Da Costa Bonifacio and Another v Lombard Insurance Company Limited (20/4174) [2023] ZAGPJHC 91 (7 February 2023)

Da Costa Bonifacio and Another v Lombard Insurance Company Limited (20/4174) [2023] ZAGPJHC 91 (7 February 2023)

The court found that although Lombard was contractually entitled to settle with DBT and claim indemnity from the Bonifacio brothers, the invocation of Rule 13 provided the Bonifacio brothers with procedural rights to contest Lombard's liability to DBT. The settlement occurred before the Bonifacio brothers exercised these rights, potentially depriving them of the opportunity to challenge the underlying liability. The court held that another court may find that the Bonifacio brothers' right to challenge Lombard's liability remained intact and that the order holding them liable under the indemnity should not have been made before they had the opportunity to contest the liability. The limited...

Citation
[2023] ZAGPJHC 91
Parties
Applicant: Jorge Alexandre Da Costa Bonifacio; Applicant: Sergio Rui Da Costa Bonifacio; Respondent: Lombard Insurance Company Limited
Court
South Gauteng High Court, Johannesburg
Jurisdiction
South Africa
Judgment Date
7 February 2023
Case Number
20/4174
Procedural Posture
Leave to Appeal / Application for Leave to Appeal Following Judgment on Indemnity Liability
Outcome
Leave to appeal granted to the Supreme Court of Appeal against the whole judgment.
Judges
Strydom
Legal Topics
Third Party Proceedings, Performance Guarantee, Indemnity Contract, Rule 13 Procedure
Civil Procedure Commercial and Corporate Third Party Proceedings Performance Guarantee Indemnity Contract Rule 13 Procedure

Case Brief

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Parties

Jorge Alexandre Da Costa Bonifacio

Applicant

Sergio Rui Da Costa Bonifacio

Applicant

Lombard Insurance Company Limited

Respondent

Procedural Posture

Leave to Appeal / Application for Leave to Appeal Following Judgment on Indemnity Liability

Legal Issues

  1. 1 Whether settlement between Lombard and DBT extinguished the Bonifacio brothers' procedural right to challenge Lombard's liability under Rule 13.
  2. 2 Whether Lombard could claim indemnity from the Bonifacio brothers without their participation in or consent to the settlement.
  3. 3 Whether the procedural rights under Rule 13.6 allow third parties to contest the liability of the principal debtor after settlement.

Ratio Decidendi

The court found that although Lombard was contractually entitled to settle with DBT and claim indemnity from the Bonifacio brothers, the invocation of Rule 13 provided the Bonifacio brothers with procedural rights to contest Lombard's liability to DBT. The settlement occurred before the Bonifacio brothers exercised these rights, potentially depriving them of the opportunity to challenge the underlying liability. The court held that another court may find that the Bonifacio brothers' right to challenge Lombard's liability remained intact and that the order holding them liable under the indemnity should not have been made before they had the opportunity to contest the liability. The limited...

Court Disposition

Leave to appeal granted to the Supreme Court of Appeal against the whole judgment.

Orders

  • Leave to appeal is granted to the First and Second Applicants (Seventh and Eighth third parties) to appeal to the Supreme Court of Appeal against the whole of the judgment of this court.
  • Costs to be costs in the appeal.