Most short-term insurance policies have a standard “precautionary clause” that requires the insureds to “take all reasonable precautions to prevent loss, damage, accidents…”. This clause ordinarily forms part of the general terms and conditions of the policy. It is not uncommon for insurers to rely on this clause to reject claims – sometimes rightly so, and sometimes unjustifiably so. Examples: in the case of a house contents insurance policy, an insurer can potentially reject a claim for fire stemming from the effects of loadshedding, and base the rejection on an insured’s failure to install/maintain a fire insulator; for a motor vehicle insurance claim resulting from accident, an insurer could reject the claim on the basis that the insured failed to adhere to the laws of the road e.g., an insured drove at an excessive speed. This is what happened in the recent case of Govender v Guardrisk. As it will be apparent below, the judgment in this case gives hope to many car insurance policyholders whose claims have been rejected. This piece purports to demonstrate this by zooming into the facts of the case; the issue for determination, as explained by the court; the court’s decision and reasons.
In 2019, Mr. Govender, driving with his mother in his Ferrari California at night, lost control of the vehicle and collided with a lamp pole. As a result, the vehicle was damaged beyond repairs and, luckily, he and his mother did not sustain any serious bodily injuries. It was common cause that it had been raining heavily on the night of the incident. When Mr. Govender lodged a claim for the damaged Ferrari, Guardrisk repudiated his claim on the basis that Mr. Govender was driving at an excessive speed despite the prevailing circumstances. Guardrisk thus argued that Mr. Govender’s behaviour was reckless, and he had breached an express term and condition relating to the precautionary clause. Guardrisk’s expert opined that Mr. Govender had been travelling at 135km per hour at the time of incident. In contrast, Guardrisk’s Assessor’s report stipulated that Mr. Govender had been travelling at 100km per hour. Further, Mr. Govender testified that he was travelling at 80km per hour. Given the surrounding circumstances and relevant considerations surrounding the case, the court concluded that the Assessor’s speed approximation of 100km per hour carried more weight than the other two.
The court had to determine whether Mr. Govender’s travelling speed, in view of the prevailing circumstances and conditions, was so excessive to the extent that it could be regarded to have been reckless. It was common cause between the parties that Guardrisk would be absolved from paying in terms of the policy only if Mr. Govender’s behaviour was reckless.
Mr. Govender and his mother were the only two witnesses to testify. Mr. Govender testified that he had taken the necessary precautionary measures such as putting the windscreen wipers on; he slowed down due to the rainy conditions; he put on his vehicle headlights and emergency lights to make his vehicle more visible to other road users. He further testified that he was driving at 80km per hour. His mother corroborated this version stating that the vehicle was travelling at a reasonable and safe speed. Guardrisk’s expert concluded that the vehicle was travelling at 135km per hour. This was found less likely to be true given the fact that his approximation was based on inaccurate data – for example, the expert had been unable to explain to Mr. Govender’s expert as to the basis upon which the tensile strength of the metal in the Ferrari had been calculated; no part of Mr. Govender’s Ferrari had been examined to determine tensile strength; the expert had used a European Union standard measurement which he had derived from the testing of wheel rims by Mercedes Benz AG in Germany, and the expert was unable to answer as to whether the wheel rims were made of the same material as the Ferrari or whether they had been manufactured in Italy. On the other hand, an experienced and highly regarded expert involved by Mr. Govender gave sound evidence – he admitted that hydro/aquaplaning (which Mr. Govender had argued was the cause of the accident) was less likely to occur at speeds of 80km per hour or less, but that it (hydro/aquaplaning) could not be excluded without knowing how much water was flowing across the road. On this basis, the court found that Guardrisk had failed to discharge its onus to prove that Mr. Govender’s behaviour had been reckless in the circumstances. Guardrisk thus had to pay in line with the policy terms.
This case demonstrates the significance of doing your own thorough investigation as an insured where you feel that your claim has been unjustifiably repudiated and seeking legal advice to prosecute your claim.