OK Bazaars 1929 Limited v Standard Bank of South Africa Limited (278/2000) [2002] ZASCA 5; 2002 (3) SA 688 (SCA) (12 March 2002)

OK Bazaars 1929 Limited v Standard Bank of South Africa Limited (278/2000) [2002] ZASCA 5; 2002 (3) SA 688 (SCA) (12 March 2002)

The Supreme Court of Appeal held that Overton, acting for the appellant, negligently made a misstatement that Hyperama had purchased goods from KTC, which was false. Standard Bank relied on this misstatement and the accompanying undertaking when establishing the letter of credit. The court found that the misstatement was causally linked to the loss suffered by Standard Bank, both factually and legally. The subsequent acceptance of non-conforming documents by Malik did not constitute a novus actus interveniens, as it was reasonably foreseeable and formed part of the natural sequence of events following the misstatement. The appellant was vicariously liable for Overton's conduct, and the...

Citation
[2002] ZASCA 5
Parties
Appellant: OK Bazaars (1929) Limited; Respondent: The Standard Bank of South Africa Limited
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
12 March 2002
Case Number
278/2000
Procedural Posture
Civil Appeal / Appeal From Johannesburg High Court; Judgment Delivered
Outcome
Appeal dismissed with costs, including costs of two counsel.
Judges
Nienaber, Zulman, Cameron, Navsa, Nugent
Legal Topics
Negligent Misstatement, Economic Loss, Letters of Credit, Causation, Novus Actus Interveniens
Delict Banking and Finance Negligent Misstatement Economic Loss Letters of Credit Causation Novus Actus Interveniens

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 10 Party arguments 2 Amounts and remedies 4
Sign in to unlock

Parties

OK Bazaars (1929) Limited

Appellant

The Standard Bank of South Africa Limited

Respondent

Procedural Posture

Civil Appeal / Appeal From Johannesburg High Court; Judgment Delivered

Legal Issues

  1. 1 Whether a negligent misstatement by the appellant's employee caused economic loss to the respondent.
  2. 2 Whether subsequent acts constituted a novus actus interveniens breaking the chain of causation.
  3. 3 Whether the appellant is vicariously liable for the negligent misstatement.

Ratio Decidendi

The Supreme Court of Appeal held that Overton, acting for the appellant, negligently made a misstatement that Hyperama had purchased goods from KTC, which was false. Standard Bank relied on this misstatement and the accompanying undertaking when establishing the letter of credit. The court found that the misstatement was causally linked to the loss suffered by Standard Bank, both factually and legally. The subsequent acceptance of non-conforming documents by Malik did not constitute a novus actus interveniens, as it was reasonably foreseeable and formed part of the natural sequence of events following the misstatement. The appellant was vicariously liable for Overton's conduct, and the...

Court Disposition

Appeal dismissed with costs, including costs of two counsel.

Orders

  • The appeal is dismissed with costs, including the costs occasioned by the employment of two counsel.