Edward Nathan Sonnenberg Inc v Judith Mary Hawarden (421/2023) [2024] ZASCA 90; 2024 (5) SA 9 (SCA) (10 June 2024)

Edward Nathan Sonnenberg Inc v Judith Mary Hawarden (421/2023) [2024] ZASCA 90; 2024 (5) SA 9 (SCA) (10 June 2024)

The Supreme Court of Appeal held that the appellant did not owe a legal duty to the respondent to protect her from the risk of business email compromise and cybercrime resulting in pure economic loss. The respondent was not a client of the appellant at the relevant time, and her loss occurred due to her own compromised email account, not any omission by the appellant. The respondent had previously been warned of cybercrime risks and had successfully verified banking details in another transaction but failed to do so in this instance. She had ample means to protect herself, including verifying banking details with the appellant or her bank, but did not do so. Imposing liability on the...

Citation
[2024] ZASCA 90
Parties
Appellant: Edward Nathan Sonnenberg Inc.; Respondent: Judith Mary Hawarden
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
10 June 2024
Case Number
421/2023
Procedural Posture
Civil Appeal / Appeal From Gauteng Division of the High Court, Johannesburg
Outcome
Appeal upheld; respondent's claim dismissed with costs, including costs of two counsel where so employed.
Judges
Ponnan, Dambuza, Goosen, Tlaletsi, Dawood
Legal Topics
Pure Economic Loss, Wrongfulness, Business Email Compromise, Cybercrime, Vulnerability to Risk
Delict Civil Procedure Pure Economic Loss Wrongfulness Business Email Compromise Cybercrime Vulnerability to Risk

Case Brief

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Parties

Edward Nathan Sonnenberg Inc.

Appellant

Judith Mary Hawarden

Respondent

Procedural Posture

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

Legal Issues

  1. 1 Whether the appellant owed a legal duty to the respondent to protect her from business email compromise and cybercrime resulting in pure economic loss.
  2. 2 Whether the omission by the appellant was wrongful in the delictual sense.
  3. 3 Whether public and legal policy considerations justify imposing liability for pure economic loss in these circumstances.

Ratio Decidendi

The Supreme Court of Appeal held that the appellant did not owe a legal duty to the respondent to protect her from the risk of business email compromise and cybercrime resulting in pure economic loss. The respondent was not a client of the appellant at the relevant time, and her loss occurred due to her own compromised email account, not any omission by the appellant. The respondent had previously been warned of cybercrime risks and had successfully verified banking details in another transaction but failed to do so in this instance. She had ample means to protect herself, including verifying banking details with the appellant or her bank, but did not do so. Imposing liability on the...

Court Disposition

Appeal upheld; respondent's claim dismissed with costs, including costs of two counsel where so employed.

Orders

  • The appeal is upheld with costs, including the costs of two counsel where so employed.
  • The order of the High Court is set aside and substituted with: 'The Plaintiff’s claim is dismissed with costs, including the costs of two counsel where so employed.'