Rick's Upholstery (Pvt) Ltd v Biddulphs Removals & Storage (Pvt) Ltd

In December 2006, the appellant (Rick's Upholstery) left certain goods, including 31 rolls of leather fabric, in storage with the respondent (Biddulphs Removals & Storage), a company carrying on the business of removals and storage. Alwyn Richard Pahla, the appellant's managing director, signed a storage contract which contained an owner's risk clause exempting the respondent from liability for loss or damage. The contract indicated that insurance was available and Pahla ticked "Yes" to requiring insurance, but neither completed the insurance proposal form nor paid the premium, so the goods remained uninsured. The contract incorporated terms and conditions (clause 7) stating the respondent would not be responsible for any loss or damage from any cause, even if caused by negligence. In October 2007, the respondent informed Pahla that some goods had been stolen. Investigation revealed 31 rolls of leather fabric were missing following a break-in at the respondent's warehouse. Police investigations suggested involvement of Alexio Chinzara, a former employee of the respondent. The goods were stored in a warehouse secured by steel doors, padlocks, inter-leading doors, and three security guards on duty.

• Whether the respondent bailee was liable for theft of goods left in its care under a contract of bailment
• Whether the owner's risk clause in the contract exempted the respondent from liability for negligence
• Whether the owner's risk clause was binding on the appellant despite the appellant not being shown the full terms and conditions at the time of signing
• Whether the respondent was negligent in safeguarding the goods
• Whether an exemption clause can exempt a bailee from dolus (intentional wrongdoing) of its servant

The appeal was dismissed with costs.

In a contract of bailment for reward: (1) An appropriately worded owner's risk clause can exempt the bailee from liability for negligence, including negligence of the bailee's servants, and can shift the onus of disproving negligence away from the bailee. (2) Terms and conditions incorporated by reference into a contract are binding on a party who signs the contract accepting those terms, even if the party was not shown the actual terms before signing - the principle of caveat subscriptor applies. (3) A bailee for reward is not liable for loss of property if the loss occurs without negligence on the part of the bailee or servants entrusted with care of the property. (4) Where goods are stolen by break-in by an unknown person and adequate security measures were in place, no negligence is established against the bailee.

The Court noted that the appellant's awareness of the availability of insurance at the time of signing the contract, combined with the fact that the appellant had previously stored goods with the respondent, indicated the appellant understood the goods were being stored at his own risk. The Court also observed that it was unnecessary to comment on the judgments in Tubb (Private) Ltd v Mwamuka 1996 (2) ZLR 27 (S) and Fawcett Security Operations (Pvt) Ltd v Omar Enterprises (Pvt) Ltd 1992 (4) SA 425 (ZSC) regarding whether an employer can exempt itself from dolus of its servant by exemption clause, as neither case dealt with contracts of bailment and the issue did not arise on the facts.

This case is significant in Zimbabwean commercial law as it clarifies the application of owner's risk clauses in contracts of bailment for reward. It confirms that properly worded exemption clauses are enforceable and can exempt bailees from liability for negligence, even when the customer has not been shown the full terms before signing, provided the contract incorporates those terms by reference. The case reinforces the principle of caveat subscriptor and provides guidance on the standard of care required of commercial storage operators. It also distinguishes between liability for negligence (which can be exempted by contract) and potential liability for dolus of servants (which requires proof that an employee entrusted with care of goods committed an intentional wrong).