Ensuring contractual fairness in consumer contracts after Barkhuizen v Napier 2007 5 SA 323 (CC) – Part 1

Sutherland, PJ (2008-03)

CITATION: Sutherland, P.J. 2008. Ensuring contractual fairness in consumer contracts after Barkhuizen v Napier 2007 5 SA 323 (CC) - part 1. Stellenbosch Law Review = Stellenbosch Regstydskrif 19(3):390-414.

The original publication is available at https://journals.co.za/content/journal/ju_slr


INTRODUCTION: Barkhuizen v Napier1 concerns a short-term insurance policy, concluded between the appellant (the insured) and a Lloyds syndicate (the insurer), represented by the respondent. The insured suffered loss resulting from damage to his 1999 BMW 328i on 2 December 1999. He duly claimed R181 000 representing the sum insured on the policy. On 7 January 2000 the respondent repudiated the claim on the basis that cover was provided for private use of the vehicle, but that the loss was suffered while it was being utilized for business purposes.2 The insured only instituted action more than two years after repudiation, on 8 January 2002. The summons was met with a special plea alleging that the insurer had been released from liability because of a time-limitation clause in the policy. The clause was to the effect that a claim of the insured would lapse if he failed to serve summons on the insurer within 90 days of being notified of the insurer’s repudiation of the claim. The insured conceded non-compliance with the clause, but contended that the provision could not be enforced against him because it contravened the Constitution of the Republic of South Africa, 1996 (“the Constitution”). The question was whether the court could impugn the time-limitation clause. The parties agreed to a terse statement of facts which set out this basic factual matrix.

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