Business Law Study Notes Ch1-6 PDF

LU1-3 up to page 85 Chapter 1 What is law and why do we need law? =================================== - Definition: law is a set of rules made by a body of authority (the state) also known as the government, to control and regulate the behaviour in society. - Laws define what you mus...

LU1-3 up to page 85 Chapter 1 What is law and why do we need law? =================================== - Definition: law is a set of rules made by a body of authority (the state) also known as the government, to control and regulate the behaviour in society. - Laws define what you must do, and what you may not do. The state reinforces the law by ensuring that people obey the rules. The law tells you what your legal rights, duties and obligations are. The overall purpose of law is to maintain order. The role of the state: ====================== - Main function of government: make and enforce law - The Constitution of the Republic of South Africa, 1996, (Constitution) sets out and regulates the powers and functions of the State (government). - Some of the human rights that are protected in the Bill of Rights: - right to equality (section 9) - right to human dignity (section 10) - right to life (section 11) - right to freedom and security of the person (section 12) - right not to be subjected to slavery, servitude, or forced labour (section 13) right to privacy (section 14) - right to freedom of religion, belief, and opinion (section 15) right to freedom of expression (section 16). - The \'Bill of Rights applies to all law, and binds the legislature, the executive, the judiciary, and all organs of state. - The State\'s power is divided up between three organs or arms: the legislature, the executive, and the judiciary. - The fear of absolute power lies behind the doctrine of the separation of powers. It is based on the idea that dividing power between three organs will prevent any one organ from wielding too much power and becoming oppressive - i.e. apartheid - Parliament (AKA legislature) is the highest elected law-making body and makes legislation - The executive, consisting of the president and all the ministers of the various state departments, makes policies that put legislation into practice or result in new laws. - The judiciary, consisting of the courts, is tasked with interpreting and applying law to cases that serve before it. Legal subjects, legal objects and the nature of rights in commerce ================================================================== Legal subjects: --------------- - Legal persons, there are two types of persons: 1. natural persons: human beings 2. juristic persons: entities to which the law gives legal rights, duties and obligations (for example, a company). Juristic persons have separate legal existence from their directors, shareholders, and members. - A juristic person is entitled to the rights in the Bill of Rights to the extent required by the nature of the rights and the nature of the juristic person\'. This means that certain constitutional rights also apply to juristic persons. - Every legal person has legal personality, which is the ability to acquire legal rights, duties, and obligations. - For natural persons, legal personality begins at birth and terminates upon death. - For a juristic person, legal personality begins when the juristic entity is incorporated and terminates when the juristic entity is deregistered as an incorporated entity (incorporation is the process through which a business becomes a corporation). - Legal capacity arises from one\'s legal personality and refers to a person\'s ability in law to exercise legal rights. One person\'s legal capacity differs from another person based on various factors, namely, age, mental health, marriage, and insolvency. - persons \< seven years, cannot perform legal acts and cannot litigate or argue legal proceedings in court themselves. - children \> seven years have limited legal capacity, which means that they can litigate only if they are assisted by their parent or legal guardian. Legal objects: -------------- - This refers to an object that has economic value and in which a legal subject can have legal rights, duties and obligations. Here are a few examples: - Personality property: This refers to elements of a person\'s personality. Everyone has the right to dignity, a good name, and a good reputation. - Immaterial property/ incorporeal property: This refers to the rights that attach to immaterial property, for example, ideas leading to trade secrets and other intellectual property rights. - Corporeal things: This refers to tangible things with physical presence, for example, a cell phone, a book, or a car. Rights of ownership in corporeal things are real rights. - Performances: This refers to an act by a natural person in terms of which something is done, given, or not done. For example, if you paid Mabel for a textbook, then you are entitled to Mabel\'s performance in the form of delivery of the textbook. Rights to performance are personal rights. Legal rights: ------------- Two types of rights: 1. personal rights (against persons) - Personal rights are rights that one person can exercise only against specific people. - For example, suppose that Munyaradzi contracts to sell their textbook to Tawanda for R350 cash. The two parties acquire personal rights against each other: Munyaradzi has the personal right to claim payment from Tawanda and Tawanda has the personal right to delivery of the book from Munyaradzi after payment. This means that they can only enforce their respective rights against each other (and no one else). 2. real rights (enforced against everyone) - Real rights can be enforced against the whole world. - For example, suppose that you own your cell phone. The law will recognise your rights of ownership over the cell phone and protect it against anybody who may try to steal your cell phone. Ownership is the most important real right. Real rights can be transferred in various ways, i.e. if you sell your cell phone to your neighbour, the right of ownership transfers to them when you receive their payment. Where does South African law come from? ======================================= - Before European settlers, the indigenous people of this country had developed their own law -- African customary law. - When the Dutch settlers arrived, they brought with them their law (Roman-Dutch law ) from the Netherlands and disregarded the law of the people of the land. - Black people were enslaved and were not recognised as legal subjects. A company was recognised as a legal person, but not a Black person. - Roman-Dutch law was the official law of the Cape until the British took overand introduced parts of their English law. - The South African courts adapted the various rules and principles of these different legal systems to meet local needs and situations. - The law that has been inherited from other legal systems and that has developed over time is known as common law. Consisting of Roman-Dutch law and English law. - Common law has developed to include important court decisions and reflect the changes in the political control of the country. Murder, rape, robbery and theft are some examples of common law crimes. - We also have statutory law, which is made up of Acts of the national and provincial legislatures, and governmental regulations. - In addition are judicial precedent, custom (trade practices), international law, foreign law, and academic writings. Primary sources of law: ----------------------- (Original sources of law and are legally binding) ### The constitution: - A constitution is a fundamental law that sets out the power of the state and is the source of all authority in a state. They establish where that power is to be found, who holds it, and how it must be exercised. It is thus a foundational source of law. - In South Africa, democracy is governed by the Constitution, which came into effect on 4 February 1997. - 'The constitution is the supreme law of the republic, law or conduct inconsistent with it is invalid, and the obligations imposed by it must be fulfilled'. They were, however, not based on fundamental human rights for all. - The Constitution now includes a Bill of Rights in Chapter 2, which protects certain fundamental human rights and prevents them from being violated by the government or other people. - Section 8 reinforces section 2 by stating that the Bill of Rights applies to all law and binds the legislature, the executive, the judiciary and all organs of state. - Therefore, the government may not enact laws that violate the rights of the people. - How does the Constitution relate to other sources of law? - It refers to and recognises various other sources of law, such as the common law and customary law. - The Constitution sets out detailed rules about which organs of government may make legislation and the process they must follow in making it. - The Constitution makes it clear that all the other sources of law are now measured against the provisions of the Constitution and cannot conflict with it. ### Legislation: - Legislation is the most important source of law because it overrides any other source of law, except the Constitution. - Legislation is written law made by the law-making arm of government, the legislature/ parliament. - Legislation is the quickest and most convenient way of reforming the law as society\'s needs evolve, legislation has the advantage of being more flexible than other sources of law and can evolve faster than other organs. - The legislature consists of two houses: 1. The National Assembly 2. The National Council of Provinces. - Parliament delegates some of its law-making authority to other state organs associated with the executive arm of government, including the president, cabinet ministers, and other officials, make delegated legislation to flesh out the Act of Parliament. - Provincial and local levels of government also have the power to create legislation (provincial statutes, by-laws, and regulations). - Provincial and municipal legislatures may also delegate some of their law-making power to other organs. - Several different levels of government have authority to create legislation. - The laws created by higher levels of government have more authority than the laws created by lower levels. - National parliament passes primary legislation. - Lower legislatures passes subordinate (lower) legislation - When the national or provincial government gives a municipality the right to pass laws on matters concerning that municipality, it is an example of *delegation of legislative power*. - The power of any law-making body to legislate is limited to a specified area where that body has the necessary expertise and competence. The power or authority of any legislature is also limited by geographic boundaries. For example, the Gauteng provincial government cannot make laws for KwaZulu-Natal. If a legislature acts beyond its powers, we say it has acted ultra vires (Ultra Vires means 'beyond the powers' meaning that the legislature does not have the power to pass the law in question). When this happens, the High Court may declare that law invalid. - The legislature must follow the proper law-making procedures, otherwise its legislation will not be legally binding. - At least 50% of the people in the legislature must vote in favour of a new law before it can be passed. The new legislation must appear in a public document (ie the government gazette) to tell the people of the country about the new law before it becomes legally binding. #### How to reference and refer to legislation? When you refer to legislation for the first time, always include the full name and citation, for instance, Consumer Protection Act 68 of 2008. When you refer to the same piece of legislation in the same assessment again, there is no need to add the citation. You can either add the full name (Consumer Protection Act), or the commonly used acronym (CPA). In both instances, when you first cite the legislation, you must inform the reader that you will be referring to the legislation in one of these two ways. To illustrate: Option 1: \'We will be discussing the Consumer Protection Act 68 of 2008 (Consumer Protection Act) in Chapter 17\'. Option 2: \'We will be discussing the Consumer Protection Act 68 of 2008 (CPA) in Chapter 17\'. Thereafter, you can refer to the Act in whichever abbreviated form you choose, provided you are consistent in how you refer to the Act. For example, do not use CPA in some paragraphs and then Consumer Protection Act in other paragraphs. We refer to the provisions or clauses of an Act as sections, and we refer to the section numbers. When you start a sentence with a section number, use a capital \'S\' and write \'section\' in full (never start any sentence with a small letter. To illustrate: \'Section 5 of the CPA deals with the application of the act'. When you refer to a section number in the middle of a sentence, you can either use a small\'s\' or write section in full. To illustrate: Option 1: \'When we consider the application of the CPA, we must consider section 5 of the Act. Option 2: \'When we consider the application of the CPA, we must consider s 5 of the Act\'. Consistent referencing is again important; do not use \'section\' in some sentences and \'s\' in other sentences. Sub-sections are referenced as follows: \'In terms of section 5(2)(g) of the CPA\... Note that there are no spaces between the provision numbers and brackets. These referencing methods are illustrated throughout the book - pay attention to these details as you proceed. ### Common law: - The common law is a set of rules and principles, often very ancient ones that have not been written down in legislation. As these principles are not written down, they are not as easy to find or ascertain as other sources of law. - The phrase 'common law' means all the old, long-established principles that have gained the force of law, and which have been applied, interpreted, developed and reformulated by the courts in the precedents they set in cases. - In this sense, the common law encompasses judicial precedent to a considerable extent but excludes all legislation and the Constitution. ### Customary law (authoritative law): - Many groups of people follow rules and practices that are customary in their culture. - Customary law is oral tradition and is not written down (similar to the common law). Customary law develops from the belief systems of a community and is carried down from generation to generation. Customary law refers to longstanding practices that have gained the force of law by being consistently applied over time. Like some common law rules, some customary laws have become legislation, such as the Recognition of Customary Marriages Act and the Reform of Customary Law of Succession and Regulation of Related Matters Act. This created two types of customary law: 1. Living customary law - Living customary law is unwritten and changes over time to meet the changing needs of the society. 2. Official customary law. - Official customary law is codified and can be found in legislation and judicial precedents. This form of customary law is easy to ascertain, however, it can be argued that it is not current, as it does not change or evolve the way living customary law does. - The arrival of the settlers meant that African customary law was displaced, disregarded and replaced by the law from where the settlers came (common law). - There have since been three important legal developments over time: 1. customary law is now inclusive of customary laws from other cultures and belief systems, such as Islamic law. 2. customary law is recognised as a primary source of law. 3. customary law is subject to the Constitution and is valid only as far as it is consistent with the Bill of Rights. An example of an African customary law that is constitutional and widely practiced is the payment of lobola (bride price), which the groom pays to the family of the bride as a gift of appreciation. It is traditionally regarded as an essential requirement for a valid African customary marriage. Chiefs are recognised in our constitutional democracy. They are traditionally regarded is the executive and judicial authority in African communities. African customary law is applied by traditional courts daily. ### Customs: - AKA trade practices - customs are generally not written down. - Custom is a source of law based on a trade practice or usage that is long-established, reasonable, uniformly observed in a community or sector (and does not derive from traditional belief systems and cultures the way customary law does) - Customs are any methods or dealings that have been done in a clear, way for a sufficient period of time to become law. #### Case example: Case: Van Breda and Others v Jacobs and Others 1921 AD 330 Principle A trade practice, or custom, is recognised as a primary source of law if it satisfies certain requirements. Facts A dispute arose among fishermen about a practice that prevented fishermen in the region between Cape Point and Fish Hoek from casting their fish nets in front of another fisherman who located a school of fish first, as that would mean that the first fisherman would catch less fish, which would impact their income. The court was tasked with deciding whether this practice should be recognised as a law. The court\'s finding The court found that the practice was legally binding as a trade practice, or custom, as a source of law, as it satisfied the following requirements: The practice must be a long-standing one. It must be uniformly observed by the community in which it applies. It must be reasonable. It must be certain. - All requirements must be satisfied for a practice to be recognised as a custom. Once a custom has been proven, it is regarded as established and does not have to be re-proven in another dispute. In modern day, customs are widely used in the world of trade. I.e. banks charge interest for certain types of banking activities, such as a mortgage bond or overdraft facility. Like with other sources of law, customs are subject to the Constitution. This means that any custom that violates the Constitution will be invalid and unenforceable. ### Judicial Precedent - judicial precedent refers to certain previous court decisions that legally bind courts in future cases. Previous decisions are used as a guide for the courts to follow in future cases - but only where the facts are similar. - We use the Latin *maxim stare decisis et non quieta movere* - \'stand by the decisions and do not disturb settled law\'. - When confronted with a legal problem, we must ask how the courts dealt with the similar problem when it came up before. When one court has resolved a particular problem in a particular way, a court hearing a similar problem later will usually deal with it in the same way. This principle makes it possible to predict the future decisions of cases. - Stare decisis gives people confidence in the law - It is not always easy to find the relevant precedent: - you need to know which courts\' decisions are binding on other courts, as not all courts create judicial precedent. - you need to know which parts of such decisions must be followed. For this, you need to understand the structure of individual judgments. The part of a judgment that binds future court decisions is called the *ratio decidendi* (the reason or rationale for a court\'s decision). *Ratio decidendi*: the legal principle that comes out of the court\'s decision. - When a lawyer has found an earlier case that helps a client\'s case, the lawyer can use the earlier case (the judicial precedent) to support the client\'s arguments in the court. - An *obiter dictum* is the opinion of the court. As it does not create judicial precedent, it is not legally binding and is merely of persuasive value. #### Added value Understanding case law citations The typical case law citations: Case law citations help us to find the case. The case name starts with the names of the litigants. Always *italicise* case names, when typing them. For example, when handwriting a case name, in your notes or assessment, [underline] the case name. Civil case law: In a civil case, the parties who are litigations (initiating) are usually the plaintiff (the party bringing the legal action) and the defendant (the party defending the legal action). For example, in Van Dyk v South African Railways and Harbours 1956 (4) SA 410 (W), Van Dyk was the plaintiff, and South African Railways and Harbours was the defendant. Criminal case law: Criminal cases begin with \'S v (Accused\'s name)\'. For example, S v Henckert 1981 (3) SA 445 (A). The letter \'S\' is an abbreviation for \'the State\', who prosecutes a person accused of a crime on behalf of the victim and society. Next comes the year of the case. The year may be in brackets, depending on the referencing format for a specific publication series. Then, sometimes in brackets, you will see the volume number of the law reports where the case appears. The next abbreviation (SA or All SA) tells you which series of law reports to look in. \'SA\' means the South African Law Reports published by Juta; \'All SA\' refers to the All South African Law Reports by Butterworths. This is followed by the page number where you can find the case in the published law reports. Finally, there is an abbreviation in brackets that tells you which superior court gave the judgment. For example, (CC) means the Constitutional Court, (C) is the Cape High Court, (N) is the KwaZulu-Natal High Court, (A) is the old Appellate Division, and (SCA) refers to the Supreme Court of Appeal. There are many other court references that you will come across. Go back to the two case citations referenced above: \- Van Dyk v South African Railways and Harbours 1956 (4) SA 410 (W) \- S v Henckert 1981 (3) SA 445 (A). Secondary Sources of law ------------------------ (subordinate to the primary sources and are generally persuasive in value -- primary carries more weight) ### Public international law - Can also be a primary source of law - Public international law is the law that primarily applies between countries. It covers matters of inter-state concern, such as the boundaries between states, the law of the sea, global environmental issues, humanitarian law, international trade law, and refugee law. - Public international law comprises: - international treaties and conventions, which are formal agreements between states concluded by the representatives of states - customary international law, which are rules that developed according to state practice accepted as law (this differs to what we traditionally understand as customary law) general principles of international law. - International treaties can be bilateral (between two states only), multilateral (between more than two states) or plurilateral (more than three, but not many). There are four stages in the making of a treaty: 1. signing at the international level to stipulate the final version of the treaty text 2. agreeing with the final text at domestic level in line with the relevant domestic constitutional requirements, which differs from state to state. 3. ratification of the treaty at international level (at this stage, the treaty becomes binding on states). 4. domestication of that treaty if it is required by the international treaty or if the state wishes it to be domestic law. - A treaty must be approved domestically before the state can ratify it at international level to make the treaty binding. - The executive are responsible for signing international agreements (stage 1). - Parliament is involved at stage 2, by approving the treaty by resolution in both the National Assembly and the National Council of Provinces. - The responsibility for ratifying the treaty and binding South Africa at international level (stage 3) again lies with the executive, only then gives rise to international legal obligations. - For the treaty to become law and bind all citizens, the treaty must be incorporated by an Act of Parliament. If stage 4 did not take place, the treaty is binding at international level, but does not constitute South African law that one can directly rely on in court. - The classification and weight attached to international law: - any court, tribunal, or forum must consider international law when interpreting the Bill of Rights. They must at least demonstrate that they have considered relevant rules of public international law when interpreting the Bill of Rights. If they decide to use international law for interpreting the Bill of Rights, international law would be persuasive in nature, as a *secondary* source of law. - An international customary law rule that is consistent with the Constitution is directly applicable and is thus a *primary* source - When interpreting any legislation (not the Bill of Rights) every court must prefer a reasonable interpretation of the legislation that is consistent with public international law over any available alternative interpretation that is inconsistent with public international law. In this instance, international law is again persuasive in nature, as a *secondary* source of law. - international agreements become law in South Africa when they are enacted into law by national legislation and will be a *primary* source of law ### Foreign law - Foreign law refers to the law of other countries - Our courts often do consider the reasoning of judges in other countries as being persuasive and sometimes find foreign legislation useful when developing national law. - considering foreign law is not compulsory when interpreting the Bill of Rights if it does not conflict with the Constitution, legislation or judicial precedent - It will be applied when a case consists of parties that are foreign -- international law requires foreign law to be applied to solve a problem. For example, if German nationals who married each other in Germany get divorced in South Africa, the court will divide up their property in accordance with German law. ### Modern writings - AKA academic writings (publications, such as academic books and accredited journal articles by academics and lawyers) - They are a convenient place to find out what the law says but are not themselves law because the authors do not create law. - they are increasingly being relied upon by legal practitioners and judges because the authors critically evaluate the sources of law - not regarded as legally binding on anyone - The persuasiveness of a particular writing depends on its quality and the cogency of its arguments - On difficult legal issues, the courts may also accept an opinion of a respected writer (for textbooks) as the correct approach to take. The judicial system =================== - The judiciary is subject only to the Constitution, and the law and must act impartially and without fear, favour or prejudice - The hierarchy of courts implies that not every court\'s decision will be legally binding on other courts: - Only the decisions of the superior courts legally bind courts lower down in the hierarchy. - Earlier decisions of courts of equal standing legally bind later courts. - Decisions of courts lower down in the hierarchy do not legally bind courts that are higher up. - If a court has jurisdiction in a certain subject area or geographical region, it means that it has authority to rule, in those cases. - Jurisdiction also refers to the limits of the orders, or decisions, that the court can make, such as the maximum fines or prison terms that it can impose. The jurisdiction of a court determines its place in the legal hierarchy. Civil and criminal cases: ------------------------- +-----------------------+-----------------------+-----------------------+ | Distinguishing | Civil cases | Criminal Cases | | features | | | +=======================+=======================+=======================+ | Background and | This is known as a | This is known as a | | | civil wrongdoing, and | crime or criminal | | examples | usually | offence and | | | | | | | arises when one party | arises when a person | | | (defendant) | intentionally and | | | negligently and | unlawfully | | | | | | | unlawfully causes | breaks a law. A crime | | | damage, loss or harm | threatens the safety | | | to another | of the | | | | | | | person. The plaintiff | state, including its | | | will bring a case | legal subjects. This | | | against the | is a public law | | | | matter, as the State | | | defendant to resolve | is directly involved. | | | the dispute. This is | | | | a private | For example, P rapes | | | | Q, or R steals from | | | law matter, as this | S. | | | is a personal matter | | | | between the | | | | | | | | parties (the State is | | | | only indirectly | | | | involved). | | | | | | | | For example, A | | | | reverses into B\'s | | | | yard and knocks | | | | | | | | over B\'s water | | | | fountain, or C\'s | | | | golf ball breaks D\'s | | | | | | | | car window. | | +-----------------------+-----------------------+-----------------------+ | Dominant parties | Usually, the | The State is the | | | plaintiff institutes | dominant party and | | | the legal action | prosecutes the | | | against the defendant | accused person. If | | | (natural and/or | the accused person is | | | juristic persons). | found guilty, they | | | The person who | can lodge an appeal | | | appeals a court\'s | against the court\'s | | | finding is called the | finding of guilt. | | | appellant and the | | | | person against whom | | | | they bring the appeal | | | | is called the | | | | respondent. | | +-----------------------+-----------------------+-----------------------+ | Procedure | Civil cases are | Criminal cases are | | | regulated by the law | regulated by the law | | | on civil | on criminal procedure | | | | and the law of | | | procedure and the law | evidence, and usually | | | of evidence, and | begins when a victim | | | begins | lays a charge at the | | | | police station. | | | when the plaintiff | | | | causes a court-issued | | | | summons | | | | | | | | to be served on the | | | | defendant. | | +-----------------------+-----------------------+-----------------------+ | Standard of proof | The plaintiff must | The prosecutor must | | | prove that the | prove that an accused | | | defendant is liable | person | | | | | | | on a balance of | is guilty of the | | | probabilities. | crime beyond a | | | | reasonable doubt. An | | | | accused person is | | | | presumed innocent | | | | until | | | | | | | | proven guilty by a | | | | court of law. | +-----------------------+-----------------------+-----------------------+ | Case name | Van Duk v South | Sv Henckert 1981 (3) | | | African Railwavs and | SA 445 (A) | | examples | Harbours | | | | | (On appeal, the | | | 1956 (4) SA 410 (W). | parties\' names in | | | | the citation do | | | (On appeal, the | | | | parties\' names in | not swap around and | | | the citation will | will remain as is). | | | | | | | swap around.) | | +-----------------------+-----------------------+-----------------------+ | Findings | In a typical civil | The court will find | | | dispute, the court | that the accused | | | will make a finding | person is either | | | in favour of either | guilty or not guilty | | | the plaintiff or | of the crime. | | | defendant. | | +-----------------------+-----------------------+-----------------------+ | Sanctions | Usually, the | The State aims to | | | plaintiff seeks | punish the guilty | | | compensation | person (criminal) in | | | (damages) from the | the form of a prison | | | defendant. (Other | sentence, fine, | | | outcomes can include | community service, | | | interdicts and cost | and/or a suspended | | | orders.) | sentence. | +-----------------------+-----------------------+-----------------------+ Inferior courts - Inferior courts handle less serious cases compared to the superior courts - Their geographical area of jurisdiction is smaller than for superior courts - Inferior courts decisions are not reported, and they do not create judicial precedent - They have to follow the decisions of superior courts. Small Claims Courts - Small Claims Courts are at the bottom of the hierarchy of the courts - A Commissioner of the Small Claims Court decides on the outcome, which is final and binding on the parties -- no appeals - These courts offer a quick and easier way of resolving certain civil disputes that involve claims up to R20 000 and lawyers may not appear - The Commissioner asks each party questions to establish the facts of a case - All official languages may be used - The following matters do not fall within the jurisdiction of the Small Claims Court: - criminal matters - divorce cases - the validity or interpretation of a will the mental health status of a person - defamation cases - claims for malicious prosecution - claims for wrongful imprisonment and wrongful arrest - A claim against the State - A delict is a civil wrongdoing in private law wherein one party can be held liable for compensation for negligently and unlawfully causing loss, damage, or harm, to another person - Commissioners are legal professionals who volunteer their services free of charge - Natural persons can sue, and be sued, in the Small Claims Court. Juristic persons can be sued, but cannot sue in the Small Claims Court Chiefs\' and Headmen\'s Courts\ These courts deal with customary law cases, which are heard by a chief or headman. The procedure is informal and there are no lawyers. Chiefs and Headmen\'s Courts have criminal and civil jurisdiction that is limited to disputes based in African customary law between people who live in the jurisdictional (geographical) area of the court. Litigants who are not satisfied with the decision in a Chiefs\' or Headmen\'s Court can take their matter to the Magistrates Court for it to reconsider the matter: Magistrates\' Courts - There are two levels of Magistrates Courts: - District Magistrates\' Courts - Regional Magistrates\' Courts (a region is larger than a district). - The jurisdiction of the Magistrate\' Court is limited in terms of: geographical area (district or region), the type of case and the maximum sentence or value of the claim sought. - Here are examples of civil cases that the Magistrate\' Courts can hear: delivery or transfer of any movable or immovable property eviction orders mortgage bond disputes credit agreement disputes and general civil matters, such as claims for damages. - Let us take a closer look at these distinctions and limitations. - District Magistrates\' Courts have jurisdiction over local areas, called magisterial districts. These courts hear civil, as well as criminal cases, subject to certain limitations. - Regional Magistrates\' Courts are the highest in the hierarchy of the inferior courts. These courts hear civil and criminal cases within their region.\ Civil cases:\ They can, along with High Courts, hear divorce cases, cases on the nullity of marriages and civil unions, and matters arising from the Recognition of Customary Marriages Act.\ They can hear civil matters for claims above R200 000, and claims up to and including R400 000.\ Criminal cases:\ They have jurisdiction over serious cases, such as murder, rape, armed robbery and serious assault, except treason.\ They can sentence convicted persons to a maximum sentence of life imprisonment, or a fine per crime.\ They can impose a maximum fine of R600 000, and a maximum prison sentence of fifteen years for common law offences.\ A statute can provide for a maximum term of imprisonment of more than fifteen years for specific offences. For example, the maximum prison sentence for dealing in drugs is 25 years. - Decisions of Magistrates Courts do not create judicial precedent. However, where a higher court has decided a similar case a certain way before, the Magistrates Court must follow the precedent set by that higher court in its jurisdiction. - There are various specialised courts at the level of the Magistrates\' Courts, such as the Equality Courts, the Children\'s Courts, and the Sexual Offences Courts. Superior courts\ The superior courts are the most important courts in the hierarchy. Only superior courts create judicial precedent because they hear the most serious cases, and their judgments are recorded or reported.\ The CC, SCA and High Courts have inherent power to protect and regulate their own process, and to develop the common law in the context of the interests of justice.\ The majority judges in a case bind the minority judges on a legal matter. High Courts - High Courts have judges and are headed by a judge president - 1 to a bench of judges - A High Court\'s jurisdiction extends only over the province in which it is located - hear both criminal and civil matters and they review cases and hear appeals from the inferior courts - can also hear some constitutional matters - may hear any criminal case and civil claims for any amount of money - in criminal matters, they have jurisdiction to sentence various punishments, including life imprisonment - the jurisdiction of the High Court applies to:\ persons residing or being within the geographical area The law on criminal procedure determines the number of judges that will hear a criminal case as a court of first instance.\ A civil case that is heard by a court of first instance, meaning that the matter is not an appeal matter, is adjudicated by a *single judge*.\ *Two judges* can hear any civil or criminal appeal.\ Any case can be heard by a full bench of three judges. - a few key rules:\ High Courts are bound by their own earlier decisions in the same province, but one High Court is not bound to follow the judgments of a High Court in another province.\ A High Court may consider the decisions of other provincial divisions as merely persuasive\ The size of the High Court, determined by the number of judges that presided over a matter, is a factor that determines its weight as judicial precedent - the larger the court, the more weight it carries when setting judicial precedent.\ The date of a High Court decision is another important factor that must be weighed together with the factors above. Special courts\ Special courts are at the same level of hierarchy as the High Courts and create judicial precedent for themselves. Their purpose is to hear specialised types of cases. The Labour Court and the Tax Court are examples of special courts.\ Labour Courts have the same status as the High Courts. They adjudicate on labour law matters and are guided by the sources of labour law. The Labour Appeal Court hears appeals against decisions in the Labour Court and is the highest court for labour appeals. The Labour Appeal Court sits on the same level of the SCA and has nation-wide jurisdiction.\ The Tax Court hears tax appeals on tax assessments. The Tax Court can confirm or amend an assessment or refer an assessment back to the South African Revenue Services. A taxpayer can appeal a Tax Court decision to a full bench of the relevant High Court or the SCA. The Supreme Court of Appeal - The SCA is the second highest court in the country - nation-wide jurisdiction - in Bloemfontein in the Free State, and consists of a president, a deputy president, and appeal judges. - Cases are presided over by three or five judges - The final decision of the SCA is the one supported by the majority of the judges - The SCA deals with appeal cases sent to it from the High Courts or a court of a similar status to the High Court except labour and competition matters. - The SCA is not a court of first instance - Limited constitutional jurisdiction, but it may not hear constitutional issues that fall within the exclusive jurisdiction of the CC - The decisions of the SCA bind itself and all the other courts below it in the hierarchy.  The Constitutional Court - The CC was established in 1996 to interpret, protect and enforce the provisions of the Constitution. It is the apex court in the country and has nation-wide jurisdiction - The court is situated in Braamfontein, Johannesburg. - The CC is headed by a chief justice, a deputy chief justice and nine other judges. A case must be heard by at least eight judges - The CC is the highest court on constitutional matters and matters of public importance - CC may decide: - constitutional matters and any other matter, if the Constitutional Court grants leave to appeal on the grounds that the matter raises an arguable point of law of general public importance which ought to be considered by that Court - make the final decision whether a matter is within its jurisdiction - For the CC to have jurisdiction in a matter of public importance, the following must be considered: - The point must be one of law, and it must be arguable - The point of law must transcend the interests of the litigants and impact a significant part of the public - An applicant who seeks leave to appeal must ordinarily show that there are reasonable prospects that this court will reverse or materially alter the decision of the SCA. - The CC\'s role in upholding the Constitution cannot be emphasised enough. In its first judgment the CC found that the death penalty for criminal offences was unconstitutional as a form of punishment, as it violated the rights to life and dignity, taking into account the constitutional values. From the time of this judgment, courts could no longer sentence anyone to death in South Africa - The CC functions primarily as a court of appeal. Therefore, it considers the record of the evidence heard in the previous court that heard the matter and does not hear evidence or question witnesses - It is possible for a case to be initiated directly in the CC -- with the permission of the CC, and when it is in the interests of justice, a person may bring a case directly to the CC - The decisions of the CC bind itself and all other courts in the hierarchy - The CC may invalidate any legislation that conflicts with the Bill of Rights, and it can order the legislature to correct any legislation that is not in line with the Constitution - The law can be changed by legislation at any time - and this can have the effect of undoing a precedent. Legislation always prevails unless and until it is set aside by a court of law. Legal Positions in the judicial system: \ Attorneys and advocates:  - The term \'lawyers\' covers anyone who has studied law - law academics, prosecutors, attorneys, and advocates. - An attorney is a lawyer who can advise you and may appear in court on your behalf. If the attorney does not have time to do all the work you need due to a heavy case load, or lacks experience in that type of case, or if it is a complex case, the attorney may refer the specialised work to an advocate.\ Attorneys are general practitioners of law. They deal directly with the public, and generally spend much less time in court than advocates. Most attorneys practise privately, either on their own or in partnership with other attorneys. Attorneys may receive and hold money for or on behalf of another person, which is called trust money. - Advocates are specialists in litigation and spend a lot of time in court or in their chambers taking instructions from attorneys. They also provide clients with written legal opinions. The practical skills specific to the advocate\'s profession include being able to make an opening and closing address in court, examining (questioning) and cross-examining witnesses, and \'moving\' (or motivating) motion applications (cases where no witnesses are involved). Advocates are divided into two categories: trust account advocates and advocates without trust accounts. Practising trust account advocates are allowed to take instructions directly from the public and hold trust money, similar to practising attorneys. Advocates without trust accounts are not allowed to take instructions or deposits directly from the public, and practice in the referral system. Prosecutors:\ Prosecutors are lawyers who represent the State in criminal cases. Prosecutors are part of the National Prosecuting Authority (NPA), which is headed by the National Director of Public Prosecutions (NDPP) and several Directors of Public Prosecutions (DPP). The prosecuting authority has powers to decide on matters, such as: - which charges to lay against a person accused of a crime - whether to continue with a prosecution or withdraw charges. They also prosecute persons accused of crimes by trying to convince the court beyond a reasonable doubt to convict guilty persons. They also must make sure that justice is done, and that accused persons are treated fairly in court. Prosecutors base their prosecution on the case docket, which is a file of all the evidence the police collected during their investigation. Registrars or clerks of the court\ The registrar of a High Court is the most senior administrative officer in any division of the High Court or other superior courts. The registrar\'s office handles all the documents for a case. The clerk of the court in a Magistrates Court performs very similar tasks to the registrar of a High Court. Sheriffs\ The sheriff of the court is responsible for serving certain legal documents on people and ensuring that the court\'s judgment is carried out. For example, suppose a court orders a defendant in a civil case to pay the plaintiff a certain sum of money, but the defendant fails to do so. The sheriff may then attach (take) and sell part of that person\'s physical property to pay the required money to the plaintiff. The sale is called a sale in execution because the judgment is being executed or carried out. Magistrates\ A magistrate oversees cases heard in a Magistrates Court. Magistrates are employed by the Department of Justice. It is common for experienced prosecutors to be appointed as magistrates. Judges\ Judges preside in the superior courts, namely, the High Courts, special courts, the SCA, and the CC.\ They are appointed from the ranks of practising advocates, attorneys, magistrates, and legal academics.\ Nobody can dismiss judges from their positions except parliament, following a special procedure. The purpose of this principle is to ensure the independence of the judiciary and to protect them from influence by the other two arms of government. Chapter 2 Branches of Law\ \ Before we start: \ A jury is a panel of people who listen to a case in a court of law and reach a decision (verdict) as to whether the person is guilty or not (criminal case), or liable or not (civil case). Countries with a jury system adopt a \'trial by your peers\' approach to resolving legal disputes. Branches of Law: International law AKA public international law - applies across the different states globally and deals with matters of inter-state concern, such as the boundaries between states, the law of the sea, global environmental issues, humanitarian law, and refugee law - International treaties can be bilateral (between two states only) or multilateral (between more than two states) - Countries with a treaty in place agree to incorporate the principles into their respective national laws - international law applies so far as it does not conflict with the Constitution of the Republic of South Africa, 1996 (Constitution). - There are cases where South Africa does not comply with international law - For example, we are not yet able to provide the required minimum core of socio-economic rights (people's rights to housing, healthcare, a clean environment and social security) for everyone. - International law is controlled by international organisations, such as the United Nations Organization (UN) (promote peace and international co-operation) and the African Union (AU) (focus primarily on promoting solidarity and unity across African counties) - Countries that are not UN members can also agree to have their cases heard in this court. International law also serves to regulate international criminal law, such as genocide and crimes against humanity through the International Criminal Court in The Hague. National Law\ National law is the law of a specific country - our national law is based on the various primary and secondary sources of law - We can divide South African national law into: - substantive law:\ public law\ private law  - procedural law. Substantive law:\ Substantive law is that part of the law that gives content and meaning to the various legal principles This branch of law tells us what we can do and what we are prohibited from doing Substantive law also tells us how to apply the law (for example, how to gain ownership of a house, or how to obtain a car licence)\ \ *Public law\ *Public law is that branch of law that governs the constitution of the State, the relationship between the organs of the State, and the relationship between the State and its legal subjects - The relationship between the State and its people is vertical - We can further divide public law into the following sub-branches of law:  - Constitutional law: This branch of law governs the nature of the State, the distribution of legal power within the State, the function of its organs, and the protection of people\'s fundamental human rights - Administrative law: This branch of law regulates the administration of the State\'s powers over private individuals and aims to ensure that ministers, officials, and government departments do not abuse their administrative powers. - Criminal law: This branch of law determines what actions constitute a crime. The State is empowered to prosecute alleged wrongdoers of crimes on behalf of the victim and society. - Labour law: This branch of law governs labour relations between the employer and its employee/s. Everyone has the right to fair labour practices. - Law of taxation: This branch of law regulates the collection of revenue by the State. *Private law:\ *AKA civil law - governs the legal relationships between persons (natural and juristic persons), and their status - The relationship between persons is a horizontal one - We divide private law into the following sub-branches: - Law of persons: This branch of law governs the definition, classification, and status of natural persons in law (for example, the determination that life (and legal personality) begins at birth and terminates upon death) - Family law: This branch of law regulates family relationships between life-partners or spouses, and between parent and child (for example, engagement, marriage, civil unions, divorce and parental authority) - Law of succession: This branch of law governs what happens to a person\'s estate (assets and liabilities) after death. - Law of property: This branch of law, AKA the law of things, regulates the relationship between persons and things (for example, a person\'s right of ownership over their movable and immovable property) - Intellectual property: This branch of law regulates the relationship between persons and intellectual property (for example, the protection of a person\'s invention or literary work) - Mercantile law: This branch of law is a collective reference to various branches that deal with, for instance, commercial matters, business entities, methods of payment, and the law of insolvency - Law of obligations: This branch of law deals with disputes involving personal rights that have a proprietary value (for instance, when a creditor has a right against a debtor for performance). Obligations stem mainly from the law of contract, the law of delict, and the law of unjustified enrichment - Law of contract: This branch of law regulates the formation of a valid contract; the rights, duties, and obligations between the parties; and the termination of the contractual relationship - Law of delict: This branch of law deals with the payment of compensation to persons who sustained harm, loss, or damage, as a result of another person\'s negligent or reckless actions. For example, if Pieter forgets to close their front gate at home and Jack, Pieter\'s dog, runs out and bites Vusi, the neighbour, and destroys Vusi\'s patio furniture, Pieter will be liable to compensate the neighbour for the damage to the patio furniture, any lost income, and medical expenses from the dog bite, as well as pain and suffering caused by the event. In this branch of law, note that a party can claim for patrimonial loss (monetary) and/or non-patrimonial loss (pain and suffering) - Law of unjustified enrichment: This branch of law deals with the recovery of benefits received without any legal or valid underlying reason. For example, if Thembani discovers that there is an additional R1 000 in their Best Merchant Bank (BMB) account, and it turns out that Fatima, the cashier at BMB, accidentally deposited the R1 000 into the account, then there would not be a lawful or valid reason for Thembani to insist on keeping the money. Procedural law:\ Procedural law regulates the enforcement of substantive law when substantive law is violated - Substantive law and procedural law are inter-reliant - Procedural law describes the practical steps to resolve a legal problem - Procedural law promotes order and justice - Procedural law has three sub-branches: - Law of evidence: regulates what the parties have to prove, how parties should prove certain facts, and guides the courts when determining the weight to attach to different types of evidence - Law of criminal procedure: describes the practical steps that the State has to take when it investigates and prosecutes a person who is accused of committing a crime. Criminal procedure also helps in determining the appropriate punishment - Law of civil procedure: sets out the practical steps for enforcing non-criminal law, which is civil law Civil cases: \ The onus of proof, or burden of proof, is on the plaintiff, which means that it is up to the plaintiff to prove that their case is probably true. This is why the plaintiff\'s witnesses will testify first. If the court evaluates the plaintiff\'s version of events as being true on a balance of probabilities, it will award judgment in their favour. Usually, the court will also grant the plaintiff the right to recover the legal costs they paid from the defendant. If the plaintiff has not proved their claim on a balance of probabilities, the court will usually dismiss the plaintiff\'s claim and order the plaintiff to pay most of the defendant\'s costs.\ \ Civil procedure:\ We can divide civil procedure into two types: - the action, or trial, procedure - used when the parties are in dispute about the alleged wrongdoing of a person since they need the opportunity to question each other in court. - the application procedure - a simpler process, because there is no dispute of fact. The case before the court is more about applying the law to the facts. The trial procedure\ When the parties disagree about what the true facts (differences of opinion) of the matter are, the trial procedure allows them to argue it out in court.\ The trial procedure has four phases: 1. pleadings 2. the trial 3. appeals and reviews 4. enforcement of court judgments. *Pleadings* - The person who makes the first claim is known as the plaintiff - To start the claim, the plaintiff\'s attorney issues a summons (summons is a document that contains the plaintiff\'s claim against the defendant) - It is the duty of the sheriff of the court to serve the summons to the defendant. We call that \'serving a summons\' - If the defendant wants to defend the case, they must notify the plaintiff by sending a notice of intention to defend (a document stating that they are going to dispute the plaintiff\'s claims and defend the case) - The defendant must then deliver a plea (formal reply to a summons) that sets out the grounds for defence - In the plea, they respond by admitting, denying or claiming no knowledge of the allegation - The defendant can deliver a counter-claim against the plaintiff along with the plea - If either party chooses not to defend the claim, or does not deliver a notice of intention to defend a plea, the other party can ask the court to award a judgment by default. As long as the court has proof that the summons was served, it does not need any evidence that the plaintiff's claim was true - The documents that are referred to in the arguments are known as the pleadings. They contain the written summaries of the main facts of each party\'s case and help the court to understand the dispute -- an attorney, advocate, or the litigants themselves sign the pleadings - The pleadings ensure that the issues in dispute are narrowed down and that there are no unnecessary surprises at the trial - At the start of legal proceedings, the clerk of the court opens a court file for the case, and files the original documents of all the pleadings (In the High Court, the registrar opens the file) -- once the deadline for delivery of all pleadings has ended, the pleadings are closed. - Next, a date is set for a trial to take place in court then the plaintiff serves and files a document called a notice of set down (formal notice to tell the defendant's attorney that the matter has been scheduled for a certain date and time) - There will usually be an exchange of documents between the parties. This process is known as discovery. *The trial* - The purpose of the trial is for the court to decide whether the allegations made in the pleadings are correct - After some opening statements, the plaintiff's lawyer calls all the witnesses who can testify under oath in support of the plaintiff\'s case - The court, generally, only accepts verbal evidence, AKA viva voce evidence - The best way for a court to assess whether or not witnesses are telling the truth is to put them under cross-examination, which means the attorney or advocate of the other party questions them -- the judge or magistrate is then in a better position to make a judgment on the matter *Appeals and reviews* - The losing party in a case has the right to appeal if the court\'s decision was incorrect based on the facts or the law - The party that appeals a decision is known as the appellant and the other party is the respondent - An appeal court relies only on the merits of the case by considering: - the typed record of the previous court that heard the evidence in the matter - the arguments by the respective parties\' lawyers on why the previous court made an incorrect decision - An appeal court does not hear any new evidence - The appeal court will then decide whether to uphold the appeal, in which case the previous court\'s decision is overturned, or dismiss the appeal and the previous court's decision remains in force - When deciding in which court to lodge the appeal, we must follow the hierarchy of the judicial system - A review tests:\ whether the previous court followed the correct procedure;  whether the attitude of the magistrate or judge was fair. *Enforcement of court judgments* - The final phase of the trial procedure, in which the judgments of the court are enforced - In a civil matter, the judgment of a court often results in an order that one party has to pay an amount of money, usually to the other party. The person who has to pay the money is called the judgment debtor, while the person who is to receive the money is the judgment creditor - If a judgment debtor fails to pay the amount of money due in terms of a court order, the judgment creditor may issue a warrant of execution. The sheriff of the court draws up a list of the debtor\'s property and holds a sale in execution where the items are auctioned to the highest bidder.\ In cases where the judgment debtor is not in a position to pay the debt, another option is for the judgment creditor\'s attorney to call upon the debtor to explain their financial position in court. The court can then order the debtor to pay off the debt in affordable instalments. - If a debtor fails to pay money in terms of a judgment, the creditor may apply for a garnishee order or an emolument attachment order (EAO). The advantage of these options is that the creditor is guaranteed payment of the debt expeditiously. The disadvantage is that it reflects poorly on the debtor\'s credit record. - A garnishee order is an order by a Magistrates\' Court whereby a creditor attaches a share of a debt owed to the debtor by a third party (a garnishee) which allows the garnishee to deduct part of the debt or pay for all of the debt due to the debtor directly to the creditor. This applies to any third party and any type of debt. - An EAO is an order made by the Magistrates\' Court whereby the creditor is allowed to attach a portion of the debtor\'s salary. The debtor\'s employer will deduct an amount from the debtor\'s income and directly pay it to the creditor. - How to apply for a garnishee order. The creditor must apply to a court in the area where the garnishee resides, carries on business, or is employed through an ex parte application in the requisite form, which must be supported by an affidavit setting out all the relevant information:\ the parties (debtor and garnishee) \ confirmation of the judgement made in favour of the creditor\ confirmation of the outstanding debt and the debt repayable by the garnishee. \ If the creditor\'s application is successful, the debtor and the garnishee will then be served a copy of the order, which will include a date on which the garnishee must appear in court if they wish to dispute the order. The order can be enforced in the same way as a judgment of the court which means that, if the garnishee defaults on payment, a warrant of execution may be issued against the garnishee. The warrant of execution will then be sent to the sheriff, who can attach the garnishees property to sell in an auction.\ If the garnishee wants to dispute the order, they are required to present their case.\ Depending on the evidence, the court may cancel, amend, or suspend the order. The application procedure - When there is no real dispute on an important question of fact between the parties, the matter can be brought by way of an application. - The matter does not go to trial because the court does not usually have to hear oral evidence. The argument between the parties is mostly about differences in the way they interpret the law. As the facts are not in dispute, the court has to consider only the dispute of law. - Instead of calling witnesses, the parties can argue the matter on paper by way of affidavits. The person who signs the affidavit has to make a statement to the Commissioner of Oaths that is similar to the oath or affirmation that witnesses make in court, promising a truthful statement. The affidavits contain all the statements of fact that are necessary for the court to decide on the dispute. The first affidavit is attached to the notice of motion and is called the founding affidavit because it explains the applicant\'s case. If the affidavits disagree on an important fact, the court can hear some oral evidence or refer the matter to a trial court. - The person who is seeking relief (a legal remedy) through an application is called the applicant - the other party is called the respondent. - Applications usually start with a document called a notice of motion (and not a summons) to which the founding affidavit is attached, which sets out the relief or compensation that the applicant wants. Ch 3 Interpreting statutes Why do we need to interpret statutes? ===================================== - Statutes regulate a wide variety of civil and criminal matters covering many areas of life - A statute contains many provisions, which set out definitions, requirements, conditions and other legal rules or principles. - Difficulties when reading provisions of a statute: - Drafters may use a term that is too broad, without defining the scope of its meaning. - Drafters may think that certain terms are implied, whereas this may not be so obvious to the reader. - Words may be ambiguous or vague. - The meaning of a term may no longer apply in unforeseeable circumstances and may lead to absurdities. - Provisions may differ - one section of a statute may say one thing while another says something else. - A provision in a statute may be unconstitutional because it conflicts with the Bill of Rights in the Constitution. - Technology is changing rapidly, and legislation cannot change quickly enough. In South Africa, legislation only recognises bank notes or coins as legal tender, which may be used to settle a monetary debt -- a creditor can refuse to accept payment by these methods. There are essentially four constitutional provisions that have helped to transform legislative interpretation: - Section 1 is a founding provision that sets out the constitutional values on which the South African state is based. - Section 2, the supremacy clause, provides for the supremacy of the Constitution. - Section 8, the application clause, makes the Bill of Rights applicable to all law and to the three arms of government. - Section 39, the interpretation clause, instructs the courts on the interpretation of the Bill of Rights and other legislation. - Section 39(2) of the interpretation clause - This subsection, which provides for the interpretation of legislation in general, states: \'When interpreting any legislation, and when developing the common law or customary law, every court, tribunal or forum must promote the spirit, purport and objects of the Bill of Rights. - This means that all courts, tribunals and forums are obliged to view the aim and purpose of any statute in the light cast by the Bill of Rights. When deciding on the meaning of a provision, the courts must prefer a meaning that is consistent with our constitutional values (section 1) and constitutional rights (Bill of Rights). #### Added value The Constitution is the starting point In Bata Star Fishing (Pty) Ltd v Minister of Environmental Affairs and Tourism 2004 (4) SA 490 (CC), paras 72 and 90, the Constitutional Court stated: \' 172\] The Constitution is \... the starting point in interpreting any legislation\... \[First, the interpretation that is placed upon a statute must, where possible, be one that would advance at least an identifiable value enshrined in the Bill of Rights; and second, the statute must be reasonably capable of such interpretation\... \[90\] The emerging trend in statutory construction is to have regard to the context in which the words occur, even where the words to be construed are clear and unambiguous\' In South African Police Service v Public Servants Association 2007 (3) SA 521 (CC), para 20, the Constitutional Court stated: \'Interpreting statutes within the context of the Constitution will not require the distortion of language so as to extract meaning beyond that which the words can reasonably bear. It does, however, require that the language used be interpreted as far as possible, and without undue strain, so as to favour compliance with the Constitution. This in turn will often necessitate close attention to the socio-economic and institutional context in which a provision under examination functions. In addition, it will be important to pay attention to the specific factual context that triggers the problem requiring solution\'. Practical approaches used to interpret statutes =============================================== The courts use certain approaches when interpreting statutes which are interconnected and should be used simultaneously. Some of the commonly used approaches are: textual approach systematic approach purposive approach contextual approach historical approach teleological approach. Textual approach ---------------- Courts must use the ordinary grammatical meaning of words or phrases. This is particularly useful when words or phrases are not defined in the statute itself. Authoritative dictionaries can be used to determine the ordinary grammatical meaning. Systematic approach ------------------- Statutes must be read in their entirety. This will ensure that the text used in the Act is understood in its context, as a whole. The definition section of a statute is an important starting point. Purposive approach ------------------ Courts must determine the reason or purpose for which a particular statute was enacted, taking into account the social, political and economic background. Often, statutes will expressly state their purpose or aims. Contextual approach ------------------- The courts must consider the context of a statute to determine who it applies to and the real-life circumstances that the statute applies to, taking into account the historical and political background that led to its enactment, the contents of the statute, and any commission reports. Historical approach ------------------- The courts will determine the mischief that the statute was enacted to deal with. Previous versions of the same statute may be useful for this exercise so that the court can track the mischief that the Act was enacted to address. The historical and political context is again important. #### Case study No drug-peddling on the streets Consider this fictional scenario. To prevent the peddling of illegal drugs on street corners, which has a ripple effect on other criminal activities and causes a range of harms in society, the legislature decides to pass a law to address this. Section 5 of the Illegal Drugs Act 3 of 2023 states: \'Peddling illegal drugs on the streets in South Africa is a criminal offence, which shall carry a criminal sanction of no less than 5 years of imprisonment\'. In response to this new law, drug-peddlers start selling illegal drugs from the windows of apartments that overlook the streets. Tim is arrested for drug-peddling. Is Tim guilty of a criminal offence? If you were defending Tim during their criminal trial, which approach to interpretation would you rely on to reach an acquittal. If you were prosecuting Tim, which approach, or approaches, would you rely on to convict Tim as a drug-peddler? Well, if we applied the textual approach, the drug-peddlers would not be guilty of a criminal offence, as they were not selling drugs on the streets, but from windows above the streets. This approach may lead to illegal activities going unpunished. However, in applying the purposive approach, we would need to consider the reason or purpose for the Act. In this scenario, the purpose was to prevent the peddling of drugs, which also had a rippling effect on other criminal activity, and which caused harm to society. We could also apply the historical approach to determine the mischief that the Act was trying to address - to prevent the peddling of drugs, related criminal activities, and harm to society. This means that, using the purposive approach or the historical approach, the drug-peddlers are guilty of a criminal offence - irrespective of where they sold drugs from. Teleological approach Courts must probe deeper into the meaning behind the statute. The long title and preamble of an Act may assist in this exercise. #### Added value Demystifying statutes You may be required to read statutes in due course in santity is limed at demystiving what a statute looks like. The CPA is an important statute in commercial law, so let us use this Act for the activity. This will help you to read and understand the CPA (and other statutes) in the future. step 1: Look up the Consumer Protection Act 68 of 2008 using this freely accessible government website: www.gov.zal/sites/default/files/32186\_467.pdf Step 2: Look up the short title of the Act. This refers to the formal name of the Act by which it should be referred and cited. In this instance, it is the Consumer Protection Act 68 of 2008. Step 3: Look for the date on which the president assented (approved) to the English version of the statute. The president signed the English version of the CPA on 24 April 2009. Step 4: Look for the long title of the Act. In the CPA, the long title states: To promote a fair, accessible and sustainable marketplace for consumer products and services and for that purpose to establish national norms and standards relating to consumer protection, to provide for improved standards of consumer information, to prohibit certain unfair marketing and business practices, to promote responsible consumer behaviour, to promote a consistent legislative and enforcement framework relating to consumer transactions and agreements, to establish the National Consumer Commission, to repeal sections 2 to 13 and sections 16 to 17 of the Merchandise Marks Act, 1941 (Act No. 17 of 1941), the Business Names Act, 1960 (Act No. 27 of 1960), the Price Control Act, 1964 (Act No. 25 of 1964), the Sales and Service Matters Act, 1964 (Act No. 25 of 1964), the Trade Practices Act, 1976 (Act No. 76 of 1976), the Consumer Affairs (Unfair Business Practices) Act, 1988 (Act No. 71 of 1988), and to make consequential amendments to various other Acts; and to provide for related incidental matters\'. Note that the long title assists in the interpretation process by setting out a summary of the description of the purpose and scope of the Act. Step 5: Look for the preamble. It starts with \'The people of South Africa recognise - that apartheid and discriminatory laws of the past have burdened the nation with unacceptably high levels of poverty, illiteracy and other forms of social and economic inequality\... We introduced you to preambles in the previous section when you looked up the preamble of the Constitution. The preamble serves to introduce the statute, provide background and context to the intention of the legislature, and explain the purpose of the statute in more detail. Note that not all statutes have a preamble. After reading the preamble of the CPA in full, you should have a deeper understanding of the background to and purpose of the CPA. Step 6: How many chapters are there in the CPA? Did you find the index of seven chapters? Step 7: Now let us read what section 1 says. Section 1 of the Act lists all the definitions that apply specifically to the CPA. Definitions are usually set out in section 1 of an Act. Presumptions ------------ - In addition to using the approaches, where there is still uncertainty about the aims of the legislation, the court may apply certain common-law presumptions. - Some of the presumptions that have assisted the courts in the interpretation of legislation: - The presumption is in favour of natural justice, which means that statutes must be interpreted in a way that they comply with procedural fairness. - The legislature is presumed not to intend to be unreasonable or to cause injustice. - A statute is presumed not to violate relevant international law, which means that the courts will interpret a statute in a way that does not bring South African law into conflict with international law that is binding on the country. - The presumption is against construing a statute to exclude or limit the jurisdiction of the superior courts. - A statute is presumed to apply prospectively, and not retrospectively, which means that a statute only applies from the date of the enactment (and does not apply to the past). - The statute is presumed not to change existing law unnecessarily, which means that a statute must be interpreted in the context of other laws. - The presumption is that the same words used in different places in the same statute have the same meaning, which means that words must be given a consistent interpretation in the same statute. - The presumption is that the legislation does not contain futile or meaningless provisions, which means that every word and provision must be given a meaning. - The legislature is presumed not to intend to legislate outside of the borders of the country. Chapter 4 Contractual capacity Requirements for a valid contract: ================================== - Contractual capacity - Agreement - Legality - Possibility of performance - Formalities - Certainty (least common) All requirements must be satisfied to form a legally binding (valid) contract. Once a valid contract is formed, the contracting parties are legally bound to perform according to the terms of the contract, and can be sued if they do not. #### Added value Void and voidable If any legal requirements for a valid contract is not satisfied, the contract is void. A void contract is one that has never come into legal existence. A voidable contract is a valid contract (the legal requirements for a valid contract have been satisfied) but one of the contracting parties may decide to set aside the contract (rescind) or abide by the contract (continue). What is contractual capacity? ============================= - Contractual capacity is the legal ability to enter into a contract. - It is essential for a party to understand the nature and consequences of a contract before entering into one. - It is one of the many competencies that the law regulates. - Contractual capacity differs for: - minors - married persons - natural persons who are mentally incapacitated at the time they contract - natural persons who are insolvent Infans \< 7 - no capacity Pupillis \>7\ 18 years When a minor turns 18 years old they become a major. Another way that a minor becomes a major is when a minor gets married (If the marriage ends in divorce, both parties remain majors) or has been emancipated. ### Emancipation - An emancipated minor has full contractual capacity. - When emancipated, it means that the minor has been freed from parental authority and that the minor no longer needs the protection of their minority status and is conducting their lives as an economically independent major. - A minor can be emancipated by a court, or through tacit emancipation by the minor\'s guardian. - When applying the South African test for tacit emancipation, the following factors are considered holistically to determine whether a minor has been tacitly emancipated by their guardian/s: - the relationship between the minor and their guardian/s: we must consider whether a guardian has made a conscious decision to allow the minor to live independently, as a major. It is not sufficient if the guardian abandoned the minor, leading to the minor living independently. - the living arrangements of the minor: we must consider whether or not the minor is living with the parents, or is living independently. - whether the minor has a job, is earning their own livelihood and is financially independent: financial freedom - if minor operates their own bank account: a sign of independence. - All the factors must be considered cumulatively. #### Dickens v Daley 1956 (2) SA 11 (N) Principle If a guardian knowingly allows a minor to live as an economically independent major, the minor is tacitly emancipated by their guardian. Facts Daley was a minor who lived with his mother and stepfather. Daley\'s father was his guardian. Daley had been working as a clerk and was financially independent. While Daley was living with his mother, he was contributing towards his accommodation costs. Daley\'s guardian did not exercise any control over the minor and allowed Daley to live as a major. Daly operated his own bank account, and later drew a cheque in favour of Dickens. When the cheque was dishonoured upon presentation, Daley claimed that he was a minor at the time and was therefore not liable for the cheque. Dickens argued that Daley was emancipated, and was therefore liable for the cheque. The court\'s finding Daley\'s guardian (the father) had tacitly emancipated him. This was evidenced by the guardian allowing the minor to conduct his life as an independent major. For instance, the minor had a job, was financially independent, operated his own bank account and drew his own cheques. Note that, had the guardian simply abandoned the minor - in other words, they did not have any interaction with the minor for years of the minor\'s life - that would not have necessarily meant that the minor was tacitly emancipated. The guardian\'s behaviour of allowing the minor to be emancipated must have been as a result of a conscious thought process, not merely neglect. ### Guardianship - In terms of the Children\'s Act 38 of 2005 (Children\'s Act), guardianship refers to the administrative part of taking care of a child. - The biological parents are called the natural guardians. The biological mother of a child, whether married or unmarried, has full parental responsibility and rights in respect of the minor, as the guardian. If a child is born to an unmarried minor mother, the guardian of the mother is the guardian of the child. - A biological father of a child has guardianship if he was married to the child\'s mother at any time between conception and birth. If the father having never been married to the child\'s mother, the court will consider the father a guardian if the father was living with the mother in a long-term relationship; or if the father contributed for a reasonable period, or attempted to contribute in good faith, to the maintenance of the child; or if the father consented to being identified as the child\'s father; or paid damages in terms of African customary law, as an acknowledgment that they are the father and as compensation to the mother\'s family. - The High Court is the supreme guardian of all minors and can, in the best interests of the child, overrule a decision by a natural or legal guardian. ### Contractual capacity of a child below seven years (infans) A child under the age of seven years has no contractual capacity because they have neither the intellect nor the judgment to enter into a legally binding contract. The contract will be void due to a lack of contractual capacity. This means that they can be involved in a contractual agreement only if a guardian enters into the contract on the child\'s behalf, where the contract will be between the guardian and the other contracting party. ### Contractual capacity of minors aged seven to 18 years (pupillus) A minor between the ages of seven and 18 years has limited contractual capacity, and may enter into a contract only with the assistance of a guardian. Assistance entails either the guardian entering into the contract on the minor\'s behalf, or consenting to the minor entering into the contract. A minor may have some intellectual development and judgment, but this is not sufficient to enter into contracts unaided. The law requires the guardian to assist the minor with the contract for it to be legally binding. ### Legal position of a minor aged seven to 18 years in an assisted contract in terms of the common law #### Which guardian(s) must consent? The consent of one guardian is. Each guardian can exercise guardianship independently of the other guardian. However, there are legal acts that require the consent of both natural guardians: - consenting to the minor being put up for adoption - removing the minor from the country alienation - (selling) of the minor\'s immovable property - applying for the minor\'s passport - consenting to the marriage of the minor. #### Form of consent: If a minor enters into an assisted contract, it means that the guardian has consented to the contract. Generally, there are no formalities required for the guardian\'s consent. Usually, consent is given before or at the time that the contract is concluded. Consent can be either express (verbal or in writing consent) or tacit (implied with circumstance and behaviour). This is illustrated in the case below. #### Van Dyk v South African Railways and Harbours 1956 (4) SA 410 (W) #### Principle Where a guardian assists a minor in entering into a contract, the guardian does not need to know the specific terms of the contract. The guardian only needs to know and consent to the general nature of the contract. Facts In this case, the minor, Van Dyk, concluded an employment contract with South African Railways and Harbours for the position of a railway officer. The minor undertook not to terminate the agreement within three years of the date of the contract. Upon majority, the minor sought to declare the contract void. The minor asserted that the guardian was not present at the time of the conclusion of the contract and was unaware of the specific terms of the contract. The court\'s finding The court held that, even though the guardian was unaware of the precise terms of the agreement, there was evidence to show that the guardian had consented to the type of contract. The minor was therefore bound by the contract. #### Effect of the guardian\'s consent Once the guardian has consented to the minor\'s contract, the guardian is not a party to the contract. The contract is legally binding between the minor and the other contracting party. The guardian does not incur any personal liability. Legal rights and obligations under the contract apply to the minor and the other contracting party. This principle is illustrated in the case law below. #### Marshall v National Wool Industries Ltd 1924 OPD 238 Principle Where a guardian assists a minor with entering into a contract, the guardian does not incur personal liability in terms of the contract. Facts In this case, the minor, Marshall, purchased shares from National Wool Industries with the assistance of the guardian (father). When the minor did not pay the balance of the purchase price, National Wool Industries sued the guardian for the outstanding balance. The court\'s finding The court held that the minor was personally liable to perform on the contract, as the minor was a party to the contract (not the guardian). As such, National Wool Industries ought to have litigated against the minor for the outstanding balance, and not the guardian. *Restitutio in integrum* (restitution) The guardian must always act in the best interests of the minor. However, it can happen that the guardian consents to a contract on behalf of the minor and it turns out to be prejudicial to, or burdensome, to the minor. In this instance, it is possible for the contract to be set aside by a court through an application called restitutio in integrum, such that it becomes a void contract. This application can be brought to the court in the following ways: If the minor is close to reaching majority, they can wait until they are a major and bring the application on their own. The minor can bring the application with the assistance of their guardian. The minor can bring the application with the assistance of a court-appointed representative. Once the court grants restitution to the minor, each contracting party - the minor and the other contracting party - must return any benefits that they received under the contract. This means that each party\'s position must be restored to what it would have been had the contract not been concluded. The legal bases for claiming the return of benefits received in a contract are: unjustified enrichment, in the case of value received *rei vindicatio* (vindicatory action), in the case of goods delivered, where ownership of the goods was retained. Both parties must return any money and/or property delivered in terms of the contract (return of benefits). However, the rules state that they only need to return what they have left of the performance at the time that the other contracting party demands the return of their goods or money. If the party has exchanged the goods or money for something else, the new property must be returned. Furthermore, any benefits that a party derived from the use of the goods or money before the contract was set aside, must also be paid to the other party. For example, suppose that a minor purchased a bicycle for daily travel and saved R30 a day on taxi fare as a result of the purchase. If the minor seeks to return the used bicycle, they also need to pay in the value that they saved by using the bicycle. #### Added value Overview of unjustified enrichment and *rei vindicatio* Unjustified enrichment means that someone has been enriched (received money or something of value) unfairly or at the expense of someone else, and there is no legal justification for this to happen. A valid contract would count as a legal justification. If the contract is void or has been set aside, there would be no legal justification for the enrichment, and the enriched person, who received the money or valuable items, has to return the money or value of the enrichment to the impoverished person who gave the money or valuable items. Rei vindicatio, or vindicatory action, is the legal term for the way in which an owner can legally recover or get back physical property that belongs to them, wherever they may find it. In other words, it is a claim for the return of property based on the real right of ownership. #### Wood v Davies 1934 CPD 250 Principle Where the court grants the remedy of *restitutio in integrum* for an assisted contract that is, or has become, prejudicial to the best interests of the minor, the minor must restore what they have received from the other party, as well as recover what they have performed in terms of the contract. Facts The minor\'s guardian purchased a house from Davies on behalf of the minor, Wood. On attaining majority, the minor sought to terminate the contract of sale. The court\'s finding The court held that the contract was patently prejudicial to the interests of the minor. The purchase price was excessive and there were a number of onerous contractual clauses. The payments would have eroded a substantial portion of an inheritance benefit, which the minor held, and the purchase was regarded as altogether unnecessary, as the minor did not need a separate house to live in. As such, Wood was entitled to rescind the contract of sale. To effect restitution, the minor had to return the property to Davies and was entitled to recover all monies paid to Davies, including interest. Since Wood was enriched by the occupation of the house for a period of time before the remedy was granted, Wood had to compensate Davies for this. #### Tshegofatso\'s Mini crisis Case study Tshegofatso is 17 years old and lives with their parents in Johannesburg. Tshegofatso will be turning 18 in two months\' time. Tshegofatso has a brilliant entrepreneurial mind and has started a part-time business selling cupcakes during school breaks and after school. Tshegofatso manages the day-to-day running of their business, as well as the business bank account. This year, the business has done exceptionally well and Tshegofatso has decided to buy a cute sports car, as a reward. Tshegofatso goes to Mini Motors and purchases a brand new red two-seater convertible for R400 000 (four hundred thousand rand). Tshegofatso pays a 30% deposit in cash, enters into a credit agreement with Mini Motors to finance the balance of the purchase price of the car and takes delivery of the car at the end of the week. Tshegofatso\'s parents have consented to the purchase of the car. After paying the first three instalments on the car, Tshegofatso\'s business starts to decline during tough economic times, and they struggle to pay the high instalments and the maintenance costs of the fancy sports car. Three more months pass by and Tshegofatso has not made any further payments to Mini Motors. Is Tshegofatso legally bound by the contract, or can they get their money back? Can their parents be liable for the cost of the vehicle if Tshegofatso cannot pay? Consider the Wood v Davies 1934 CPD 250 case above. Are there any legal principles from that case which we can apply here? As this is an assisted contract, Tshegofatso is legally bound by the contract unless they apply to the court for the remedy of restitutio in integrum. For restitutio in integrum, we will need to consider whether the assisted contract is burdensome on the minor. In this scenario, there are strong indications that the contract is burdensome - the hig