Download Metcash Trading Ltd v Credit Guarantee Insurance Corporation of

THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA
MEDIA STATEMENT – CASE HEARING IN SUPREME COURT OF APPEAL
Metcash Trading Ltd v Credit Guarantee Insurance
Corporation of Africa Ltd
Supreme Court of Appeal -96/03
Hearing date: 09 March 2004
Judgment date: 25 March 2004
Interpretation of insurance contract. Condition excluding liability of insurer not void
for vagueness. 'Claim' means demand for indemnity in a particular amount. Failure to
lodge claim timeously results in insurer being free of liability.
Media Summary of Judgment
From:
The Registrar, Supreme Court of Appeal
METCASH TRADING LTD v CREDIT GUARANTEE INSURANCE
CORPORATION OF AFRICA LTD
On 25 March 2004 in Metcash Trading Ltd v Credit Guarantee Insurance Corporation
of Africa Ltd the Supreme Court of Appeal held that Metcash Trading Ltd (‘Metcash’)
had failed to lodge a claim in terms of the investment insurance policy issued by Credit
Guarantee Insurance Corporation of Africa Ltd (‘CGIC’) timeously and accordingly
that Metcash could not hold CGIC liable under the policy. Metcash had been
conducting business in Zaïre by means of an undertaking called Metro Zaïre. In terms
of the policy CGIC would indemnify Metcash if Metcash sustained monetary loss as a
result of war causing loss to its investment in Metro Zaïre. The premises of Metro
Zaïre were burned down and looted in circumstances falling within the policy
definition of war. Metcash immediately gave notice to CGIC that Metcash intended to
lodge a claim under the policy. Such a claim had to be lodged within the period
stipulated by the policy failing which CGIC would not be liable under the policy. The
court was required to interpret the policy in order to decide whether Metcash had
complied with this provision. The court found that the period for lodging a claim was
24 months from the date of the loss and that a claim is a demand for an indemnity in a
particular amount. Since Metcash had not lodged such a claim within the period of 24
months CGIC was not liable under the policy.