General Principles of Contract

These flashcards cover the key concepts presented in the lecture about contract law and marriage in South Africa.

What are the requirements for a valid contract?

The parties must have contractual capacity, serious intention to contract, communicate their intention, be of the same mind, have a lawful agreement, ensure performance is possible, comply with formalities, and have certainty in terms.

What is the difference between civil, religious, and customary marriages in South Africa?

Civil marriages are conducted by registered marriage officers, religious marriages are performed by religious leaders (valid only if they are registered officers), and customary marriages are recognized under the Recognition of Customary Law Marriages Act.

What is the effect of a marriage in community of property (ICOP)?

Assets and liabilities of each spouse before marriage merge into a single joint estate, and property and liabilities acquired during marriage are jointly owned. If one either spouse is declared insolvent, the single joint estate is sequestrated.

What must parties do to marry out of community of property (OCOP)?

They must enter into an antenuptial contract (ANC) signed before a notary public and two witnesses.

In what scenario do spouses have contractual capacity in an ICOP?

Both spouses have full capacity to contract regarding the joint estate without consent, unless specific exceptions apply.

What is an unassisted contract for a minor?

It is a 'limping contract' where the minor can choose to ratify (enforce the contract) or repudiate (not to enforce the contract) the contract, binding the other party to their decision.

What happens if a minor misrepresents their age?

The minor can incur obligations under the law of delict due to fraudulent misrepresentation.

What are the requirements for informal consent in an ICOP?

Verbal consent is required for alienating household furniture, receiving money due to the other spouse from trade or occupation, and large donations from joint estate.

What is the effect of a marriage with the accrual system?

Each party retains separate property but the spouse with the smaller growth in estate has a claim to half the value of the difference at dissolution.

What is the impact of insolvency on the ability to contract?

An insolvent may not enter into contracts to dispose of assets in the estate or enter into contracts affecting the estate without trustee consent.

What is alienate?

To transfer ownership of property to someone else. Usually through sale, donation or exchange. Alienation involves the legal transfer of property rights from one party to another, often executed through a formal agreement or transaction.

What is cede?

To transfer a personal right to someone else.

What is mortgage?

A real right over immovable property (like land or house) used as security for a debt.

What is a pledge?

A real right over movable property given as security for a debt. Pledge involves the transfer of possession but not ownership, allowing the creditor to retain the right to sell the property if the debt is not repaid.

What is a formal consent?

A written and signed consent witnessed by two witnesses. Special legal formalities must be followed.

What does it mean to bind him/herself as surety?

It means a person agrees to be legally responsible for someone else’s debt, so if that other person doesn’t pay, you have to.

What is written consent?

The agreement must be in writing.

What is informal consent?

No special form required. Can be verbal or conduct.

What is the general rule for transactions made without consent in relation to marriage in community of property?

Some transactions require the other spouse’s consent, if that consent is not given then the transaction is invalid. There is an exception however, if the third party (outsider) did not know and could not reasonably have known that consent was missing then the contract is still valid.

What is the rule between spouses married in community of property?

If the contracting spouse knew that they would not get consent and the joint estate has suffered a loss, then an adjustment will be made in favour of the other spouse upon dissolution of the marriage. Example if a divorce occurs.

Give an example of a spouse contracting without the knowledge of the other spouse?

The husband sells a valuable asset without wife’s consent. Buyer didn’t know consent was needed. The sale is valid and buyer is protected but the wife can claim compensation later.

What is the effect of a marriage out of community of property?

Each spouse retains their own separate property that they acquired before marriage and what they acquire during marriage. Each spouse remains liable for debts they incurred before and during the marriage. Upon dissolution of the marriage each spouse retains their own separate assets and neither is liable for the others debts and also no capital claim against the other spouses estate.

What is the effect of a marriage with accrual?

Each spouse retains their own separate property that they acquire before marriage and during the marriage. They remain liable for their own debts acquired before and during the marriage and are not liable for each others debts. Upon dissolution, The spouse whose estate has shown the smaller accrual (growth) during the marriage has the right to half of the value of the difference between the two accruals at dissolution i.e cash claim for this amount. Inheritances, legacies and donations excluded from accrual calculation.

Provide an example of claims under marriage of accrual upon dissolution of the marriage?

What is a minor?

A minor is an unmarried person below the age of 18.

What is the effect of an assisted contract?

The minor is bound and liable in terms of the contract not guardian. It is fully valid and enforceable contract against the minor. The only time the minor will not be bound this contract is if the contract was inherently prejudicial, the prejudice however must be substantial.