The Contract of Sale

The Contract of Sale

Definition

• Contract in which one party (seller) undertakes to deliver the merx to another party (buyer), the purchaser in exchange of this agrees to pay the seller a certain sum of money.

Overview

• Contractual requirements must be met.• Parties have to agree on two essential

characteristics:1. The merx2. The purchase price.

The Merx

• Definite & ascertainable eg portion 12 of the farm.

• Movable or immovable, or even incorporeal thing such as a claim, or servitude or patent

The Purchase Price

• It be agreed upon & definite or ascertainable amount in money

The common rights of the Purchaser

• He is entitled to delivery of the merx.

The common rights of the Purchaser

• He is entitled to preservation of the merx pending delivery

The common rights of the Purchaser

• He is entitled to be protected by the seller against eviction

• Seller’s warranty against eviction.

The common rights of the Purchaser

• He is entitled to a merx free from latent defect

• Implied warranty against latent defects entitles purchaser to certain legal remedies:

Four elements to be proved by purchaser

1. Material defect in the merx.2. Defects was present when the contract was

concluded.3. Defect was latent. 4. At time of conclusion of contract purchaser

was unaware of the defect.

Contractual warranty

• Seller may giver buyer contractual warranty against latent defect. Where defects are present, buyer may institute actio empti

Seller conceals latent defect

• Voetstoots clause willn’t protect seller against liabilty where he knew of the defect

What may be claimed with actio empti?

a) Cancellation of the contract of sale where defect is serious

b) damages

Aedilitian Actions

• Actio redhibitoria (to claim restitution) and actio quanti minoris (to claim a reduction in the purchase price)

When can aedilitian action can they instituted?

• Thing sold has latent defect• Seller was aware of a latent defect &

fraudulent concealed such fact• He expressly/ tacitly guaranteed presence of

good characteristics• He false dicta et promissum to the buyer.

Janse van Rensburg v Grieve Trust CC 2000 (1) SA 315 (C)

• Buyer made innocent misrep that trade-in vehicle was 1993 model rather than 1989.

• Seller claimed reduction in the purchaser price in terms of actio quanti minoris.

What may be claimed with actio redhibitoria

• Pro rata reduction of the sale price

When aedilitian actions may not be instituted

a) Defect arose after conclusion of contractb) Defect not latent.c) Voestoots saled) Latent defect repairede) Waiverf) Prescription

Consumer Protection Act 68 of 2008

• S 55(2) provides that good must be:a) Reasonably suitable for the purposes for

which they are generally intended.

Consumer Protection Act 68 of 2008

b) Of good quality, in good working order & free of any defects.

c) Usable & durable for a reasonable period of time.

d) Compliance with applicable standards

Product failure or defects in goods

• It is irrelevant whether a product failure or defect was latent or patent or whether it could have detected .

Available defence for product failure or defect

• If consumer was informed of specific condition & she expressly accepted the goods on that basis.

Remedies

• She may return goods within six months after delivery to the supplier.

Transfer of Ownership

• Regulated by the rules of the law of property

Four requirements

a)Transferor must deliver the thing to the transferee. Immovable by way of registration in a Deeds Office.

Four requirements

b) Both parties must have the intention that ownership should pass from the transferor to the transferee.

Four requirements

c) The transferor must be in position to transfer ownership.

Four requirements

d) In the case of contracts of sale the purchase price must be paid or security given for the payment thereof.

Forms Delivery

(a) Actual Delivery –(de manu in manum)

Forms Delivery

(b) Delivery with short hand – traditio brevi manu

Forms Delivery

(c) Delivery with the long hand – merx sold is pointed by seller to the buyer with intention that ownership should pass

Forms Delivery

(d) Symbolic delivery – placing the buyer in possession of a symbol by means of which the buyer can control eg car keys/

Forms Delivery

(e) Constitutum possessorium – seller retains possession of the merx, but on behalf of the buyer, he rents it.

Forms Delivery

(f) Attornment - merx is physically in the possession of a third party & delivery takes place through a change of intention of the buyer & seller.

Forms Delivery

(g) Delivery through marking - eg where sheep sold is marked.