Illegal Contracts and the Burden of Proof

Authors Jacques du Plessis

ISSN: 1996-2177
Affiliations: Professor of Private Law, Stellenbosch University
Source: South African Law Journal, Volume 132 Issue 3, 2015, p. 664 – 688


South African law, in line with a number of prominent jurisdictions, recognises the general rule that when the legality of a contractual term is in dispute, the party who alleges illegality bears the burden of proof. Possible justifications for the general rule are explored and it is concluded that the rule is supported by established principles of the law of evidence, as well as by the pacta servanda sunt principle, which requires that freely concluded agreements should be enforced. It further is concluded that in disputes over the legality of restraint of trade clauses there appears to be no compelling reason why the law should deviate from the general rule by exceptionally placing the burden of proof on the party seeking enforcement. The mere fact that parties sometimes agree to these terms in situations of inequality does not suffice. However, those who advocate greater sensitivity for the position that contracting parties find themselves in when they supposedly exercise their contractual autonomy express a legitimate concern. A solution supported here is that South African law should address this problem directly by extending the existing categories of cases of improperly obtained consent to include cases of exploitation of certain specific situations of weakness. Such a development would reinforce, rather than subvert, the pacta servanda sunt principle.