A contract put simply is a legally enforceable agreement between parties. A contract can be either written or verbal. it is always advisable to enter into a written contract so as to make their life easier in the unfortunate event of breach or dispute. A written contract clearly sets out the roles and obligations of the parties and its existence is easy to prove.
There are some formalities that have to be complied with to ensure that a contract is valid, including;
- A valid offer by one party and acceptance by the other party;
- There must be meeting a of the minds (consensus ad idem);
- The contract must be clear (in terms of obligations amongst other factors, parties must not be left to deduce what is being communicated in terms of the agreement;
- Must comply with the provisions of the law;
- Performance must be possible;
- Parties must intend to be bound in terms of the agreement;
At times a contract is not performed according to the expectations set out, and breach occurs. When this happens there are options of recourse available to the aggrieved party. Remedies available can either have the contract fulfilled or cancelled resulting in parties returning to the status quo ante (the position they were in prior to the contract).
SPECIFIC PERFORMANCE
This is the process whereby the breaching party is called upon to perform their obligations in terms of the contract as had been agreed to in terms of the agreement by the aggrieved party.
CANCELLATION
Parties may choose to cancel the contract and opt to have each of them restored to the position that they were in prior to the contract (status quo ante). Cancellation results in the restoration of any performance that was done by either party and does away with or extinguishes any present or future obligations in terms of the contract.
INTERDICT
The aggrieved party can make an application in the courts for a mandatory interdict that then compels the other party to perform their obligations in terms of the contract or a prohibitory interdict that prohibits a party from disposing of or doing certain acts until the matter has been resolved.
DAMAGES
These can be claimed by the aggrieved party so that they are placed in the position that they would have been in had the contact been concluded. Damages are financial in nature. damages can be claimed over with any of the other remedies.
Has a party you entered into a contract with breached the terms of your agreement. Do you want to conduct business and want to reduce the agreement into writing? If the answer is yes, then contact our team of attorneys that will assist you.
This article is for general information purposes only – seek the advice of an attorney.
