Article of Interest

The Deliberate Non-Fulfilment of a Suspensive Condition: A Brief Analysis of the Doctrine of Fictional Fulfilment

Published 28 January 2025  |  Commercial Law  |  Phumelelo Simelane, Managing Director

Introduction

Many commercial agreements contain suspensive conditions — clauses that must be met before the agreement becomes legally binding. This article examines what happens when a party deliberately prevents fulfilment of such a condition.

Suspensive Conditions and the Doctrine of Fictional Fulfilment

A suspensive condition (or condition precedent) requires certain conditions to be met before an agreement is legally binding. If unfulfilled, the agreement falls away entirely.

In Sayed Hoosen Mia v Verimark Holdings (Pty) Ltd, Judge Wallis confirmed that no action lies to compel a party to fulfil a suspensive condition — unless the party has designedly prevented its fulfilment.

“By our law a condition is deemed to have been fulfilled as against a person who would, subject to its fulfilment, be bound by an obligation and who has designedly prevented its fulfilment, unless the nature of the contract or circumstances show an absence of dolus on his part.” — Lekup Prop Co No 4 v Wright

In Scott and Another v Poupard and Another, the test was set out as requiring: (1) non-fulfilment of the condition; (2) the defendant’s breach with intention to frustrate fulfilment; and (3) a causal link between (1) and (2).

Case Study — Sale of Immovable Property

Where a bond originator obtains a mortgage bond and sends it to the purchaser for signature, and the purchaser refuses to sign — the seller may rely on deemed fulfilment of the mortgage bond suspensive condition.

Case Study — Sale of Shares

Where a purchaser deliberately fails to pay a deposit into trust to escape a share sale agreement, the seller may raise fictional fulfilment — provided they can prove deliberate mala fide conduct.

Conclusion

The doctrine of fictional fulfilment assists an innocent party where the other deliberately frustrates a suspensive condition. The doctrine is difficult to prove — the alleging party bears the onus of demonstrating deliberate and mala fide conduct. Each case must be assessed on its own merits.

1 Mia v Verimark Holdings (Pty) Ltd (522/08) [2009] ZASCA 99

2 Lekup Prop Co No 4 (Pty) Ltd v Wright [2012] ZASCA 67

3 Scott & another v Poupard & another 1971 (2) SA 373 (A)