Peters, Flamman and Company v Kokstad Municipality
Encyclopedia
Peters, Flamman and Company v Kokstad Municipality, decided by Solomon JA, is a leading case in South African contract law
, specifically in the area of termination.
The company had entered into a twenty-year contract with the municipality to light its street lamps. It managed this without trouble for more than ten years, at which point World War I
broke out. The company was run and staffed by Germans, who were designated enemies of state and interned forthwith in prisoner-of-war camps. The company was handed over to and wound up by the state.
The company was clearly unable any longer to carry out its contractual obligations, so Kokstad Municipality sued for breach of contract. Solomon determined that, owing the supervening circumstances, performance was objectively impossible (casus fortuitus), and that the contract should therefore be terminated. The company's failure to perform was excused, "as no-one in those circumstances would be able to perform the contract and the impossibility is not due to his or her [that is, the company's] fault."
South African contract law
South African contract law is "essentially a modernised version of the Roman-Dutch law of contract," which is itself rooted in Roman law. In the broadest definition, a contract is an agreement entered into by two or more parties with the serious intention of creating a legal obligation...
, specifically in the area of termination.
The company had entered into a twenty-year contract with the municipality to light its street lamps. It managed this without trouble for more than ten years, at which point World War I
World War I
World War I , which was predominantly called the World War or the Great War from its occurrence until 1939, and the First World War or World War I thereafter, was a major war centred in Europe that began on 28 July 1914 and lasted until 11 November 1918...
broke out. The company was run and staffed by Germans, who were designated enemies of state and interned forthwith in prisoner-of-war camps. The company was handed over to and wound up by the state.
The company was clearly unable any longer to carry out its contractual obligations, so Kokstad Municipality sued for breach of contract. Solomon determined that, owing the supervening circumstances, performance was objectively impossible (casus fortuitus), and that the contract should therefore be terminated. The company's failure to perform was excused, "as no-one in those circumstances would be able to perform the contract and the impossibility is not due to his or her [that is, the company's] fault."