The legal realm is divided broadly into substantive and procedural law. The measure for damages applied in this case covers actual loss, probable future loss, as well as compensation for pain and suffering. It is important to note that a class action does not constitute a separate cause of action. The award of constitutional damages, as a result, would not have served the interests of society, nor would it be a deterrent that would prevent the future violation of rights. The decision is relevant insofar as it pertains to the manner in which South African courts approach the cause of action known as 'damages due to interference in contractual relations'. II. If you claim damages because of a breach of contract against you, you must be able to prove all of the following: § That there has been a breach of contract by the other party. In addition to the above automatic remedy, parties are also free to agree to terms that vary their common law rights, insofar as such variation is lawful. "The law of damages is that part of the law which indicates how the existence and extent of damage as well as the proper amount of damages or satisfaction are to be determined in the case of delict, breach of contract or other legal principles providing for the payment of damages." A plaintiff is only entitled to the damages that he or she can prove that they have suffered. concerning the law of contract in the South African courts. Bregman Moodley Attorneys Inc. 2015/089214/21, Physical Address: Suite 314, 3rd Floor, Office Towers, Killarney Mall, 60 Riviera Road, Killarney, Johannesburg, South Africa, Directors: Roy Bregman, Sharusha Moodley, Associates: Melani Scholtz, Sasha Goldstein & Abdul Buckus. The court in this case made it clear that there is no general right not to be caused pure economic loss and there is no legal duty on third parties not to infringe contractually derived exclusive rights to trade. There must thus be a causal link between the breach and the damage, in that the damage has actually been caused by the breach. In order to succeed with your claim, you must prove one of two things. Abduction. In law we call this ‘positive interest’. Their claims for damages were based on the breaches of constitutional law rights by the government of South Africa (i.e., they were constitutional damages); however, they had already been awarded common law damages for pain and suffering. When dealing with a claim for damages, it is particularly important to note the following: Under the South African common law, an automatic remedy that stems from a breach of contract is a claim for damages against the breaching party, in the hands of an innocent party. The matter was referred for determination to a public arbitration. Perhaps you’ve dreamed of suing that old lady who runs the corner shop and keeps telling you how healthy you’re looking and then asks how much weight you’ve gained. Limitations on Pain and Suffering Damages in South Carolina. You must therefore prove that you and the other party, at the time of concluding the contract, had foreseen that a breach would result in this kind of damage. In such an instance, South African courts have recognised that the loss may lie in the infringement of a right to goodwill or in the legal duty. The innocent party need only prove that the particular damage was of the kind that flows naturally and generally from the type of breach in question. The court, instead, decided on an award of a 'structural interdict'. The individuals in question were transferred to non-governmental organisations (NGOs). Is there even such a thing as punitive damages in South African law? 4 Visser et al Law of Damages 488-489. The Global Damages Review - Edition 3, In the inaugural edition of this publication, we addressed various rules that set boundaries on what is permissible damages evidence. Contents include: Cases contained in the latest revision service to Volume VII of the Quantum of Damages Awards by category (spine and brain, head injuries, neck and back, upper limbs, lower limbs, hip and pelvis, face, internal organs, the senses, multiple injuries, miscellaneous injuries/conditions) No. The state was unable to confirm the whereabouts of another 44 patients. money) that you are entitled to. The claimants contended that the nature of the violations, as well as the failure of the government to provide proper sanitation facilities in rural schools, meant that an award for constitutional damages was the most appropriate way to vindicate the violation of constitutional rights. LPL4802 Law of Damages Study Notes is that part of the law which indicates how the existence and extent of damage, as well as the proper amount of damages or satisfaction, are to be determined in the case of delict, breach of contract and other legal principles providing for the payment of damages. South African courts have accepted that this relief may include a form of compensatory damages known as 'constitutional damages'. An example of a contractual claim for damages would be a case in which you hire a building contractor to make alterations to your house, but later the walls crack as a result of poor workmanship. The Komape family sought constitutional damages, a delictual claim of damages for emotional trauma and shock, and other relief, such as medical expenses, against the Department of Basic Education in South Africa. The Constitutional Court also clarified that the Country Cloud case did not lay down that, in inducement cases, the wrongfulness inquiry need not be concerned with the duty not to cause harm or the infringement of rights. The Supreme Court of Appeal confirmed this finding by relying on the Constitutional Court judgment of Country Cloud Trading CC v. MEC, Department of Infrastructure Development, Gauteng (CCT 185/13) [2014] ZACC 28 as authority that this kind of prevention of contractual performance constituted wrongful conduct, actionable in delict under South African law. The aim is to “make the injured party whole again”.Speaking about a tort action, the Supreme Court of Canada has stated: “The general principles underlying our system of damages suggest that a plaintiff should receive full and fair compensation, calculated to place him or her in the same po… (If you can, however, prove that your walls would still be standing had he used proper materials, you might still stand a chance with a damages claim.). Consequential damages. Damages awarded for actual loss, to place the plaintiff in a position that she would have been in had she not suffered the wrong complained of. D Collier-Reed and K Lehmann (ed) Basic Principles of Business Law (2006) LexisNexis: South Africa. On the other hand, ‘negative interest’ is the proper measure when one determines the amount of damages you’re entitled to in the case of a delict. constitutional damages may be awarded to a plaintiff by a court, as compensation where a breach of a person's constitutional right occurs. Examples of 'pure economic loss' claims that have been held to be actionable include the claim of 'interference in contractual relations' and 'negligent misstatements'. Under the South African law of contract, a claim for damages may also be coupled with a claim for specific performance of the contract. Michael Komape, a five-year-old child, drowned in a pit toilet on his school's premises in 2014. The Komape matter differs, however, in that the family has claimed constitutional damages in circumstances where there was an infringement of a constitutional right, but no direct financial loss was suffered. CAUSATION How you prove causation in your cases can depend on the type of case and the type of injuries at issue. "I am a regular reader of Lexology, as are a few of my colleagues. But the fact is that you cannot sit back and do nothing to reduce a loss that you can see looming ahead, and still expect to be compensated for the whole amount. If your claim involves noneconomic damages, you should know there are some limitations in South Carolina. Keep a step ahead of your key competitors and benchmark against them. Penalty clauses: Parties may also agree that a liquidated (pre-calculated) amount of damages or an agreed penalty amount may become payable in the event of a breach of contract. South African law does not allow a plaintiff to claim punitive damages from a defendant in a private claim, as this is seen as being contrary to public policy. The government argued that once someone has been compensated under the common law, they may not rely on the Constitution to obtain additional compensation. Some cases, by their very nature, require the use of expert testimony. If the walls of the house start to crack a month later as a result of the cheap materials he used, you will be able to claim damages from him. There is a difference between the way in which damages are determined in a case of breach of contract and in a case of a delict being committed. General damages are a type of compensatory damages, which are granted by a court in a lawsuit to repay losses or injuries resulting from another person's wrongdoing. Compensatory damages are the most common remedy in cases of breach of contract. Govindjee et al Commercial Law 2: Fresh Perspectives (2007) Pearson: South Africa. Abduction consists in unlawfully taking a minor out of the control of his or her custodian with the intention of enabling someone to marry or have sexual intercourse with that minor. In addition, it was held that the only way to vindicate the claimants' constitutional rights was to grant an order awarding constitutional damages over and above the amount already awarded for emotional shock and trauma. In Lavery and Co. Ltd v Jungheinrich, 1931 AD 156, the courts distinguished between: “general damages” as damages that flow naturally and generally from a breach of contract and which the law presumes that the parties thought would result from such a breach of contract; and 3 Visser et al Law of Damages 488. You cannot sit back, do nothing, and later claim for damage to your house. Govindjee et al Commercial Law I: Fresh Perspectives (2006) Pearson: South Africa. In summary, the difference between your current financial state and the one in which you would have been had the contract been properly carried out, is the amount of damages (i.e. The court found that many constitutional rights had been violated but that a claim for constitutional damages was punitive (which is not allowed under South African law) and would result in over-compensation of the Komape family. The circumstances under which a plaintiff may be awarded compensation under certain legislation is particular to the provisions of the specific statute that is being relied upon. In order to mitigate your loss, you must stop the flow of water, even if it means contracting the service of another plumber and paying for it yourself. Questions? In this regard the Minister of Education and the Limpopo Department of Education was ordered to supply and instal toilets at each rural school currently equipped with pit latrines. § That you suffered damage, as well as the exact extent of your damage. For example, let’s say you had a contract with a plumber to fix a pipe in your house, and he committed a breach by not fixing it properly, and water is streaming everywhere. Understand your clients’ strategies and the most pressing issues they are facing. If someone else’s action or failure to act causes you to suffer damage, loss, or injury, you may claim compensation from that person. Damages for breach of contract are determined on this principle: through the awarding of damages, you must be put back into the same financial position that you would have been, had the contract been properly performed. The arbitrator found that several constitutional rights had been violated by the state's actions and that the claims for compensation due to the 'invasive and pervasive violation of constitutional guarantees by the government cannot readily be couched in common law terms'. In most agreements you will find clauses that try to limit, or even exclude, the liability of a party to that agreement. (Louis F van Huyssteem Contract law in South Africa (Netherlands: Kluwer Law International BV 2010) at 76 – 79). Limitations (or exclusions) of liability can be based on: the nature of the liability (taking into account whether it is contractual, delictual or strict liability, that is liability imposed by legislation); the type of damages suffered; or an agreed monetary limit. A party faced with an unjustified refusal to perform the contract has an election whether to accept the repudiation or not. These types of damages are more difficult to … Common law offences still applicable within the South African legal system are defined below. The question before the Supreme Court of Appeal was therefore whether a class action could be brought at all and, if so, what procedural requirements needed to be satisfied before it was instituted. In other words, if the damages you suffered would have been fewer if you’d acted like a reasonable person and tried to reduce them, you can’t claim the entire loss. Some types of damages commonly issued in a breach of contract case include: Compensatory Damages. The damages you’d be entitled to would be the difference between your present financial state after the delict has been committed, and the state you would have been in had the delict not taken place. It may reject repudiation and continue with any remaining performance obligations of its own. It is important to stay current with legal developments, and the articles are a great aid toward this goal. Considering this fact and that the award was handed down, publicly, in 2018, it is anticipated that courts in future may refer to this arbitration in support of awarding constitutional damages as appropriate relief, when the circumstances warrant. Copyright © 2020 Bregman Moodley Attorneys | Designed By, Specialist Divorce Lawyers In Johannesburg, Estate agents liable to buyer for defects in property. Further, foreign members of a class will be bound to the proceedings if they are regarded as members of the class in accordance with South African law. The focus in that publication was to survey the codified rules and common law principles underpinning the analysis and presentation of damages. The extent of your damages will be the amount that it will cost you to have the cracks repaired.) Reaching a fair amount as compensation for general damages is not an easy task. It should be noted that a class action had never been brought before in South Africa and there is no legislation that allows for such proceedings. whether, given the composition of the class and the nature of the proposed action, a class action is the most appropriate means of determining the claims of the class members. 2.3.1 The common law position 7 2.3.2 The introduction and object of the Act 8 2.3.3 The influence of the Constitution of South Africa and the Bill of Rights 9 2.4 Development, problems and future of the Act in South African law of Damages 9 Please contact customerservices@lexology.com, An extract from The Global Damages Review - 2nd edition. Because of the fact that these cases inevitably involve disputes of fact between the parties, they are always brought by way of action proceedings (as opposed to motion proceedings) and culminate in a trial where evidence is led. Practice Area (s): Shipping & Logistics. In addition, the Constitutional Court held that there is no legal duty on third parties not to infringe contractually derived exclusive rights to trade, because exclusive trading rights make the competitive field uneven. This is particularly because of that fact that the elements of a delict (as set out above) must still be satisfied when 'pure economic loss' claim is brought. Here’s how it works. 5 See para 2.1 below. ", © Copyright 2006 - 2020 Law Business Research. 6 Prescription Act 68 of 1969 7 Section 3(2) Prescription Act 68 of 1969; Neethling and Potgieter Law of Delict 225, 263. There are, as has already been noted, three main delictual remedies: Dale Hutchinson and Others. Course. However, on appeal, the majority of the Constitutional Court held otherwise. Poor workmanship usually results in a financial loss when someone else must then repair the defect. This matter involved the assessment of wrongfulness in delict, which raises matters of policy, infused by constitutional values. Basic Definition of Damages In more recent years, the original concept of damages has been expanded to include punitive damages, to punish the wrongdoer. Become your target audience’s go-to resource for today’s hottest topics. If the plaintiff can prove that the defendant's actions directly led to the loss or injury, the defendant will be ordered to pay damages. However, this does not mean that unlawful competition cases are not actionable in South Africa. The defendant must have committed an act, or an actionable omission; harm, in the form of damage or loss, to the plaintiff; because of the fault (whether intentionally or negligently) of the defendant. It is not possible to claim damages for loss you could have avoided, had you taken the steps a ‘reasonable person’ in your position would have taken to mitigate (reduce) the damages. This matter has since been appealed to the Supreme Court of Appeal. (You hired the building contractor to build walls without any cracks in it. 8 Visser et al Law of Damages 137; Evins v Shield Insurance Co Ltd 1980 2 SA 814 (A Or better still, accidentally slipping on some fabric softener in a supermarket and ensuring yourself a very comfortable retirement on Clifton Beach. This is also the position in South African law when calculating damages in the circumstances. Under South African law, claims for damages are financial claims that are brought to compensate a plaintiff as a result of a loss-causing event that occurred because of the fault of the defendant. The next generation search tool for finding the right lawyer for you. The appeal was heard on 2 September 2019 and judgment is presently awaited. Constitutional damages have previously been awarded in South Africa, for example in the case of President of the Republic of South Africa and Another v. Modderklip Boerdery (Pty) Ltd 2005 (5) SA 3 (CC), where the court awarded damages to the owners of land due to an infringement of their constitutional right to property in circumstances where unlawful occupiers had refused to vacate the premises. Pick n Pay sought relief against Masstores under the delict of 'interference with contractual relations'. The diverse terminology used by legal professionals has only served to exacerbate the uncertainty. (d) Finally, having regard to the current South African consumer credit legislation and the common law position applicable to contracts, recommendations will be made where necessary in order to address shortcomings and problems with the National Credit Act. Nelson Mandela University. The Competition Act: Section 49D(1), read with Section 65(6) of the Competition Act entitles the Competition Tribunal to hand down a consent order that may contain an award for damages because of loss suffered as a result of a breach of the Competition Act; The Consumer Protection Act: Section 61 states that a producer, importer, distributor or retailer of 'goods' (as defined in the Act) is liable for any harm caused by unsafe or defective goods, which do not comply with the Consumer Protection Act; and. It is up to the other party (in this case, the incompetent plumber) to prove that you could and should have reduced your loss. A quote from a builder for repairing the cracks will prove the extent. Damages in delict are divided into: patrimonial/special damages (including medical costs, loss of income and the cost of repairs); non-patrimonial damages/general damages (including pain and suffering, disfigurement, loss of amenities and … This looks at the difference between your present financial state after a breach of contract has occurred, and the financial state in which you would have been if the contract had been carried out properly. An application was brought by a number of NGOs and five individual consumers for the certification of a class action against three of the major bread producers arising out of anticompetitive conduct which had increased the price of bread. As the matter has been appealed, it will be interesting to see if the Supreme Court of Appeal overturns the High Court order and awards constitutional damages to the Komape family; if so, this will set a new precedent. 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