Resisto Dairy (Pty) Ltd v Auto Protection Insurance Co Ltd

• Jurisdiction: South Africa
• Judge: Hoexter JA, Beyers JA, Rumpff JA, Botha JA and Wessels AJA
• Judgment Date: 30 November 1962
• Citation: 1963 (1) SA 632 (A)
• Hearing Date: 08 November 1962
• Court: Appellate Division

G Hoexter, J.A.:

On the 17th October, 1959, the oil fuel tank of a truck, belonging to the appellant and driven by its servant, partly broke loose and was dragged along a public road with the result that the oil leaked on to the road. This oil caused a motor car to skid on the road and to collide with a Land Rover belonging to the Cape Sea Industries (Pty.) Ltd., hereinafter referred to as the claimant. The claimant claimed the H sum of R1,600 from the appellant in respect of the damage to the Land Rover, and on the 9th August, 1960, instituted action against the appellant for that sum. The truck owned by the appellant was one of several listed in an insurance policy which the respondent had issued to the appellant before the accident. Sec. 11 of the policy is headed 'Liability to third parties' and reads as follows:

'The Company will indemnify the insured in the event of an accident caused by or through or in connection with any vehicle described in the schedule hereto

Hoexter JA

or trailer attached thereto (including the loading and/or unloading of such vehicle or trailer) (including any vehicle referred to in sec. 111 hereof) against all sums, including claimants' costs and expenses, which the insured shall become legally liable to pay in respect of

(i)

death of or bodily injury to any person.

(ii)

A damage to property.

The Company will pay all costs and expenses incurred with its written consent.'

The appellant contended that the above section of the policy entitled it to be indemnified by the respondent in respect of any sum which the claimant might recover from it by action. The respondent repudiated B liability by reason of an alleged failure on the part of the appellant to give timeous notice of the accident as provided by the following condition in the policy:

'1. Notice shall be given in writing to the Company as soon as possible after the occurrence of any accident or loss or damage and in the event of any claim. Every letter claim writ summons and/or process shall be notified or forwarded to the Company immediately on receipt by the C insured. Notice shall also be given in writing to the Company immediately the insured shall have knowledge of any impending prosecution or inquest in respect of any occurrence which may give rise to a claim under this policy . . .'

The appellant denied the alleged failure and in the alternative contended that the conduct of the respondent, after it had received written notice of the accident, precluded it from denying liability on D the ground of appellant's alleged failure.

I ought to add that the respondent repudiated liability also on the ground that the appellant, in breach of condition 6 of the policy, had failed to maintain the lorry in an efficient condition and had left the vehicle unattended without taking proper precautions to prevent further damage or loss.

E The trial Court held that the onus was on the respondent to prove its defences, and the evidence led related to one issue only, viz., that relating to the alleged late notice and to the conduct of the respondent after receiving notice of the appellant's claim. It was held that the F respondent had proved the failure of the appellant to give timeous notice of the accident, and that the subsequent conduct of the respondent did not preclude it from denying liability by reason of such failure. It is this judgment which the appellant now challenges in this Court.

The appellant argued in the first place that condition 1 of the policy, G which has been quoted, should be construed as requiring notice of the accident only after the insured has received a claim from the third party. In my opinion, however, whatever may be the meaning to be assigned to the words 'in the event of a claim', the use of the word 'and' before those words must connote a notice additional to the one H required of the occurrence of any accident. It follows that it was the duty of the appellant to give notice of the accident as soon as possible after its occurrence.

The accident in the present case occurred on the 17th October, 1959, and the next morning Shapiro, the managing director of the appellant, telephoned to the police and was informed that the appellant's truck was not involved in the collision. Shapiro, however, knew that the accident had been caused by the oil which had leaked from the fallen fuel tank of the appellant's truck, and I agree with the finding of the trial Court that he must have realised the possibility that the claimant

Hoexter JA

would hold the appellant responsible for the damage done to his Land Rover. It was therefore the duty of the appellant to have notified the respondent of the occurrence as soon as possible and in writing. It A failed to do so, because it was only on the 6th January, 1960, that it actually gave written notice of the accident to the respondent. The question now arises whether the subsequent conduct of the respondent precludes it from repudiating liability on the ground of the appellant's failure to give notice as soon as possible. In order to answer this question it becomes necessary to refer to the evidence in some detail. It will be convenient at this stage to point out that a firm of B insurance assessors, Duncan Campbell by name, acted on behalf of the claimant, that one Carnie, of the South African Insurance Trust, acted on behalf of the appellant, and that Borgstaan (Pty.) Ltd. were the managing agents of the respondent.

C It appears from the evidence that Shapiro, after he had telephoned the police on the day after the accident, did nothing at all until he received a letter from Duncan Campbell. This letter was dated the 28th December, 1959, and it stated that the claimant was holding the appellant liable for the damage done to its Land Rover in the accident of the 17th October, 1959. Shapiro immediately telephoned Carnie and D informed him of the contents of this letter. Carnie in turn telephoned Borgstaan and, as it was just before the New Year holidays, he informed them that he would send them a written report after the holidays. Thereafter Carnie interviewed the driver of the appellant's truck and filled in the accident report form provided by the respondent. He sent E this form, together with the letter of the 28th December, 1959, written by Duncan Campbell to the appellant, to Borgstaan under cover of a letter dated the 6th January, 1960. In the meantime Borgstaan had also received from Duncan Campbell a letter, dated 28th December, 1959, which informed the respondent that the claimant was holding the appellant, F referred to as 'your insured', liable for the damage to his Land Rover.

As soon as Borgstaan received the accident report form, the respondent was aware, not only that the claimant was holding the appellant liable, but also that the appellant was claiming an indemnity from the respondent in respect of that liability and in terms of its insurance G policy. Counsel for the respondent has argued that Shapiro must have appreciated the fact...