The Role Of The Principles Of Good Faith And Ubuntu In The Law Of Contract

• Published date: 31 May 2022
• Subject Matter: Government, Public Sector, Constitutional & Administrative Law, Government Contracts, Procurement & PPP
• Law Firm: Fasken
• Author: Ms Bianca Da Costa, Andricia Hinckemann and Barr-Mary Tyzack

Historically, the roles of fairness, reasonableness and good faith in the law of contract have been the subject of debate; one of the most controversial issues is whether a court can refuse to enforce a valid contract if it considers that the enforcement would be unfair, unreasonable, or unduly harsh. In light of this, our courts have developed principles governing the enforcement of contracts, through principles such as good faith and ubuntu.

In the distinguishable case of S v Makwanyane and Another 1995 (3) SA 391 (CC) 484, the Constitutional Court explains ubuntu as humaneness, personhood and morality. Metaphorically, it expresses itself in umuntu ngumuntu ngabantu, describing the significance of group solidarity on survival issues so central to the survival of communities. The court stresses that the spirit of ubuntu "...emphasises respect for human dignity, marking a shift from confrontation to conciliation..."

Since the advent of the constitutional dispensation, the principle of good faith now derives its force from the Constitution and the values enshrined within it. These values include human dignity, the achievement of equality and the advancement of human rights and freedoms, and the rule of law. Incorporated into our law as a constitutional value is the principle of ubuntu; ubuntu in turn, informs the principle of public policy.

HM Du Plessis, a senior lecturer in the University of South Africa¹, makes a key distinction between the concept of good faith and ubuntu and provides that although both notions encourage contractual justice between the parties, ubuntu includes an additional duty to promote the parties' and community's social and economic well-being. As a result, unlike good faith, ubuntu is concerned with promoting substantive equality in private relationships

It is against this background, that we set out a timeline below on how the courts have applied the principles of good faith and ubuntu, which has influenced the interpretation of contracts over time.

Good faith and ubuntu, from a case law analysis:

1. Sasfin (Pty) Ltd v Beukes [1989] (1) SA 1 (A) 7
2. 1. The court held that the interests of the community or the public are of paramount importance in relation to the concept of public policy. Furthermore, that agreements which are clearly inimical to the interest of the community, whether they are contrary to law or morality, or run counter to social or economic expedience, will accordingly, on the grounds of public policy, not be...