Yet another missed opportunity to develop the Common Law of Contract? An analysis of Everfresh Market Virginia (Pty) Ltd v Shoprite Checkers (Pty) Ltd [2011]ZACC 30

Abstract

Courts are under a general obligation to develop common law by applying constitutional values as mandated by sections 8(3), 39(2) and 173 of the Constitution. There have been attempts by part of the judiciary and calls from legal commentators to develop the common law contractual doctrine of good faith. In particular, the question that has occupied judicial decision making and academic writing for some time now is whether the spirit, purport, and objects of our Constitution require courts to encourage good faith in contractual dealings or whether the Constitution insists that good faith requirements are enforceable. The Constitutional Court had an opportunity to settle this question in Everfresh Market Virginia (Pty) Ltd v Shoprite Checkers (Pty) Ltd1. This article argues that the Court wrongly decided that it was not in the interests of justice to grant leave to appeal. Consequently, the Court’s misdirection and its refusal to refer the matter to the High Court to develop common law to require parties who undertake to negotiate a new term in a lease agreement to do so reasonably and in good faith resulted in the loss of a great opportunity to develop the common law.