Bader and Others v Centriq Insurance Company Limited (4572/2015) [2017] ZAGPJHC 12 (16 February 2017)

Bader and Others v Centriq Insurance Company Limited (4572/2015) [2017] ZAGPJHC 12 (16 February 2017)

The court held that the plaintiffs are not absolved from proving that Delru's liability to them falls within the terms of the indemnity policy issued by Centriq Insurance. The judgment obtained against Delru in the Pretoria High Court does not, in itself, establish the insurer's liability under section 156 of the Insolvency Act, as Centriq was not a party to those proceedings and the findings are not binding on it. Section 156 creates a distinct right for third parties to recover from the insurer upon the insured's insolvency, but the plaintiffs must still prove that the conduct giving rise to Delru's liability is covered by the policy. The court found that there was no evidence linking...

Citation
[2017] ZAGPJHC 12
Parties
Plaintiff: Valerie Ann Bader; Plaintiff: Charles Michael Bader N.O.; Plaintiff: Angela Lee Bader N.O.; Plaintiff: Johannes Petrus Barnard N.O.; Plaintiff: DBF Executors Services (Pty) Ltd N.O. (represented by David Leslie Fisher); Defendant: Centriq Insurance Company Limited
Court
South Gauteng High Court, Johannesburg
Jurisdiction
South Africa
Judgment Date
16 February 2017
Case Number
4572/2015
Procedural Posture
Civil Judgment / Stated Case; Determination of Liability Under S 156 of the Insolvency Act
Outcome
Plaintiffs' claim fails; the stated case is decided in favour of the defendant.
Judges
Wepener
Legal Topics
Insolvency Act Section 156, Professional Indemnity Insurance, Burden of Proof on Insurer Liability
Civil Procedure Banking and Finance Insolvency Act Section 156 Professional Indemnity Insurance Burden of Proof on Insurer Liability

Case Brief

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Parties

Valerie Ann Bader

Plaintiff

Charles Michael Bader N.O.

Plaintiff

Angela Lee Bader N.O.

Plaintiff

Johannes Petrus Barnard N.O.

Plaintiff

DBF Executors Services (Pty) Ltd N.O. (represented by David Leslie Fisher)

Plaintiff

Centriq Insurance Company Limited

Defendant

Procedural Posture

Civil Judgment / Stated Case; Determination of Liability Under S 156 of the Insolvency Act

Legal Issues

  1. 1 Does a judgment against the insured (Delru) establish the insurer's (Centriq) liability to the plaintiffs under section 156 of the Insolvency Act?
  2. 2 Is the insurer bound by findings in litigation to which it was not a party?
  3. 3 Must the plaintiffs prove that Delru's liability falls within the terms of the indemnity policy to recover from the insurer?

Ratio Decidendi

The court held that the plaintiffs are not absolved from proving that Delru's liability to them falls within the terms of the indemnity policy issued by Centriq Insurance. The judgment obtained against Delru in the Pretoria High Court does not, in itself, establish the insurer's liability under section 156 of the Insolvency Act, as Centriq was not a party to those proceedings and the findings are not binding on it. Section 156 creates a distinct right for third parties to recover from the insurer upon the insured's insolvency, but the plaintiffs must still prove that the conduct giving rise to Delru's liability is covered by the policy. The court found that there was no evidence linking...

Court Disposition

Plaintiffs' claim fails; the stated case is decided in favour of the defendant.

Orders

  • Plaintiffs are ordered to pay the costs in relation to this part of the proceedings.