Bonifacio and Another v Lombard Insurance Company (247/2023) [2024] ZASCA 86 (4 June 2024)

Bonifacio and Another v Lombard Insurance Company (247/2023) [2024] ZASCA 86 (4 June 2024)

The Supreme Court of Appeal held that the appellants were liable to indemnify the respondent for the payment made under the performance guarantee. The guarantee was autonomous and created an obligation to pay upon demand, irrespective of disputes in the underlying contract. The indemnity contract entitled the respondent to settle DBT's claim and seek indemnification from the appellants, and the settlement did not deprive the appellants of any procedural rights, as they failed to exercise those rights when available. The liability under the indemnity was not conditional upon a court finding against the respondent. The issue of fraud could not be adjudicated in the absence of DBT, and no...

Citation
[2024] ZASCA 86
Parties
Appellant: Jorge Alexandre Da Costa Bonifacio; Appellant: Sergio Rui Da Costa Bonifacio; Respondent: Lombard Insurance Company Limited
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
4 June 2024
Case Number
247/2023
Procedural Posture
Civil Appeal / Appeal From Gauteng Division of the High Court, Johannesburg
Outcome
Appeal dismissed with costs, including costs of two counsel where so employed.
Judges
Ponnan, Nicholls, Matojane, Koen, Seegobin
Legal Topics
Performance Guarantee, Indemnity, Third Party Procedure, Settlement Agreement, Fraud Defence
Commercial and Corporate Civil Procedure Performance Guarantee Indemnity Third Party Procedure Settlement Agreement Fraud Defence

Case Brief

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Parties

Jorge Alexandre Da Costa Bonifacio

Appellant

Sergio Rui Da Costa Bonifacio

Appellant

Lombard Insurance Company Limited

Respondent

Procedural Posture

Civil Appeal / Appeal From Gauteng Division of the High Court, Johannesburg

Legal Issues

  1. 1 Whether the appellants are liable to indemnify the respondent for payment made under a performance guarantee.
  2. 2 Whether the settlement between the respondent and DBT deprived the appellants of procedural rights to contest liability.
  3. 3 Whether the claim against the appellants was conditional upon a court finding of liability against the respondent.

Ratio Decidendi

The Supreme Court of Appeal held that the appellants were liable to indemnify the respondent for the payment made under the performance guarantee. The guarantee was autonomous and created an obligation to pay upon demand, irrespective of disputes in the underlying contract. The indemnity contract entitled the respondent to settle DBT's claim and seek indemnification from the appellants, and the settlement did not deprive the appellants of any procedural rights, as they failed to exercise those rights when available. The liability under the indemnity was not conditional upon a court finding against the respondent. The issue of fraud could not be adjudicated in the absence of DBT, and no...

Court Disposition

Appeal dismissed with costs, including costs of two counsel where so employed.

Orders

  • The appeal is dismissed with costs, such costs to include the costs of two counsel where so employed.