Mercurius Motors v Lopez (149/07) [2008] ZASCA 22; [2008] 3 All SA 238 (SCA); 2008 (3) SA 572 (SCA) (27 March 2008)

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[2008] ZASCA 22
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Mercurius Motors v Lopez (149/07) [2008] ZASCA 22; [2008] 3 All SA 238 (SCA); 2008 (3) SA 572 (SCA) (27 March 2008)

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THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA
Reportable
Case no: 149/07
In
the matter between:
MERCURIUS
MOTORS ...
Appellant
and
PAUL
ALEXANDER PAVIA LOPEZ ...
Respondent
_______________________________________________________
Coram
:
Streicher, Navsa,
Ponnan, Maya JJA et Mhlantla AJA
Date of hearing:
7
March 2008
Date of delivery:
27
March 2008
Summary
:
Loss of vehicle delivered to service depot ─ failure to safeguard
keys ─ reliance on exemption clause ─ held that clause not
part
of contract of deposit ─ the service depot held liable.
Neutral
citation:
Mercurius
Motors v Lopez
(149/2007)
[2008] ZASCA 22
(27 March 2008).
_______________________________________________________
JUDGMENT
_______________________________________________________
NAVSA JA
NAVSA JA:
[1] During the morning of 23 July 2003
the respondent, Mr Paul Lopez, delivered a Jeep Cherokee motor
vehicle (the Jeep), which he
was then leasing from Daimler Chrysler
Services South Africa (Pty) Ltd, to Mercurius Motors at its East Rand
Mall depot in Boksburg.
Mercurius Motors (Mercurius) trades as a
motor dealer and service centre and is a division of the Imperial
group of companies. The
vehicle was delivered to Mercurius to be
serviced, for minor repairs to be effected and for the installation
of spotlights. The vehicle
was still under warranty and the costs of
repairs and the service were to be borne by the Daimler Chrysler
company (hereafter Daimler
Chrysler). The cost of the installation of
spotlights was to be borne by Mr Lopez.
[2] At the relevant time Daimler
Chrysler was the manufacturer of Jeep and other vehicles and
Mercurius was the franchise dealer which
sold vehicles to the public.
[3] In terms of his lease agreement
with Daimler Chrysler Mr Lopez bore the risk of loss of the
value of the vehicle.
[4] According to Mercurius, the East
Rand Mall depot was broken into by robbers during the night of 23
July 2003 ─ a lock on a gate
was broken. It was alleged that
security guards employed by Colt Security, an entity contracted by
Mercurius to safeguard its property,
were overpowered and abducted.
1
[5] The next morning, at approximately
08h15, Mr Lopez was informed about the theft of the Jeep. He had
leased it for use by his wife.
It was relatively new (approximately
six months old) and Mr Lopez and his wife were understandably upset.
The Jeep was fitted with
a satellite tracking device and Mr Lopez
informed Netstar, the company that provided the tracking service,
that the vehicle had gone
missing from Mercurius and instructed them
to take steps to trace and recover it. Unfortunately it could not be
traced and has not
been recovered.
[6] It is common cause that the Jeep
was the only vehicle missing from the depot. The keys to the Jeep
that had been handed to Mercurius
when the vehicle was delivered
could not be found. The established procedure was that the keys to
all the vehicles that had been
brought in for service had to be
safely locked away at the end of a working day.
[7] The respondent’s wife insisted
that, whilst steps were being taken to recover the vehicle and until
the question of liability
for its loss was determined, she should be
provided with a ‘loan’ vehicle. Mercurius provided such a vehicle
for use by Mrs Lopez
for a period of six months. This
notwithstanding, Mercurius denied liability for the loss of the Jeep,
relying on exemption of liability
clauses contained in the documents
Mr Lopez signed at the Mercurius workshop on the morning on which he
delivered the vehicle to
the workshop.
[8] The plaintiff instituted action in
the Johannesburg High Court against Mercurius based on the contract
of deposit, claiming damages
for the loss of the Jeep, the value of
which was agreed in an amount of R245 000.
[9] In its plea Mercurius repeated its
reliance on the exemption clauses and denied that the loss of the
Jeep was due to any negligence
on its part.
[10] The Johannesburg High Court found
in favour of Mr Lopez, ordering Mercurius to pay him R245 000
with interest a
tempore
morae
at the rate of 15.5
per cent per annum from 13 January 2004 to date of payment. Mercurius
was ordered to pay Mr Lopez’s costs. The
present appeal is with the
leave of this court.
The exemption clauses
[11] The first exemption clause is
contained in a document entitled ‘Warranty Repair Order’. Instead
of the expected Mercurius
Motors appellation at the head of the
document, the name Daimler Chrysler appears. Immediately above the
space for a customer’s
signature the following appears in fine
print:
‘
I
hereby authorize the repair work to be done along with the necessary
material, and hereby grant you and/or your employees permission
to
operate the car or truck herein described on streets, highways or
elsewhere for the purpose of testing and/or inspection. An express
mechanic’s lien is hereby acknowledged on this car or truck to
secure the amount of any charges for work not covered by Daimler
Chrysler’s warranty.’
[12] Immediately below the space for
the customer’s signature the following appears in capitals:
‘
NOT
RESPONSIBLE FOR LOSS OR DAMAGE TO CARS OR ARTICLES LEFT IN CARS IN
CASE OF FIRE, THEFT OR ANY OTHER CAUSE BEYOND OUR CONTROL.’
This exemption clause is clearly
visible and can hardly be missed by a person signing the form.
[13] The other exemption clause on
which Mercurius relied is contained in a second document described as
a repair order form. On the
left-hand side at the top of the
document, the words ‘MERCURIUS MOTORS’ are set out in large and
bold letters. Between a heading
that reads ‘
JOB
INSTRUCTION / WERKOPDRAG
’
and
a position indicating a signature by a customer is a space
approximately 13 cm x 13 cm, to be completed by the Mercurius
employee
receiving instructions from the customer regarding the work
to be done.
[14] On the repair order form,
immediately above the space indicated for a customer’s signature,
the following appears in capital
letters:
‘
PLEASE
REMOVE PULL-OUT RADIOS AND VALUABLES FROM YOUR VEHICLE.
WE WILL NOT BE HELD
RESPONSIBLE FOR ANY THEFT WHATSOEVER.’
This caption is prominent and should
easily be noticed by anyone signing the document.
[15] To the left of the caption
referred to in the preceding paragraph, the following appears in fine
print:
‘
I
have read and agree to the conditions of Contract on the reverse side
hereof. This is to certify that no valuable or personal belongings
have been left in the vehicle. Ek het die kontrak voorwaardes op die
keersy gelees en aanvaar sulke voorwaardes. Ek bevestig dat
geen
waardevolle en/of persoonlike besittings in die voertuig gelaat is
nie.’
It is necessary to record that this
print is much smaller than appears hereinabove, is starkly less
prominent than the caption referred
to in the previous paragraph and
does not attract one’s attention.
[16] The relevant part of the document
is reproduced in this paragraph to enable a better appreciation of
how it appeared to Mr Lopez:
[image]
This reproduction is condensed ─ the
original page on which the writing appears is four centimetres wider
than appears above. Consequently,
in reality, the space between what
appears on the right and left-hand side of the document is wider.
[17] It is also necessary to note that
the repair order form has a carbon copy underneath and has to be
detached in order to reveal
the conditions on the reverse side. The
relevant condition on which Mercurius relied is in clause 5, which
reads:
‘
I/we
acknowledge that MERCURIUS shall not be liable in any way whatsoever
or be responsible for any loss or damages sustained from
fire and/or
burglary and/or unlawful acts (including gross negligence) of their
representatives, agents or employees.’
It is evident that the ambit of this
exemption clause is wide.
[18] The evidence of Mr Lopez to the
effect that his attention was not drawn to the writing referred to in
para 15, nor to the conditions
themselves, by the workshop manager
who received the Jeep and who took down the instructions, is
uncontested.
The court below
[19] Tshiqi J, having regard to Mr
Lopez’s reliance on a contract of deposit and considering that
Mercurius had pleaded that the
contract was subject to exemption
clauses, correctly held that Mr Lopez as plaintiff bore the onus to
prove that the exemption clauses
were not part of the contract.
2
[20] The court below took into account
the general principle in our law that, when a person signs a
contractual document, he or she
agrees to be bound by the contents of
the document ─ otherwise referred to as the
caveat
subscriptor
rule.
3
Tshiqi J weighed up this rule against
Mr Lopez’s contention that he was misled as to the nature, purport
and contents of the document.
[21] Tshiqi J examined the warranty
claim form and concluded that, viewed objectively, the document was
misleading and confusing and
could be read to be exempting Daimler
Chrysler and not Mercurius.
[22] Interpreting the caption
immediately above the space for the customer’s signature in the
repair order form, the court below
held that the exemption could only
relate to theft from the vehicle of items such as radios and other
valuables and that the wording
does not include an exemption in
relation to the theft of the vehicle itself.
[23] The trial judge considered that
the reference on the left-hand side of the repair order form to the
conditions of contract was
printed and located in such a manner so as
not to draw the reader’s attention. She held that Mr Lopez’s
contention, that he was
misled by the form because it was unclear and
confusing, was justified.
[24] Having reached these conclusions
in relation to the exemption clauses, the high court then considered
the liability of a depository
for reward in regard to the loss of
items entrusted to him or her. The court rightly pointed out that a
depository could, of course,
escape liability if there was no
dolus
or
culpa
on his or her part.
4
[25] In relation to negligence, Tshiqi
J had regard to the instances of negligence on which Mr Lopez relied.
First, the failure by
Mercurius to safeguard the Jeep’s keys.
Second, the failure immediately to determine which vehicle was
missing, and then to communicate
the loss to Mr Lopez to enable him
to instruct the company responsible for the tracking device in the
Jeep to take steps to recover
it.
[26] In respect of the loss of the
key, the court below recorded that Mercurius was unable to explain
where the keys to the Jeep had
been kept and how they had got lost.
Mercurius had tendered evidence to show that it was the duty of
apprentice mechanics to ensure,
at the end of a working day, that no
keys were left in vehicles. Furthermore, employees of the security
company, when they came on
duty, were themselves required to do a
check to ensure the same. In the event of keys being found they were
obliged to remove the
keys and hand them to a patrol vehicle for safe
custody. No evidence was tendered of such steps having been taken.
[27] As stated earlier, no explanation
was offered for the absence of the keys from the bag containing the
keys to all the other vehicles
that had been in safekeeping. The
court below held that the probabilities indicated that the keys to
the Jeep were either left in
the vehicle or in a place where they
were easily accessible. It noted that there was no evidence that the
keys had been in the possession
of the guards or were kept safely. No
reason was proffered by Mercurius as to why the Jeep’s keys would
have been kept separate
from the other sets of keys which were locked
away safely.
[28] In respect of the second ground
of negligence on which Mr Lopez relied, the court below held that it
had not been shown that,
even if Mercurius had identified the missing
vehicle sooner and had informed Mr Lopez earlier, the tracking
company would have been
able to locate the vehicle.
[29] Finally, Tshiqi J held that the
conduct of Mercurius in relation to the keys amounted to negligence
and she consequently made
the orders referred to in para 10 above.
Conclusions
[30] In respect of the warranty claim
form, the court below, in my view, placed too much store on the fact
that the Daimler Chrysler
name appeared at the top of the document.
It can hardly be gainsaid that the authorisation referred to in para
11 above was an authorisation
directed at Mercurius and that
Mercurius was the entity that would effect the repairs in accordance
with the Daimler Chrysler warranty.
[31] In any event, counsel for
Mercurius did not place any reliance on the clause in the warranty
claim form. He accepted that the
exemption relates to loss or damage
occasioned by causes beyond the control of Mercurius and that the
theft of the Jeep was not beyond
its control.
[32] In relation to the caption in the
repair order form referred to in para 14 above, Tshiqi J rightly held
that the theft to which
the exemption relates is of valuables out of
the vehicle, rather than of the vehicle itself.
[33] A person delivering a motor
vehicle to be serviced or repaired would ordinarily rightly expect
that the depository would take
reasonable care in relation to the
safekeeping of the vehicle entrusted to him or her. An exemption
clause such as that contained
in clause 5 of the conditions of
contract, that undermines the very essence of the contract of
deposit, should be clearly and pertinently
brought to the attention
of a customer who signs a standard instruction form, and not by way
of an inconspicuous and barely legible
clause that refers to the
conditions on the reverse side of the page in question. Moreover, the
caption immediately above the signature
is misleading in that a
customer is directed to that provision and away from the more
important provision in small print on the left-hand
side of the
document which refers to the conditions on the reverse side of the
document which are themselves not easily accessible.
5
It will be recalled that Mr Lopez’s
unchallenged evidence was that the conditions on which Mercurius now
relies were not brought
to his attention.
[34] The test for negligence is as
follows:
‘
(a)
would
a reasonable person, in the same circumstances as the defendant, have
foreseen the possibility of harm to the plaintiff;
(b)
would a reasonable person
have taken steps to guard against that possibility;
(c)
did the defendant fail to
take the steps which he or she should reasonably have taken to guard
against it?
If all three parts of
this test receive an affirmative answer, then the defendant has
failed to measure up to the standard of the
reasonable person and
will be adjudged negligent.’
6
[35] By not safeguarding the keys to
the Jeep, the employees of Mercurius did not act as a reasonable
person in their circumstances
would have acted. It was clearly
foreseeable that theft of the vehicle would be facilitated by the
availability of the keys and no
discernable steps were taken to guard
against this.
[36] It was common cause that the
theft of the Jeep took place. The precise circumstances under which
it occurred were not agreed
upon. Counsel on behalf of Mercurius did
not seek, before us, to rely on the statements of the security guards
which had been ruled
inadmissible by Tshiqi J. It is significant that
the only vehicle missing was the vehicle in respect of which the keys
had not been
properly safeguarded. All the indications are that it is
the negligence of the employees of Mercurius which facilitated the
theft
of the Jeep. In any event, Mercurius failed to discharge the
onus of disproving
dolus
or
culpa
on its part.
[37] It is not necessary to deal with
the delay in relation to the notification by Mercurius to Mr Lopez of
the loss of the vehicle.
The material conclusions reached by the
court below cannot be faulted.
[38] The following order is made:
The appeal is dismissed with costs.
__________________
M S NAVSA
JUDGE OF APPEAL
CONCUR:
STREICHER JA
PONNAN JA
MAYA JA
MHLANTLA AJA
1
This
information was conveyed to Mercurius by a representative of Colt
Security and is contained in statements by two security guards
who
did not testify. The admissibility of the statements were in issue
in the trial court. For reasons that will become apparent
the
present appeal can be decided without reference to these statements.
See para 34 below. I shall assume in favour of Mercurius
that the
Jeep went missing in consequence of that robbery.
2
In
the case of the dispute as to the existence of such a clause as part
of the contract of deposit, it will be for the plaintiff
depositor
to prove that the clause was not a term of the contract. See
Stocks
& Stocks (Pty) Ltd v T J Daly & Sons (Pty) Ltd
1979 (3) SA 754
(A) and Harms
Amler’s
Precedents of Pleadings
6
ed (2003) p 145.
3
See
R H Christie
The Law of
Contract in South Africa
5
ed (2006) pp 174-179 and the authorities there cited.
4
See
Stocks & Stocks
supra
at 762A-D.
5
See
Spindrifter (Pty) Ltd v
Lester Donovan (Pty) Ltd
1986
(1) SA 303
(A) at 318C;
Kempston
Hire (Pty) Ltd v Snyman
1988
(4) SA 465
(T) at 467B-C and 468G-H;
Keens
Group Co (Pty) Ltd v Lötter
1989
(1) SA 585
(C) at 590B-592C;
Ndlovu
v Brian Porter Motors Ltd
1994
(2) SA 518
(C) at 526F;
Diners
Club SA (Pty) Ltd v Livingstone
1995
(4) SA 493
(W) at 495I-496A;
Fourie
NO v Hansen
2001 (2) SA
823
(W) at 833F-834C. See also the very interesting article by
Tjakie Naudé and Professor Gerhard Lubbe
Exemption
Clauses ─ A Rethink Occasioned by Afrox Healthcare BPK v Strydom
(2005) 122
SALJ
441.
6
See
Jonathan Burchell
Principles
of Delict
(1993) p 86 and
Kruger v Coetzee
1966 (2) 428 (A) at 430.