Breach of Contract and Remedies For Breach

BREACH OF
CONTRACT
AND REMEDIES
FOR BREACH
CONTRACT
Dr Innocent Maja with Walter
Makhuyana
BREACH OF CONTRACT
 It occurs when one party to the contract fails to
honour obligations in a contract.
 There is fault on the part of the party breaching the
contract
 Breach is limited to parties to a contract
 Trojan Nickel Mine v Reserve Bank of Zimbabwe HH-
169-13 highlights that a third party can be sued for
intentional inducement of a breach of contract.
CATEGORIES OF BREACH
 Breach according to when performance was due
e.g. anticipatory breach & malperformance
 Breach according to which party failed to honour
contractual obligations e.g. mora debitoris and
mora creditoris
 Breach according to the impact on the essential
terms of the contract e.g. breach going to the root
of the contract and breach not going to the root of
the contract
i. ANTICIPATORY BREACH
It occurs before performance is due
A. Repudiation – occurs when a party acts (by words or
conduct) in a way that indicates that (s)he is not going to
honour contractual obligations. Requirements include (i)
conduct indicating refusal to perform, (ii) no justification
for refusal to perform and (iii) the innocent party should
accept repudiation,
2. Prevention of performance – the conduct of the other
party should make the other party’s performance
impossible. Requirements are (i) performance is impossible
and (ii) the other party must have caused the impossibility.
ii. MALPERFORMANCE
It occurs after performance is due
A. MORA – occurs when performance is not on time. Mora
ex re – when performance time is stipulated, the party is in
mora if they fail to perform on time. Mora ex persona – no
time is stipulated. The innocent party has to place the
debtor in mora by way of a demand. Demand should specify
reasonable time to perform and the action that the creditor
intends to take,
2. Positive malperformance – occurs when there is
defective performance. Innocent party can reject the
defective performance and claim for specific performance,
cancellation or damages.
iii. MORA DEBITORIS
It occurs when there is late performance by debtor
Requirements include (i) delay in performance by debtor,
(ii) performance must remain possible and (iii) the debt
must be due and enforceable
IV. MORA CREDITORIS

 Occurs when creditor fails to co-operate with debtor
which makes performance impossible.
 Requirements include (a) debt must be due, (b) debtor
must tender proper performance (c) creditor failed to
accept performance or cooperate with debtor (d)
creditor at fault and (e) performance must remain
possible
v. Breach going to the root
It refers to breach of a material term
Transport and Crane Hire v Hubert Davies & Co 1991
(1) ZLR 190 indicates that cancellation is an
appropriate remedy
Vi. Breach not going to the root

 Refers to breach of a non-essential term
 It does not lead to cancellation of contract unless
there is a cancellation clause or there is
anticipatory breach or repudiation.
Defences available to innocent party when there is breach
 Where there are reciprocal obligations, the innocent party
can withhold performance in order to force the defaulting
party to perform
 Principle of reciprocity or exceptio non-adimpleti contractus
 Beitbridge Railway (Pvt) Ltd v Commercial Union Insurance
Company of Zimbabwe 2008 (1) ZLR 207 (S) 214 D-E
recognized the principle of reciprocity as part of
Zimbabwean law
 See also Christie; Business Law in Zimbabwe at pp 106 &119;
 ‘There is a presumption that in every bilateral or
synallagmatic contract, i.e. one in which each party
undertakes obligations towards the other, the common
intention is that neither should be entitled to enforce
the contract unless he has performed or is ready to
perform his own obligations
REMEDIES FOR BREACH
 Which party breached the contract?
 In respect to which obligation?
 Are there reciprocal obligation?
 Which form of breach did the party commit?
 What is the appropriate remedy?
 Innocent party should make its claim in one action (once
and for all rule)
 Remedies for breach of contract are aimed at either
fulfillment of contract or termination of the contractual
relationship. Innocent party can therefor choose to
uphold or cancel the contract
WHEN INNOCENT PARTY
UPHOLDS
1.SPECIFIC PERFORMANCE – it is the primary remedy and is
aimed at compelling the defaulting party to perform its
contractual obligations.
 General rule is that the innocent party is entitled to
specific performance unless it is impossible to perform,
the order causes undue hardship, the contract if for
personal services, it would be difficult to supervise
performance by the defaulting party or where damages
would adequately compensate the Plaintiff.
2. INTERDICT – is a court order either restraining a
person from doing a particular act or compelling a
person to do a specific act.
 Prohibitory interdict – restrains
 Mandatory interdict – compels a person to do a
positive act to remedy a wrong
 Restitutionary interdict – compels restoration of
possession.
Requirements include right (prima facie or clear),
irreparable harm, balance of convenience favours
granting of interdict and the Applicant must have
no other satisfactory remedy.
3. DECLARATION OF RIGHTS
 Secured in terms of section 14 of the High Court
Acts (Chapter 7:06)
 They normally resolve disputes on existence,
validity and interpretation of a contract and
rights of parties in a contract.
 Also called a Declaratur.
WHEN INNOCENT PARTY CANCELS
1. CANCELLATION
 REQUIREMENTS
 Right to cancel – material breach, anticipatory
breach, repudiation, mora or there is a cancellation
(forfeiture) clause
 Ability to restore performance received
 Exercise of right to cancel – notice of cancellation
should be unqualified, immediate, final and must be
exercised ex nunc (Econet Wireless (Pvt) Ltd v
Trustco Mobile (Proprietary) Limited and anor S43-
13.
WHEN INNOCENT PARTY UPHOLDS OR
CANCELS
DAMAGES – are claimed for financial loss and are aimed at

placing the innocent party at the position they would have
been had the contract been performed (Victoria Falls &
TV1 Power Company Limited v Consolidated Langlaagte
Mines Limited 1915 AD 1 page 22 and Rowland Electro
Engineering (Pvt) Ltd v Zimbank 2007 (1) ZLR 1 (H) 13F)
 REQUIREMENTS
 Breach of contract
 Patrimonial (financial) loss
 Causal connection between breach and loss
 Loss is not too remote
A. General damages– loss is not remote
B. Special damages – loss is remote but can be claimed if
loss was reasonably foreseeable. Courts have developed
the contemplation principle (was loss reasonably
foreseeable) and the convention principle (loss should be
reasonably foreseeable and parties must agree that guilty
party should pay in the event of such loss occurring).
Zimbabwean courts use contemplation principle.
C. NOMINAL DAMAGES – Wynina (Pvt) Ltd v MBCA Bank
Limited held that Zimbabwean courts can award nominal
damages where a party proves breach and cannot establish
quantum.
 Innocent party has a duty to take reasonable steps to
mitigate loss and should be reimbursed for it.

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BREACH OF

IV. MORA CREDITORIS

Vi. Breach not going to the root

DAMAGES – are claimed for financial loss and are aimed at

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