Summary
Summary Chapter 2 notes Merc law
- Course
- Mercantile Law 193
- Institution
- Stellenbosch University (SUN)
In depth summary of chapter 2 notes . Covered in first term
[Show more]
1 review
By: 27836525P • 8 months ago
Content preview
THE OBLIGATION● Contract = an agreement which creates obligations
→ Rights and duties arise from a contract
→ Obligations do not , but many follow from delicts / enrichment
CONTRACT TYPES:
➢ Unilateral Contracts
○ Creates obligations which only involve rights for one party and
duties for the other.
➢ Bilateral / multilateral Contracts
○ Creates rights and duties for both parties
➢ A Reciprocal Contract
○ A multilateral contract
○ Although obligations of both parties exist in exchange for one
another.
● Obligation = a relationship between at least 2 legal subjects
→ Possible for contracts to create obligations for more than one person
(Multiparty obligation)
→ Performance that is to be rendered in terms of the contract can be a
duty to do something (positive obligation) or to give something / not
do something (negative obligation)
Consequences of obligations:
1) Obligation = recognised by the law and once it is completed in
accordance with the contract, it cannot be claimed back
2) Obligation may be legally enforced
➢ Natural obligation
○ Not enforceable by law
○ If debtor fails to perform, performance cannot be claimed or
enforced
,CONTRACTUAL CAPACITY
Contractual capacity = the capacity to perform juristic acts, such as conclude
contracts, independently without the assistance of anyone else.
● Point of departure is that a person must realise the nature, scope and
consequences of his acts before he has full contractual capacity.
INFLUENCE OF AGE
INFANT:
● Someone under the age of 7
● Have no contractual capacity
● All contracts must be concluded on behalf of them by their parent/guardian,
however, they still hold the rights and obligations, not their parent/guardian
MINOR:
● Someone between the ages of 7-18
● Has limited contractual capacity
○ Can acquire rights and obligations provided they have the assistance
or permission of their parent/guardian
○ If they don’t have assistance or permission → they gain a right but not
an obligation.
REMEDIES TO COUNTER PARTY
➢ If contract is reciprocal
○ Minor will not be able to enforce performance unless he tenders
performance as well.
➢ Unjust enrichment
○ When the minor was enriched at the plaintiffs expense
○ Not linked to a juristic act → therefore, contractual capacity is
irrelevant.
, EXCEPTIONS
➢ Fraud by the minor
○ Misrepresenting himself as being 18 and older and could be
identified as a major → them minor will be bound by the contract
➢ Ratification
○ Once minor becomes a major → he can ratify agreements he
concluded while he was a minor
○ Becomes a fully operative contract → parents can ratify
agreements
➢ Statutory exceptions
○ A few exceptions such as a minor over the age of 16 can open a
savings account at a bank as well as form a will without
assistance.
➢ Emancipation
○ A minor becomes emancipated when his parent/guardian allow
him to independently conclude certain types of agreements
○ Requires that the minor has the ability to act independently
when it comes to financial or economic matters.
MENTAL CAPACITY
● Mental illness
○ Once a person is declared mentally ill, that person has no contractual
capacity whatsoever.
○ Thus all contracts must be concluded on his behalf
○ However, while a person = temporarily sane he has full contractual
capacity at the moment of the transition.
● Prodigals
○ A prodigal = someone who due to defect as judgement or character
recklessly squanders his assets.
○ When deemed a prodigal by the high court he has limited contractual
capacity → can acquire rights but no obligations
THE INFLUENCE OF MARRIAGE
● Unless an antenuptial contract is signed all marriages are in community of
property → I.E. they share all assets and liabilities equally.
, AGREEMENT & RELIANCE OF
AGREEMENT
LAW OF A CONTRACT
Foundational principles of law or contract:
● FREEDOM OF CONTRACT:
○ Everyone = free to contract with whomever they wish to on whatever
terms they want to contract on.
● SANCTITY OF CONTRACT:
○ People will be held to the contract that they have made to the terms
they have agreed on.
A consensus = the latin term for what lawyers see as the agreement the
parties have reached.
Parties must agree on 3 things:
1. Who are the parties?
2. The terms of the contract
3. The intention to create legally enforceable obligations (animus contrahendi)
★ If one or more of these are not agreed on by the parties → faced with a case
of mistake / lack of agreement. Therefore no valid contract unless court
enforces reliance theory.
‘Will theory’ → Looking for external manifestations (intentions) of the party through
declarations
An agreement = the basis for contractual liability
It must have:
● Joint intention
● Intention to create obligation
● Consciously agree
● Will made known through declaration of intent = offer and acceptance
Declaration of will : express / tacit / electronic
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller juliayates19. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R110,00. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
53068 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy summaries for 14 years now