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Guardrisk Insurance, a subsidiary of JSE-listed financial services giant Momentum Metropolitan, lost its appeal against a Western Cape Superior Court ruling in the Covid-19 business interruption insurance case involving Café Chameleon.
The Supreme Court of Appeals (SCA) on Thursday morning dismissed Guardrisk’s appeal case with costs, in the latest victory for the Cape Town restaurant.
SCA Judge Azhar Cachalia’s ruling was transmitted electronically and distributed to the relevant parties.
It represents a new legal precedent in the current Covid-19 business interruption insurance battles in South Africa, with many seeing the Café Chameleon case as a “test case” to get to the bottom of the matter.
Other cases are before the courts, including those against Santam and Old Mutual, which have been appealed or where lawyers for the insurers were awaiting the Café Chameleon v Guardrisk appeal ruling before deciding how to proceed.
Read:
Business interruption insurance win ‘setting a precedent’ at Cape Café
Santam Fails to Have Guardrisk’s Café Chameleon Appeal Postponed
The SCA’s Guardrisk ruling on Thursday could open the way for billions of rand more in pandemic-related claims against the country’s short-term insurers, which have paid interim relief on certain business interruption insurance claims. of Covid-19 or have chosen not to pay. until there is legal certainty on the subject.
It is unclear whether Guardrisk or other short-term insurers that may lose such appeals will take the matter to the Constitutional Court.
However, Café Chameleon owner Nico Schoeman has called for the SCA case to be closed, telling Moneyweb previously that the highest court for business matters in South Africa is the SCA.
Read: Café Chameleon Wants SCA Business Interruption Insurance Case Closed
“The central question in this appeal was whether the government’s imposition of a lockdown in response to multiple outbreaks of a ‘notifiable disease’, namely Covid-19, was covered across the country, and predominantly in Cape Town. , where Café Chameleon’s operates its business. for the infectious diseases clause, ”Judge Cachalia noted in his final remarks on the Guardrisk ruling.
“The question was answered in favor of Café Chameleon, as was the question of whether the Covid-19 outbreak in Cape Town was the cause of its business disruption,” he added.
Judge Cachalia noted that in reaching this conclusion, his decision was “reinforced by much of the reasoning” in the UK Financial Conduct Authority’s test case surrounding similar claims, in addition to the two recent rulings of Western Cape Superior Court involving Ma-Afrika Hotels v Santam; and Interfax vs Old Mutual.
Read:
Ma-Afrika wins court battle against insurance giant Santam
Old Mutual Insure, the latest loser in the Covid-19 claims battle
Ren Dunster, an attorney for Café Chameleon, said Thursday in reaction to the SCA ruling that he and his client (Schoeman) were delighted with the ruling.
“We applaud the urgency and clarity with which the judges addressed the matter. We are privileged to have such a strong judiciary in South Africa, ”he said.
