Fedsure General Insurance Limited v Carefree Investments (Proprietary) Limited

The respondent, a clothing manufacturer, insured a containerised consignment of fabric under a marine open insurance policy covering transit from South Korea to Durban. After discharge at Durban harbour, the container was stored first at the Portnet terminal and then at the South African Container Depot, a bonded warehouse, pending customs clearance. The respondent delayed clearance because it lacked funds to pay customs duty and VAT, choosing to wait for a favourable cash flow position before arranging finance. While the goods were still in bonded storage and before clearance or collection, they were stolen and never recovered. The respondent claimed under the policy; the insurer repudiated liability, alleging that the goods were no longer in the ordinary course of transit and that cover had terminated.

The appeal succeeded with costs. The order of the High Court was set aside and replaced with an order dismissing the plaintiff’s claim with costs.

The case is significant for clarifying South African law on marine transit insurance, particularly the meaning of 'ordinary course of transit'. It confirms that delays caused by the insured for reasons of commercial convenience can interrupt transit and suspend cover, even though the journey has not formally ended. The judgment provides authoritative guidance on the objective assessment of transit under Institute Cargo Clauses.