o Bob’s: I do not have the shoes, I did not get what I want… so I
am raising the exception
o If divisible: bob’s must pay for everything they did until the shoes
were stolen
Factors influencing divisibility enquiry
o No hard and fast rules to determine whether a performance is
divisible or not
o must consider:
1. The intention of the parties
Confirmed in Sasfin v Beukes + Vogel v Volkersz
If not expressly stated in the contract, must be
inferred from the terms of the contract a whole
the nature of the performance can be decisive
2. Nature of the performances
Application
o Court said that contract is divisible
o Heneways are entitled to be reimbursed the fees and the
customs duty and the commission for the work that they did
Why did the court say so?
o There are no hard and fast rules
o But one must look at the intention of the parties
o If the parties expressly indicated what their intentions are, then
it would be simple… but they didn’t no express agreement as
to the intention of the parties wrt the divisibility of the
performance
o So what are the considerations that helped the court to decide if
they were divisible?
1. Differentiate btw various performances and phases
Performances will usually be divisible where the
contract makes provision for separate or distinct
performances
Or where the contract provides for a composite
performance which can be subdivided
Appellant: performance is indivisible because there
was a single indivisible contract
, But the court held that the divisibility of the contract
as such is not a prerequisite for the divisibility of
performance
A;sp, the contract made provision for a composite
performance consisting of separate and distinct
operations eg. Transport the goods, customs
clearance, final transportation to shop etc.
likely to be divisible
2. Divisibility of counter performance
Divisibility of performance does not depend on
divisibility of counter performance
BUT, proof of a divisible counter-performance creates
a presumption that the performance is also divisible
Provided, that each distinct performance can be
related to a corresponding part of the divided
counter-performance
Here, the appellant’s counter-performance is
divisible a specified amount can be allocated to
each distinct performance
Eg. R245 for the transportation of the goods from the
airport to the appellant’s shop
Hence, when this part became impossible, the R245
could be deducted from the final amount
The fact that a separate part of the performance
could be related to a corresponding part of the
counter-performance shows that the parties probably
intended performance and the contract to be
divisible
Court had no difficult in linking these performances
to counter performances in the form of monetary
amounts allocated to each performance
3. Subsidiary to the main provisions
The performance which became impossible in the
present case was the delivery of the goods to the
appellant’s shop
This was the last of the respondent’s obligations
o Charged a small fee
o Required no special expertise
By its nature, this was an obligation subsidiary to the
main purpose of the contract
, o Main purpose: forwarding + customs clearance
o Subsidiary: delivery from warehouse to
premises
A test for subsidiarity: whether the parties would
have entered into the contract without that provision
o Tells us if a provision is subsidiary to the main
purpose and severable
o From Sasfin v Beukes
Similar to sasfin cos although not dealing with the
severability of an offending provision, dealing with
the ‘severance’ of part of the contract cos of
supervening impossibility of the performance
Court held that the contract would likely have been
concluded even if the last little part would not be
concluded (getting someone to take the shoes from
the warehouse to Bob’s premises)
this provision was subsidiary to the main purpose
it was severable
the performances are regarded as divisible
o the appellant had to pay the respondent for the services
rendered up to the point where supervening impossibility
occurred
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