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2024
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[2024] ZANCHC 98
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CCN Boerdery BK v ABSA Versekeringsmaatskappy BPK (2622/2015) [2024] ZANCHC 98 (4 October 2024)
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTHERN
CAPE DIVISION, KIMBERLEY)
Case
No: 2622/2015
Reportable:
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to Judges:
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to Magistrates:
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to Regional Magistrates:
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In
the matter between:
CCN
BOERDERY
BK
Plaintiff
and
ABSA
VERSEKERINGSMAATSKAPPY BPK
Defendant
Coram: Lever J
JUDGMENT
Lever
J:
1. The
plaintiff in this matter ran a business where it bought up lucerne
from other farmers and resold
such lucerne. The plaintiff entered
into a contract which was alleged to be partly written and partly
oral to insure such lucerne
with the defendant. The said insurance
agreement was negotiated through a broker appointed by the plaintiff.
This brokerage firm
bears a similar name to the defendant, but the
evidence is that it operates independently of the defendant and even
sells products
from at least one competing insurer. One of the risks
plaintiff sought to insure the said lucerne against was spontaneous
combustion
under what was termed a ‘crop and stack’
extension to the relevant insurance agreement.
2. There were
three incidents which gave rise to claims against the said insurance
agreement. The present
matter involved only the third such claim. The
incident that gave rise to the said third claim took place on the 29
December 2012.
The defendant repudiated this third claim in writing
on the 1 March 2013. Thereafter, the plaintiff left his original
brokers and
appointed a new broker. The new broker referred to as
‘Libra Brokers’ wrote to the insurance ombud on behalf of
the
plaintiff on the 9 December 2013. Thereafter a complaint was
lodged with the insurance ombud on the 11 December 2013.
3.
Correspondence between the insurance ombud and the defendant then
ensued. The insurance ombud was unable
to resolve the matter as the
quantum of the plaintiff’s claim fell outside his jurisdiction.
4. The
plaintiff then issued and served summons in this matter on the 18
December 2015. The defendant defended
the action and
inter alia
filed a special plea. The said special plea relied upon a contractual
time bar contained in the agreement between the parties.
The relevant
written portion of the agreement is contained in clause C1(f) and
reads as follows:
“
(f)
Prescription
(i)
The company will not be liable for any loss or
damage after the
expiry of 24 (twenty four) months after the occurrence of such loss
or damage, unless the claim is the subject
of a pending lawsuit or
arbitration, or unless the claim in respect of the insured’s
legal liability is against a third party.
This limitation shall not apply to
claims under any of the following Sections:
a. Business
interruption
b. Probity
Guarantee
c. Stated
Benefits
d. Group
Personal Accidents
e. Personal
Accidents (Assault) Extension under the Money Section if and when
applicable.
(ii)
If the Company denies any claim and a Summons is not
served withing 6
(six) months after such denial or in the case of arbitration in terms
of General Condition 13 (Arbitration) of
this Policy within 6 (six)
months after the arbitrator or arbitrators or final decision-maker
has given his or her verdict, all
benefits in terms of this Policy
will be forfeited in terms of such claim.”
5. It was
common cause between the parties that the exceptions and the
provisions relating to arbitration
in the above quoted clause did not
apply to the present case.
6. The special
plea proceeded that the incident giving rise to the claim took place
on the 29 December 2012
and the repudiation having taken place on the
1 March 2013, that the summons was served on the 18 December 2015.
Accordingly, the
relevant action was not initiated within six months
of the repudiation, and it was also not initiated within twenty-four
months
of the incident that gave rise to the claim.
7. The
plaintiff replicated to the said special plea. Such replication was
to the effect that plaintiff
denied the contention that the relevant
clause relating to the time bar formed a part of the insurance
agreement between the parties.
Plaintiff also raised two other
alternatives in the said replication, but these were not pursued when
the matter was argued.
8. It is only
this special plea that is before this court for adjudication. The
defendant accepted the duty
to begin and led the evidence of three
witnesses. The defendant also accepted the onus to establish the
contract.
9. The first
witness called by the defendant was Mr Seabelo Nkomozulu. Mr
Nkomozulu was an employee of the
defendant at different times. He was
not employed by the defendant at the time that is material to the
present claim, but the records
and correspondence relating to the
present claim falls under his custody and control. Mr Nkomozulu
recovered the email which was
sent to the plaintiff’s broker
with the various policy components attached to such email from the
defendant’s old archive
system. He could not open such
attachments. Mr Nkomozulu also identified the various components that
make up the defendant’s
insurance policy agreement. Mr
Nkomozulu also pointed out from the documents that plaintiff claimed
to be the written terms of
the said insurance agreement that the
general terms and conditions, which contain the time bar clause, were
incorporated by reference.
10. The next witness called by the
defendant was Mr Jonathan Tuohy. He is a technical manager with the
defendant. He was furnished
with the email that appears on page 1 of
the defendant’s bundle, which is dated the 3 August 2012. Mr
Tuohy was able to open
the attachments to that email and furnished
same to the defendant’s attorney. The plaintiff’s then
broker Mr Barnie
Du Plessis is known to him although he (Mr Tuohy)
did not deal with the policy at the material time. Mr Tuohy
identified the attachments
to the aforesaid email which he opened.
This included
inter alia
the general terms and conditions
which included the ‘time bar clause’ quoted above. Mr
Tuohy denied the contention
that the policy schedule attached to the
plaintiff’s Particulars of Claim at pages 7 to 25 of pleadings
bundle 1 formed the
full policy issued by the defendant.
11. Mr Tuohy also explained what is
meant by the terms inception date, endorsement date and review date.
Mr Tuohy also testified
that once the policy is issued the documents
would be sent to the plaintiff’s broker, who would forward such
documents to
the plaintiff.
12. The next witness called by the
defendant was Mr Barend (Barnie) Frederik Du Plessis. His evidence
was that he was the plaintiff’s
broker and acted as the
plaintiff’s agent in arranging insurance coverage for the
plaintiff. The people Mr Du Plessis had
contact with in his dealings
with the plaintiff were Mr Charles De Villiers and his daughter. Mr
Du Plessis’ evidence was
that he had contact with the
plaintiff’s representative at least once a month, at times he
would have had weekly contact
with the plaintiff’s
representatives and at other times he might have had such contact
every second week.
13. With reference to the email dated
3 August 2012, which appears at page 1 of the defendant’s trial
bundle, Mr Du Plessis
testified that such email was sent by Ms Minnie
Grobler, who was an administrative officer employed by the defendant.
The email
was copied to Mr Du Plessis as the plaintiff’s
broker. Mr Du Plessis was asked if he had an independent recollection
of receiving
this email to which he replied that he could not
independently recollect receiving it but acknowledged that it was
copied to his
email address.
14. Mr Du Plessis was asked what he
did with the electronic version of the relevant insurance contract
which was attached to the
said email in several parts. To which he
replied that he was obliged by legislation to either print a hard
copy or forward the
contract in electronic form to the client within
30 days of him receiving it. Mr Du Plessis was asked if he could
remember doing
so in this case. He replied that he could not now
recall doing so, but testified that in the ordinary course he would
visit his
clients at least once a month that he would normally print
that contract and take it to the client when he visited them.
15. Mr Du Plessis was referred to a
trailing email to the one already referred to dated 9 October 2012
which appeared at page 2
of the defendant’s trial bundle and a
further trailing email dated the 20 December 2012 in which at the
instance of the plaintiff
certain amendments and additions to the
relevant policy were sought.
16. These emails tend to support the
evidence of Mr Du Plessis that he had regular contact with the
representatives of the plaintiff.
17. It was clear from the evidence of
Mr Du Plessis that he forwarded the relevant repudiation letter to Mr
De Villiers’ daughter.
18. Mr Du Plessis also testified that
as the broker he was aware of the defendant’s time bar clause.
19. It is also clear from the evidence
of Mr Du Plessis that in forwarding the repudiation letter to the
representative of the plaintiff
he drew attention to the part of the
letter that dealt with the various options of how the matter could be
pursued if the plaintiff
did not accept the repudiation of its claim
by the defendant and this included a reference to the limit of time
within which legal
steps had to be initiated.
20. The defendant then closed its case
on the special plea and the plaintiff then called Mr Charles Tielman
De Villiers to testify
on behalf of the plaintiff.
21. Mr De Villiers testified that he
was not a member of the plaintiff, but he described himself as the
controlling mind behind
the plaintiff. Mr De Villiers testified that
his wife and a trust established for her benefit were the members of
the plaintiff.
Mr De Villiers also testified that his daughter did
all of the administrative work on behalf of the plaintiff, and this
included
the filing of the relevant insurance policy.
22. Mr De Villiers testified that the
only written policy document the plaintiff received from the
defendant was the schedule attached
to the Particulars of Claim as
annexure “A”, which appears at pages 7 to 17 of Pleadings
Bundle 1.
The said document is in the Afrikaans
language and contains the following term: “Hierdie polisskedule
moet saamgelees word
met die polisbewording, wat deel vorm van die
versekeringsooreenkoms wat hierby aangeheg is, of op versoek verkry
kan word.”
Loosely translated this means that: This
policy schedule must be read together with general terms and
conditions that form part
of this insurance agreement, such general
terms and conditions are annexed hereto or can be obtained on
request.
23. Mr De Villiers did not testify on
what he understood by this clause that was clearly set out in the
document which the plaintiff
asserted as the written portion of the
relevant insurance agreement. Unfortunately, Mr De Villiers was also
not cross-examined
on this aspect. However, from this clause alone it
must have been abundantly clear to Mr De Villiers that there was more
to this
insurance agreement that would affect the rights of the
plaintiff under the contract of insurance.
24. Significantly, under
cross-examination Mr De Villiers conceded that the broker and
Brokerage were acting as the plaintiff’s
agent in entering into
the relevant contract of insurance between the plaintiff and the
defendant.
25. Also of significance is the fact
that despite testifying that his daughter did the administration on
behalf of the plaintiff,
which would have included receiving and
filing the relevant contract of insurance, the plaintiff did not call
Mr De Villier’s
daughter to give evidence in this matter. This
is important in the context that the evidence was that such daughter
was the administrative
officer of the plaintiff. Mr Du Plessis’
evidence that his dealings were mainly with the daughter of Mr De
Villiers. The
fact that the plaintiff replicated to the special plea
that the time bar clause did not form part of the relevant contract
of insurance
between the plaintiff and the defendant.
26. This was the evidence placed
before this court. Mr Jankowitz who appeared for the plaintiff argued
that the time bar clause
was of such a nature that the defendant bore
the onus of establishing not only that it was part of the agreement
but that it had
come to the attention of Mr De Villiers and that he
had accepted the time bar clause as a term of the insurance contract
on behalf
of the plaintiff.
27. Mr D T v R Du Plessis SC, who
appeared for the defendant, argued that this was not the case pleaded
by the plaintiff in its
replication. That, accordingly, it was not
the case that the defendant had to meet on the pleadings. Mr Du
Plessis argued that
Mr De Villiers conceded that the broker also a Mr
Du Plessis was acting as the plaintiff’s agent in entering into
the relevant
insurance agreement. That the said broker was furnished
with the full agreement and was aware that the relevant insurance
contract
contained the disputed time bar clause.
28. The defendant’s counsel Mr
Du Plessis is undoubtedly correct when he states the argument put
forward by Mr Jankowitz on
behalf of the plaintiff was not the case
that defendant had to meet on the pleadings. In these circumstances,
such case cannot
fairly be considered in argument.
29. Mr De Villiers in his evidence on
behalf of the plaintiff contended that he was not aware of the
defendant’s time bar
clause in the relevant agreement of
insurance and on this basis, Mr Jankowitz argued that plaintiff did
not agree to the time bar
clause. Apart from the legal consequences
of the broker being the plaintiff’s agent, there are two other
considerations that
cast doubt on the evidence given by Mr De
Villiers. Firstly, in a letter by the plaintiff’s new brokers,
being Libra Brokers,
dated 9 December 2013, it is clear that such new
brokers were on that date aware of the defendant’s time bar
clause and that
at the date of the letter that the plaintiff’s
claim had already lapsed in terms of the time bar clause in the
agreement
with the defendant. Mr De Villiers was unable to explain
how Libra Brokers had knowledge of the time bar clause if he was
ignorant
of that fact as he claimed to be. The second aspect that is
a cause for concern in regard to the case put forward by the
plaintiff
is that it was clear from the evidence put before this
court that the daughter of Mr De Villiers was the person who did the
plaintiff’s
administrative work. That she was the person who
filed the policy documents relevant to this matter. Yet she was not
called to
give evidence on the plaintiff’s behalf.
30. The defendant’s Counsel, Mr
Du Plessis argued that I should draw a negative inference from the
plaintiff’s failure
to call the daughter of Mr De Villiers. I
don’t think it is necessary for this court to go that far to
reach a conclusion
in this matter.
31. The evidence before this court
clearly established that the time bar clause was a part of the
relevant insurance agreement between
the plaintiff and the defendant
in this matter.
32. The legal consequences that flow
from the broker Mr Du Plessis being the plaintiff’s agent in
negotiating the insurance
cover with the defendant bind the plaintiff
to such agreement including the time bar clause.
33.
In these circumstances the defendant’s special plea must
succeed, and the plaintiff’s claim must be dismissed on
the
basis that it has become time barred.
34.
The only outstanding issue that remains is the issue of costs. Mr Du
Plessis, who appeared for the defendant argued that costs
should
follow the result and that I should award costs of two counsel. He
argued for costs of two counsel not on the basis of the
complexity of
the matter but on the basis that the matter was of great importance
to both the plaintiff and the defendant.
35.
In my view costs should follow the event, but this is not a matter
that justifies the employment of two counsel. In considering
the
scale on which costs should be awarded I consider scale B to be the
appropriate scale.
In
the circumstances, the following order is made:
1.
The defendant’s special plea is upheld.
2.
The plaintiff’s claim is dismissed.
3.
The plaintiff is ordered to pay the defendant’s costs on scale
B.
L
G Lever
Judge
Northern
Cape Division, Kimberley
APPEARANCES:
For The Plaintiff:
Adv D C Jankowitz
oio Haarhoffs Inc
For The Defendant:
Adv D T v R Du
Plessis SC with Adv W A De Beer oio Van De Wall Inc.
Date of Hearing:
14 February 2023
Date of Judgment:
04 October 2024