Kruger v President Insurance Co Ltd

• Jurisdiction: South Africa
• Judge: Thirion J
• Judgment Date: 19 January 1993
• Docket Number: 4945/92
• Court: Durban and Coast Local Division
• Hearing Date: 19 January 1993
• Citation: 1994 (2) SA 495 (D)

Thirion J:

This is an application for an order declaring that applicant's claim for compensation under the provisions of the Agreement Establishing J the Multilateral Motor Vehicle Accidents Fund (the agreement),

Thirion J

A which forms a Schedule to the Multilateral Motor Vehicle Accidents Fund Act 93 of 1989, has not become prescribed by reason of the operation of art 55 read with arts 57 and 63 of the agreement. In the alternative, and in the event of it being held that her claim has become prescribed, the applicant seeks an order, pursuant to art 58(b) of the agreement, granting her leave to serve on the respondent, before a date to be determined by the Court, her summons in an action to enforce her claim for compensation B in accordance with the provisions of art 63 of the agreement.

The applicant's notice of motion takes a curious form but the above is in essence the relief which the applicant is seeking.

The applicant sustained bodily injuries as a result of her being involved, C on 5 January 1990, in a collision with a motor vehicle in respect of which the respondent was the appointed agent of the Multilateral Motor Vehicle Accidents Fund (MMF) established under the agreement.

On a date which does not appear from the papers the applicant instructed a firm of attorneys to handle her claim for damages arising from the D occurrence. On 27 May 1991, ie more than 16 months after the occurrence, this firm of attorneys addressed a letter to the applicant informing her that due to a 'reorganisation' of the firm, it could not continue to act for her in the matter and that her claim was being 'entrusted' to another firm, Messrs Johan Oberholzer & Co. Stefan Oberholzer of the latter firm consulted with the applicant on 6 June 1991. For some reason which has E remained unexplained Stefan Oberholzer appears to have called for a police report in connection with the accident on 27 November 1991 only. This report was collected by hand at the police station on 3 December 1991 and on 9 December 1991 the prescribed claim form MMF1, which had been completed by the applicant, together with the relevant supporting F documents, were despatched by registered post to the respondent and they were received by it on 17 December 1991. Thereafter the respondent in an undated letter requested to be furnished, inter alia, with the registration number of the vehicle which had been involved in the collision. The required information was furnished by letter dated 14 January 1992.

G On 31 March 1992 the respondent addressed an offer of settlement to the appellant's attorneys in the following terms:

'We refer to the above matter and confirm that we are prepared to compensate your client R4 215,15 plus R500 contribution towards costs plus an indemnity certificate for past provincial hospital expenses being in full and final settlement of this claim. On receipt of your advice that H our offer is acceptable, we shall forward an appropriate release form for signature and return.'

This letter was received by the applicant's attorneys on 7 April 1992.

To this letter the applicant's attorneys replied by letter dated 14 May 1992 informing the respondent that the applicant's instructions were that I the offer 'was much too low for her to accept it'. The letter ended with the following remark:

'Please therefore either substantially increase your offer or the matter must proceed to trial.'

The respondent replied by letter dated 16 June 1992 giving details of how J it had computed the sum offered by it. The letter ended with the

Thirion J

A observation that the respondent regarded its offer of 31 March 1992 as being reasonable. By letter dated 2 July 1992 applicant's attorneys rejected the respondent's offer and expressed applicant's willingness to settle the claim in an amount which was substantially higher than the amount offered by the respondent.

B On 13 July 1992 Stefan Oberholzer telephoned Marthia Eloff, the respondent's claims officer, in connection with applicant's claim. There is a conflict on the affidavits as to what was said during this telephone conversation. According to Stefan Oberholzer, he requested an extension of prescription until 31 December 1992 and Eloff agreed thereto. Stefan Oberholzer followed up this conversation with a letter addressed to the C respondent and dated 14 July 1992. The letter reads:

'Ons verwys na ons telefoongesprek met u mej T Eloff op 13 Julie 1992 en bevestig dat by ooreenkoms verjaring in hierdie aangeleentheid uitgestel word tot en met 31 Desember 1992.

Die skrywer bevestig verder dat u in die tussentyd dringend aandag aan die D saak sal gee wat betref ons teenaanbod gedateer 2 Julie 1992.

Ons verwag om van u te verneem.'

Eloff's version of the telephone conversation is that when Stefan Oberholzer requested that prescription be extended to 31 December 1992 she was under the impression that he was referring to prescription which was E still current, ie that the claim had not yet become prescribed. According to her, she did not understand Stefan Oberholzer to be asking that respondent waive the defence of prescription in respect of a claim which had already become prescribed. She says that she had the file with her at the time of this conversation and her mind was not attuned to the fact F that the claim might already have become prescribed. Eloff in any event denies that she agreed to extend the period of prescription.

According to Eloff, she informed Stefan Oberholzer during the conversation that she would obtain applicant's file and would seek confirmation from the MMF of an extension of prescription and would convey the decision of G the MMF to him in writing; she thereafter consulted the relevant file and discovered that the claim had prescribed and consequently she addressed a letter to the applicant's attorneys informing them of the fact that the claim had prescribed. Eloff claims that she did not have authority to waive prescription on behalf of MMF. She does however concede that she H might have informed Stefan Oberholzer during their conversation that she did not expect that there would be any difficulty in obtaining an extension.

I am of the view that, even on Stefan Oberholzer's account of the conversation, applicant has failed to establish that respondent or the MMF had agreed to waive prescription. Stefan Oberholzer did not raise with I Eloff in their telephone conversation the possibility that the claim might have become prescribed. It seems clear on Stefan Oberholzer's own account that he believed at the time that the claim had not yet become prescribed. It was not brought to Eloff's attention that what she was being asked was to waive prescription in respect of a prescribed claim. Since she did not know that she was being asked to waive the right to raise the defence of prescription in respect of a prescribed debt, she cannot be held to have J waived that right.

Thirion J

A I deal next with the contention that applicant's right to claim compensation has become prescribed in terms of art 55 of the agreement. The agreement and particularly art 55 was amended in important respects by Proc 102 of 1991 which came into operation on 1 November 1991. In the light of the fact that applicant's cause of action arose before 1 November B 1991, the question arises whether the amendments effected by Proc 102 of 1991 have application in respect of applicant's claim.

Plaintiff's summons by which she commenced action against the respondent was issued and served on respondent on 20 July 1992.

I propose to consider, firstly, whether, under the agreement in its unamended form, the applicant's claim prescribed before the service of the C summons and, secondly, whether the amendments effected by Proc 102 of 1991 apply in respect of applicant's claim.

The relevant provisions of the agreement in its unamended form are:

'Article 55: Notwithstanding the provisions of any other law relating to prescription, but subject to the provisions of art 56, the right to claim compensation under chap XII from an appointed agent in respect of claims D referred to in art 13(b) shall become prescribed upon the expiry of a period of two years from the date upon which the claim arose: Provided that prescription shall be suspended during the periods referred to in art 63.

. . .

Article 57: Notwithstanding the provisions of art 55, no claim which has been lodged under art 62 shall prescribe before the expiry of a period of E 90 days from the date on which the appointed agent delivers to the claimant or his representative per registered post or by hand a notice to -

(a)

object to the validity of the claim; or

(b)

repudiate liability; or

(c)

convey an offer of settlement of the claim to the claimant or his representative.

Article 58: If a third party's claim for compensation has...