Access over 20 million homework & study documents

search

21CR Fraud

Content type
User Generated
Rating
Showing Page:
1/5
1
Fraud
DEFINITION
Fraud is the unlawful intentional making of a misrepresentation which causes actual prejudice or which
is potentially prejudicial to another.
Fraud consists in unlawfully making, with intent to defraud, a misrepresentation which causes actual
prejudice or which is potentially prejudicial to another
ELEMENTS
The essential elements of fraud are:
(1) Unlawful
(2) Misrepresentation
(3) Prejudice
(4) Intention
(1) Unlawfulness
The misrepresentation must be prohibited by law, but some forms of misrepresentation are not unlawful
The exaggeration of the qualities of good or commodities involved in ordinary commercial advertising
(puffing) is not unlawful, even where the prejudice may be well-known such as in the case of tobacco or
liquor.
There are some limits to the sort of prejudice to the governmental activities of the State that will come
within the ambit of fraud
There seems to be a tacit acceptance that certain types of misrepresentations that cause prejudice are not
prosecuted and are thus by implication not unlawful.
Authority, coercion or consent may be grounds of justification from an otherwise fraudulent
misrepresentation.
Misrepresentations of love or affection falsely made in order to obtain sexual favours do not amount to
fraud
If X is HIV-positive and engages in unprotected sexual intercourse with Y without disclosing his HIV status,
and Y has consented to the sexual intercourse with the impression that only pleasure will be exchanged and
not a life-threatening virus, can X be guilty of fraud?
Questions to consider are:
1. Is the non-disclosure of an HIV status to a sexual partner unlawful?
2. Does X make a misrepresentation through the non-disclosure of his status?
3. Does X’s conduct have the intention to cause the prejudice (actual or potential)
4. What if it turns out that Y is HIV-negative after the intercourse; can X be liable for fraud assuming all the
elements are proved?
Failure to disclose an HIV-positive status
S2(4)(c) of the Criminal Law (Sexual Offences) Amendment Bill defines rape to include situations where a person
“intentionally fails to disclose to the person is respect of whom an act which causes penetration is being committed,
that he or she is infected by a life-threatening sexually transmissible infection in circumstances in which there is a
significant risk of transmission of such infection to that person”
(2) Misrepresentation
The essence of fraud is the deceiving or misleading of the victim into believing the incorrect statement of
fact or law.
Generally it is done expressly through speech or writing but it can be implied (conduct).
A misrepresentation; an incorrect statement of fact or law made by one person to another
Example: B buys goods on credit and impliedly represents he will pay for the goods in the future. However,
at the time of the purchasing he had no intention to pay later, so he has misrepresented his state of mind
which will cause prejudice to the shop owners.
CASE: R v Persotam
Facts: The accused and his wife bought goods on credit from the complainant and represented that they
were willing and able to pay for the goods. The court a quo held the accused made a false representation
calculated to prejudice the sellers.
Court held: There is always an implied representation of good faith by the purchaser of good on credit. So
much is that a matter of course that no seller would dream of asking of the purchaser an expression of

Sign up to view the full document!

lock_open Sign Up
Showing Page:
2/5
2
honest present intention to fulfill his part of the bargain. The accused represented an intention to fulfill his
promise to pay on the due date, which arose from his conduct of buying the goods on credit.
Principle: When a person buys good on credit there is an implied representation of good faith that he/she
is willing and able to pay; if the person does not pay it amounts to misrepresentation
(1) Words
The words or writing must constitute a statement that is false
Whether the words used are false is often a difficult question of fact
R v Wege: X sold a tractor to Y and informed him that it was “new” but it had been used for demonstration
purposes and had driven 400-500 miles. The court had to determine whether “new” meant “unused”
(2) Conduct
A fraudster may make a misrepresentation by:
Nodding or shaking his head (R v Larkins),
Dressing a certain way (R v Barnard)
Using certain stationery (R v Rhodes)
Ordering a meal in a restaurant (R v Bornmann)
o By ordering a meal X represents by his conduct that he is able and willing to pay for it. If he has no
honest belief in his ability and willingness to pay, he commits fraud (Similar to R v Persotam)
Conducting business in a certain manner (R v Persotam)
Distinguishing merchandise (R v Paton)
Tendering a document (R v Uys) or credit card (S v Salcedo)
Activating a machine (S v Myeza)
Withdrawing money from an ATM
Misrepresentation may be a positive act or an omission.
(3) Silence/non-disclosure/omission
A misrepresentation may be made by remaining silent or not speaking when he ought to have
“If anyone with evil intent suppresses or conceals the truth by which means he leads into error, he is guilty
of falsum
A mere omission to disclose the law may amount to a misrepresentation if there was a legal duty to inform a
person
The legal duty can arise from statute but it ultimately depends on the boni mores (legal convictions of the
community)
Example: M is a cattle owner and his cattle were kept in the same kraal as N’s cattle. N passes away and M
has to disclose how many of N’s cattle there are so that N’s descendants can inherit. 5 new calves were
born from N’s cattle but M fails to disclose this and keeps the cattle for himself. The fiduciary relationship
imposes a legal duty in this instance
Special relationship directors must expose information to others???
CASE: R v Heller
Facts: Three groups of companies were under control of 3 different people. The first accused had played a
major role in fraud as he had enriched himself personally through certain transactions and did not disclose
this
Court held: The non-disclosure of a fact can form the basis for a charge of fraud.
(4) Opinion
A man can tell a lie about the state of his own mind and such misrepresentation will suffice for fraud if it
can be proved
R v Persotam: AD held that if X buys on credit he impliedly represents that here and now he intends to pay
in the future and commits fraud if he has no such intention
R v Deetlefs: The accused did not have an honest belief that the cheque would be honoured on the post-
date so his opinion was a misrepresentation.
(5) Law
If a state of law is misrepresented it will not avail him to say that everyone is presumed to know the law
He dishonestly misrepresented the state of his opinion, and the true inquiry whenever a fraud charge is
based on a misrepresentation is whether he honestly held that view of the law
CASE: S v Schnittker
Facts: The appellant was a salesman who went to a butcher and told him he was selling placards regarding
industrial legislation that were required to be placed on the walls of certain places of business. The butcher

Sign up to view the full document!

lock_open Sign Up
Showing Page:
3/5

Sign up to view the full document!

lock_open Sign Up
End of Preview - Want to read all 5 pages?
Access Now
Unformatted Attachment Preview
Fraud DEFINITION ❖ ❖ Fraud is the unlawful intentional making of a misrepresentation which causes actual prejudice or which is potentially prejudicial to another. Fraud consists in unlawfully making, with intent to defraud, a misrepresentation which causes actual prejudice or which is potentially prejudicial to another ELEMENTS The essential elements of fraud are: (1) Unlawful (2) Misrepresentation (3) Prejudice (4) Intention (1) Unlawfulness ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ 1. 2. 3. 4. The misrepresentation must be prohibited by law, but some forms of misrepresentation are not unlawful The exaggeration of the qualities of good or commodities involved in ordinary commercial advertising (puffing) is not unlawful, even where the prejudice may be well-known such as in the case of tobacco or liquor. There are some limits to the sort of prejudice to the governmental activities of the State that will come within the ambit of fraud There seems to be a tacit acceptance that certain types of misrepresentations that cause prejudice are not prosecuted and are thus by implication not unlawful. Authority, coercion or consent may be grounds of justification from an otherwise fraudulent misrepresentation. Misrepresentations of love or affection falsely made in order to obtain sexual favours do not amount to fraud If X is HIV-positive and engages in unprotected sexual intercourse with Y without disclosing his HIV status, and Y has consented to the sexual intercourse with the impressio ...
Purchase document to see full attachment
User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

Anonymous
Excellent resource! Really helped me get the gist of things.

Studypool
4.7
Trustpilot
4.5
Sitejabber
4.4