The general principle is “Pacta Sunt Servanda” – agreements must be kept. Under our common law, a verbal contract is just as valid and binding as a written one. However, there are significant statutory exceptions and evidentiary hurdles to consider.
1. When Writing is Compulsory (Statutory Exceptions)
While most agreements can be verbal, the South African Parliament has passed laws requiring certain contracts to be in writing and signed to be valid. A verbal agreement in these categories is void ab initio (invalid from the start):
- Sale of Land: The Alienation of Land Act 68 of 1981 requires all contracts for the sale of immovable property to be in writing and signed by both parties.
- Suretyships: Under the General Law Amendment Act 50 of 1956, a promise to stand surety for someone else’s debt must be in writing.
- Antenuptial Contracts: These must be in writing, signed before a Notary Public, and registered in the Deeds Office.
- Executory Donations: A promise to give a gift in the future must be in writing and signed by the donor.
2. The Burden of Proof
The biggest challenge in South African courts is the onus of proof. If you sue someone, you must prove on a “balance of probabilities” that:
1. The parties had the serious intention to contract.
2.The specific terms of the agreement were agreed upon.
Without a written document, the court looks for corroborating evidence, such as:
- Part-payment: Proof that money changed hands via EFT or bank statements.
- Conduct: If you delivered goods and the other party accepted them, their conduct suggests a contract existed.
- Digital Evidence: Emails, WhatsApp messages, and voice notes are recognized as “data messages” under the Electronic Communications and Transactions Act (ECTA) and can be used to prove the terms of a verbal deal.
3. The Consumer Protection Act (CPA)
If the agreement is between a supplier and a consumer, the Consumer Protection Act may apply. The CPA requires that even if a contract is verbal, the supplier must provide the consumer with a record of the transaction. Furthermore, any “unjust, unreasonable, or unfair” verbal terms may be declared void by a court or the National Consumer Tribunal.
To avoid the “he-said, she-said” trap, it is recommended sending a Letter of Confirmation immediately after a verbal discussion. If you send a WhatsApp or email stating, “As discussed, I am buying your car for R100,000 to be paid by Friday,” and the other party does not object, this serves as strong evidence that the verbal agreement was exactly as you stated.
In summary, you can sue on a verbal agreement, provided it does not involve land or suretyships. However, because litigation is expensive and the outcome of verbal disputes is often unpredictable, it is always safer to “get it in writing.”
by Jaques van den Ende