Law REMEDIES FOR BREACH; TERMINATION & LEASE
OBJECTIVES To gain understanding of the different types of remedies available for breach. To learn how a contract can be validly terminated. To learn how a contract of lease is created; To learn the various rights and duties of a lessee and lessor; To learn about the various remedies available to the lessee and lessor; To understand the statutory formalities applicable to a contract of lease; 2
REMEDIES FOR BREACH When a party does not meet his or her obligations in terms of the contract there are in mora . When this happens the aggrieved party has a choice as to what they will do about the breach. They have a choice of the following remedies for breach of contract: Specific performance Cancellation Contractual damages 3
TYPES OF REMEDIES The remedy available depends on the type and extent of the breach. The remedies can be categorised into the following: Those that enforce the contract: Order of specific performance and an interdict Those that rescind the contract: cancellation Those that compensate the harmed party for the breach namely damages and penalty clauses 4
REMEDIES FOR ENFORCEMENT 1. SPECIFIC PERFORMANCE An order for specific performance can be one of two things: an order compelling the defaulting party to perform what he has undertaken to do. This occurs when the duty imposed by the contract is a positive one, i.e. a duty to do something. OR an order restraining the defaulting party from carrying out what he has agreed not to do. This is known as a prohibitory interdict and it usually arises when the contract has imposed a negative duty on the defaulting party. 5
WHEN WILL COURT GRANT SPEC PERF 1. The court has to exercise its discretion and determine whether or not it will grant the order asked for. 2. It usually won’t grant the order if it is against public policy or 3. if it will cause an inequitable result for instance, if compelling performance will cause extreme hardship to the defaulter and third parties. e.g no order for specific performance to a debtor who is insolvent When a party is able to perform in terms of the contract, but chooses not to do so the court will usually grant specific performance 6
SPECIFIC PERFOMANCE Read; Haynes v Kingwilliamstown Municipality 1951 (2) SA 371 (A) Pg 125 of Prescribed textbook If the court refuses to grant specific performance the aggrieved party may sue for damages If the court grants an order for specific performance, it may also award damages 7
INTERDICT R enters into a written and validly binding contract to sell his house to X. After a heated argument and verbal war, R threatens to get a bull dozer to break down the house before X moves in. what remedy is available to X?
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- Fall '19
- Contract Law, Lessor