The Commercial Case Law Index is a collection of judgments from African countries on topics relating to commercial legal practice. The collection aims to provide a snapshot of commercial legal practice in a country, rather than present solely traditionally "reportable" cases. The index currently covers 400 judgments from Uganda, Tanzania, Nigeria, Ghana and South Africa.
Get started on finding judgments that are relevant to you by browsing the topic list on the left of the screen. Click the arrows next to the topic names to reveal a detailed list of sub-topics. Most judgments are accompanied by a short summary written by subject-matter expert postgraduate students from the University of Cape Town.
The court considered whether a Financial Services Provider (FSP) as regulated according to the Financial Advisory and Intermediary Services Act (FAAIS) was negligent by advising the plaintiff which led to a loss of two million Rands. Further, if the second defendant was liable to indemnify the first defendant for professional negligence considering the exclusion clause in the insurance contract.
The court held that s 16 of FAAIS requires that an FSP act honestly, fairly with due skill, care and diligence. Further that the FAAIS Code of Conduct requires professionalism, in the interest of the public. In the case of an insurance contract, the court held that an exclusion clause might make proper commercial sense, be consistent with and not repugnant to the purpose of the contract.
The court concluded that the defendant did not act in accordance with expectations of an FSP, the defendant was negligent and dishonest. Further, the purpose of the insurance contract was to indemnify the insured for professional negligence; the exclusion interpreted restrictively cannot be applicable in the case.
The defendant was ordered to pay damages of two million Rands plus interest and second defendant to indemnify the first defendant.