There is an agreement if there is consensus between two or more people, and all are aware of having reached consensus (conscious consent).
A contract (or obligatory agreement) is an agreement undertaken with the intention of creating an obligation or obligations.
Contractual liability means that the party or parties to the contract can be held legally liable for the fulfillment of the provisions of the contract.
An obligation is a juristic bond in terms of which the party or parties on the one side have a right to performance and the party or parties on the other side have a duty to render performance. Contracts, delicts and various other causes (e.g. undue enrichment) give rise to obligations.
Performance is human conduct which may consist of a commission or an omission.
A civil obligation is a legally enforceable obligation, while a natural obligation is unenforceable.
A unilateral contract is a contract in terms of which only one of the parties undertakes to render some performance. An example of such a contract would be a contract of donation. Only the donor undertakes to render some performance.
A multilateral contract is a contract in terms of which more than one party undertakes to render a performance. An example of such a contract would be a contract of loan. The lender undertakes to lend the borrower a certain amount and the borrower undertakes to repay the amount.
A reciprocal contract is a special type of multilateral contract. It is a multilateral contract in terms of which performance is promised on the one side in exchange for performance on the other side. An example of such a contract is a contract of sale. Suppose Peter sells his bicycle to Chris for R 200. Both Peter and Chris undertake to render some performance, and both are simultaneously creditor and debtor. Peter is debtor as regards the delivery of the bicycle and creditor as regards the payment of R 200. Chris is debtor as regards the payment of R 200 and creditor as regards the delivery of the bicycle
Age is a factor that effect’s a person’s legal capacity. A distinction should be drawn between capacity to act, capacity to litigate and capacity to be held accountable for crimes and delicts.
In addition a distinction should be drawn between an infant, minor and an adult’s respective legal capacities.
· An infant refers to a natural person up until 7 years of age.
· A minor refers to a natural person between 7 and 18 years of age.
· An adult or major person refers to a person 18 years of age and older.
· Legal capacity refers to the ability of a person to have rights and duties.
· Capacity to act refers to a person’s capacity to perform valid juristic acts.
· Capacity to litigate refers to the person’s capacity to appear in court as party to a lawsuit.
· Capacity to be held criminally liable or delictually accountable refers to accountability. The capacity of a person to be convicted of a criminal crime or to be held delictually liable for a delict he/she has committed is largely dependent on the state/ party being able to proof that the person had the intent (dolus) or acted with negligence (culpa) to be held criminally or delictual liability. Note the difference between a crime and a delict!
Capacity to act
An infant cannot:
1. Have any capacity to act and cannot conclude any juristic act;
2. Enter into any agreement whatsoever, not even one that confers only rights and imposes no duties. Therefore even if there is agreement between an infant and another person the law ignores it. In this regard once a guardian enters into an agreement on the infant’ behalf it is on the infant that rights are conferred and duties imposed: the infant has legal capacity and can thus have rights, duties and capacities. Certain transactions, i.e. an engagement or an insurance contract on his life, cannot however be concluded by the guardian on the infant’ behalf.
3. Act as somebody’s agent because the law attaches no consequences to his/her expression of will;
4. Conclude a juristic act even with the assistance of his guardian: his guardian has to act on his behalf;
5. Accept a donation: the court, the master or the guardian must accept the donation on the infant’ behalf, even if it is the infant’ parent or guardian: the parent or guardian has to accept the donation on the infant’ behalf and it must be made clear that the donation is being accepted on his behalf.
Capacity to litigate
An infant does not have locus standi and cannot be a party to a lawsuit even if assisted by his guardian: the guardian must always litigate for and on behalf of him.
Delictual and Criminal Liability
When determining criminal and / or delictual liability it is important to note that any crime must either have an element of dolus (intend) or culpa (negligence).
1. Therefore because an infans is completely unaccountable he can never
be CRIMINALLY liable;
2. In respect of DELICTUAL liability, an infant cannot be delictually liable where liability is based on fault (intend).
3. He may, however, be liable for delicts not based on fault (negligence) (as in the case where an infant may give rise to legal consequences, i.e. destroying another’s property).
1. An infant can be sued under actio de pauperie if he owns an animal and the animal causes damage; or
2. Be held liable on the ground of undue enrichment or negotiorum gestio as these forms of liability are not based on capacity to act or capacity to incur delictual or criminal liability.
Capacity to Act
Capacity to enter into a contract
# The general rule is that a minor can only incur contractual liability if he is assisted by his guardian when a contract is made.
# the minor can, however, enter into a contract without the assistance of his guardian if:
(i) the contract improves his position without imposing any duties on him.
(ii) If a minor enters a contract without his guardian’s consent and the contract imposes duties on the minor he is not contractually liable to perform those duties and as such the contract is unenforceable (naturalis obligatio) against the minor.
The agreement is however not void, as the other party must honor his part of the agreement (obligation on him is a civil obligation) which is enforceable.
# Thus the contract created is only partially valid. Such a contract can be ratified by the guardian or by the minor himself when he attains majority. (Ratification converts the natural obligation to a civil one which is then enforceable).
Repudiation (cancellation) of the contract:
# It is up to the guardian (or the minor when attaining majority) to decide whether to honor or repudiate the contract: the other party must abide by this and still perform in terms of the contract.
# Thus the other party cannot rely on the minor’s minority to avoid his own contractual obligations.
#. Normally, when sued, the minor raises his minority as defense.
# The minor cannot sue the other party for performance, as he would need his guardian’s consent to sue and such a consent would amount to ratification of the minor’s contract.
# If the minor has performed in terms of a contract and the contract is repudiated, the minor may recover what he has performed:
- property other than money is recovered by the rei vindicatio and
- money is recovered by the condictio action.
The minor’s contractual capacity
1. Assistance by the guardian
The reason why a minor cannot enter into a contract without his guardian’s consent is to protect the minor against his own immaturity of judgment. This falls away when a guardian gives his consent and the minor is then liable ex contractu as if he were a major.
2. The guardian’s consent can take many forms:
1. The guardian can act on the minor’s behalf
2. The minor can enter into the contract with his guardian’s consent
3. The guardian can ratify the agreement after it has been concluded
4. The guardian’s consent can be given expressly or tacitly- If the guardian raises no objection to a transaction, it can be accepted that tacit consent was given
The guardian will also be taken to have ratified the contract if he allows the minor to sue the other party for performance in terms of the contract
# Guardian’s consent may apply to a single transaction or several, i.e. if the guardian allows their child to conduct their own business
# The guardian need not have knowledge of each and every term of the contract, but must be aware of its nature and essential terms
# Consent obtained through fraud or undue influence is worthless
# the guardian is obliged to help the minor when entering into contracts that are to the minor’s advantage:
a. If the guardian is unwilling or unable to do this, the court may order the guardian to do so or itself give the required consent
b. The court will also intervene if a guardian’s own interests in a transaction conflict with the duty to further the minor’s interests or where the guardian’s consent is insufficient in itself
# A guardian may not enter into a transaction on behalf of a minor that will come into operation only after the minor has attained majority.
# A guardian may not conclude a contract on behalf of a minor in respect of agreements of a closely personal nature, i.e. ante nuptial agreement.
# A guardian who has consented to a transaction may withdraw consent prior to the transaction being concluded
3. Liability of the Guardian
# A guardian does not incur personal liability in respect of the minor’s contract, regardless of whether he assisted the minor or acted on the minor’s behalf.
# A guardian can be held liable:
(i) if the minor acted as his agent
(ii) if he guaranteed the minor’s performance and the minor does not perform
(iii) if he bound himself as surety for the minor’s performance and the minor does not perform
(iv) on the basis of negotiorum gestio if he is the child’s parent: the parent has a duty to maintain his children: if he does not perform his duty and it is performed by a third party, he can be held liable on the basis of negotiorum gestio. Here the guardian’s liability arises not contractually but quasi-contractually.
# A guardian my expressly or tacitly ratify a contract the minor initially concluded without the guardian’s consent. Ratification validates the contract with retroactive effect.
# A guardian cannot ratify a contract he did not initially have the power to conclude on behalf of a minor. The minor may also ratify a contract when he comes of age: the contract then becomes fully enforceable.
# Ratification by the minor can take place tacitly or expressly: when deciding if a minor tacitly ratified a contract, the court considers the minor’s acts and conduct and deduces from this whether or not the minor had the intention of ratifying the contract. If the above happens, and the minor does not know that he is acting as if he is tacitly approving a contract, the minor’s ratification would be rebutted if his ignorance is reasonable and excusable.
See also Edelstein v Edelstein.
Statutory exceptions regarding a minor’s capacity to act
There are some exception created by statute which allows a minor incur contractual liability:
1. A minor of 18 years may without consent to enter into, vary or deal with a life insurance policy and pay premiums due under the policy. Any money payable under the policy must be paid to the minor who can do with it as he wishes.
2. A minor over the age of 16 may be a member of or a depositor with a mutual bank unless the articles of the mutual bank provide otherwise.
a. The minor may without assistance have full dealings with the bank and deal with his deposit as he sees fit.
b. He has all the privileges and obligations of a normal member, except that he cannot hold office in the bank.
3. Deposits in the Postbank and national savings certificates in the name of a minor of any age may be repaid to him
Misrepresentation: Contractually liable?
If a minor misrepresented himself as a major, the general view is that the minor should be held liable.
There is, however, no consensus on what the basis for this liability should be.
There are 2 possibilities:
1. The minor can be held liable on the basis that the contract he concluded is enforceable, i.e. the minor can be held contractually liable
2. The minor can be held liable on the basis of the delict (or rather wrongful act) he committed, namely misrepresentation, i.e. the minor can be held delictually liable
Argument for Contractual Liability:
1. Roman-Dutch writers expressly denied the restitutio ad integrum to a minor who misrepresented himself as a major.
2. As restitutio ad integrum presupposes a binding contract it is implied that there is a binding underlying contract.
Cronje & Heaton do not support this:
1. Restitutio ad integrum’s proper application is for contracts the minor concluded with the necessary assistance and contracts the guardian concluded on the minor’s behalf where the contract is binding.
2. Roman-Dutch practice, however, was also to apply for restitutio ad integrum in cases where a minor had entered into a contract without the necessary consent.
3. Cronje & Heaton maintain that in these circumstances the minor was not liable at all and that there was no need to resort to restitutio ad integrum as the minor could have simply recovered the performance already rendered in terms of the unenforceable contract.
4. Thus the invocation of restitutio ad integrum where it was not necessary does not mean that the minor is contractually liable for misrepresentation.
The second argument regarding why a minor should be held
contractually liable for misrepresentation goes as follows:
1. The authors rely on estoppel (if someone culpably represents that a certain state of affairs exists, and another person acts to his or her own disadvantage in consequence of such a representation, the deceiver is precluded from raising the true facts).
2. If the minor misrepresents himself as a major and another person enters into a contract on the basis of this misrepresentation, the minor cannot raise his minority as a defense.
3. Consequently the minor is held liable on the contract as if he was a major when the contact was concluded
4. The other party can then simply sue the minor and by means of estoppel frustrate any reliance of the minor on his minority as defense
Cronje & Heaton do not support this:
1. Holding the minor liable would defeat the object of limiting a minor’s capacity to act
2. The fact that the minor acted fraudulently does not mean he has the necessary ability to judge and that the protection of the law is thus not needed.
3. In addition, holding the minor liable would mean that a minor could change their status and attain full capacity to act by committing a misrepresentation
See also Louw v MJ & H Trust (Pty) Ltd.
Minors can be held delictually liable on a delictual basis for misrepresenting themselves as majors.
Claim of majority:
(i) If a minor openly claims to be a major, he is definitely misrepresenting himself. The other contracting party does not need to enquire into the truth of the statement and he may accept the assertion unless he has good cause for believing that he is dealing with a minor.
(ii) In the case of tacit claim of majority - here the issue is whether the minor’s conduct amounts to misrepresentation. If the minor knows the other party thinks he is a major and does nothing to remove the misconception, he commits a misrepresentation. For the minor to be held liable he must be old enough to be mistaken for a major.
The minor will be held liable only if:
1. He made a misrepresentation regarding his or her majority or capacity to act and as a result thereof
2. The other party suffered a loss and
3. The misrepresentation was the cause that induced the other party to enter into a contract with the minor.
Undue enrichment – Contractually liable?
Definition: Person A (eg. a minor) is unduly enriched at the at the cost of expense of person B ( a major) if he or she (A) gains a patrimonial benefit at the expense of B without there being a recognized legal ground justifying the transfer of the benefit. Person B (the major) can then claim undue enrichment.
Calculation of enrichment -
The enrichment claim is limited to the lesser of:
1. The amount by which the enriched person’s estate remains enriched at the date of the institution of the action
2. The amount by which the other person’s estate remains impoverished by that date.
1. The moment on which the calculation must be based is that moment when the other party institutes his or her claim.
2. The amount by which the minor's estate is increased owing to the performance of the other party must be calculated. Here we look only at price the actual value of the performance and ignore the contract price.
3. The amount by which the estate of the other party is decreased as a result of the performance must be calculated. Here again look only at the actual value of the performance and not at the contract price.
4. You can now determine two amounts. The minor is liable for the lesser of the two.
5. If the minor has lost the performance he or she received or its value has decreased, or if he or she has sold it, the following rules apply:
a. If the minor has lost the performance he or she received (or it has been stolen), the other party is not entitled to anything.
b. If the value of the performance has decreased, the minor is liable only for the decreased value.
c. If the minor sold the performance before the action was instituted, he or she remains liable for the purchase price received, depending on how he or she applied the proceeds thereof.
d. If the proceeds are still in the minor's possession on the date of institution of the action, he or she is liable for as much of it as still remains at the time of institution of the action.
e. If the minor has used the proceeds for necessaries, he or she is still liable for the purchase price of these necessaries, even if nothing remains of them. Necessaries include food, clothing, accommodation and medical treatment. The reason for the minor's liability in this case is that he or she would have had to purchase the necessary items out of his or her own estate in any case. Therefore, by saving on these expenses, the minor is unduly enriched at the expense of the other party.
f. If the minor purchased luxury items with the proceeds, he or she is liable for the value of whatever still remains.
Benefit theory was introduced by Nel v Divine, Hall & Co. where it was held that if a contract as a whole is to a minor’s benefit, the minor is contractually liable.The courts applied this incorrect decision consistently until Edelstein v Edelstein authoritatively rejected it:
In Edelstein v Edelstein it was held that a minor is not contractually liable whenever a contract is in a vague and general way to his advantage, but that he may be held liable ex lege for the amount by which his estate was unduly enriched by the transaction.
Thus the benefit theory is no longer of application in today’s law.
Restitutio in integrum: Contractually liable?
Definition: The purpose of the restitution is to restore the status quo ante: complete restitution from both sides must take place, putting the parties in the position they would have been had they never entered into the contract.
Restitutio in integrum: is therefore an extraordinary legal remedy whereby a minor can escape liability if
1. he contracted with the assistance of his guardian (or the guardian contracted on his behalf) and
2. the contract was prejudicial to the minor at the moment it was made.
Each party must:
1. Return everything received under the contract
2. The proceeds or any advantage derived from the contract
3. Compensate the other for any loss suffered as a result of the contract
# Restitution not only affords a cause of action, but can also be used as a defense when a minor is sued for performance in terms of a prejudicial contract.
# Restitution to a minor differs from other cases of restitution:
# If does not release a person who has bound himself as surety for the minor from his obligations, i.e. a parent would still have to meet the obligations he/she stood surety for.
# Restitutio in integrum prescribes at most three years after the date upon which the minor became a major, but cannot occur within the first year after the minor became a major.
When can restitutio be used?
Restitutio in integrum:
1. is only necessary if the minor is contractually liable.
2. is available even if the court consented to the minor’s contract, as the court could have been misled or erred.
3. can be applied for whenever a minor has suffered prejudice, i.e. not only for contracts
When can restitutio not be used?
Restitutio in integrum can not:
1. be relied upon to set aside a marriage or escape delictual or criminal liability
2. be used by a minor who misrepresented himself as a major or in some other fraudulent manner persuaded the other party to enter into a contract
3. be used if the prejudice arose at a later date
4. be used if, after attaining majority, the minor ratifies the contract
1. The minor may, with the assistance of his guardian, apply for restitution before attaining majority.
2. The guardian may also apply for restitution on the minor’s part.
3. If the guardian fails to assist, a curator ad litem may be appointed to assist the minor
4. The minor can wait to attain majority and institute the action himself
Minor’s capacity in terms of other juristic acts
# Other agreements
(i) The minor can enter into other agreements which benefit him without his guardian’s assistance, i.e. the extinguishing of his debt to someone else, but may not enter into agreements that encumber him without his guardian’s assistance.
(ii) If the minor performs without his guardian’s assistance, the performance is invalid and he can recover whatever he performed.
(iii) If a minor entered into a contract with assistance, but performed without assistance, he may not recover his performance: as guardian consented to contract it is taken that he also consented to the minor’s fulfilling the contract by rendering performance.
Minor’s capacity to make and witness a will
Any person over may from the age of 16 make a will and dispose of his property as he pleases.
A witness to a will must be at least 14 years old.
Capacity to marry
Circumstances under which a minor may marry:
1. If both a legitimate minor’s parents are alive, the must both consent even if they are divorced, unless
a. the court orders otherwise, or
b. sole guardianship has been granted to one of his parents
2. If one of the parents is deceased, the surviving parent’s consent is sufficient
3. If the minor is extra-marital only the mother needs to consent, unless
4. An orphan for whom a guardian has been appointed must get the guardian’s consent
5. For a boy under 18 and a girl under 15 the consent of the Minister of Home Affairs in needed: children below the age of puberty cannot marry at all, thus the Minister’s power to consent is limited to girls between 12 and 15 and boys between 14 and 18.
6. If one or more of the minor’s parents is absent or incompetent to consent, consent may be granted by the commissioner of child welfare.
a. The commissioner must also determine whether it is in the minor’s interest to enter into a prenuptial contract.
b. If it is, the commissioner must ensure that this is done before consenting and assist the minor in its execution
c. If the commissioner refuses his consent, the minor may approach the high court for consent.
7. The minor may also approach the high court if his parents / guardian refuse consent. The court may grant consent if:
a. it is of the opinion that the parent or guardian’s refusal is without adequate reason, and
b. contrary to the interests of the minor
8. If the court consents, it may also order that a particular matrimonial be entered into, the court can appoint a curator to assist the minor in this regard.
9. A minor who has been married before or has been declared a major requires no consent
Effect of absence of consent to marry
# Section 24 of the Matrimonial Property Act 88 of 1984 governs the patrimonial consequences of a marriage entered into by a minor without consent.
# Section 24(1) provides that if the marriage is dissolved due to lack of consent, the court may make any order regarding the matrimonial property as it sees fit.
# Section 24(2) provides that if the marriage is not dissolved, the patrimonial consequences are
1. the same as if the minor was of age when the marriage was entered into, and
2. any antenuptial contract in terms of which the accrual system is included and which was executed with a view to the marriage, is deemed to be valid
Lack of consent of Minister of Home Affairs
1. If the consent of the Minister of Home Affairs was needed but was not obtained, the marriages is null and void
2. The Minister may, however, declare the marriage valid ex post facto.
Lack of consent of parent(s)
1. If the consent of the parent / guardian / commissioner of child welfare was needed but was not obtained, the marriage is voidable. It may be set aside by the court on application by:
a. The parents or guardian before the minor attains majority and within six weeks from the date on which they became aware of the existence of the marriage, or
b. The minor before attaining majority or within 3 months thereafter
Capacity to consent to medical treatment and operations
Section 129 of the CA - A minor at the age of 12 may consent to medical treatment provided he/she is of sufficient maturity. A minor may consent to a surgical procedure if he/she is 12 years of age, mature enough to understand the implications of such operation and whom is assisted by his/her guardian.
Section 130 – A minor may consent to a HIV test if he/she is 12 years of age or under 12 years of age and has the necessary maturity to understand the procedure and consequences.
Section 134- no person may refuse to sell condoms/contraceptives if the minor is 12 years of age.
Minor cannot be a director of:
1. a company
2. a mutual bank
3. a trustee of an insolvent estate
4. executor of a deceased estate (submitted by Cronje & Heaton: not decided)
Emancipated minors can also not hold the above offices.
5. Minors cannot be appointed as someone else’s guardian (they are obviously the guardian of their own children)
Capacity to litigate
· A minor has limited capacity to litigate (locus standi in iudicio) in most private-law lawsuits. Thus: a minor himself can sue or be sued with his guardian's assistance, or his guardian can take up the case on his behalf.
· If the minor does not have a guardian, he or she must be assisted by a curator ad litem who is appointed on application by the court. Anyone who has an interest in this appointment, or a friend or a creditor of the minor, may make such an application. The minor himself or herself can make the application if old enough to be able to understand the procedure.
In criminal proceedings the guardian’s assistance is not needed.
Capacity to incur delictual and criminal liability
To incur delictual or criminal liability, the minor must be accountable.
To be accountable, a person must have the mental ability to:
1. Distinguish right from wrong
2. Act in accordance with such an appreciation
Minors 10 - 14: Rebuttable presumption to be not accountable for their crimes and delicts
Minors 14 – 18: Rebuttable presumption to be accountable for their crimes and delicts