Patrick Bracher (ZA)

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Principles of contract for the benefit of a third party (stipulatio alteri)

By Patrick Bracher (ZA) on April 16, 2019 Posted in Drafting tips

A recent academic article by Dr Rika van Zyl argues persuasively that, where there is a contract for the benefit of a third party, the third party accepts the benefit of the contract between the other two parties and not to become a party to the contract. In drafting such contracts you must make sure the … Continue reading

Burden of proof in actions against ship owner for loss of cargo and the principles of bailment (UK)

By Patrick Bracher (ZA) on April 16, 2019 Posted in General

England’s highest court finally, after over four centuries of reported decisions on the issue, definitively held that the burden of proof lies on the carrier where cargo owners sue a ship owner for loss or damage to cargo. If the carrier could and should have taken precautions which would have prevented some inherent characteristic of … Continue reading

Use of a vehicle includes a passenger opening a car door

By Patrick Bracher (ZA) on April 8, 2019 Posted in Insurance

Extraordinarily, a case involving a passenger opening a car door and scratching a neighbouring vehicle in a supermarket carpark led to a decision before the Court of Justice of the European Union. Europe’s highest court found that this is ‘use of vehicles’ for the purposes of motor vehicle insurance. The event happened in Latvia where … Continue reading

Relief denied for director who put personal interests first (US)

By Patrick Bracher (ZA) on April 8, 2019 Posted in General

Under the business judgment rule, a director or officer may be excused from conduct which has adverse circumstances for the company if their judgment, albeit poor judgment, was exercised in good faith and in the interests of the company. In an action in Delaware, USA, the CEO was denied this assistance by the court because, … Continue reading

Repudiation of a contract

By Patrick Bracher (ZA) on April 4, 2019 Posted in General

Where the purchase price of imported sugar included the import duty and the purchase price had to be reduced if the duty was reduced, the persistent claim by the seller for the unreduced amount was a repudiation and led to the lawful cancellation of the sugar contract. Payment of the sugar contract was to be … Continue reading

Contractual claim not covered under liability policy (US)

By Patrick Bracher (ZA) on April 4, 2019 Posted in Insurance

Where the purchaser of an oil refinery sued the seller for breach of contract for $25 million damages resulting from a fire caused by various acts and omissions of the seller prior to the sale, the claim was not covered under the seller’s commercial general liability policy. The claim was not based on property damage but … Continue reading

Acceptance of settlement offer must be unconditional

By Patrick Bracher (ZA) on April 3, 2019 Posted in General

The Supreme Court of Appeal has reaffirmed the principle that where a party alleges that a compromise (settlement) has been effected in an exchange of correspondence it must be proved that the offer of compromise was accepted. The acceptance must be absolute, unconditional and identical with the offer. Otherwise there is no consensus and no … Continue reading

Interpretation of contracts: Wording, context & purpose

By Patrick Bracher (ZA) on April 3, 2019 Posted in Drafting tips

The Supreme Court of Appeal has yet again reaffirmed the principles dealing with the interpretation of contracts. Interpretation of contracts is a unitary exercise which starts with the text to be interpreted and considers it within the contract as a whole, and in context. It requires consideration of text, context and purpose of the contract. … Continue reading

Interpretation of contracts – Don’t relegate the written text

By Patrick Bracher (ZA) on March 26, 2019 Posted in Drafting tips

The Supreme Court of Appeal has decried the growing tendency to lead evidence about what experts think a contract means and about the subjective intention of the parties and details of their negotiation. The written text must not be relegated, but must be considered having regard to the context in which the agreement was entered … Continue reading

Principles of unlawful use of confidential information and trade secrets

By Patrick Bracher (ZA) on March 26, 2019 Posted in General

The Supreme Court of Appeal restated the principles on liability for unlawful competition by the use of the trade secrets of a competitor. Every person is entitled to freely carry on their trade or business in competition with rivals but the competition must remain within lawful bounds. If it involves a wrongful interference with another’s … Continue reading

Insurers’ role in losses caused by malfunctioning technology

By Patrick Bracher (ZA) on March 25, 2019 Posted in Insurance

One of the major issues facing the law in an age of autonomous technology is the question of who is liable for damage caused by a machine or artificial intelligence either by physical injury or the failure of a contract. Insurers will have a major role to play. If a machine such as a driverless … Continue reading

Fraud as a defence to payment under a guarantee

By Patrick Bracher (ZA) on March 25, 2019 Posted in Insurance

The guarantor in Raubex Construction (Pty) Ltd v Bryte Insurance Company alleged that payment under a guarantee was not due because of fraud on the part of the beneficiary. A mere error, misunderstanding or oversight, however unreasonable, does not amount to fraud and is insufficient to show that the contentions of the beneficiary are deliberately … Continue reading

Liability of auditor for incorrect accounting treatment advice (UK)

By Patrick Bracher (ZA) on March 21, 2019 Posted in General

The English Court of Appeal found that the plaintiff building society had not proved damages against its auditors who gave them incorrect information about how to treat long-term interest rate swaps on its balance sheet under the IFRS requirements. The swaps were not included on the balance sheet from 2005 till 2013, when they were … Continue reading

Business rescue application does not terminate provisional liquidation

By Patrick Bracher (ZA) on March 13, 2019 Posted in General

An application for business rescue does not terminate the office of provisional liquidators nor does it result in the assets and management of the company in liquidation re-vesting in the directors of the company. Where a company had been liquidated, an application was made for business rescue in GCC Engineering v Lawrence Maroos. Although section 131(6) … Continue reading

Interpretation of statutes must be consistent with the Constitution

By Patrick Bracher (ZA) on March 13, 2019 Posted in General

The Constitutional Court has reminded us in the context of mineral rights that a statutory provision must be interpreted in accordance with the spirit, purport and objects of the Bill of Rights (s 39(2)) and consistently with the Constitution and consistently with international law (s 233), and the courts must apply customary law when that law is … Continue reading

Duty of lateral support applies to reasonably built-on land

By Patrick Bracher (ZA) on March 6, 2019 Posted in General

The Western Cape High Court found that the common law duty to provide lateral support to a neighbouring property falls within the law of neighbours where the guiding principle is reasonableness. The duty of lateral support relates to contiguous pieces of land even where the land has been built on, provided the buildings have not … Continue reading

UK regulator to drop general counsel from accountability

By Patrick Bracher (ZA) on March 6, 2019 Posted in General

The UK’s Financial Conduct Authority intends to drop plans to hold heads of legal departments at banks and insurance firms responsible for ignoring misconduct because it would hamper lawyers from giving independent legal advice. General counsels will be excluded from the new accountability regime for senior managers. Binding legal counsel to the accountability provisions would … Continue reading

The elements of defamation

By Patrick Bracher (ZA) on February 27, 2019 Posted in General

The Johannesburg High Court discussed the balance between the constitutional right to freedom of expression and the required respect for inherent dignity ‘to all human beings’. The defendant in Mostert v Nash argued the allegedly defamatory statements made about the plaintiff were true and in the public interest. It is for the defendant in a … Continue reading

Interpretation: Useful definition of ‘spouse’

By Patrick Bracher (ZA) on February 27, 2019 Posted in Drafting tips

The following definition of ‘spouse’ was included in recent draft legislation. The definition may be useful when you need to define the term in a contract. The definition will have to be adapted to the specific requirements and wording of the rest of the document. ‘spouse’ in relation to any person at the relevant time … Continue reading

Insurance regulation in 20 Asia Pacific countries

By Patrick Bracher (ZA) on February 27, 2019 Posted in Insurance

In January 2019, Norton Rose Fulbright published ‘Ten things to know’ about insurance regulation in 20 Asia Pacific countries. The guide is hosted on our free subscription premium content site, the Institute, as an interactive map featuring the 20 jurisdictions. It covers the following countries for those interested in investing or doing business with insurers … Continue reading

CyRiM warns of up to $193 billion cyber risk – Insurers beware!

By Patrick Bracher (ZA) on February 6, 2019 Posted in Insurance

The Cyber Risk Management (CyRiM) Report 2019 shows that the economic damage to the world from a concerted global cyber-attack propagated by malicious email could range between $85 billion (least severe) to $193 billion (most severe). Retail at least could suffer the highest total economic loss globally ($15 billion), followed by healthcare ($10 billion) and manufacturing ($9 billion). It … Continue reading

Power station damaged by shocked squirrel is excluded

By Patrick Bracher (ZA) on February 6, 2019 Posted in Insurance

Where a squirrel found its way onto a power station’s electrical transformer triggering an electrical arc that killed the squirrel and caused damage to the municipality’s property of $213 524, the court denied the municipality all-risks insurance cover because of an exclusion for ‘loss caused by arcing or by electrical currents other than lightning’. The court … Continue reading

Draft Expropriation Bill published

By Patrick Bracher (ZA) on January 25, 2019 Posted in General

On 21 December 2018 the government published their Draft Expropriation Bill 2019 for comment by 21 February 2019. As the laws will affect all of us you should read it and consider commenting. The Bill only relates to registered rights and will therefore mainly affect land rights and mineral rights. The government has said that the law … Continue reading

Prescribed rate of interest is 10.25% from 1 January 2019

By Patrick Bracher (ZA) on January 25, 2019 Posted in General

The prescribed rate of interest has been changed with effect from 1 January 2019 to 10.25% per annum. The previous rate was 10%. According to the Prescribed Rate of Interest Act, interest on debts where no rate is prescribed is calculated at the repo rate plus 3.5%. The prescribed rate of interest applies to all debts … Continue reading