A closer look at the case
The property in question was bought on auction and the contract was subsequently signed by the buyer’s husband. The buyer did not sign the agreement herself and the seller was not initially aware of her existence. As the buyer then took considerable time to comply with the terms of the agreement, the seller put her on terms. In response, the buyer then made an application to the High Court to enforce the agreement.
The court felt the issue was the factual question of whether the written agreement was concluded between the buyer and the seller or between the buyer’s husband and the seller. Was the buyer’s husband acting as an agent and not in his own capacity when executing the written agreement? It appeared that the buyer’s husband only inserted the fact that he was acting for and on his wife’s behalf into the agreement at a later stage. It also appeared that he had no written authority to act on her behalf.
The court’s finding
The court therefore found that the claim for specific performance failed on several grounds, including the following.
As this case demonstrates, any party to an agreement must make sure that they personally sign the agreement in their capacity or provide written authority to an agent to sign on their behalf. It’s also clear that should an authority to sign be granted by ratification, the other party to the agreement must consent in writing.
A note on electronic signatures
The wording of the ALA as it currently reads does not allow for electronic signatures. This was, however, questioned in a recent decision by the Eastern Cape Local Division of the High Court, which found an electronically signed OTP to be valid. This decision must, however, be read and interpreted with great caution, as it will not be binding in any other division until the Supreme Court of Appeal sanctions this finding. The specific merit of the case must also be considered when an argument for the validity of electronic signatures is made.
Written by Wessel de Kock