Constantia Insurance Co Ltd v Nohamba

• Jurisdiction: South Africa
• Citation: 1986 (3) SA 27 (A)

Constantia Insurance Co Ltd v Nohamba
1986 (3) SA 27 (A)

1986 (3) SA p27

Citation	1986 (3) SA 27 (A)
Court	Appellate Division
Judge	Corbett JA, Joubert JA, Boshoff JA, Galgut AJA and Nicholas AJA
Heard	February 24, 1986
Judgment	March 27, 1986

Flynote : Sleutelwoorde E

Appeal — In what cases — Against declaratory order having final effect as to validity of special plea — Order dismissing such special plea having all the attributes of a final order and appealable as falling within ambit of s 20 (1) F of Act 59 of 1959.

Insurance — Compulsory Motor Vehicle Insurance Act 56 of 1972 — Claim under — Requirements of s 25 (1) — Plaintiff, in MVA 13 form, through bona fide oversight, not disclosing entitlement to compensation under Act 30 of 1941 — MVA 13 form in all other respects accurate and complete — Plaintiff's omission not founding a special plea of G non-compliance with s 25 (1).

Headnote : Kopnota

Where a Court (on a stated case) is asked to make a declaratory order having a final effect as to the validity of a special plea, and thereupon makes an order which in effect dismisses H the special plea, its decision has all the attributes of a final order and is appealable as a "judgment or order" falling within the ambit of s 20 (1) of the Supreme Court Act 59 of 1959. (per GALGUT AJA; CORBETT JA, JOUBERT JA and BOSHOFF JA concurring; NICHOLAS AJA dissenting.)

Where the information set out in a MVA 13 form is in other respects complete and accurate, but the plaintiff has, through I a bona fide error, omitted to disclose (in para 10 of the form) that he is entitled to a payment under the Workmen's Compensation Act 30 of 1941, the information set out will suffice to allow the insurer to investigate the claim and the plaintiff will have sufficiently (ie "substantially") complied with the requirements of s 25 (1) of the Motor Vehicle Insurance Act 56 of 1972. (A special plea alleging non-compliance with s 25 (1) held to have been ill-founded under the above circumstances.)

The decision of the Full Bench of the Eastern Cape Division in Constantia Insurance Co Ltd v Nohamba 1984 (4) SA 927 confirmed. J

1986 (3) SA p28

Case Information

Appeal from a decision of the Full Bench of the Eastern Cape Division (EKSTEEN AJP, MULLINS J and A JENNETT AJ) reported at 1984 (4) SA 927. The facts appear from the judgment of GALGUT AJA.

L E Leach for the appellant: Should the respondent not have substantially complied with the statutory provisions of the B Compulsory Motor Vehicle Insurance Act 56 of 1972, the submission of the claim form would not amount to a valid "claim" and, therefore, the respondent's claims as set out in the summons would thus be unenforceable against the appellant as the summons was issued without any prescribed claim having been lodged and, ipso facto, without the requisite period of 90 C days laid down in s 25 (2) of the Act having expired. Evins v Shield Insurance Co Ltd 1980 (2) SA at 831 - 832; Nkisimane and Others v Santam Insurance Co Ltd 1978 (2) SA at 434H; Badenhorst and Another v Sentrale Raad vir Koöperatiewe Assuransie Bpk 1977 (2) SA at 791. It is well established that substantial compliance with the requirements of s 25 (1) as read with reg 16 of the said Act is sufficient in relation to D the contents of the prescribed claim form. AA Mutual Insurance Association Ltd v Gcanga 1980 (1) SA at 865; Davids v Protea Assurance Co Ltd 1980 (4) SA at 343G; Viljoen v AA Onderlinge Assuransie Maatskappy Bpk 1973 (2) SA at 677 - 678; SA Mutual Fire and General Insurance Co Ltd v Mapipa 1973 (3) SA at 603. E Whether or not there has been substantial compliance with the provisions of the Act is a matter of degree, each case depending upon its own particular facts and circumstances. Cf Viljoen's case supra at 678A. Ordinarily the minimum amount of information that will have to be supplied in order for there to be substantial compliance with the provisions of the Act relates to the identity of the claimant, the accident, the injuries and loss occasioned thereby, the identification of the F insured vehicle and to the computation of the amount of compensation claimed. Rondalia Versekeringskorporasie Bpk v Lemmer 1966 (2) SA at 255 - 256; Evin's case supra at 831C - G. In addition the degree of accuracy required should be sufficient to enable the authorised insurer to decide whether to resist the claim, or to settle or compromise it before G incurring the costs of litigation. Nkisimane's case supra at 434F; President Insurance Co v Gumbi 1971 (1) SA at 746H. In regard to whether there has been substantial compliance with the provisions of s 25 of the Act, sight must not be lost of the fact that the provisions of the said section were enacted mainly for the benefit of authorised insurers and that such H insurers are entitled to rely upon the accuracy of the information provided to them in the claim form. Gcanga's case supra at 865B; Viljoen's case supra at 677G. The reason why an authorised insurer is so entitled to rely upon the accuracy of the information contained in the claim form is that the Legislature clearly endeavoured to ensure that the information provided would not be casually advanced but would put the I insurer fully into the picture. Gumbi's case supra at 746H and 747 - 748. The test as to whether there has been substantial compliance must be applied objectively by looking at the claim form itself in order to ascertain whether or not the reasonable insurer would be prevented by the inaccuracy therein from properly investigating the claim and determining its attitude towards such claim and the amount of its liability. Gcanga's J case supra at 865G - H. In the light of the aforegoing, it is apparent that the Legislature clearly intended both

1986 (3) SA p29

that the authorised insurer should have sufficient information A as to enable it to accurately determine the amount of its liability (if any) towards an injured claimant and that in order to do so such insurer would be entitled to rely upon the accuracy of the information provided to it in the prescribed claim form. The information sought in para 10 of the claim form relating to the claimant's entitlement to receive compensation B in terms of the Workmen's Compensation Act 30 of 1941 is of fundamental importance as such compensation falls to be deducted from the quantum of a claimant's damages which may be recovered under Act 56 of 1972. See s 22 (2) of the latter Act. The respondent's entitlement to compensation in terms of Act 30 C of 1941 was a factor crucial to the assessment of the computation of the extent of the appellant's potential liability to the respondent arising out of the collision, and to any settlement or compromise which the respondent might offer and, indeed, to the investigation of the respondent's claim. In the light of all the aforegoing and, in particular, bearing in mind that substantial compliance with the provisions of s 25 of Act 56 of 1972 must be objectively judged, the D appellant has clearly established that the inaccurate information set out in the prescribed claim form was insufficient to enable it to properly investigate the respondent's claim and to determine its attitude towards such claim; that it was prejudicial in the extreme towards it being able to assess the amount of compensation which should be paid; E and that it was further prejudicial towards the appellant being able to settle or compromise the respondent's claim prior to the costs of litigation being incurred.

The conclusion of KROON AJ in the Court of first instance that there was substantial compliance with the provisions of s 25 (1) appears to have been based upon a finding that had the F appellant properly investigated the respondent's claim it could have verified the correctness of the allegations set out in para 10 of the prescribed claim form. It is conceded that the appellant would not be entitled to shield behind a negligent failure on its part to make reasonable investigations. Cf Viljoen's case supra at 678D. However, as has been set out above, a reasonable insurer is entitled to G rely upon the accuracy of the information provided in the claim form. Viljoen's case supra at 677H. To hold that the appellant could have verified the information provided begs the question of whether objectively decided the appellant was obliged to take steps to verify the information provided by the respondent. Where a claimant clearly states that he is not H entitled to receive workmen's compensation and that the provisions of the Workmen's Compensation Act are in no way applicable to his claim, a reasonable insurer, objectively judged, will not be obliged to investigate such a statement. There was nothing potentially ambiguous in the information which had been provided by the respondent which would require I investigation. Had the respondent alleged in the claim form that he had received compensation in terms of Act 30 of 1941, the appellant may possibly have been obliged to investigate the amount thereof, but where an unambiguous allegation is made that no such compensation would be forthcoming, the appellant was entitled to rely upon such information. To hold otherwise to what has been set out above would lead to the inevitable conclusion that an insurer would be obliged to verify the J correctness of each and every allegation contained in a

1986 (3) SA p30

A prescribed claim form submitted to it which could possibly be investigated, and that a failure to do so would debar such insurer from complaining that the claim form had been improperly completed. This conclusion is clearly untenable and could never have been contemplated by the Legislature. Such B contention is, in addition, contrary to the authorities cited above.

Although the inaccuracy complained of relates to only one portion of the...