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CL > Contractual capacity (6) > Flashcards

Contractual capacity (6) Flashcards

1
Q

Capacity, in the legal sense, refers to?

A

‘what a person is capable of doing in terms of law’

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2
Q

There are three categories of contractual capacity, as summarised in the table below. As such, legal subjects either have?

A
  • full contractual capacity, meaning that they are able to enter into valid and binding contracts;
  • no contractual capacity, meaning that they are unable to enter into a valid contract; or
  • limited contractual capacity, meaning that the lack in their contractual capacity must be supplemented by another person, in order to enable these persons to enter into valid and binding contracts.
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3
Q

Who has full contractual capacity?

A
  • Majors
  • Juristic persons
  • The state
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4
Q

Who has No contractual capacity?

A
  • Infants
  • Mental deficiency
  • Under the influence of drugs or alcohol
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5
Q

Ahmed is a six-year-old child. Ahmed has?

A

Legal capacity

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6
Q

Ahmed is a six-year-old accountant. Ahmed has?

A

Both a. and b.
- Contractual capacity
- Legal capacity

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7
Q

Ahmed is a 26-year-old accountant. Ahmed was recently declared to be mentally ill by the High Court in Cape Town. Ahmed has?

A

Legal capacity

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8
Q

Majors and juristic persons have full contractual capacity, meaning that they?

A
  • Can enter into valid contracts.
  • In addition, the state is also able to enter into valid contracts
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9
Q

Full contractual capacity?

A
  • Majors
  • Juristic person
  • The state?
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10
Q

A major is a?

A

natural person of 18 years or older.

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11
Q

Juristic persons, (include companies, close corporations and statutory bodies.)

Explain a juristic person?

A

Companies become a separate person in the eyes of the law, as of the date of incorporation at registration (section 19[1] of the Companies Act 71 of 2008).

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12
Q

Give examples of Juristic person companies?

A

Companies,
Close corporation
Statutory body
Universities’

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13
Q

Indicate whether the following persons are natural or juristic persons: Zodwa, a 19-year-old student.

A

Juristic person

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14
Q

Indicate whether the following persons are natural or juristic persons: Lindiwe, an interior designer, who runs her business under the name of Lindi’s Fab Designs.

A

Lindiwe – natural; Lindi’s Fab Designs is merely a trade name, and not a juristic person

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15
Q

Indicate whether the following persons are natural or juristic persons:

Zodwa, a 19-year-old student.
Lindiwe, an interior designer, who runs her business under the name of Lindi’s Fab Designs.
The Office of the Ombud for Financial Services Providers (FAIS Ombud) that was established by section 20 of the Financial Services and Intermediary Services Act of 2002 (FAIS).

A

Natural

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16
Q

Indicate whether the following persons are natural or juristic persons: Mpahlele Accounting Inc., an accounting firm.

A

Juristic person

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17
Q

Explain No contractual capacity?

A
  • Mental incapacity
  • Infans
  • ## Drugs and alcohol: Persons under influence of drugs or alcohol to a near state of automatism
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18
Q

What type of contractual capacity does an infans have?

A

No contractual capacity

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19
Q

What type of contractual capacity does an intoxicated
person near state of automatism have?

A

No contractual capacity

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20
Q

What is the general presumption between contracting
parties entering into a contract?

A

Contracting parties are presumed to be sane

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21
Q

What is the effect of a contract concluded with an infans who
was assisted by her mother?

A

Void

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22
Q

Lisa, aged six years and 11 months, buys a DVD from Movies Galore, with her pocket money. The contract between Lisa and Movies Galore is:

A

Void

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23
Q

What is the general presumption between contracting
parties entering into a contract?

A

Contracting parties are presumed to be sane

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24
Q

Sam has three beers. Although she feels a bit tipsy, she is not drunk. Sam sells her tablet to Angelique for R 500. The contract between Sam and Angelique is:

A

Valid

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25
Q

Sam has three bottles of wine. Sam is very drunk and does not know where she is when she sells her tablet to Angelique for R 500. The contract between Sam and Angelique is:

A

Void

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26
Q

True or false: Andrea must prove that Caitlin experienced a lucid moment when the contract was concluded. This statement is:

A

False

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27
Q

Tru or False: Contracting parties are presumed to be sane when they enter into a contract. This statement is:

A

True

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28
Q

A contract concluded with an infans who was assisted by her mother is:

A

Void

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29
Q

True or False: An infans has no legal capacity. This statement is:

A

False

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30
Q

True or false: It is trite law that it is not possible for contracting parties to reach consensus, if one party is mentally ill or mentally incapacitated at the time when the contract is concluded.

A

True

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31
Q

Limited contractual capacity

A

Minors

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32
Q

Define a Minor?

A

A minor is an unmarried child between the ages of seven and 18 years of age. (See the previous discussion regarding effect of marriage on a minority.)

33
Q

Who is the legal guardian of a minor child?

A

The biological parents of a minor child are the natural guardians of the minor child. After the legal adoption of a minor child, the adoptive parents have the same rights and duties as the biological parents. As such, adoptive parents become the legal guardians of the minor child.

34
Q

In deciding to appoint a person as a legal guardian, the court will take the following factors into account:

A
  • What is in the best interest of the minor child?
  • What is the relationship between the applicant and the minor child, and what is the relationship between the minor child and any other relevant person?
  • Reasons why the existing guardian is not suitable to have guardianship of the minor child (section 24 of the Children’s Act).
  • Any other factor that, in the opinion of the court, needs to be taken into account.
35
Q

Minor + no assistance =

A

Unenforceable

36
Q

Minor conclude contract without + ratification =

A

Valid Contract

37
Q

Emancipation refers to?

A

an instance where the parent or guardian of a minor child grants consent to allow the minor to ‘act in certain economic spheres without obtaining additional consent or assistance’ (Nagel, 2015: 81). Such consent may be given either expressly or tacitly; the parent or guardian’s ‘mere aloof attitude will not constitute consent’, and may be revoked at any stage

38
Q

The following table summarises the effect on a contract concluded by a minor?

A
  • Assisted by parent/guardian = Valid (unless additional consent is required)
  • Emancipated minor: Valid (only in respect of contracts related to emancipation)
  • Fraudulent minor: Valid
  • Minor receives rights only: Valid
  • Ratification by minor after they attained majority: Valid
  • Ratification by parent/guardian: Valid
  • Statutory exceptions: Valid – see the previous table
  • Unassisted minor: Common law (i.e. general rule) - - Unenforceable: Unassisted unemancipated minor: - - Contract regulated by CPA Voidable at the option of consumer
  • Unassisted unemancipated minor: Contract regulated by NCA Void
39
Q

Which of the following contracts concluded by a minor are valid?

A

Minor concludes the contract and the parent gives consent afterwards

40
Q

All of the following are statutory exceptions related to
minors except?

A

A pregnant woman of 16 years and older may consent to an abortion

41
Q

When can a minor claim restitution under common law?

A

If the contract is to the detriment of the minor

42
Q

Which term describes the situation where a minor is
granted consent to act without needing to obtain
additional consent or assistance in terms of the law?

A

Emancipation

43
Q

What is an unmarried person between the age of 7 and
18 years known as?

A

Minor

44
Q

Spouses who are married in community of property estates merged into a?

A

joint estate

45
Q

Out of community of property excluding profit and loss?

A

Spouses who wish to marry out of community of property, excluding profit and loss, need to expressly specify in their ANC that they wish to exclude profit and loss accrued during their marriage

46
Q

Spousal consent required

A

Spouses who are married in community of property require the consent of the other spouse, when they enter into certain transactions. There are three types of consent that are required, namely, informal consent, written consent and written consent attested by two witnesses, depending on the type of contract that the spouse is concluding.

47
Q

Written consent attested by two witnesses of the other spouse is required for any of the following transactions?

A

Alienation, mortgaging or burdening of any immovable property by servitude or a real right.

Purchasing residential immovable property by means of instalments, as defined in the Alienation of Land Act 68 of 1981. Conclusion of a credit agreement as provided for in the NCA.
Signing surety for or on behalf of another person.

48
Q

The sequestration of a natural person’s estate has an effect on the status of this person. Upon the sequestration of the insolvent’s estate, the insolvent is?

A

divested (i.e. stripped) of their estate, and the estate first vests in the Master, and thereafter the insolvent’s trustee.

49
Q

A prodigal is a spendthrift and must be so declared by?

A

a court of law. A curator is appointed to administer the affairs of the prodigal.

50
Q

A prodigal cannot enter into a valid contract that is binding on their estate without the assistance/consent?

A

of the curator. Any contract that a prodigal enters into without the assistance of the curator is void.

51
Q

If an insolvent signs a contract, what type of contract is it?

A

Voidable

52
Q

Sipho and Zuki are getting married. They want to combine all their assets so they have joint ownership. What type of matrimonial property system is this?

A

In community of property

53
Q

Which one of the following statements is correct?

A

A minor over the age of seven years has limited capacity to act

54
Q

Which one of the following statements is correct?

A

Allison, aged six has no capacity to act

55
Q

What is a person who squanders his assets in an
irresponsible fashion known as?

A

Prodigal

56
Q

Nandi, aged 16, buys a tablet from Amir with money that she had earned as a waitress. Nandi enters into the agreement without her mother’s (Lindi) assistance. As Nandi is afraid her mother will insist that she returns the tablet, she hides it from Lindi. This agreement is?
Unenforceable

A

Unenforceable

57
Q

Nandi, aged 16, buys a tablet from Amir with money that she had earned as a waitress. Nandi enters into the agreement without her mother’s (Lindi) assistance. The evening after Nandi buys the tablet, she shows it to Lindi, who praises her for the good bargain that she got. This agreement is?

A

Valid

58
Q

Nandi, aged 16, buys a tablet from Amir with money that she had earned as a waitress. Nandi enters into the agreement without her mother’s (Lindi) assistance. The evening after Nandi buys the tablet, she shows it to Lindi, who praises her for the good bargain that she got. What is the name of the legal principle illustrated?

A

Ratification

59
Q

Nandi, aged 16, buys a tablet from Amir’s Computer Business (Pty) Ltd. on credit. Nandi enters into the agreement without her mother’s (Lindi) assistance. As Nandi is afraid her mother will insist that she return the tablet, she hides it from Lindi. This agreement is a credit agreement, as defined by the National Credit Act 34 of 2005. This agreement is?

A

Void

60
Q

Nandi, aged 16, buys a tablet from Amir’s Computer Business (Pty) Ltd. Nandi enters into the agreement without her mother’s (Lindi) assistance. As Nandi is afraid her mother will insist that she return the tablet, she hides it from Lindi. This agreement is regulated by the Consumer Protection Act 68 of 2008. This agreement is?

A

Voidable, at Nandi’s instance

61
Q

Nandi, aged 16, started living with her mother, Lindi, after her divorce from Samson. She buys a tablet from Amir with money that she had earned as a waitress. Nandi enters into the agreement without her mother’s (Lindi) assistance. This agreement is?

A

Valid

62
Q

What is the legal principle referred to in question (vii) called?

A

Emancipation

63
Q

Refer to the facts in question (vii). Assume that Lindi withdraws her consent regarding Nandi being a hairdresser. This agreement is:

A

Unenforceable

64
Q

Nandi, aged 16, opens a savings account with Bright Star Bank Ltd. without the assistance of her mother, Lindi. This agreement is:

A

Valid

65
Q

Nandi, aged 16, buys a tablet from Amir’s Computer Business (Pty) Ltd. Nandi enters into the agreement without her mother’s (Lindi) assistance. When Nandi entered into the agreement, she pretended to be a major, and she supported the lie with a falsified ID book. The salesperson at Amir’s Computer Business (Pty) Ltd. believed Nandi, and on the basis of this lie, the agreement was concluded. As Nandi is afraid her mother will insist that she returns the tablet, she hides it from Lindi. This agreement is regulated by the Consumer Protection Act 68 of 2008. This agreement is?

A

Valid

66
Q

Wanda’s estate was sequestrated by the High Court in Pietermaritzburg. Pursuant to the sequestration of her estate, Laurens is appointed to administer Wanda’s estate. Wanda sells her TV set that she owned, prior to the sequestration of her estate, to Maggie. This agreement is?

A

Voidable, at Laurens’s instance

67
Q

Wanda’s estate was sequestrated by the High Court in Pietermaritzburg. Pursuant to the sequestration of her estate, Laurens is appointed to administer Wanda’s estate. Wanda sells her TV set that she owned, prior to the sequestration of her estate, to?

A

Voidable, at Laurens’s instance

68
Q

(xiii) Refer to the facts in question (xii). What is Laurens’s legal name?

A

Trustee

69
Q

How are Mary and Joseph married?

A

Out of community of property, with accrual

70
Q

Joseph was recently promoted. He wants to buy a new car. Joseph finds a car, and he applies for motor vehicle financing, in the form of an instalment transaction, which is a credit agreement, as defined by the National Credit Act 34 of 2005. Which type of consent, if any, does Joseph have to obtain?

A

Only Mary’s written consent, attested by two witnesses

71
Q

Mary wants to accept a new job offer. Which type of consent, if any, does Mary have to obtain?

A

No consent

72
Q

Joseph wants to sell their antique coin collection that is valued at R 125 000. Which type of consent, if any, does Joseph have to obtain?

A

Only Mary’s written consent

73
Q

Assume that before their marriage, Mary and Joseph signed an agreement to regulate their marital property regime. They did not include any express provisions in this agreement to change the general legal position, as contemplated in the Matrimonial Property Act 88 of 1984. How are Mary and Joseph married?

A

Out of community of property, with accrual

74
Q

Refer to the facts in question (xix). With reference to the agreement that Mary and Joseph concluded, in order to be enforceable against third parties, choose the correct statement. This agreement?

A

Must comply with b. and c.
b) Must be notarially executed
c) Must be registered

75
Q

True or false: A person who is married out of community of property, with accrual, has limited contractual capacity.

A

False - full contract

76
Q

T&F: Mary, aged 15, enters into a contract without the assistance of her mother, Jane. This contract that Mary had concluded, is unenforceable

A

True – CL position regarding contracts with minors

77
Q

True or false: Musa’s family thinks that she spends too much money on shoes. At the end of the month, Musa buys five pairs of shoes from Razzmatazz Shoes, when she is on her own at Sandton Shopping Centre. The contract between Musa and Razzmatazz Shoes is valid.

A

True – she has full contractual capacity (i.e. she was not declared a prodigal by a court of law)

78
Q

True or false: Wanda, an unrehabilitated insolvent, signs a contract with Black Skies Ltd., in terms of which she will render IT services to Black Skies Ltd. Wanda enters into the contract without the assistance of Roxanne, her trustee. Wanda entered into a valid contract with Black Skies Ltd.

A

True – contract does not relate to her old estate

79
Q

Rachelle, aged 15, may draft a valid will.

A

False – only if 16 or older

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