SPECFIC CONTRACT:

TOPIC 2: CONTRACT OF SALE

PART 4
REMEDIES
Presence of latent defect or DEP is a pre-requisite for ALL the remedies we are going to discuss
(regardless of their scope)

(a) Aedilitian Actions

(b) Actio Empti
(c) Delictual Liability
(d) Consumer Protection Act

REMEDY 1

(a) Aedilitian actions

• Most narrow remedies – old – prototypical consumer protection remedies
• Classical Roman law: developed by the aediles (officials in charge of what happened in the
market place) – slaves & livestock – developed remedies when missrep had been made about
slaves (things) OR if slave considered to be latently defective in some form, loitered (lazy).
• actio redhibitoria & quanti minoris
• Post-classical law: were made applicable to all things (not just slaves and livestock)

• Basis for availability of remedy to the buyer / Basis of liability:

• Warranty: Phame v Paizes 1973 (A)?
• Clear that a sellers liability ito aedilitian actions, while it is a ex lege (auto)
consequence of a COS, it is incorrect to describe it as a warrant irt quality of
goods sold
• Because it operates differently to what normally expect from a warranty
• Ex lege warranty: would generally be allowed to claim for consq loss but not the
case with these remedies
• Enrichment?
• Not possible, because liability that specifically arises out of a legal ground / COS
• Enrichment liability would only be if there is NO legal ground
• Sui generis liability?
• Seller’s liability when it comes to aedilitian actions is therefore by consensus a sui
generis liability, arises automatically and is of its own sort

(i) actio redhibitoria: cancellation & restitution

• The result of the action rehibitoria was cancellation of the contract and restitution. The remedy
could only be used in the instance of a serious defect of misrepresentation.
• Cannot claim consequential loss
• When?
• Whenever terminate contract (serious course of action)
• Test: whether the defect / dictum et promissum is SERIOUS or material
• Test for materiality
• Defect or dictum et promissum is material if a reasonable person would
not have concluded the contract had she KNOWN of the true state of
affairs
• Ask whether it is a type of situation where regardless of the defect the
buyer would be satisfied with a claim for damages

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• Buyer can claim (restitution):
• return of price;
• interest on purchase price;
• expenses
• eg receipt of goods (expenses for transport to place where buyer wants merx to
be)
• Looking after a sick animal (if animal is the merx)
• What can seller receives:
• restitution of merx;
• fruit / proceeds of merx connected to the merx;
• Compensation for damage to the merx if buyer’s fault (not result of the defect)
• REMEDY: aimed at restoring status quo ante (if no contract had been concluded)
• Only available in the event of a SERIOUS defect / dictum et promissum
• Would a RP of concluded contract if aware of true state of affairs
• If NO, then serious defect
• If less serious defect, then remedy is NOT available
• If want to rely on aedilitan remedy then have to rely on action quanti minoris: price
reduction.

ii)action quanti minoris

• The action quanti minoris can be used where there is a serious or less serious defect or
misrepresentation. The buyer asks for a reduction in the purchase price
• Buyer can’t claim consequential loss with this remedy
• When:
• less serious defect or dictum et promissum
• Or serious defect / dictum et promissum but prefer not to cancel the contract
• Buyer can claim price reduction
• Reduction: difference between price and value
• Awarding buyer difference between what buyer paid and the actual value of the
defective merx OR merx without the attributes S said it would have (dictum at
promissum)
• Court is flexible in measures use when determining the actual value buyer received
• For example, if we are dealing with a defective merx with a market value, e.g.
second hand goods then the court will look at the market value, however more
often there isn’t a market value for second hand goods. Therefore, the courts will
look to other measures and it if for the buyer to bring evidence to show which
measure is accurate.
• Sarembock case
• Porches welded together, no market value for this
• Court thus had to consider external evidence to determine what the
appropriate measure would be here
• Has to determine what will be equitable in the circumstances

• Ganet
• This case adopted a flexible approach. As mentioned in a previous
lecture, it concerned the manufacturing of wire frames to be used for
advertising boards. The buyers were assured that the wire frames would
withstand the winds but did not. Since at the time advertising boards had
not yet been used in South African, there was no market value for this
type of product. The merx was unique and designed specifically for the
buyer.

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 • Repair costs were also an issue here – thus the court worked with the
difference between the purchase price and the price that the seller paid to
the actual manufacturer of the frames.

Next remedies à
DO allow buyer to claim consequential loss

REMEDY 2

(B) ACTIO EMPTI: BREACH OF WARRANTY

• Consequential loss
• Contractual remedy based on breach of a WARRANTY
o Seller has warranted that the merx will be free of latent defects or possess certain
qualities
• Gives rise to ordinary BoC remedies: Specific performance, cancellation or damages
• Express / tacit: parties have agreed that the S warrants that the merx is fit for purpose OR of a
reasonable quality
o Express warranty: what parties have agreed on (interpretation)
o Tacit warranty: must % from lesser type of statement (dictum et promissumve or puff)
o Minister Landbou-Tegniese Dienste v Scholtz 1971 (A)
§ S sold a stud bull to the minister; the bull was named Allman the 4th. It was sold
for the purpose of breeding but he was sterile. The minister wanted to institute a
claim for compensation, because breach of a tacit warranty.
§ The court inferred the existence of this warranty because the seller knew the
purpose of the purchase for the buyer, and knew that the buyer would not have
concluded the contract had he known about the infertility. The seller’s job was to
breed these bulls.
§ The seller did not dispute that there was a tacit warranty, had he disputed this the
court would have had to go to a lot more effort to try and determine what
distinguishes a warranty from a dictum et promissum. Court here was focusing on
whether the bull was fit for purpose but that is also hat we focus on when we are
trying to determine whether a seller has made a dictum = focusing on whether
something is fit for purpose is not going to tell us whether we are dealing with a
dictum /warranty.
§ Point? Existence of a warranty that is contractually regulated by the parties, a
situation where there is an ex lege (automatic) warranty in a contract of sale and
that is where we are dealing with seller who is either a manufacturer or a
particular kind of trader or retailer.
§ Summary:
• On appeal the court made it clear that there is a difference between
relying on the ex lege warranty given by a seller and a claim which is
based on an actual, all be it, tacit, contractual warranty.
• The minister in this case was actually relying on a tacit term this is based
on an inference from the terms of the contract and surrounding
circumstances
• Looking at the surrounding circumstances, the court held that there was
an implied warranty that the bull would be suitable for stud purposes.
• Looking at the evidence it would be highly unlikely with a seller whose
business it is to deal with stud bulls for the seller not to give a warranty
that this bull was fit for breeding purposes.

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 • Remember that the Minister’s claim is not based on the Aedilitian
remedies – here the buyer is trying to rely on a tacit/express contractual
warranty relating to a quality/attribute of the merx.
• Thus, to succeed with a claim based on breach of warranty the buyer
would have to: Show the existence of tacit or express warranty in the
contract, and that this was breached.

o Gannet Manufacturing v Postaflex

§ This is a little tricky, a representative of the seller made certain statements about
the frames to the effect that they would be strong enough to withstand normal
wind.
• The court concluded that this was a dictum promissumve – a
representation as to an attribute of the merx.
§ However, this statement had not been raised to a term in the contract – it was not
yet a warranty.
§ Compared to Scholtz case, it is tricky as it is clear from the evidence that the
seller held itself out to be an expert in relation to the manufacturing of the metal
frames AND it knew that the buyers had no expertise when it came to the
manufacturing of the metal frames.
• This seems to suggest, following the Scholtz case approach that there
might have been a warranty given as to the strength of the frames, but the
court did not find this.
§ The dividing line between a dictum promissumve and a contractual warranty is
not clear.
§ If the warranty has been breached it amounts to breach of contract, and the
buyer has all the remedies for breach of contract at their disposal including a
claim for contractual damages.

• à Extended liability of manufacturers / traders (retailer / merchant seller)

o Our rules governing this come from RDL
§ Voet: artifex (manufacturer) à is liable for consequential loss automatically
• “all manufacturers are liable for consequential loss”
• Because a manufacturer is taking automatically to warrant their skill
o French - Pothier: trader whose business it is to trade in specific goods are also liable for
consequential loss

• Shortcoming of essentialia – naturalia model

o Cant explain why with COS with essentialia but with different naturalia
§ Contract with an ordinary seller vs COS with manufacturer or retailer has the
same ESSENTIALIA
§ BUT it has different NATURALIA
o Contract with ordinary seller
§ No ex lege warranty and as a general rule CAN’T claim consequential loss
o COS with manufacturer
§ There is such a ex lege warranty and you can claim consequential loss
o Reason for difference between two sellers
§ Is based on POLICY considerations
• Because manufacturers and originally traders were responsibility for
making / creating the merx
• Thus idea, is that your liability should be more if merx is defective vs
ordinary seller who had nothing to do with the making of the merx
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 • Manufacturer (expert), thus if goods defective should be liable for more
because the expert
• Modern SA law position of Voet and Pothier changed
• Look to case law

Position in modern SA law regarding extended liability? = case law

• D&H Piping Systems v Trans Hex Group – Manufacturers – provides a test as to when
something can be regarded as being a manufacturer
• Gannet Manufacturing v Postaflex – Manufacturers
• Kroonstad Westelike Boere Koop v Botha – Traders, retailers and merchant sellers
• Langeberg v Sarculum – This judgement is important as it expands on Kroonstad and there
is a good minority judgement which criticises the way in which certain retailers are treated in
SA law – read and understand this criticism.

Liability of manufacturers in SA law

D & H Piping Systems (Pty) Ltd v Trans Hex Group Ltd 2006 3 SA 593 (SCA) - PRESCRIBED

Facts:
• D &H Piping Systems who makes pipers, is the buyer. Trans Hex Group, the manufacturer of lime
products is the seller.
• Trans Hex mines limestone out of quarries and then sell it to the public
• By-product of mining activities is dolomitic aggregate – which is used on cement
o Thus was sold to D&H iot make cement pipes
o Particular batch they bought from Trans Hex was defective and the cement pipes
D&H piping made began to crumble
• D&H piping faces damages claims from it’s clients
• Therefore they Then institutes a claim for damages against Trans Hex for this amount, on
the basis they MANUFACTURED the dolomitic aggregate
o Instituted the actio empti
• Trans Hex Group argued that they did not manufacture dolomite aggregate, the sand was
merely a by-product of their digging for lime.

Legal Question:
• Who is a manufacturer for the purposes of the extended liability in terms of the Aedilitian
remedies? Does T fall within the scope of a manufacturer? Are they liable for the
consequential loss suffered by D & H?

Ratio:
• 1) ALL MANUFACTURERS in SA are liable for consequential loss without qualification
o For example – in the event that you have a latent defect.
• 2) Broadens the concept of manufacture to include something/merx which is produced ito
manufacturing process
o Trans Hex primary purpose is to manufacture lime products by mining a quarry
o A by product of mining activities is that they produce dolomitic aggregate
§ Trans Hex argument that they didn’t manufacture this because it was a
BYPRODUCT
§ But court disagreed with this and argued we must understand notion of
manufacture BROADLY

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 o If want to determine if someone is a manufacturer of a particular kind of product,
must ask ourselves 2 questions (two step)
§ a) is the end product DIFFERENT to the raw product from which it was made
• dolomitic aggregate produced during mining activities is a very
different product from raw lime being mined
§ b) And if so, does the end product have a commercial utility / worth as a result
of the process which it has undergone
• dolomitic aggregate did have a commercial activity, clear since Trans
Hex was selling it to various clients
• Therefore, because seller was deemed to be a manufacturer and obliges to pay
consequencial loss to the buyer

• Gannet Manufacturing v Postaflex 1981

• Confirms Seller can be held liable as a manufacturer, not only when they are the
manufacturer but also when they create the REASONABLE impression that they are the
manufacturer
• Representative of the seller, didn’t create a reasonable impression
• Either because it was irrelevant to Buyer who the actual manufacturer was
• Alternatively, to the extent the buyer did think Seller was a manufacturer of
advertising boards. This reliance was NOT reasonable because it was common
knowledge in the industry that Seller regularly makes use of subcontractors to
manufacture the goods
• Thus, Seller was treated as an ordinary Seller and not as a manufacturer. Thus, Buyer
could NOT claim consq loss in the absence of another ground

Ganet Manufacturing v Postaflex - PRESCRIBED

• Extends that in D&H: where a buyer reasonably believes that a seller is a manufacturer (i.e.
where the seller holds himself out to be a manufacturer), such a seller will also be liable for
consequential loss)

Facts:
• Postaflex, the buyers, came up with the idea to have advertising material placed in metal
frameworks (big advertising boards)
• But because this had not been done in SA yet, they needed to find someone who could
produce the frameworks, so they approached Gannet to do this for them.
• Gannet came back with a sample frame, but Postaflex was concerned that due to the flexible
nature of these frames, they would not be able to withstand the type of windy conditions which
normally experiences.
• A representative of Gannet stated that "the welds (corner points) of these frames can
withstand 40 tonnes."
• At a second meeting when Postaflex raised their concerns about the flexibility again, the
representative of Gannet again said that they were strong enough as they were similar to an
airplane wing which needs to be flexible.
• As a result of the representation that these frames would be strong enough to withstand the
ordinary wind, Postaflex went ahead with the sale.
• The frames disintegrated in the ordinary windy conditions and Postaflex wanted to claim a
reduced purchase price on the basis of a dictum promissumve made by the representative of
Gannet.

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Ratio:
• On the facts of Gannet buyer wanted advertisement boards designed and manufactured,
approached plaintiff (seller) to that end
• Prototype made and when buyer expressed concerns about the ability of these boards to
withstand wind, a representative of seller said it would be strong enough.
o It was not
• BUT the seller did not hold himself out to be the manufacturer –
o They had subcontracted it to somebody else. Seller was not ‘actually the
manufacturer’.
• The manufacturing task had been subcontracted out, which was common practice in that
particular trade
• Court was willing to consider that a seller can also incur liability where the buyer reasonably
relied on the appearance that the seller was manufacturer.
o i.e. incur liability as manufacturer if you actually make/manufacture the merx but it
appears that now you can also incur liability/extended liability where you create the
impression that you have actually manufactured the merx even though that is not the
case.
• Court here came to the conclusion that the seller did not hold himself out as the manufacturer,
because it was fairly common in the particular industry to make use of subcontractors –
o Implication of this being that even though the buyer may have relied on an impression
created by the seller that it was the manufacturer, that reliance was not reasonable.
• Because a reasonable buyer would have known that in the particular industry, frequent use is
made of subcontractors to manufacture goods and that there is expectation resting on buyer
if that is important to him to ask whether the seller is actually the manufacturer.
• Unreasonable in this case for the buyer to think that the seller was the manufacturer
o If the buyer really did attach such importance to the identity of the manufacturer, he
would have asked whether the seller was the manufacturer, which he did not
• Buyer could not claim consequential loss
• SUMMARY of rules re manufacturer –
o ALL manufacturers are liable for consequential loss.
o What constitutes a manufactured thing is broadly understood in our law.
o PLUS know that you can also incur liability as a manufacturer if you have left the buyer
with the reasonable impression that you are in fact the manufacturer of the goods.
• Certain traders, retailers, and merchant sellers
o More complicated

Liability of traders / merchant sellers

• Pothier: trader whose business it is to trade in specific goods, are liable for consequential loss
• Because hold themselves out to be experts in the goods they sell
• So if merx is defective, those retailers should be liable, even if they didn’t know it was
defective
• Protects reasonable reliance of buyers, people from whom they are purchasing a merx,
actually know what they are talking about
• Ie form of consumer protection

Kroonstad Westelike Boere Koöp v Botha - Prescribed

• Botha bought pesticide from the Co-Op. the pesticide was sealed and manufactured by a
German company. German company also included instructions on how to use the pesticide.
• Botha used the pesticide on a crop. Something wrong with the pesticide and the crop fails.
• Kroonstage is just the middle man
• When can a buyer claim against retailer?
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 • AD considered Pothiers rule, after an extensive discussion on approaches to this rule in
previous decisions, the court came to the conclusion, that his rule was too broad in its
original formulation
• Held, a merchant seller, will be liable for consq LOSS IF they publicly profess to have the
necessary Knowledge and expertise irt goods sold

• Problems with formulation of this rule above

• 1) what does a retailer have to do/what conduct must there be for there to be a public
profession of skill and knowledge
• Difficulty in applying this qualification, would have become more evident if court in
Kroonstad tried to apply it
• Is it relevant to det if public profession of K, that retailer is not actually an
expert irt goods sold
• 2) does it matter in determination whether there has been a public profession of expert
and skill, that goods have been manufactured by someone else who also provided the
instructions for use
• 3) does it matter that a buyer asks for a product by name, and thus seems to suggest
that she is in possession of some information that the retailer may not be in possession
of
• Difficulties in applying if there is expertise

• General feeling, that the court limited a retailer’s liability unduly

o If dealing with a rule originally developed to protect buyers, then limiting these
protections without good reason if add qualification
o Rule is unrealistic, forces a unrealistic conclusions as to whether a retailer has
publicly confessed to have expertise
o Because sometimes public confession of skill would be attributed to a Seller who is
simply a conduit between manufacturer and buyer
o Thus, a seller can be held liable for public profession, even if S had no chance to
inspect the merx because it is eg in sealed packaging
o If holding someone liable for public profession, then element of artificiality involved
§ Some of reasons why Minority in Langerberg heavily criticises adaptation of
Pothier rule and recommends it should be reconsidered by the legislature
§ Also pointed out in Krootstad, aware of fact that it was potentially creating a
rule that was difficult to apply (thus hesitant in reaching their conclusion)

Langeberg v Sarculum Boerderye 1996 - PRESCRIBED

Public profession of skill and expertise does NOT have to be made to public at large, can be made
to a particular segment of the public.

Facts:
• The seller in this case provided farmers with packets of seeds, with the idea that the farmers
would grow these crops and resell them to the seller.
• Something went wrong with a batch of seeds sold to the farmers – there was a latent defect,
and as a result they suffered a loss.
• The farmers instituted a claim against the seller for this loss suffered.

Ratio:

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Majority judgment:
• According to the majority, the public profession requirement was met because:
o 1. The seller prescribed the type of seed (the cultivar) to be used
o 2. Representatives of the seller regularly visited the farmers and gave advice – where
to plant, when to plant etc.

Minority judgment:
• The minority, however, found that this public profession related to the cultivar (the type of
seed) and if the cultivar was unsuitable the judge would have had little difficulty in concluding
that the seller guaranteed the suitability of the cultivar.
• However, the problem was not with the cultivar – all indications are that the cultivar (type of
seed) is suitable.
• The problem is with the specific packets of seed and there is no indication that the seller was
able to determine that there was a problem or that they sourced the seed from a disreputable
seed merchant.

• Before we can say that someone can be held liable, they must have had the OPPORTUNITY
to inspect the merx, whether they took such opportunity or not. Pothier held merchant sellers
to be liable – but here they were making the goods and had the opportunity to inspect them.
o Today, with technology and packaging, sellers do not have this opportunity – they are
often just a party in a chain.
o The rule by Pothier is out of touch with today’s contract of sale the rule of public
profession and expertise needs to be reconsidered.
o Court stated that this rule was too broad in its original form – the court stated instead
merchant seller will be liable for consequential loss if that merchant publically
professes to have the necessary knowledge and expertise in relation to the goods sold.
o There are a number of problems with applying whether there is a public profession of
skill and expertise:
§ What does a retailer have to do or what conduct must there be for there to be
a public profession of skill and knowledge. The difficulty in applying that
qualification would become more evident had the court in Kroonstad tried to
apply it. = does it matter to determining if there has been a public profession or
expertise if the retailer had not been an expert in the goods sold?
§ Does it matter in determining this public profession or knowledge and skill, that
the goods have been manufactured by somebody else, who also provided the
instructions for use?
§ Does it matter that the buyer asks for a product by name, and does this suggest
that he or she is in some possession of information the retailer is not?
• Did the court unduly limit the protection for buyers by adding this
qualification?
• The rule is also unrealistic as it forces potentially an unrealistic
conclusion, why? Because sometimes a public profession of skill would
be attributed to a seller who is simply a conduit between manufacturer
on the one hand and buyer on the other. (reason why minority in
Langeberg) heavily criticizes this version of the potier rule and
recommends that it should be considered by the legislature.

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THIRD REMEDY

(c) Delictual liability

• Damages – consequential loss
• Misrepresentation: intentional / negligent
• Fraudulent or negligent misrepresentation
• Must always prove an element of fault.
• 3 cases prescribed (dealing with FRAUDULENT misrepresentation)
• All 3 cases had a voetstoots clause
• Waller v Pienaar;
• House with cracks painted over because of uncompacted sand foundation
• Ellis v Cilliers
• House with false ceiling
• Hiding fact house is rotting
• Bander v Van der Spuy
• S lied about effectiveness of repairs to thatch roof and under guarantee

• RULE: S must know if the defect and fail to disclose it IOT INDUCE the buyer to conclude the
contract
• Not enough to succeed with a fraudulent misrep (specifically in an omission)
• Buyer must go further and show failure to disclose that defect was done iot induce buyer
to conclude the contract
• Crack in a wall, painted over for aesthetic reasons, forgot about it and then sold it
• Not fraudulent misrep
• Cracks in wall (what it represents)
• à pointed to something more serious (structurally related or unsuitable foundation)
• Depends if impacts what buyer wanted to do with the merx thus impacts buyers purpose
of buying the house
• Knows if info is disclosed then buyer wouldn’t of concluded the contract
• = induce you to conclude the contract
• Omission: no general duty to disclose info
• Where necessary info falls within exclusive K of the seller / legal convictions of the community
would recognise that the S is the buyer’s sole source of info. Thus, duty on S to disclose this
• Overlap between contractual and delictual remedies & COS
• Dictum et promissumve = form of a misrepre
• This refers specifically to a STATEMENT (said something)
• You cannot have this in a from of an omission / failure to say something
• If the issue is a failure to disclose a latent defect OR failure to provide info you should
have, then must rely on misrep in form of an omission à fraudulent or negligent misrep
(can’t rely on a dictum et promissumve)

• Improperly obtained consent

• Restitution / recission
• Claim for damages (contractual context) –- treated as a claim for delictual damages

• In order to succeed with fraudulent misrepresentation/omission is that:

• The seller must know of the defect and failed to disclose it.
• The buyer also needs to show that this failure to disclose information was done
deliberately in order to induce the buyer to conclude the contract.
• When will a delictual claim arise – general rules of delict apply firstly, we have a strange
combination of remedies that originate from different sources. Cancellation and recission are

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 contractual remedies, and damages (even within the contractual context) are considered
delictual in nature. Not a situation of concurrent causes just remedies that originate from
different sources.

(d) Consumer Protection Act: Suppliers liability for defects (s 53, 55, 56, 61)
Ø The CPA has changed the liability of the seller for attributes of the merx but remember that it is
only relevant in so far as the contract/transaction is subject to the CPA. The relevant sections
are section 53, section 55, section 56 and section 61.

S56: implied warranty of quality

• General position set out – sets out an implied warranty provided by every relevant role player in
the in supply chain: producer, importer, distributor, retailer
• ex lege warranty
• Goods supplied must comply with S55 standards
• The seller warrants that the goods comply with S 55
• Section 56 (4) determines that this implied warranty is additional to the common-law rules and
any express contractual measures. The implied warranty does not apply where the goods are
altered contrary to the instructions or after leaving the control of the producer, importer,
distributer or retailer.
• Irrelevant for purposes of supplier’s liability
o whether defect is latent or patent (detected upon reasonable inspection)
o Whether its existence could have been established by consumer prior to delivery
• Thus, no longer necessary for a buyer to show defect existed at contract conclusion
o = Variation of CL position, where buyer was required to do so

S55: right to safe, good quality goods

First two -similar to CL
1. Reasonably suitable for ordinary purpose (or special purpose where consumer informs
seller)
2. Good quality, good working order and defect-free
o S53(1)(a): definition of a ‘defect’ in Act
o Two fold:
§ Any material imperfection in the manufacturing of goods that renders
those goods as less acceptable than persons are generally
reasonably entitled to expect.
• Odd as notion of materiality relates to termination of contract.
• But it doesn’t play a role in whether there was actually a defect
in the first place.
• Odd to impend materiality to the definition of a defect
§ Any characteristic that renders the goods less usable, safe or
practicable, than persons are generally reasonably entitled to expect
in the circumstances
• Ito the CL definition of a defect there must be an abnormal
characteritic
• But the act says any characteristic is fine
o This definition is problematic as definition is not in line with the CL.

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 3. Usable and durable for reasonable period
• Required ito CPA
• Not ito CL
• Usually more expensive, implies should be more durable
• Suppliers usually offer a warranty

4. Comply with any applicable standards set out in legislation

• EG: food stuff must comply with iot be safe

S56(2): remedies for non-compliance with above standards

• When the goods do not comply with one or more of these standards a consumer has remedies
as set out in section 56(2) of the CPA. Which remedy to use is the choice of the consumer.
• Election of consumer - can choose remedy
• Repair, Replacement of goods or Refund (repayment of price)
• Repair or Replacement = form of specific performance
• Refund = indicative whether contract has been cancelled
• Serious remedy: strict test for when can cancel
• Breach must be serious / material
• No such requirement ito S56(2) remedy
• Consumer can elect to cancel contract even for a MINOR defect
• Fact at election of consumer – provides them with a huge a amount of power
(unjustifiably so)
• Other jurisdictions: election of remedy is the choice of the supplier and not
the consumer
• Supplier in best position to know what remedy they can afford to
consumer, by taking into account own circumstances
• Claim for refunds: cater for this risk, usually knock on effect ito
prices charged for goods
• à then generally effects other consumers
• i.e even in the form of a trivial defect as the supplier is probably in
the position to know how to take into account their own
circumstances. If you put suppliers at risk, this will affect the
purchase price.

• Must exercise remedies within 6 months of delivery:

• If you discover merx is defective AFTER 6 months of delivery, then will have to fall back
on CL remedies (Act doesn’t take them away)
• Problematic, when dealing with requirement that the goods must be usable and durable
for a reasonable period of time
• Problematic when dealing with a requirement that the goods must be “usable and
durable for a reasonable period of time”. A court should be able to use its power
to make innovative orders: In relation to these goods – because the CPA grants a
power to a court to make any innovative order it sees fit in order to progressively
realise and give effect to consumer rights – academics believe that a court should
be in a position to give effect to one of the remedies ito S56(2) even if the defect
arose after 6 months.

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Vousvoukis v Queen Ace CC t/a Ace Motors – PRESCRIBED

FACTS
• Consumer: V, purchased 2nd hand BMW in September (R500 000)
o In Dec, car goes into limp mode (refuses to go over 60km/h because computer says
something is wrong), started to make funny noises
o Contacts car dealership who take car to BMW mechanic, turns out engine seized
(doesn’t work)
• V wants the car REPAIRED
o Given 2 options
§ Dealership would buy a new engine, but he was informed by dealership that he
would have to pay for it
• Issue: already paid so much for car
• Entitled to ask for new engine
§ Dealership would get a second hand engine, not clear what parties agreed (but
dealership ultimately paid for this)
• Engine seizes in Dec, 3 months after delivery
o Ito CPA V, as consumer, was entitled to claim for replacement engine at no cost to
consumer
• Second hand engine put into engine, V gets engine back in Feb
• In July, car goes into limp mode again, second engine also seized
• What happened was that there was a problem with OIL PUMP, something in second hand
engine which destroyed it
• Pump was repaired and car worked again
• But at time summons issued, V was under impression that problem lay with engine itself
(second engine didn’t work)
• Timelime: September (buys car); Dec something goes wrong & repaired, Feb gets car back, July
second engine seizes

• V no interested in car, wants to CANCEL contract and wants money back

o Relies on remedies in S56(2)
o And in alternative, the actio rebitoria
o On face of it, 6 months to be able to use remedies if Repair, Replace, Refund has
expired
o To get around this legal Rep of V argued, the putting in of the second car engine
constituted a NEW supply of goods
§ Thus 6 months would start to run again

According to court
• When dealing with complex products, then must understand complex product consists of
different components
o Thus, engine is a component of a car that was sold
o If defect in component – means something defective in ENTIRE product rather than an
engine that is in and of itself defective
o Putting in second engine, constitutes repair of what was defective in original product
(car)
§ Not a new supply of goods but rather repair of original performance

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• Definition of “to supply” in act
o Is to provide something in return for CONSIDERTATION
§ Importation of ‘consideration’ from Eng Law à means something of value
§ But here V gave no consideration because got second engine for free
§ Thus not complying with definition of “to supply”

• Alterative argument – court should use power to make innovative order to extend 6 months
period on the facts because engine/car was not usable or durable for reasonable period of time
o Expect car engine to last longer than 3 months
• Court DISAGREED that it has the freedom to make this type of innovative order when
legislature was clear that only wanted these remedies to be available for 6 months
o Very formalistic
o But court is not wrong, legislature is clear that have remedies for 6 months
o Problem lies with legislature and NOT the court, and placed time limit on remedies

Question: If second hand engine was defective, could he claim repair for this?
• Ito S56, if exercised one of remedies (goods repaired) but remain defective or another defect
arises, within 3 months of repair then can either claim replacement or refund
o But V didn’t have this remedy either, because more than 3 months after engine
repaired
• Can still fall back on CL, which V did
o But for some reason, his attorney limited their CL claim to action rebitoria
§ But according to court, to institute this remedy, defect must be serious
§ According to court
• Defect in oil pump (not engine) was not serious enough to justify use
of this remedy
• Came to conclusion by looking at the monetary value of damage done
vs overall purchase price
o R15 000 to repair pump
o But compare to whole purchase price R470 000
o It is not serious
• Thus not available
o Unsure why didn’t argue actio quanti minoris in alternative (reduced contract price)
§ Thus, had to take back BMW, despite not wanting it

• Can’t claim damages ito section 56(2)

• Would have to rely on S61 requirements
• Common law remedies remain applicable
• Thus, doesn’t mean you don’t have any remedy after 6 months
• Just have to rely on CL remedies
• 6 months restricted based on foreign jurisdictions (lost in translation)
• Germ: reversal burden on proof if defective within 6 months, SUPPLIER must prove
defect not caused by them
• After 6 months: consumer bear’s burden

S61: “modified” strict liability for harm

• S61 creates a CHAIN of liability for everyone in the supply chain – from the manufacturer to
the retailer
o 1) Each party in chain is jointly and severally liable
§ Thus, consumer can choose to institute damages claim against any one of
the people in the chain of supply

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 o 2) Can only institute damages claim if you have suffered harm as a result of a
hazardous or unsafe product or merx
§ Defined in S53
• Defined as death or personal injury as well as destruction or damage
of property and any further loss that raised from these instances of
harm
• Definitions have in common, that merx presents a risk of personal
harm to the consumer
o 3) Concept of “harm” is fairly narrowly defined”
§ When the acts refers to “harm” caused by hazardous or unsafe merx, it
means
• the death, injury or illness of the natural person
• Plus any physical loss or damage caused by hazardous or unsafe
merx
• AND any pure economic loss arising from those two situations à
suffered as a result of death, injury or illness or the physical damage /
loss caused
o “modified” to categorise strict liability created ito S61
§ Because usually when dealing with situations of strict liability, there is no
defence for the wrongdoer
• But ito CPA S61 does afford certain defences to a supplier in the
chain of supply

Liability excluded if defect is:

i. Attributable to compliance with public regulation
• Second place where have a defence
o Hazar product, characteristics that render it unsafe are attributable to compliance
with public regulation
§ When manufacture product, you were in line with standards prescribed for
the products
§ But subsequently, compliance renders the product unsafe / hazardous
§ It would be a defence for retailers, that these characteristics are
attributable to public regulations
o Thus supplier should not be liable
• EG: Treat timber with X chemical (standard ito public regulation) and then a year later
turns out chemical was poisonous and used poles to hold up vineyards and affects your
crop. If farmers wanted to institute claim against retailer (timber person) – retailer would
have a defence since acted in accordance with the law at the time (no liability)

ii. Did not exist at the time of supply to (other) person who is liable; OR where defect
attributable to compliance with instructions of person who supplied
• Defect/ hazard did not exist when (manufacturer) supplied merx to someone further
down in chain of supply
o Manufacturer won’t be liable
• OR can show defect was attributable to persons instructions who supplied the merx
o I am the party further down the chain, if hazard/defect is because of following
instructions to person who supplied to me then this is also a defence

iii. Where it is unreasonable to expect distributor or retailer to have discovered the defect
• Extended liability of manufacturers and retailers (Kroonstad) – something legislature
needs to sort out
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 • This is legislatures response to this observation
o Difficult / impossible for retailer to check product to see if it ok

iv. Prescription – Claim for damages prescribes

(e) EXCLUSION of liability

• Common law: Voetstoots + no representations clause
o How ito CL do you exclude liability for the fact that the merx is defective and/or exclude
liability for representations made about the merx
o To protect yourself from liability for LATENT defects:
§ Must include voetstoots clause in contract
§ Sell merx “AS IS”
o Liability for statements made about quality of merx “representations” must include:
§ NO representations clause

• Escape clauses?
o General contractual principles:
§ Try show you were unaware that the clause was in the contract
• And contracting party should of pointed it out to you but didn’t
• Ie show made a MATERIAL and REASONABLE mistake about the
existence of the clause (iustus error doctrine)
§ Convince court that should interpret clause restrictively, only covers certain
instances and not others
o Clause contrary to public policy – prove FRAUDULENT misrep on the part of the
SELLER
§ Act or omission (duty to disclose)
§ Banda v Van der Spuy (Walller v Pienaar; Ellis v Cilliers)
• Sets out what must prove to prove misrep was fraudulent
• Note: insufficient to show seller had knowledge of defect and did not
disclose it – does not constitute fraud YET
o It is the additional fact that failure to disclose was done with the
intention of INDUCING the buyer to purchase the merx which
makes misrep fraudulent

o Different merx
§ Where Voestoots clause is not relevant – show seller delivered a different merx
to what was agreed upon
§ Fredy Hirsch v Chickenland (Pty) Ltd: Can only place a claim on a latent
defect if the imperfection is in the merx that the parties had actually agreed upon
• If the imperfection, is as a result of the seller delivering a different merx
o Then no longer dealing with defective performance but rather non-
performance
o Only protects you against malperformance and not in the event of
non-performance
• EG: parties agree that specific horse will be sold and seller delivers a
mule (not a defective horse) rathe a completely DIFFERENT performance

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 § Freddy Hirsch v Chickenland / Nandos – use to procure it’s spices for chicken
itself but then sources function out to Freddy Hirsch
• Implied term: spices must be fit for human consumption
• UK health authority asked Chickenland to recall it’s products in the UK
because contained “Sudan 1”
o Dye which they use in floorpolish = NOT fit for human
consumption
• Chicken land wants to institute claim v Freddy
• Freddy relies on clause exempting them from defective products
o Held only exempted them from products with latent defects
o But because spices with Sudan 1 which is NOT fit for human
consumption is something different to spices that are fit for human
consumption
o Rather delivered a DIFFERENT merx
§ Thus, guilty of NON-PERFORMANCE and not defective
performance e
§ Thus, VOETSTOOTS clause was NOT applicable

CPA S55(6)
• Allow a supplier to exempt themselves from liability in the event the merx does not comply with
std in S55(6)(a) & (b)
• Must be fit for purpose and defect free
• Can exempt yourself from liability where doesn’t comply with above std if
o 1) the supplier has EXPRESSLY informed the consumer that goods are being offered in
a specific condition and
o 2) where consumer has either expressly agreed to receive goods in this condition or
knowingly acted in a manner accepting goods in this condition

S55(6)(b)
• Debate what this section allows supplier to do
o CL voetstoots clause where sell goods as IS, is still valid ito the CPA
§ Can reject this argument, when sell goods voetstoots you are not informing
consumer of specific conditions of goods (legal concept and not plain language
explanation)
• Thus can’t ito CPA say selling goods Voetstoots
o Other end of debate: argument renders S55)6) useless - iot escape liability supplier must
list each and every defect in the merx
§ But then a supplier of second hand goods, who would then be required to list all
these second hand goods / factory defect goods
o Middle way:
§ Prof thinks makes the most sense
§ This section requires supplier to draw consumers attention to the specific
condition of the merx albeit in generalised terms so that the consumer
understands the risk they are to undertake in purchasing the merx
• EG: should be sufficient for a supplier to notify consumers that the goods
sold in factory shop are rejects and they may have defects
o And that the consumer should therefore carefully inspect the
goods
§ Thus informed of specific condition (rejects) but in general
terms (inspect carefully)

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 o EG: notify consumer buying 1989 BMW, it has 300 000km on the
clock and advised to indep expert to investigate the car
§ 1) may have defects 2) should inspect it 3) take the risk
upon themselves if goods turn out to be defective later

• Consumer must either expressly agree to accept goods in this condition or knowingly acted in a
manner consistent with accepting the goods in this cond
o Depends on circumstances
o But usually notice “second hand goods” to det. Whether someone is bound by terms
must look to DWW (reasonable reliance)

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