Metcash Trading Limited v Credit Guarantee Insurance Corporation of Africa Limited

Metcash Trading Ltd held an interest and had advanced medium- and long-term loans to a business undertaking in Zaïre, Metro Zaïre SPRL. It insured this investment under an investment insurance policy issued by Credit Guarantee Insurance Corporation of Africa Ltd, covering losses arising from causes such as war. In September 1991 the Metro Zaïre store was destroyed and looted in circumstances constituting war under the policy. Metcash notified the insurer of a potential claim shortly thereafter but did not quantify its loss. Extensive correspondence followed over several years. Only on 28 September 1993 did Metcash submit a quantified demand for indemnity. The insurer repudiated liability, contending that the claim had not been lodged timeously in terms of the policy. Metcash sued for indemnification, and after its claim was dismissed in the High Court, appealed to the Supreme Court of Appeal.

The appeal was dismissed with costs, including the costs of two counsel.

The case is significant for South African insurance and contract law as it reaffirms established principles on the interpretation of insurance contracts, clarifies the meaning of 'claim' as requiring a quantified demand, and confirms that time-bar provisions in insurance policies will be strictly enforced where they are clear and workable.