Tag archives: Interpretation

Interpreting insurance contracts: a refresher (part 1)

The Supreme Court of Appeal judgment of Centriq Insurance Company Limited and Oosthuizen contains a useful summary of the general principles of interpretation of insurance policies and other contracts: Insurance policies are contracts like any other. Contract provisions must be construed having regard to their language, context and purpose in what is a unitary exercise. … Continue reading

Courts will rarely refuse to enforce contracts on grounds of public policy

Contracting parties cannot escape the enforcement of a contract on the basis of the terms being contrary to public policy unless they can prove that the terms are so unfair, unreasonable or unjust in the circumstances that a court should intervene. The Constitutional Court reaffirmed that although constitutional values such as Ubuntu, reasonableness and fairness … Continue reading

The difference between ‘significant’ and ‘substantial’

In April 2020 the UK Supreme Court had reason to discuss the difference between ‘significant’ and ‘substantial’ in the context of what is a ‘significant reduction in life expectancy’. The court said that ‘like the skin of a chameleon, the adjective takes a different colour so as to suit a different context’. The word ‘significant’ … Continue reading

Effect of invalid clause within lease agreement

The Supreme Court of Appeal held in March 2020 that an invalid clause in a lease does not necessarily result in the unenforceability of the entire agreement. Two parties entered into an agreement in terms of which the lessor let the premises to the lessee for a period of ten years and three months. The … Continue reading

‘Occurrence’ in insurance policies

The test enunciated by the English court in Kuwait Airways Corporation v Kuwait Insurance Co [1996] 1 Lloyds Rep 664, confirmed in Mann and Another v Lexington Insurance Company [2000] is no different in South African law. “An ‘occurrence’ (which is not materially different from an event or happening, unless perchance the contractual context requires … Continue reading

Effect of settlement agreement

Ten years after the 2010 World Cup the Supreme Court of Appeal has given judgment in a dispute between the South African Football Association and a travel business relating to travel arrangements for the competition. The parties had a settlement agreement which was in ‘full and final settlement’ of the dispute relating to whether SAFA … Continue reading

Damage caused by incorrect labelling is not insured as ‘arising out of’ the product manufactured (US)

A bulk supplier of prescription drugs, which was not a manufacturer, supplied drugs in bulk to a retailer. A customer of the retailer suffered severe bodily injury because of misleading and defective labelling by the retailer. The retailer was entitled to the benefit of the distributor’s insurance if any claim was ‘only with respect to … Continue reading

Specific terms override general terms and insurers bound by agents (US)

The Washington Supreme Court found that an insurance company was bound by its agent’s written representations that a particular corporation was an additional insured under a policy even though the printed words in the certificate of insurance said the addition was not binding. A mobile telephone operator and a contractor together erected a cell phone … Continue reading

Bin with wheels is not a ‘vehicle’ (US)

A New York Appeals Court unsurprisingly found that a recycling bin with wheels, which ruptured a gas line used by residents of an apartment building, is not a ‘vehicle’. An all risks policy exclusion did not apply if there was ‘direct loss causing physical damage to covered property from vehicles’. The court said that not … Continue reading

Meaning of the word ‘acquire’ and other interpretation issues

A building contractor sought to argue that the word ‘acquire’ in the Housing Consumers Protection Measures Act 1998 meant ‘buying or obtaining ownership’. The court held that the primary meaning of ‘acquire’ is ‘come to possess something’. The suggestion that persons who have rented their places of permanent residence have not ‘acquired a home’ as … Continue reading

Importing a tacit term into a contract

Where a non-variation clause and a whole agreement clause were included in a comprehensive contract dealing in detail with the subject matter between the parties, the court refused to import a tacit term into the contract. A tacit term is an unexpressed provision in the contract which derives from the common intention of the parties … Continue reading
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