TOPIC 13 EXEMPTION CLAUSES

VALIDITY + EFFECT
 Pactum de non petendo in anticipando:

o A prior agreement not to claim damages if another person’s conduct causes harm.
o Can exclude the recovery of damages + liability for boc + delict.
o DISTINGUISH pactum from consent:
 Valid consent:
 No delict – no subsequent legal action
 Pactum
 Still delict – agreement to exclude subsequent legal action.

o Defendant must discharge onus of proving that the terms of the exemption exclude
liability in the particular circumstances.
o CPA 68 of 2008 now limits the scope of contractual exemption clauses.
o Rqmts same for any other contract.
 Need authorisation to contract obo another person.
 Jameson’s Minors v Central South African Railways
 A prior agreement by a breadwinner that no claim will be made in
the event of his negligently caused injury/death, even if such an
agreement binds his estate + his dependants, will not exclude the
right of his dependants to claim compensation for loss of support in
the event of his death.

o Parents/guardians can conclude pactum obo minor child.

 Agreement that excls liability for negligently caused injury to the child is not.
 Child should be entitled to restitution in integrum to have effects of
agreement set aside.
 Courts interpret such agreements restrictively.

o Courts regard:
 An agreement is INVALID if excludes liability for INTENTIONAL HARM.
 An agreement as VALID if excludes liability for harm from NEGLIGENCE.

o Courts enforce exemption clauses even where the effect appears to undermine a
basic purpose of the contract, such as:
 to be treated with due care in a hospital
 Afrox Healthcare Bpk
 to store valuables safely in a bank.
 First National Bank of SA Ltd v Rosenblum
INTERPRETATION
 Determines extent of exclusion/limitation of liability.
 Defendant bears onus of establishing the terms of agreement when raising a defence.

 In Van der Westhuizen v Arnold, Lewis AJA said:

o Courts should be wary of contractual exclusions, since they do deprive parties of
rights they would have had at common law.
o “a careful construction of the contract itself” should ensure protection of both
party’s interests.
o Great care to meaning of clause esp if very general in its application.
o Background + surrounding circumstances.

 If no specific reference to negligence in exemption clause, ie, in case of a so-called ‘owners

risk’ clause, courts consider whether the words are extensive enough in their ordinary
meaning to cover negligence on the part of the defendant.
 If fault as negligence is rqmt for liability (delict/boc) courts will interp to allow no defence
against liability.
o Unless stated otherwise.
 In case of ambiguity, courts will decide the issue against the party relying on the exemption,
as the person considered responsible for drafting the contract (proferens).
 Must be clear that parties intended the CoA in issue to be covered by the exemption.

EXEMPTION CLAUSES + THE CONSTITUTION

 Subject to broad principle of legality
 Unenforceable if not in line with public policy + Constitutional values.
 Afrox Healthcare Bpk v Strydom
o Pl had been admitted to hospital that defendant owned, for operation + treatment.
o Upon admission, signed an agreement that contained an EC:
 Hospital not liable for any claim for damage/loss of any nature flowing from
injury of any cause, except only with the exclusion of intentional omission by
the hospital / employees.
o Pl alleged that it was an unspoken term of the agreement that the defendant’s
nursing staff would treat him in a professional manner + with reasonable care.
o Plaintiff suffered damages due to neg conduct by a nurse [=boc] + instituted action.
o Defendant relied on EC to avoid liability.
o Plaintiff contended:
 Contrary to public interest + conflict with principles of good faith.
 Duty to provide med treatment in professional + caring manner.
 Wide ambit of exemption.
 Conflict with s39 of C.. promote spirit, purport, object of BoR’s.
o Held:
  No evidence that plaintiff had occupied a weaker bargaining position at
conclusion of C.
 EC not conflict with s27(1)(a) - right to med treatment
 In public interest that courts enforce C’s freely entered into + seriously by
parties with necessary capacity.
o Contention that EC was contrary to public policy therefore failed.

 Exemption from liability for causing death??

Johannesburg Country Club v Stott

o Court had to consider an EC to exclude liability on part of the Club for personal
injury/harm to its members / their children whilst on the club premises, however
caused.
o 1 of members killed by lightning whilst playing golf + his wife instituted a
dependant’s action (sought damages for loss of support + funeral costs)
o Court issued a directive requesting that legal representatives of parties provide
argument on whether EC should be unenforceable on grounds that it violates pp,
because it is inconsistent with the constitutionally entrenched right to life.
o However, despite this, court found that it could decide the matter w/out having to
resort to constitutional enquiry.
o Held: terms of the exemption clause did not cover liability for loss of support as
claimed by the plaintiff.

Barkhuizen v Napier
o CC considered const validity of E + L clauses.
o Involved a time limitation clause in short-term insurance contract.
 Rqd claimant to institute court proceedings w/in 90 days after the insurance
company had rejected the claim.
o Majority of Court held that the proper approach to constitutional challenge is to
determine whether the time limitation clause is contrary to public policy, +
whether it allowed an adequate + fair opportunity to seek assistance of court.
o Period of 90 days was not inadequate / unfair.
o At beg of period, plaintiff had all info needed to sue insurance co (as he had already
lodged his claim with ins co, which they rejected).
o No evidence that contract was not freely concluded btw persons with equal
bargaining power/ that insured was not aware of clause.
o Waited for 2 yrs to sue after being told of rejection of claim.
o However, he did not provide any reasons for not observing the clause.
o In circ’s , Court found that clause was not unfair/unreasonable.
 o Minority of court:
 Considerations of pp, based on C, dictated that the time-bar clause (which
limited access to courts) should not be enforced.
 Not merely due to small print/ harsh on insured, but because clause was in a
std form document, + generally failed to comply with std’s of notice +
fairness, which contempory notions of consumer protection rqd in open +
democratic societies.
 Another judgment held time clause was unreasonably short + inflexible, with
result that it precludes a reasonable + adequate opportunity to seek legal
redress.

Durban’s Water Wonderland v Botha 1999 1 SA 982 (SCA)

o Plaintiff and her young daughter injured when they fell during a “jet ride”.
o Court had to consider whether the exclusionary clause in the window of ticket office formed
part of the contract regulating use of amusement park.
AND

o Whether the notice also excluded liability based on negligence.

o “Owners risk clause” – the court must consider whether the words are extensive enough to
their ordinary meaning to cover negligence on the part of the defendant.
o In case of doubt, it must be resolved against the defendant as proferens.
o Restrictive approach used here.
o Here the amusement park escaped liability.

Minister of Education v Azal 1995 1 SA 30 (A)

o The court concluded that a clause which ltd liability of the school against parents for damage
to property OR the personal injury of the children with regard to certain school activities, did
NOT cover negligence on the part of teachers.