Santam Insurance Co Ltd v Tshiva; Maxanti v Protea Assurance Co Ltd

• Jurisdiction: South Africa
• Judge: Wessels JA, Muller JA, Kotzé JA, Trengove JA and Viljoen AJA
• Judgment Date: 30 March 1979
• Citation: 1979 (3) SA 73 (A)
• Hearing Date: 23 February 1979
• Court: Appellate Division

Kotzé JA:

On 6 October 1972 a collision occurred in Port Elizabeth between B a large lorry CB 21098 and a Valiant motor car CB 44478 at the intersection of the main road from Uitenhage and the by-pass road to New Brighton. The first-mentioned vehicle proceeded from north to south on the road from Uitenhage, was driven by one Zondagh and was insured in terms of the provisions of the Compulsory Motor Vehicle Insurance Act 56 of 1972 C ("the Act") by the respondent in the cross-appeal (hereinafter called Protea). The last-mentioned vehicle proceeded from west to east in the by-pass road, was driven by one Joseph Timbad (also known as and hereinafter referred to as Dindala) and was insured in terms of the provisions of the Act by the appellant (hereinafter called Santam). The husbands of first and second respondents were passengers in the Valiant D and were killed in the collision. The respondents brought separate actions in the South-Eastern Cape Local Division in their personal capacities and their capacities as guardians of their minor children for loss of support against both Protea and Santam on the ground of the negligence of Zondagh E alternatively the negligence of Dindala alternatively of their joint negligence. In order to disclose a cause of action against Santam the first and second respondents alleged that their husbands were conveyed in the Valiant

"for reward within the meaning of that term as defined in... Act 56 of 1972, alternatively... in the course of the business of the driver, alternatively in the course of the business of the owner of such motor vehicle."

F They amplified these allegations by pleading that the owner of the Valiant, Daniso, operated a taxi service, that the Valiant was one of the vehicles used by him as taxi at the time of the collision, that the deceased were fare-paying passengers in the Valiant, that the driver was G employed by the owner to drive the Valiant and that it was his duty to drive it at the relevant time.

Protea, in its plea, denied negligence on the part of Zondagh and averred that Dindala's negligence was the sole cause of the collision. Santam, in its plea, admitted that the deceased persons were passengers in the Valiant but denied that they were being conveyed for reward or in the H course of the business of the driver or owner. It also denied negligence on the part of Dindala and averred that Zondagh's negligence was the sole cause of the collision. Finally Santam raised a legal defence to the effect that, in the event of it being held that the Valiant was used as a taxi, it denied liability as insurer and averred

"that the owner did not apply for insurance as the holder of a motor transport licence, did not tender the premium for such insurance nor was the vehicle one which may have been used under authority of any motor transport licence."

Kotzé JA

The two actions were consolidated and came to trial on virtually identical pleadings before DE WET J. The damages were agreed in the sum of R10 800 A in respect of first respondent and in the sum of R18 000 in respect of second respondent who, however, limited her claim against Santam to R12 000 - see s 22 (1) of the Act. At the commencement of the trial:

(a)

Counsel for Santam formally admitted that Dindala was "totally to blame" for the collision.

(b)

B Counsel for the first and second respondents announced that, despite the admission referred to in (a), the case would proceed against Protea in an endeavour to establish that some negligence on the part of Zondagh also contributed to the collision.

(c)

C Counsel for the first and second respondents admitted that "the third party insurance cover taken out by the owner of the vehicle insured by second defendant (ie Santam) was not that kind of insurance which should have been taken out to cover a taxi-cab with a lawful certificate of exemption attached thereto in terms of the Motor Transportation Act."

D The learned trial Judge exonerated Zondagh from any blame and held that the collision was entirely due to Dindala's negligence. Santam's defence that no liability attached to it as statutory insurer was dismissed, the finding of the trial Judge being that the deceased were conveyed in the course of the business of the owner of the Valiant and Santam was E accordingly held liable to first respondent and second respondent in the sums agreed upon. DE WET J based his order of costs on an estimate that one-third of the trial time was spent on the issue of Zondagh's alleged negligence and two-thirds on the issue of Santam's legal liability. The following order was accordingly made (Protea and Santam respectively being referred to as first defendant and second defendant and respondents being collectively referred to as plaintiffs and singly as first plaintiff and second plaintiff):

"(a)

F The first defendant is absolved from the instance.

(b)

Second defendant is ordered to pay the first defendant's costs up to and including the first day of the trial, and

(c)

plaintiffs are ordered to pay first defendant's costs incurred thereafter jointly and severally.

(d)

G Second defendant is ordered to pay first plaintiff, Deborah Nobanzi Tshiva, the sum of R10 800 together with interest thereon at the rate of 6 per cent per annum calculated from the date of this judgment to date of payment.

(e)

H Second defendant is ordered to pay second plaintiff, Sophie Maxanti, the sum of R12 000 together with interest thereon at the rate of 6 per cent per annum calculated from date of this judgment to date of payment.

(f)

Second defendant is ordered to pay plaintiffs' costs up to and including the first day of trial, and 66 2/3 per cent of plaintiffs' costs incurred thereafter."

Santam thereafter on 11 April 1978 appealed to this Court against the order on "die meriete alleen" and specifically against the finding that the husband of the respondents were conveyed in the course of the business

Kotzé JA

of the owner of the Valiant. On 10 May 1978 the respondents cross-appealed against the order absolving Protea from the instance, the order compelling them to pay Protea's costs subsequent to the first day of the trial and the order limiting Santam's liability for respondents' costs to two-thirds after the first day of the trial.

Before dealing with the merits of the appeal it should be mentioned that an application for condonation has been enrolled by the respondents. This application relates to the omission of the name of Protea from the notice of cross-appeal which was, however, served on it. Before us it was intimated, on behalf of Protea, that, whilst it does not oppose the application, it does contend that there are no prospects of success and that the respondents should be ordered to pay the costs of the application. In the circumstances, and regard being had to the relatively trivial nature of the omission, the application is granted - the respondents to pay the costs of the application.

I turn now to the appeal. It was common cause at the trial that, at the material time, Daniso operated a lawful taxi business under the name of "Mbele's Taxis." The learned trial Judge found, on evidence adduced before him which I find it unnecessary to summarise, that three vehicles duly licensed as taxis were in use at the said time and that motor vehicle CB 44478 was at the same time also used as a taxi but without the requisite motor carrier certificate in terms of the provisions of the Motor Carrier Transportation Act 39 of 1930. He furthermore found that Daniso had employed Dindala to drive the last-mentioned vehicle and that the husbands of the respondents were being conveyed by Dindala in the course of the aforesaid taxi business at the time when they were fatally injured. It was also found on the probabilities that

"the deceased did not realise that the insured motor vehicle was not legitimately carrying on business as a taxi."

None of the findings set out in the previous paragraph were questioned before us nor was Dindala's evidence that each deceased paid him a "fare" of 20c disputed. But it was argued on behalf of Santam that, in the circumstances as found by the learned Judge, s 23 of the Act, correctly construed, exempts it from liability to the respondents. The submission was that in relation to motor vehicle CB 44478 Daniso conducted an illegal business without a certificate contrary to the provisions of Act 39 of 1930 and that the conveyance of the deceased persons therein did not constitute conveyance "in the course of the business" of Daniso within the meaning of that phrase in s 23 of the Act. It was furthermore contended that the finding that the deceased did not realise that the insured vehicle was not legitimately carrying on a taxi business was an irrelevant consideration.

In considering Santam's contention it is necessary to refer briefly to the legislative history of s 23 of the Act. As at 1 September 1978, when the Compulsory Motor Vehicle Insurance Amendment Act 69 of 1978 (which is irrelevant for present purposes) came into operation (Proc 220 of 1978), s 23 read as follows:

"23.

An authorised insurer shall not be obliged to compensate any person in terms of s 21 for any loss or damage - ...

(b)

suffered as a result of bodily injury to or the death of any person who, at the time of the occurrence which caused that injury or death,

Kotzé JA

was being conveyed in or upon the motor vehicle in question -

(i)

otherwise than for reward; and

(ii)

otherwise than in the course of the business of the driver or owner of that motor vehicle; and

(iii)

A otherwise than in the course of his employment as servant of that driver or owner, or was in the act of entering or mounting that vehicle for the purpose of being so conveyed, or was in the act of alighting from that vehicle after being so conveyed."

Its...