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[2017] ZAGPJHC 384
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A v Road Accident Fund (2016/4995) [2017] ZAGPJHC 384 (8 December 2017)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
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IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO: 2016/4995
Not reportable
Not of interest to other
judges
Revised.
8/12/2017
In
the matter between:
A,
D
Plaintiff
and
ROAD
ACCIDENT
FUND
Defendant
JUDGMENT
BALOYI
AJ:
[1]
This is a claim for past and future loss of earnings following
injuries suffered by the plaintiff in a motor vehicle accident
on 23
October 2014. The plaintiff was a passenger in a armoured vehicle
when it collided with another vehicle during a so-called
cash-in-transit heist.
[2]
In determining the issue of loss of income, past and future, I am
required to determine – (i) the plaintiff’s pre-accident
potential, namely, whether but for the accident the plaintiff would
have been promoted; (ii) whether the plaintiff’s employment
will be terminated, and if so, the probable date for termination;
(iii) past loss of income; and (iv) the plaintiff’s
pre-accident
retirement age.
[3]
The defendant has conceded liability for 100% of the plaintiff’s
damages and the parties have agreed to refer the determination
of
general damages to the Health Professionals Council of South Africa.
The plaintiff’s injuries, are detailed in the reports
of neuro
surgeon, Dr Marus, plastic surgeon, Dr Chait and orthopaedic surgeon,
Dr Read, as follows - multiple facial bone fractures,
cervical spine
C7 spinous process fracture, thoracic spine T4 compression
fracture,various facial scarring, scarring to the scalp,
dental
injuries viz. loose teeth and injury to the right knee, are admitted.
The defendant disputes that the injury to the right
knee is a
sequelae
of the accident.
[4]
The defendant has admitted the expert reports of Drs Marus, Vorster,
Chait and Mr L Roper. The plaintiff, his wife, Mrs
Lee Viona
Anderson, Brink SA Human Resources Manager, Mrs Bonita Meyer and
Industrial Psychologist, Mr D De Vlamingh testified
in support of the
plaintiff’s claim and Industrial Psychologist Mr T Tsiu
testified on behalf of the defendant.
[5]
At the time of the accident, the plaintiff was employed by the
company, Brink Armoured Security SA as armoured vehicle escort
for
the transportation of high commodity assets. His monthly salary
included a basic salary and overtime pay for overtime work.
Following
the accident, the plaintiff was absent from work for a period of 3
months and upon return to work, he was and continues
to be
accommodated in office-based administrative duties in the control
room, in which position he earns only a monthly basic salary
and does
not work overtime and therefore earns no overtime. He was booked off
work for a further period. There is an issue about
overtime payment
to the plaintiff in August and September 2015 (although according to
the salary slips presented as evidence it
appears that payment was in
October and not September).
[6]
The parties agree that the plaintiff is no longer suited for his
pre-accident position, he will no longer be able to achieve
his
pre-accident career and earning potential, he will retire early, once
his employment is terminated he will probably remain
formally
unemployed. With respect to the termination of employment, the
plaintiff contends that his employment will be terminated
in June
2018 whilst the defendant holds that the date of termination is an
unknown date in the future.
Past
loss of income
[7]
According to Mrs Meyer, as at October 2014, the plaintiff earned a
monthly basic salary of R12 103.48, and an average monthly
overtime
earnings in the amount R1 978.00 over the preceding twelve months
period. I accept this evidence of Mrs Meyer.
[8]
Whilst the plaintiff testified that he did not receive any overtime
pay in the entire period after the accident, he conceded
in
cross-examination that he was paid overtime as appears on the
payslips I have referred to in paragraph 5 and explained that
he was
not aware that he was paid these amounts. I have no reason to
disbelieve the plaintiff. According to Mrs Meyer, the overtime
payments were monies owed to the plaintiff for past overtime and not
overtime worked in the months indicated in the payslips. Mrs
Meyer
also testified that the plaintiff has not worked overtime since the
accident, which evidence accords with that of the plaintiff.
I have
no reason not to accept the plaintiff’s and Mrs Meyer’s
evidence that the plaintiff has not worked overtime
since he was
injured in the accident and accordingly accept this evidence. It
follows that the aforementioned amounts are not to
be deducted from
the amount to be awarded for past lost income.
[9]
From the above, it appears that but for the accident, the plaintiff
would have continued to earn overtime for as long as he
carried on
the duties of armed escort. The defendant has not contended
otherwise. However, contigencies must be applied to this
scenario due
to the uncertainty of hours that would in fact have been worked, if
any. Whilst in her submissions counsel for the
defendant contended
for a higher contingency deduction of 10% to be applied to the value
of past income, contrary to the lesser
percentage deduction of 5%
applied by the defendant’s actuary, Dr Jacobson, no explanation
was offered for the departure
from Dr Jacobson’s proposed
percentage of 5%. I am mindful that there is no art to the
determination of a correct or accurate
contigency deduction
percentage and that the court must cautiously use its discretion,
taking into account relevant facts, to arrive
at what it considers
fair and reasonable. As the Appellate Division (as it then was) said
in Southern Insurance Association Ltd
v Bailey 1948(1) SA 98 (A)
113H, “
Any
enquiry into damages for loss of earning capacity is of its nature
speculative …
“
.
[10]
It is apposite at this stage to raise the difficulty with reliance on
the expert report of the the plaintiff’s actuaries,
Munro
Forensic Actuaries. As counsel for the defendant correctly points
out, the calculations of Munro is premised on an incorrect
higher
salary as a basis. Munro’s calculations proceed on the basis
that the plaintiff earned a monthly salary of R15 288.
Notwithstanding the evidence of Mrs Meyer about the correct salary of
the plaintiff (R12 103.48), the plaintiff’s counsel
persisted
to submit that I accept the calculations of Munro as appear in the
report. Quite evidently, the evidence of Mrs Meyer,
which I have
accepted, undermines the calculations and conclusions arrived at by
Munro. It follows that I agree with the submission
of the defendant’s
counsel that in the circumstances, I should not rely on the
claculations of Munro and the conclusions
arrived at.
[11]
I am satisfied that a lesser percentage of 5% as applied by Dr
Jacobson for past loss, and I might mention that Messrs De Vlamingh
and Tsiu agreed on the pre and post morbid value of past income (R606
773) and (R495 667) respectively, is appropriate. Accordingly,
a 5%
contigency deduction should be applied to the value of income but for
the accident (R606 773 less 5% = R576 434) less 5% contigency
deduction from value of income after the accident (R495 667 less 5% =
470 884). The resulting net past loss is R105 550. As I have
found,
the amounts paid to the plaintiff on 31 August 2015 and 31 October
2015 are not to be deducted from this amount.
Future
loss of income
[12]
Under this heading, I must consider the plaintiff’s prospects
for promotion but for the accident; the probable date of
termination
of the plaintiff’s employment; and the plaintiff’s pre
morbid date of retirement
[13]
The parties are agreed that the plaintiff’s vocational capacity
has been reduced and that he has been rendered vulnerable
and less
competitive in the open labour market in the aftermath of the
accident, his future vocational capacity is largely dependent
on the
outcome of psychological and physical intervention programmes
recommended, his injuries are amendable to treatment and the
orthopaedic injuries sustained in the accident will not have any
long-term effect on his employment. The plaintiff’s
intellectual
abilities are described ascommensurate with his
pre-accident educational and work levels; he did not suffer a brain
injury or focal
injury to the brain as a result of the accident; he
suffers secondary anxiety, stress and mood disorder some of which is
treatable
and has features of a secondary chronic pain syndrome and a
somatoform disorder and has developed a dependency on family to
assist
him with basic functions such as dressing.
The
prospects for promotion
[14]
At the time of the accident, the plaintiff was 40 years old and is
presently 43 years of age. According to the retirement policy
of his
employer, the plaintiff would have had to retire at 65 years of age.
[15]
The plaintiff testified that he holds a grade 10 school pass and
grades E, D, C, B Sera certificates. Prior to his employment
at Brink
SA, he was employed as a security guard at Asset Secuirty and at
Nforce for 3 and 6 years respectively. At the latter,
he was promoted
to the position of inspector of security guards. He would have been
eligible for promotion to the position of supervisor
but for the
accident and would retire at 65 years of age.
[16]
The evidence of Mrs Meyer may be summarised as follows – she
joined Brink SA in August 201;, according to her colleagues
who
worked with the plaintiff before the accident, the plaintiff would
have been promoted to position of supervisor before age
45 years; the
company’s promotion policy is to promote internal candidates
and is not based on academic qualifications; supervisor
positions
become available every 2 to 4 years. Mr De Vlamingh testified that he
assessed the plaintiff on 19 May 2016, the prospects
for the
plaintiff to be promoted to supervisor by age 45 were good because
the criteria for the position of supervisor does not
require academic
ability and his progression was good; the internal policy of
promotion means that the plaintiff had a realistic
expectation for
promotion; the plaintiff completed schooling at grade 10 and never
failed in his schooling years; with his experience
and qualification,
the plaintiff could have been easily employed elsewhere and with his
ability would easily make the position
of supervisor. Mr Tsiu
assessed the plaintiff on 1 December 2016 and concluded that prior to
the accident, the plaintiff had no
prospect of promition because a
grade 10 school qualification is not sufficient; the plaintiff’s
age at the time of accident
diminished the prospect for promotion by
age 45, promotions are competitive and the plaintiff lacks the
necessary academic qualification
of grade 12.
[17]
I am unable to find that pre accident the plaintiff had good or
probable prospects for promotion to supervisor.
17.1 The plaintiff was
overlooked for promotion pre-accident for the given reason that he
did not meet the required criteria. It
was not suggested that
following this, he acquired further skills that met the criteria for
promotion. There is no evidence before
me that contrary to the
conclusion when he was denied promotion, he in fact did possess the
necessary requirements for promotion.
According to Ms Meyer,
promotions occur only when an opening of a position arises, which,
according to her is, on average every
two to four years. To find that
an opening would have opened up and that the plaintiff would have
been found to meet the requirement
for promotion invites speculation.
17.2 Mrs Meyer’s
conclusion that the plaintiff would have been promoted is based on
what she was allegedly told by her colleagues
who knew the plaintiff
pre accident. This evidence is not corroborated by other placed
before me and there is no explanation for
absence of corroborating
evidence on what is obviously an imporatnt issue. I must agree with
the defendant’s counsel that
this is hearsay evidence which, in
the absence of corroboration, as happened, cannot be relied upon. For
the same reason, I place
no reliance on the letter of Ms Meyer dated
21 October 2016, adressed to no one in particular, in which she
appears to convey that
but for the accident the plaintiff would have
been promoted. I deliberately choose the word “appears”
because it is
not evident that that is the intention of the letter. I
mention in passing that curiously, none of the persons who knew the
plaintiff
pre accident or who with knowledge of his pre accident
unsuccessful application for promotion were called to shed light on
this
obviously important topic.
17.3 Mrs Meyer’s
testimony that promotions are from internal candidates does not take
the matter any further – there
is no evidence that any of the 4
supervisor positions att Brink SA would become available for
consideration of the plaintiff whilst
he was still eligible for
promotion.
17.4 Contrary to Mrs
Meyer’s evidence, and perhaps that of Mr De Vlamingh, it is
evident from the plaintiff’s
failure to be promoted when he
applied that promotions are competitive. I must in the event find
that the plaintiff has not shown
that he would have been promoted by
age 45. I do not overlook the evidence that the plaintiff was
promoted to inspector of security
guards in his previous employ.
However this does not assist the plaintiff for the following reasons
– his previous employment
where he became inspector of security
guards was, on the plaintiff’s ownevidence, a smaller company
to his present employer
and there is no evidence before me that the
position of inspector of security guards carries the same
qualification criteria as
the requirements for supervisor at the
present employer.
[18]
In the event, I find that the evidence before me does not establish
that pre accident, the plaintiff had any or probable prospects
for
promotion. The evidence before me simply does not go that far.
Termination
of employment
[19]
It is common cause that the plaintiff is presently accomodated in
administrative duties. The parties are in disagreement about
the
probable date for termination, which Mrs Meyer says is imminent in
June 2018. The defendant, whilst accepting that the plaintiff’s
employment will terminate before he reaches age of retirement,
contends that the date of dismissal is at this stage unknown.
[20]
Ms Meyer testified that she has made a recommendation to Brink
International, the head office of Brink SA, that the plaintiff
be
discharged from employment on the ground that he is unable to fully
perform his duties in the current accomodated position –
he is
forgetful and as a result cannot be trusted with certain
responsibilities, he often complains of pain and sleeps in his car
when he should be working. As a result, Mrs Meyers says, the
plaintiff does not meet the performance requerements for the present
position. Mrs Meyers also testified that the final decision on the
plaintiff’s termination lies with Brink International
and is
yet to be made. The evidence of Mrs Meyer that the plaintiff’s
termination is imminent does not accord with the report
of Mr L
Roper, who records in his report that he consulted with the
plaintiff’s manager who reported to him that the plaintiff’s
performance was good and his memory and concentration abilities
intact. It also does not accord with the evidence of Mr Tsiu that
he
consulted with the plaintiff’s immediate supervisor, who does
not know anything about the imminent termination of the
plaintiff’s
employment in June 2018. This in my view is a curiosity which lends
itself to the possibility that Mrs Meyer
may well have exaggerated
the circumstances of the plaintiff and the imminence of his
dismissal.
[21]
A further reason that I conclude that Mrs Meyer may well have
exaggerated the plaintiff’s circumstances is that the parties
agree that with the recommended treatment and adherence thereto,
which the plaintiff is presently not receiving, the condition
of the
plaintiff should improve. Whilst this will not return him to armed
escort duties, there is no evidence before me that he
will not be
able to perform other duties suited to his circumstances, including
the present administrative duties.
[22]
Mr Tsiu also testified that in the event of a discharge from
employment, the plaintiff would be entitled to the statutory
protection that prescribes that the employer consider reasssignment
to other duties, compliance with incapacity dismissal processes
including medical boarding. I agree.
[23]
On the evidence before me, I am unable to find that the termination
of the plaintiff is imminent to June 2018. This does not
negate
termination on some future date, which the defendant has conceded and
I find accordingly.
The
plaintiff’s pre-morbid retirement age
[24]
The pre-morbid retirement age of the plaintiff is 65 years. This is
according to the retirement policy of the employer and
his own
evidence. The plaintiff asserts that I must allow for the full amount
of R3 448 300.00 for future loss of earning as determined
by Munro on
the basis of a higher salary than was testified to my Mrs Meyer,
whose evidence in this regard I have accepted; that
the plaintiff
would be promoted before the age of 45 years but for the accident;
that the plaintiff’s employment will be
terminated in June 2018
and a pre-morbid retirement age of 67.5 years. I am unable to rely on
these calculations, at least for
the reasons that the calculation is
based on an incorrect salary and retirement age and have in fact
already decided that I will
not rely on Munro’s calculations.
For completion, I point out that notwithstanding the evidence of Mrs
Meyer on the correct
salary and the evidence about the retirement age
as per Brink SA policy and the plaintiff’s own evidence that he
would retire
at 65 years of age, the plaintiff’s counsel
persisted in contending for reliance on the calculations of Munro.
[25]
This leaves with the report of Dr Jacobson. Dr Jacobson determines
the plaintiff’s value of income but for the accident
at R3 808
876 and proposes to apply a 15% contigency deduction resulting in a
net value of R3 237 545. He determines the value
of income after the
accident at R3 109 019 to which he applies a higher contigency
deduction of 20% resulting in a net value of
R2 487 215 after the
accident and a net future loss amount of R750 330. Contrary to Dr
Jacobson’s determination, counsel
for the defendant submitted
that I apply a contingency deduction of 11% to the pre-morbid income
of R3 808 876 (R418 976.36) and
a marginally higher deduction of 21%
to the post-morbid income of R3 109 019 (R652 893.64). This results
in a contingency differential
of 10%, resulting in a net sum of R933
774.63.
[26]
Whilst there is no exact or accurate manner of determining the
correct percentage contigency deduction, I have the discretion
to
make an award that I consider right and am not bound by the actuarial
calcualtions urged upon me – see Legal Insurance
Company Ltd v
Botes
1963 (1) SA 608
(A) 614F-G. I consider that a pre-morbid
contigency deduction of 8% and post-morbid deduction of 22.5% is
appropriate. This results
in a pre-morbid deduction of R304 710.08
and a net value of R3 504 165.92. An application of a post-morbid
contigency of 22.5%
yields R699 529.27, resulting in a post morbid
earnings of R2 409 489.00 with the total loss being R1 094 675.92.
[27]
The total loss of income is accordingly R1 169 954.62 (R1 094 675.92
(future) + R75 211.70 (past)).
[28]
The defendant submits that the plaintiff has received compensation in
terms of the Compensation for Occupational Injuries and
Diseases Act
130 of 1993 in the amount R187 445.41, which is not disputed by the
plaintff, and that the full amount of compensation
must be deducted
from the award to the plaintiff. I agree that this amount must be
deducted from the award in accordance with section
36 of COIDA which
reads -
“
36(1) If an occupational
injury or disease in respect of which compensation is payable, was
caused in circumstances resulting in
some person other than the
employer of the employee concerned (in this section referred to as
the “Third Party”) being
liable for damages in respect of
such injury or desease-.
(a)
the employee may claim
compensation in terms of this Act and may also institute action for
damages in a court of law against the
third party; and
…
(2)
In awarding damages
in an action referred to in ss(1)(a) the court shall have regard to
the amount to which the employee is entitled
in terms of the Act”
.
[29]
Accordingly, the award to the plaintiff will be R982 509.21 (R1 169
954.62 – R187 445.41) – see RAF v Maphiri
2004 (2) SA 258
SCA.
Future
medical costs
[30]
The defendant makes, and the plaintiff accepts, an undertaking in
terms of
section 17(4)(a)
of the
Road Accident Fund Act 56 of 1996
to
pay the plaintiff’s cost for future medical examinations by
medical practitioners, future accomodation in hospitals, medical
facilities and/or nursing homes for the treatment of or rendering of
medical services or supplying goods to the plainitff arising
from the
accident. I agree with the defendant that, due to the unresolved
dispute about the alleged knee injury recorded in the
report of Dr
Read, the undertaking must exclude the costs associated with the knee
injury and I intend to make an order accordingly.
[31]
In the result, I make the following order -
1. The defendant must pay
to the plaintiff R982 509.21 for loss of income.
2. The defendant must pay
interest on the aforesaid amount at the legally prescribed rate from
14 days after the delivery of this
judgment to date of payment.
3. The defendant must
give an undertaking to the plaintiff in terms of section 17(4) of the
RAF Act 56 of 1996 to pay the costs
for future medical examinations
by medical practitioners, future accomodation in hospitals, medical
facilities and/or nursing homes
for the treatment of or rendering of
medical services or supplying goods to the plainitff arising from the
accident, excluding
the costs associated with a knee injury referred
to in the orthopaedic reports of Dr Read.
4. The defendant pay the
costs of suit, including the qualifying fees of the plaintiff’s
experts – Drs Marus, Chait,
Read, Vorster, Messrs Roper, De
Vlamingh, Georgiou, Munro.
_________________________________
BALOYI
AJ
ACTING
JUDGE OF THE HIGH COURT
Date
of Hearing: 2 August - 4 August 2017
Judgment
Delivered: 8 December 2017
APPEARANCES
For
the Plaintiff:
Adv U
Jordaan
Instructed
By: Wim Krynauw Attorneys
Johannesburg
For
the Defendant:
Adv LC
Abrahams
Instructed
By: Diale Attorneys
Johannesburg