The Commercial Case Law Index is a collection of judgments from African countries on topics relating to commercial legal practice. The collection aims to provide a snapshot of commercial legal practice in a country, rather than present solely traditionally "reportable" cases. The index currently covers 400 judgments from Uganda, Tanzania, Nigeria, Ghana and South Africa.
Get started on finding judgments that are relevant to you by browsing the topic list on the left of the screen. Click the arrows next to the topic names to reveal a detailed list of sub-topics. Most judgments are accompanied by a short summary written by subject-matter expert postgraduate students from the University of Cape Town.
This case considered whether employees who were claiming compensation for loss of employment were ‘permanent employees’ in terms of an employment contract. The case additionally concerns whether the Court of Appeal had misdirected itself with regards to the weight of evidence.
The plaintiffs contended that they were employed by the respondent as permanent employees in terms of an employment contract. The respondent subsequently went into liquidation and the plaintiffs claimed for loss of compensation.
The court held that for a plaintiff to be entitled to benefits as an ex-employee, they should spell out clearly the terms of their employment as contained in their contract of employment and then prove their entitlements under those terms. The plaintiffs assume the burden of persuasion and producing evidence, however, it was clear that they were unable to produce a written agreement which spells out their terms of employment. The court found that any contract of employment for more than six months which was not in writing was unenforceable.
The plaintiffs had been employed for 10 and 12 years respectively, but failed to obtain letters of appointment. It became apparent that they were only employed for the duration that they were engaged on a particular voyage.
The court found that to be a permanent employee one would need to prove employment through the use of a contract of employment, which was in writing and could be used as evidence to illustrate the terms thereof. In this case, the plaintiffs were only employees when the respondents required their services. Furthermore, the court held that the Court of Appeal had not misdirected itself with regards to the weight of evidence as the plaintiff failed to properly prove their claim.
The parties entered into a business transaction for the supply and installation of a saw-mill. However, the transaction was not covered by a properly drawn up contract. Furthermore, it became apparent that the plaintiff provided the defendant with a plant which was defective and not fit for the purpose it was intended.
This case considered whether the Court of Appeal had misdirected itself to the defects contained in the machinery, whether there was a breach of a fundamental obligation and whether the goods sold were fit for the purpose which they were intended to be used.
The court considered the Sale of Goods Act, 137 of 1962 (the act) and found that the breach of a promise under the act depends on the category of promise; either a fundamental obligation, condition or a warranty. Breach of a fundamental obligation or a condition entitles the party not in default to repudiate the contract of sale and if it is the seller who is in breach, the buyer can reject the goods. The breach of a warranty cannot lead to a repudiation or rejection of the goods but will entitle the party not in breach to damages. However, a party entitled to repudiation and rejection may waive their right and opt for damages.
The court considered whether the goods were fit for the purpose that they were provided for. The plaintiff sold the machinery in the course of its business on condition that it will be fit for the purpose of saw milling. A machine is fit for purpose if it is able to perform the task for which it was acquired, safely and for a reasonable period, before defects appear. The court found that a saw mill should not break down after 11 days of operation and therefore did not meet the standard of the purpose for which it was intended. The court found that as a result of the defect, the defendant was entitled to general damages as a result of the failure of the saw mill being fit for purpose.
The appellant claimed that a letter in dispute was not a contract but a proposal which outlined the services the respondent intended to render and the billing details. The court considered whether the statement of claim by the respondent disclosed a reasonable cause of action based on a binding contract. The other issue was whether the costs granted in the lower court were justifiable.
The court held that there must be a cause of action cognizable in law. In that light, an action founded on a contract must disclose the cause of action and court must restrict itself to the averments in the statement of claim. The court also held that costs follow the events and are compensatory in the court's discretion.
The court did not determine the existence of the contract because a valid and enforceable contract is a substantive issue that should be determined at trial. The court also found that since the requisite factual elements were present in the statement of claim, a cause of action existed despite weaknesses and unlikelihood of success of the case. The court also found that the trial court awarded the costs reasonably and by the law.
Accordingly, the court dismissed the appeal.