Pretoria - The insurer, and not Gauteng provincial government, is liable for the costs incurred years ago to repair the damage caused during the construction of Gautrain underground routes.
The Supreme Court of Appeal confirmed an earlier ruling by the High Court in Johannesburg, which found the insurer of the project, Zurich Insurance Company South Africa, had to foot the bill.
Zurich turned to the Supreme Court after it was unhappy with the ruling. But the Supreme Court confirmed that there was a policy in place and that the province as the insured must be indemnified from carrying the costs.
It is not at this stage known exactly how much the provincial government will claim from Zurich after the repairs.
The Gautrain runs from Park Station, past stations including Rosebank and Marlboro, to OR Tambo International Airport on one line and Hatfield, Pretoria, on another.
Parts of the rail network are below ground in tunnels, while others are above ground. This matter concerns the construction of tunnels between the stations of Rosebank and Sandton as well as Sandton and Marlboro Portal.
In a joint venture, the province granted Bombela Concession Company the concession to run the Gautrain rapid rail system. Insurance was taken out for the construction of the tunnels, and leaking water was an engineering concern from early on.
The province discovered what it believed to be damage to parts of the tunnel from water seeping into the tunnel system and made a claim for the repairs in terms of the policy with Zurich, but the insurer repudiated the claim.
Three grounds for appeal were presented before the Supreme Court, which included whether the province’s claim against the insurer had lapsed and if the rock mass surrounding the void of the tunnels was part of the insured property.
When the tunnels were designed, provision was made for the pre-grouting of the rock mass as the excavation process progressed. In the construction process, however, pre-grouting was never done.
The province suspected the damage had been caused to the tunnels because of the excessive ingress of water into the tunnels.
An international expert in rock mechanics concluded the problem arose due to the fact the tunnels were not pre-grouted.
By the time it was established that the tunnels were damaged, more than three years had lapsed since the completion of the construction. Zurich thus insisted that any claim against it had prescribed.
As in the case of the High Court, the Supreme Court found it did not prescribe. In a unanimous judgment, it held that the province only suspected at the time that there may have been damage. It reported its suspicions to Zurich, but the assessors sent to inspect the tunnels found no damage.
It was only when the expert alerted the province that there was actually some damage that the government can be said to have had knowledge of the damage, the court said.
The Supreme Court also confirmed that rock mass surrounding the void of the tunnels was part of the insured property.
“It was clear from the policy that the damages to the tunnels were covered,” the court said.
The judges looked at the meaning of “tunnel” as explained in dictionaries and found that the definition included the roof, floors and sides, which included the surrounding rock mass through which the tunnel was excavated. “Without the surrounding rock mass, there can be no tunnel,” the court said.
The court concluded that Zurich had to fork out for the damage once the province had quantified it.
Pretoria News