Department of Private Law

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Browsing Department of Private Law by browse.metadata.advisor "Lubbe, Gerhard"

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    Price adaptation and the requirement of certainty with specific reference to the contract of sale
    (Stellenbosch : Stellenbosch University, 1999-03) Laing, Martin Roland; Lubbe, Gerhard; Stellenbosch University. Faculty of Law. Department of Private Law.
    ENGLISH ABSTRACT: This study addresses the well-established principle of South African law that a price in a contract of sale must be certain or objectively ascertainable. The interpretation given to this principle by our courts is examined first, and found to be conservative. This approach is thereupon set against the recognition that parties frequently wish to provide for the possibility of price adaptation. The notion of price adaptation recognises that the latter often contract within a commercial environment fraught with uncertainty, yet wish to agree upon a price term which is both flexible and secure. An attempt to provide for price adaptation may bring an agreement into conflict with the rule of pretium certum. Accordingly, the study addresses the various means by which parties attempt to import price adaptation, whilst, at the same time, ensuring that their agreement does not fall foul of the latter rule. The courts may be of help through the implementation of terms or, as in the case of certain European jurisdictions, through their power to modify agreements following a drastic change in circumstance. Particular attention is given, however, to price adjustment clauses and reference in contracts to the standard of reasonableness. The development of price adaptation techniques depends upon the astuteness of courts in their striking down of agreements on the basis of pretium certum. The study concludes with an analysis of the American approach to certainty of price.