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Essay style answers to prepare for possible exam questions
Positive malperformance
Positive malperformance is the breach that occurs when there has been performance, but it has not
been in accordance with the contract’s requirements. A positive or negative duty can be breached.
The requirements include actual performance and it must be noted that reciprocity is required in
this sense – where the debtor performs or tenders to and there is then an acceptance on the part f
the creditor. A debtor can also commit positive malperformance if it was a unilateral act. Secondly,
the performance must be defective, which requires a dual investigation which consists of an
interpretation of what the contract requires and then whether it does comply with this. The defect
does not have to be material for the debtor to be guilty. The requirement of fault depends on the
intention of the parties, but the onus lies on the debtor to prove that defect was through no fault of
his own. The general position in terms of whether a debtor has the right to cure his performance, in
terms of Reid, is that they do not. There are exceptions to this rule and include an express or tacit
term in the contract which allows for it, trade usage and when the debtor performed before the
stipulated date for performance.
The remedies include specific performance in which the creditor would have a choice to keep the
performance but require reparation or to reject the performance and require new performance.
Cancellation would only be available in the case that there was a lex commissoria in the contract. If
not, the common law becomes applicable and requires that the malperformance must be material.
In Singh v McCarthy Retail it was held it would be a matter of judicial interpretation to determine
whether it was indeed material.
It must be noted that a right to cancel a contract is not acquired by means of a notice of intended
rescission, this is only applicable in the case of material breach and mora – as confirmed in Sweet v
Ragerguhara.
Where the performance was divisible, only the part of the contract with the defect can be cancelled.
Damages can be claimed to the extent that the aggrieved party has relied on alternative measures.
Mora debitoris
Mora debitoris is applicable where a debtor culpably fails to make a timeous performance of their
obligations. The breach is only relevant where there is still a possibility for the debtor to perform.
This is a continuous form of breach and the fact that the debtor was in mora for a period of time is
not cured retrospectively by a performance. Mora debitoris requires that the performance must be
due and enforceable, which is when a creditor can validly claim performance leaving the debtor
without a defence. Due to the principle of reciprocity, before the creditor can claim performance,
they must have also completed their part of the performance e.g. acceptance. The nature of the
performance might lead to the fact that the creditor must afford reasonable time to the debtor to
complete their performance.
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The creditor can only hold the debtor liable if he/she is aware that the performance is expected. If
there is a specific date in the contract, the debtor is automatically in mora and no demand would be
required from the creditor. Where a date is not specified, the creditor must demand performance by
means of a notice informing them a specific date and time which includes a reasonable time to
perform. The debtor will only become guilty of mora ex persona where the reasonable time has
lapsed. There is uncertainty in case law regarding how a reasonable time would be determined by
court, but it seems that the court will look at the time of contract conclusion and the amount of time
that has lapsed before the creditor issued a demand.
There is a presumption of fault and the debtor would have to show that late performance was due
to know fault of his own.
A general consequence of mora debitoris is that debtor would have a perpetual duty to perform,
which means that where an event of supervening impossibility occurs when the debtor is in mora,
he would not be released of his obligations. He would still be liable to perform and where it is not
possible, he would have to pay compensation to the creditor in the form of damages.
Moratory interest
Cancellation could only occur in the event that time is of the essence. This could be included in
terms of a lex commissoria. If it is tacit, it can be inferred from the nature of the contract that the
timeous performance would be of importance to a creditor. Where there is no lex commissoria
present, a notice of intended rescission needs to be given by means of which the creditor would
make time of the essence. This does not have the effect of cancelling but merely informing the
debtor that if he does not perform within a reasonable time, the creditor will acquire a right to
cancel. The notice must be clear and unambiguous and award the debtor reasonable time to
perform. A demand and notice can be combined, according to Nel v Cloete. A final notice of
cancellation is the only way to exercise a right to cancel.
Mora can be terminated by means of purging of mora, in the case that the contract has not yet been
cancelled the debtor has the right to cure his performance. The creditor must accept the
performance, provided it is in accordance with the contract and if he does not he will be guilty of
mora creditoris. However, the “new” performance does not cure the fact that the debtor was in
breach.
Problematic case law: Broderick Properties and Federal Tobacco Works.
Mora debitoris and the CPA p56
Prevention of performance
Prevention of performance includes any conduct that will render the performance impossible after
the conclusion of a contract. In order for a contract to be valid, performance should be possible at
the time of contract, thus initial impossibility is not applicable here. This is also not relevant where
supervening impossibility occurs.
The prevention can occur at any time before or after the date of performance. The onus would be on
the debtor to prove that it was due to now fault of his own. If the debtor provided a warranty, he
would be liable regardless of fault.
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The consequences of prevention of performance is dependent on whether the entire or only a part
of the performance became impossible. In the former case, specific performance would not be
possible. However, where it is only partial, a party is entitled to claim specific performance of the
possible part and make good for the shortfall with a claim for damages.
A party is always entitled to claim damages.
Cancellation will always be applicable in the case of total impossibility. But if it is partial, it must first
be determined whether the breach is material – which enquires into whether it is reasonable to
expect of the creditor to keep the contract in tact and be satisfied with a claim for damages.
Temporary? P61
Repudiation
Repudiation was classified in Sweet v Dublin as any conduct which fairly exhibits a deliberate and
unequivocal intention to no longer be bound. The intention of the party is not established by means
of a subjective enquiry, but rather objectively ask whether it would be a reasonable inference that
the party is committing repudiation. The case of Datacolour v Intamarket brings the idea of
objectivity and confirms that objective factors are taken into account with this breach. Repudiation
anticipates malperformance and can be committed by either party
The construction of repudiation in English law was very odd in the sense that they thought
repudiation to be an offer of the guilty party to terminate the contract and only once this offer has
been accepted will there be repudiation as a breach and the contract will be terminated as a result
thereof.
The initial offer and acceptance construction was rejected in the case Tuckers Land & Development,
where the court acknowledged that repudiation was a breach of an implied obligation to abide by
the terms of the contract. Due to being a breach of an implied obligation, it constitutes an
independent form of breach and does not require the offer and acceptance.
Repudiation can take place in various ways, including creating the impression of not willing to
perform properly or at all. This test is objective as in Datacolour. Denial of the validity of terms or the
entire existence of the contract, like in the abovementioned case is an example of repudiation.
Premature cancellation is where a party alleges that they are entitled to cancel the contract when
they are not, the court confirmed in Erasmus v Pienaar that this is a classic example of repudiation.
Another example is if they do not comply with the required procedure set out in the contract for
cancellation, as in the Datacolour case.
Where defective performance is tendered as complete, it cannot yet be seen as positive
malperformance and is thus still an anticipatory breach in the form of repudiation. This will be the
case if the tender of performance is accompanied by conduct or words that indicates the party
thinks that is all that is required from them.
Fault is not a requirement in repudiation, because objective considerations are taken into account. It
is also not the case that a party will only be guilty of repudiation when they have repudiated a
