CIVIL LAW – Delict – Victimisation in workplace – Teacher alleges she retired early due to victimisation by principal – Claim in delict for damages – Lost income following early retirement for health reasons – Liability of employer for omissions – Teacher had right to lodge a grievance as contemplated by her statutorily imposed conditions of service – Failed to pursue this remedy – Wrongfulness not established – Appeal upheld and claim dismissed.
Facts: Ms Singh was employed for many years by the department of education as an educator. About 7 years before she would reach the usual compulsory retirement age of 65, she took early retirement. She alleged that she was compelled to that course because she came to suffer from clinical depression as a result of the failure of her employer to take any reasonable steps to prevent the principal of her school from victimising her. Ms Singh contends that she is entitled to be compensated for the income she lost because she could not work for what would have been the last 7 years of her working life.
Appeal: Against the judgment of the High Court in favour of Ms Singh for payment of just under R1,3 million, interest and costs. The amount was said to represent the present value of seven years’ income.
Discussion: That the central feature of Ms Singh’s case was that she was victimised by the principal; that he has passed away and the accounts of the incidents comes from Ms Singh; that she seeks to hold the department liable in delict to compensate her on the grounds of its alleged omission to take steps to prevent the onset of depression and the associated emotional cost to her; and that the psychiatric evidence reflects an opinion that further progress in treating her condition would not be achieved unless she was taken out of the environment which she blamed for her condition.
Findings: It is necessary when considering the issue of wrongfulness in this case to keep a sharp eye on the bigger picture. Both the victimisation and her illness are recognised in the statutory instruments which govern her employment relationship with the department. She had a right to lodge a grievance as contemplated by her statutorily imposed conditions of service. Ms Singh chose not to employ the remedy available to her. A more complete picture of the factual background does not support a claim that it would be reasonable to hold the department liable in delict for the financial consequences of Ms Singh’s early retirement. Wrongfulness was not established.
Order: The appeal is upheld and the order of the trial court replaced with one dismissing the plaintiff’s claim.
OLSEN AJA (PONNAN ADP and MEYER JA concurring)
PROFESSION – Fidelity Fund – Liability – Attorney appointed executor of insolvent deceased estate – Funds from death benefit under life policy – Money paid into attorney’s trust account by widow subsequently stolen – Whether the money was entrusted as provided in section 26(a) of the Attorneys Act 53 of 1979 – Claim dismissed by the Fund but upheld by the High Court – Appeal by the Fund dismissed.
Facts: Ms Guilherme was married to Mr Bartie (the deceased) who committed suicide. His attorney, Mr Spencer, was appointed executor of the insolvent deceased estate. Ms Guilherme received a death benefit under the life policy of R5 million. Mr Spencer advised her to pay the money into his trust account as these funds were at risk as a result of the deceased’s liabilities towards his creditors. She did so and received certain of the funds. She later terminated his mandate and appointed a new attorney who found that R799,967.24 was still due to her and that Mr Spencer had already been suspended from practice and was eventually struck from the roll. The Legal Practitioners’ Fidelity Fund rejected her claim.
Appeal: The High Court ordered the Fund to pay Ms Guilherme the R799,967.24 plus interest and the costs. The full court in a majority judgment dismissed the appeal.
Discussion: The submission by the Fund that payment by Ms Guilherme of her money to an attorney for safekeeping to hide it from the creditors of her late husband’s estate did not constitute an entrustment for purposes of section 26 of the Attorneys Act 53 of 1979; that the Fund’s counsel elected to rely on a definition of “deposit” in Wille’s Principles of South African Law; that she acted on Mr Spencer’s advice as her deceased husband’s attorney and executor of the insolvent deceased estate; that he used his intimate knowledge to advise her; and that her money was deposited into his trust account in the course of his practice to be held in trust for her until she “was required to withdraw monies or when the estate was finalised”.
Findings: The legislature did not have “a trust in the legal sense of the word” in mind when section 26 was enacted. Mr Spencer who received the money in trust could be equated to a trustee as the money had been placed under his control for the benefit of Ms Guilherme, the beneficiary. The Fund was not entitled to reject Ms Guilherme’s claim. Her money was entrusted to Mr Spencer in accordance with subsection 26(a). She is entitled to be reimbursed for the loss suffered consequent upon the misappropriation of the funds by the attorney.
Order: The appeal is dismissed with costs.
DAFFUE AJA (DAMBUZA ADP, SALDULKER JA, MOTHLE JA and MATOJANE JA concurring)
CONTRACT – Insurance policy – Forfeiture of claim – Partly fraudulent and partly genuine claim arising from the same incident – Interpretation of terms and enforceability – Whether a partly fraudulent and partly genuine claim results in forfeiture of entire claim, retrospective from either date of reported incident or actual incident date, entitling insurer to repayment of amounts already paid arising from such incident.
Facts: The insured (respondent) took out a policy with Discovery to insure his dwelling in Pretoria and household contents. He later submitted a claim under the building section of the policy for losses caused by storm damage to his residence. The claim was for the costs of repairs to the residence and damage to household contents, as well as for emergency accommodation. Discovery paid out the aggregate amount R1,594,980.12. The amount claimed for emergency accommodation was tainted by fraud while the claims for damage to the residence and household contents were not and were legitimate. Discovery sought repayment in the High Court.
Appeal: Against the order of the High Court which only ordered repayment of R675,000 being the payment for accommodation (with interest and costs).
Discussion: Whether a partly fraudulent and partly genuine claim arising from the same incident results in the forfeiture by the insured of the claim in its entirety; if the principal question is answered in the affirmative, whether the insurer is entitled to repayment of the amounts already paid to the insured arising from the same incident when it is subsequently discovered that part of the claim was tainted by fraud; the interpretation of the clauses; and whether the doctrine of accrued rights finds application in the context of the facts of this case.
Findings: Forfeiture clauses of the kind under consideration in this case are now a common feature in insurance contracts. The clause is clear and unambiguous and explicitly provides that upon breach of its terms, Discovery would be entitled to terminate the policy with retrospective effect from the date of the incident giving rise to the claim. When the respondent purported to submit his claim on 11 November 2016 there was no longer an extant insurance policy because it had already been terminated with retrospective effect from 10 November 2016 – the date of the incident – pursuant to the clause. Discovery was entitled to a refund of all the moneys previously paid out by it to the respondent.
Order: The appeal is upheld and the order of the High Court substituted such that judgment is granted for payment of R1,594,980.12.
PETSE AP and MASIPA AJA (SALDULKER JA, MABINDLA-BOQWANA JA and WEINER JA concurring)
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