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[2010] ZAGPPHC 26
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Law Society of South Africa and Others v Minister of Transport and Another (10654/09) [2010] ZAGPPHC 26; 2010 (11) BCLR 1140 (GNP) (31 March 2010)
IN
THE NORTH GAUTENG HIGH COURT,
(REPUBLIC
OF SOUTH AFRICA)
Case
number: 10654/09
Date:
31/03/2010
in
the matter between:
LAW
SOCIETY OF SOUTH AFRICA
First
Applicant
SOUTH
AFRICAN ASSOCIATION OF
Second
Applicant
PERSONAL
INJURY LAWYERS
THE
QUADPARA ASSOCIATION
Third
Applicant
OF
SOUTH AFRICA
THE
NATIONAL COUNCIL FOR PERSONS
Fourth
Applicant
WITH
PHYSICAL DISABILITIES IN SOUTH AFRICA
NONTLE
JENNICA WILLEM
Fifth
Applicant
BRENDA
FLANAGAN
Sixth
Applicant
LISHA
GOVENDER
Seventh
Applicant
JOHN
QONDILE NTSHIZA
Eighth
Applicant
MCEDISI
DAKELA
Ninth
Applicant
JERONICO
MERVYN JANSEN
Tenth
Applicant
DIVAN
GERBER
Eleventh
Applicant
and
THE
MINISTER OF TRANSPORT
First
Respondent
THE
ROAD ACCIDENT FUND
Second
Respondent
JUDGMENT
FABRICIUS
AJ
This
is an application in which the Applicants seek a declaratory order
that certain sections of the
Road Accident Fund Act of 1996
as
amended by the Amendment Act 19 of 2005 are inconsistent with the
Constitution, and therefore invalid, as well as a declaratory
order
that certain regulations are invalid for a number of reasons. Before
I deal with the relevant notice of motion, I need to
address
preliminary issues.
APPLICATION
FOR POSTPONEMENT:
This
application (which comprises some 6 000 pages) was set down for
hearing
from 1 to 3 March 2010. On 24 February 2010 a separate substantive
application for a postponement was sought by the First
Respondent
herein, on the basis that a number of affidavits had not been filed
timeously, and further that the replying affidavit
of the Applicants
raised new matters. As far as the first objection was concerned, I
was of the view that there was no real prejudice
to any of the
parties. As far as the second complaint was concerned I was of the
view that no substantial new issues had been raised
in the replying
affidavit, but if this was so, such issues could be addressed by
further affidavits which I would receive during
the actual hearing. I
was also of the view that so much time, effort and costs had been
spent / incurred in preparation of the
actual hearing, that everyone,
including the Court, would be prejudiced if a postponement were to be
granted, albeit on the basis
that the hearing would recommence a
month later (if this could be arranged between all the parties). I
was further of the view
that there was a substantial public interest
in the application and its outcome, and that the application ought to
be resolved
as soon as practically possible. I took an overall
approach therefore that a postponement would not be in the interest
of justice
and I therefore refused the application with costs.
1
INTERVENING
APPLICATION:
Having
filed the necessary affidavits, the Minister of Finance and the
Minister of Health sought to intervene in the proceedings
in the
application that was heard on 1 March 2010. On behalf of the Minister
of Finance a lengthy affidavit was filed by the Deputy
Director-General for Public Finance in the National Treasury.
2
The deponent referred to the role of the Treasury, the Public Finance
Management Act
3
and the role of the National Treasury, as well as section 213 of the
Constitution which deals with the National Revenue Fund. The
deponent
also referred to the Road Accident Fund, and more particularly to
section 5 thereof, which deals with its financing amongst
others by
way of a levy. He stated that for the 2009 / 2010 year, the general
fuel levy was expected to contribute R30,1 billion,
or about 5% of
total tax revenue. The RAF levy was expected to raise about R12
billion in 2009/10. He contended therefore that
in the light of the
statutory provisions the National Treasury had a direct and
substantial interest in
ensuring
or preserving the provisions which would have the effect of either
maintaining the effective management of the resources
of the RAF, or,
ensuring efficiency in the expenditure of revenue raised through a
compulsory contribution by road users in the
form of a fuel levy. The
affidavit then dealt with the Applicants attack on the relevant
provisions of the Act, and continued by
stating the position of the
National Treasury towards the Applicants claim. The history of the
third party system and the criticism
thereof was dealt with, as well
as the intention of “the new system”.
4
The Applicants case was also criticized in the affidavits and it is
clear that the views of the Treasury (the Minister of Finance)
had
been sufficiently set out having regard to its actual interest in the
proceedings, or the outcome of the proceedings. The Minister
of
Health also filed an affidavit.
5
The Minister stated that essentially the matter before me was one
between the Law Society of South Africa on the one hand, and
the
Minister of Transport and the Road Accident Fund on the other.
However, he said, some of the declaratory orders sought, impacted
on
the work and policies of the Department, and it is clear that he
referred to the relief sought in respect of a number of impugned
regulations. The Minister then dealt with the complaints by the
Applicants in the
context
of the alleged invalidity of the particular regulations, referred to
certain facts including correspondence, and made certain
submissions
thereon. It is clear that both the Minister of Health and the
Minister of Finance brought this application to intervene
either in
terms of Rule 12 of the Uniform Rules of Court, or the common law. It
is clear that Rule 12 does not create a right of
joinder, but makes
joinder subject to the Court’s discretion, which must of course
be exercised judicially, and once it has
been shown that:
The
Applicant was especially concerned in the issue;
The
matter is of common interest;
The
issues are the same;
It
is clear that the test of the direct and substantial interest in the
subject matter of the action is the decisive criterion.
A mere
allegation to this effect is insufficient, and there must at least be
prima
facie
proof
of the interest and the right to intervene.
6
On
behalf of the Minister of Finance lengthy heads of argument were
filed which dealt with the legal basis for intervention, but
also set
out certain facts which I had to take into account relating to the
so-called “new system”, and the Minister’s
interest
in the consequences should the main application be upheld. Similarly,
lengthy heads of argument were filed on behalf of
the Minister of
Health. The argument dealt with the basis for the application for
intervention, and the Minister’s views
on the facts giving rise
to Applicants’ attack on certain of the regulations published
in terms of the
Road Accident Fund Act. It
is clear that neither the
Minister of Finance nor the Minister of Health sought any relief in
these proceedings. Neither the Treasury
nor the Department of Health
was liable to be joined in a constitutional challenge to an Act of
Parliament for which neither was
responsible. I was also of the view
that neither section 213 nor 216 of the Constitution nor the
provisions of sections 5, 6 and
11 of the Public Finance Management
Act, nor
section 5
of the
Road Accident Fund Act required
that the
Minister of Finance be cited as a necessary party to any litigation.
It is clear that the Minister of Transport is the
Minister
administering the relevant legislation, and
there
is no dispute about that.
7
On behalf of the First Applicant it was argued that neither of the
Ministers had a sufficient legal interest to intervene, and
that if
their contentions regarding their interests in the proceedings were
sustainable, at least the Minister of Finance would
have been a party
to virtually every challenge to statutory provisions. The executive,
and the true administrator of the impugned
provisions, namely the
Minister of Transport, was before Court, and it was further contended
that different Ministers could not
have inconsistent interests in the
current proceedings. A successful intervention would be severely
prejudicial to the Applicants,
and any delay in the proceedings could
not be satisfactorily cured by a costs order. On the other hand,
should leave to intervene
be refused, neither of the Respondents nor
the Applicants for intervention would suffer any real prejudice, in
that the main Applicants
did not oppose the introduction of such
further affidavits as the Ministers would seek to file, and, as a
result, they would be
able to place such evidential material before
me for consideration. Accordingly, the interests of justice required
that such applications
for intervention be refused. I considered the
applications for intervention, their legal basis and the facts raised
therein, and
decided having regard to all of the mentioned
considerations, that I
ought
to refuse the applications. Accordingly I did so, but made an order
that the affidavits of the Ministers would be received
as evidence,
and that no order as to costs would be made.
THE
RELIEF SOUGHT:
During
argument the Applicants’ notice of motion was amended, and an
amended written notice that was handed to me was after
argument was
further amended, and put before me by way of a letter dated 5 March
2010 from Applicants’ attorneys. This amended
notice of motion
indicates in bold the clarifications of relief sought, and also
certain deletions of the original notice. For
purposes of this
judgment I deem it appropriate to quote the amended notice of motion
in
toto
(up to and including the relief sought).
AMENDED
NOTICE OF MOTION
8
TAKE
NOTICE
that
the applicants intend to make application for an order in the
following terms:
Declaring
that
section 21
of the
Road Accident Fund Act 56 of 1996
is
inconsistent with the Constitution and invalid, to the extent that
it has been substituted by
section 9
of the
Road Accident Fund
Amendment Act 19 of 2005
.
9
Declaring
that:
the
proviso to
section 17(1)
as read with
section 17(1A)(a)
of the
Road
Accident Fund Act is
inconsistent with the Constitution and
invalid;
10
and/or
section
17(4)(c)
of the
Road Accident Fund Act is
inconsistent with the
Constitution and invalid;
11
and/or
section
17(4B)
of the
Road Accident Fund Act is
inconsistent with the
Constitution and invalid.
12
Declaring
that Regulation 3(1)(b) of the Road Accident Fund Regulations, 2008,
is not authorised by the
Road Accident Fund Act and
is therefore
invalid, in that it prescribes a method of assessment that was
promulgated without prior consultation with medical
service
providers, alternatively without proper regard to views and advice
expressed by medical service providers.
13
Declaring
that Regulation 3(1)(b) of the Road Accident Regulations, 2008, is
not authorised by the
Road Accident Fund Act and
is therefore
invalid, in that it prescribes a method of assessment which is not
reasonable in ensuring that injuries are assessed
in relation to the
circumstances of the third party.
14
Declaring
that Regulation 3(1)(b) of the Road Accident Fund Regulations, 2008,
is not authorised by the
Road Accident Fund Act and
is therefore
invalid, in that it prescribes a method of assessment and a
procedure for
lodging
claims which unreasonably impede road accident victims’ ability
to enforce their statutory right to compensation.
15
Declaring
that Regulations 3(1)(b)(ii) and (iii) of the Road Accident
Regulations, 2008, are not authorised by the
Road Accident Fund Act
and
are therefore invalid, in that the First Respondent has
impermissibly purported to define what constitutes a “serious
injury”
in terms of the Act.
16
Declaring
that Regulations 3(1)(b)(ii) and (iii) of the Road Accident Fund
Regulations, 2008, are not authorised by the
Road Accident Fund Act
and
are therefore invalid, in that they exclude road accident
victims who have suffered serious injury from the right to claim
compensation
for non-pecuniary loss.
17
Declaring
that Regulation 3(3) of the Road Accident Fund Regulations, 2008, is
not authorised by the
Road Accident Fund Act and
is therefore
invalid, in that it prescribes a procedure for lodging claims for
non-pecuniary loss which conflicts with
sections 24
and/or 17 of the
Road Accident Fund act and/or
which
unreasonably impedes road accident victims’ ability to enforce
their statutory right to compensation.
18
Declaring
that
Regulations 3(4)
to
3
(13) inclusive of the Road Accident Fund
Regulations, 2008, are inconsistent with the Constitution and
invalid on the grounds
that they deprive victims of road accidents
of access to courts and the right to a fair trial to which they are
entitled in terms
of section 34 of the Constitution.
19
Declaring
that Regulation 3 of the Road Accident Regulations, 2008, is not
authorised by the
Road Accident Fund Act and
is therefore invalid,
in that it was promulgated without prior consultation with the
Minister of Health alternatively it was
promulgated without due
regard to views and advice expressed by the Minister of Health.
20
Declaring
that Regulation 5(1) of the Road Accident Fund Regulations, 2008, is
not authorised by the
Road Accident Fund Act, and
invalid on the
grounds
that
the liability of the Road Accident Fund under
section 17(4B)(a)
of
the
Road Accident Fund Act as
set out therein is irrational and
arbitrary, and was not prescribed after consultation with the
Minister of Health, alternatively
was prescribed without due regard
to the views and advice expressed by the Minister of Health.
21
Declaring
that Regulation 5(1) of the Road Accident Fund Regulations, 2008, is
not authorised by the
Road Accident Fund Act, is
arbitrary and
irrational and invalid on the grounds that the liability of the Road
Accident Fund under
section 17(4B)(a)
of the
Road Accident Fund Act
is
incapable of being calculated thereby and/or it is incapable of
implementation as a method of computing road accident victims’
statutory compensation.
Declaring
that Regulation 5(2) of the Road Accident Fund Regulations, 2008, is
not authorised by the
Road Accident Fund Act and
invalid on the
ground that it impermissibly delegates to the Road Accident Fund the
power to determine the tariff for emergency
medical treatment
applicable under
section 17(4B)(b)
of the
Road Accident Fund Act.
22
Declaring
that Regulation 5(2) of the Road Accident Fund Regulations, 2008, is
not authorised by the
Road Accident Fund Act, and
invalid on the
ground that it impermissibly purports to define what constitutes
emergency medical treatment for the purposes
of
section 17(4B)(a)
of
the
Road Accident Fund Act and/or
it unreasonably limits the ambit
of emergency treatment.
23
Declaring
that the tariff set out in Notice R. 771 and published by the Road
Accident Fund in the Gazette on 21 July 2008 (“the
emergency
medical tariff”), is not valid as the tariff for emergency
medical treatment applicable under
section 17(4B)(b)
of the
Road
Accident Fund Act, on
the ground that it was not negotiated between
the Road Accident Fund and health care providers contemplated in the
National Health Act, 2003
.
24
Declaring
that the tariff set out in Notice R. 771 and published by the Road
Accident Fund in the Gazette on 21 July 2008 (“the
emergency
medical tariff”), is not valid as the tariff for emergency
medical treatment applicable under
section 17(4B)(b)
of the
Road
Accident Fund Act, on
the ground that it is not reasonable and does
not properly have regard to the cost of such treatment and/or the
ability of the
Fund to pay.
Declaring
that the tariff set out in Notice R. 771 and published by the Road
Accident Fund in the Gazette on 21 July 2008 (“the
emergency
medical tariff”), is not valid as the tariff for emergency
medical treatment applicable under
section 17(4B)(b)
of the
Road
Accident Fund Act, on
the ground that it unreasonably limits or
prescribes the emergency treatment which may be provided in an
emergency.
Declaring
that Regulation 6(1) of the Road Accident Fund Regulations, 2008, is
not authorised by the
Road Accident Fund Act, and
invalid on the
ground that it impermissibly purports to restrict the ambit of
section 24(1)(b)
of the
Road Accident Fund Act and
impermissibly
limits where a claim for compensation may be sent by registered post
or delivered by hand
[i.e.
lodged]
in
compliance with
section 24(1)(b).
25
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25
Declaring
that Regulation 6(1) of the Road Accident Fund Regulations, 2008, is
not authorised by the
Road Accident Fund Act, and
invalid on the
ground that it prescribes a method of assessment and a procedure for
lodging claims
which
unreasonably impedes road accident victims’ ability to enforce
their statutory right to compensation.
26
Declaring
that Regulation 6(2) of the Road Accident Fund Regulations, 2008, is
inconsistent with the Constitution and invalid
in that it that
affords the Road Accident Fund the right to interrogate a third
party and/or deprives victim of road accidents
to the right to be
equal before the law and to a fair trial to which they are entitled
in terms of sections 9 and 34 of the Constitution
and/or it is not
authorised by the
Road Accident Fund Act.
27
Declaring
that Regulation 6(2) of the Road Accident Fund Regulations, 2008, is
inconsistent with the Constitution and invalid on the grounds
that
it is arbitrary and irrational and unreasonably impedes road
accident victims’ ability to enforce their statutory
right to
compensation.
28
Declaring
that the Forms RAF 1 prescribed in Regulation 7 of the Road Accident
Fund Regulations, 2008,
are
is
invalid in that
it
they
:
29
is
are
not authorised by the
Road Accident Fund Act; and/or
is
are
arbitrary and irrational; and/or
is
are
incapable of implementation; and/or
unreasonably
impede
s
road accident victims’ ability to enforce their statutory
right to compensation; and/or
does
do
not achieve or promote the object of the
Road Accident Fund Act.
Declaring
that Form RAF4, is invalid in that it:
30
is
not authorised by the Road accident Fund Act; and/or
is
arbitrary and/or irrational; and/or
is
incapable of implementation; and/or
unreasonably
impedes road accident victims’ ability to enforce their
statutory right to compensation; and/or
does
not achieve or promote the object of the
Road Accident Fund Act.
Regulations
3; alternatively 3(1)(b), 3(3), 3(4) to 3(13) inclusive; 5(1) and
5(2), 6(1) and 6(2), the Forms prescribed in terms of Regulation
7
(1)
of the Road Accident Fund Regulations, 2008, and Form RAF4 are
hereby reviewed and set aside.
31
The
emergency medical tariff is herby reviewed and set aside.
The
orders in paragraph
s
1
alternatively
and
paragraph
2,
and
in paragraph 3
are referred to the Constitutional Court for confirmation.
Further
or alternative relief.
The
First Respondent is ordered to pay the costs of this application
and, if
the
Second Respondent opposes this application, it is ordered to pay such
costs jointly and severally with the First Respondent
”
The
ABOLITION of certain Common law Claims
(Section 21
of the
Road
Accident Fund Act of 1996
as substituted by Section 9 of the
Amendment Act 19 of 2005: Prayer 1):
Section
21 as substituted reads as follows:
“
21.
Abolition of certain common law claims.
No
claim for compensation in respect of loss or damage resulting from
bodily injury to or the death of any person caused by
or arising
from the driving of a motor vehicle shall lie –
against
the owner or driver of a motor vehicle; or
against
the employer of the driver.
Subsection
(1) does not apply-
if
the Fund or an agent is unable to pay any compensation; or
to
an action for compensation in respect of loss or damage resulting
from emotional shock sustained by a person, other than the
third
party, when that person witnessed or observed or was informed of the
bodily injury or the death of another person as a
result of the
driving of a motor vehicle.”
Before
I deal with this and the other prayers, I need to address the issue
of standing. With reference to its written constitution
the First
Applicant averred that it had an interest in the matter for a number
of reasons, in that many of its members practiced
in the area of road
accident litigation, and represented the vast majority of persons who
claimed compensation from the RAF. The
rights of their clients and
would-be clients were profoundly affected by the 2008 amendments and
the relevant regulations. The
Law Society therefore brought this
application because of the impact of these amendments would have on
the rights
of
such accident victims, who are, and would be the clients of the
members of the Law Society. It also acted in its own interest,
it
alleged, and in the interest of those persons who cannot act in their
own name. It also acted in the public interest in that
the RAF system
was a very important compulsory insurance scheme administered by the
State. It was therefore in the public interest
that it should serve
its intended purpose, namely to provide adequate compensation to
persons who have been the victims of road
accidents. It further
alleged that it acted for legal practitioners, some 20 000 attorneys
in over 9 000 firms, who were affected
by the statutory framework
applicable to road accident compensation.
32
The Law Society then further alleged that it acted herein for “tens
of thousands of indigent road accident victims, who instruct
Law
Society members to recover compensation from the RAF.” Many of
these could not bring the proceedings themselves, because
they were
badly disabled, lived in remote areas or were disadvantaged by
poverty.
The
Second Applicant alleged that it brought the application in its own
right by
virtue
of its authorised objects, but also acted on behalf of its members
and in the public interest.
The
Third Applicant has members from all walks of life, including a large
number of quadriplegics and paraplegics who live in all
regions of
South Africa, and who belong to all race groups. It alleged that it
had an interest in this application because the
relevant amendments
of 2008 would directly affect the interest of certain of its
affiliated members. It also represented the interest
of persons who
would become disabled in road accidents in future, and whose “right”
to adequate compensation would
be affected.
The
Fourth Applicant alleged that it brought this application in its own
right by virtue of its authorised objects, and also acted
on behalf
of its members, and in the public interest. Its constitution promoted
the best possible legislative dispensation for
persons with physical
disabilities, and it sought the elimination of
all
legislative measures which hinder integration and independence of
persons with physical disabilities. It actively sought out
and
assisted newly disabled persons including victims of road accidents.
This included persons who would become disabled in the
future. The
other Applicants are persons who joined the proceedings having been
granted leave to do so by an order of this Court.
In Court, only the
Eleventh Applicant was separately represented, and the other
Applicants made common cause with the First Applicant.
In its
answering affidavit
33
First Respondent vigorously denied the Applicants’
locus
standi,
and particularly that of the First Applicant whose interests
allegedly was purely financial. First Respondent alleged that the
present litigation was driven purely by financial self-interest, and
particularly the fact that payments for legal costs for the
year
ending 31 March 2009 were R1,6 billion. It also gave figures for the
other years back to 2005, and stated that those amounts,
which run
into billions, merely reflected the party-and-party portion of the
total legal costs under the previous dispensation.
The total legal
costs incurred i.e. attorney-client costs would never be known,
because it was a subject of private contractual
arrangements between
attorneys and claimants. The CEO of the Road Accident Fund had
estimated that
the
contingency fees for the year ending 31 March 2009 were R4,3 billion.
First Applicant or its members had never disputed such
an allegation
by providing details of how much the attorney-client component was,
and no evidence was ever given to any statutory
commission about this
fact. First Respondent also noted that a previous Commission had
already remarked that (obviously) many of
the persons who gave
evidence in those proceedings had a vested and pecuniary interest in
the retention of the then existing system.
The Satchwell Commission
had stated that it was not the function of a system of road accident
compensation to prop up a legal profession
in order that it may “do
good” for the benefit of democratic or constitutional values.
34
I agree with that view. First Respondent therefore suggested that the
current litigation was only driven by the financial interests
of
lawyers, and especially members of the First Applicant. It denied
that the First Applicant was acting, or could be acting in
the
interest of indigent persons and the public interest. However, it
accepted that changes brought about by the Amendment Act
and the
regulations would impact on the financial interests of First
Applicant members, and on those of some of their clients.
However, it
noted that First Applicant did not explain why the present challenge
was brought “in the abstract”, and
in the absence of
evidence regarding the manner in which
real
clients were affected. It was therefore undesirable for me to
pronounce upon an important matter such as the present one in
the
context of an abstract challenge, and with reference to speculative
allegations about how the new system would work. It also
challenged
First Applicant’s
locus
standi
herein on the basis that First Applicant had not explained why it had
elected to challenge the present legal reform which did not
impact
directly on the attorneys’ profession, or the practice of law,
but merely impacted on the financial interests of its
members and
some of its clients. It further denied that Applicant had presented a
balanced view of the Amendment Act and averred
that it in fact had
ignored the primary interest of the public, which was a sustainable
road accident compensation scheme. There
were also other challenges
to the
locus
standi
of the other Applicants, including some relating to their
constitution and their right to litigate. The First Respondent’s
resistance to First Applicant’s
locus
standi
was tempered somewhat during argument. It is of course undoubtedly so
that the members of First Applicant are probably likely to
have a
financial interest in the outcome of this application, and it is
probably also correct that potential victims of road accidents
will
consult attorneys that will accordingly be affected by the Amendment
Act. It is also correct that the First Applicant has
not relied on
any specific concrete case or a particular client who has been or is
likely to be
affected
by the amendment. In that particular context the application is
“abstract”, but in my view the challenge to
the Amendment
Act and the relevant regulations is real, in that it undoubtedly has
affected, and will affect victims of road accidents
since the
amendment came into effect on 1 August 2008, and in future.
Ultimately, of course I must apply section 38 of the Constitution
of
the Republic
35
which deals with the enforcement of rights, and states that anyone
listed in that section has the right to approach a competent
Court,
alleging that a right in the Bill of Rights has been infringed or
threatened, and that the Court can grant appropriate relief
including
a declaration of rights. The persons who could approach the Court
were those acting in their own interest, acting on
behalf of another
person who could not act in his or her own name, anyone acting as a
member of, or in the interest of a group
or class of persons, anyone
acting in the public interest and an association acting in the
interest of its members. The Constitution
in this context refers to
an allegation that a right in the Bill of Rights either has been
infringed or so threatened. The section
was obviously intended to be
of much broader or wider effect than for instance Rule 12 of the
Uniform Rules of Court that I have
already dealt with. The majority
of the Constitutional Court
36
stated that whilst it is important that the Court should not be
required to deal with
abstract
or hypothetical issues, it could see no good reasons for adopting a
narrow approach to the issues of standing in constitutional
cases. To
the contrary, it should rather adopt a broad approach to standing.
This would ensure that constitutional rights enjoy
the full measure
of the protection to which they are entitled.
37
Apart from that I have also considered the fact that constitutional
invalidity, or the allegations of such, requires an objective
approach by a Court with reference to the facts of the case.
38
I am also of the view that a generous approach to standing is
essential to the maintenance of the Rule of Law as envisaged by the
Constitution, and in any event for constitutional legitimacy. I
believe I am justified in holding that any indigent, poor and other
disabled persons who are physically and financially unable to launch
or conduct these proceedings can act herein, and, that the
present
challenge by the First Applicant is a reasonable and effective
challenge to legislation which does or will, directly or
indirectly,
affect thousands of persons who have been or will in future be
affected by the present legislative scheme. Accordingly
I decline to
dismiss the Applicants’ application on the ground of lack of
locus
standi.
I
now deal with the contentions advanced by the parties in the context
of the abolition of the common law claim in the light of
section 21
of the Act.
39
THE
LAW PRIOR TO THE 2008 AMENDMENTS:
Before
the commencement of the 2008 amendments, victims of road accidents
retained their common law right of action against wrongdoers.
Since 1
May 1997 claims have been regulated by the
Road Accident Fund Act 56
of 1996
, which repealed the proceeding 1986 and 1989 Acts. This Act
has been altered by the
Road Accident Fund Amendment Act 19 of 2005
which came into operation on 1 August 2008, but which also stated
that a cause of action which arose prior to that date must be
dealt
with as if this Act had not taken effect. The injured person, in
terms of the statutes, is referred to as a “third
party”.
This is a person who has suffered loss or damage as a result of any
bodily injury to herself or himself, or
the
death of or any bodily injury to any other person, caused by or
arising from the driving of a motor vehicle. The liability of
the
Road Accident Fund is Aquilian in nature, and it is necessary for the
Plaintiff to make allegations relating to wrongfulness,
negligence
and causation. The onus would be on a Plaintiff to establish that a
reasonable person in the position of the Defendant:
Would
foresee the reasonable possibility that the conduct (whether an act
or omission) would injure (another person) or property
and cause
that person patrimonial loss;
Would
take reasonable steps to guard against such occurrence; and
That
the Defendant failed to take such reasonable steps.
40
Whether a reasonable person would have taken steps to guard against
foreseeable harm, involves a value judgment taking into
account the
degree or extent of the risk created, the gravity of the possible
consequences, the utility of the wrongdoers’
conduct and the
burden of eliminating the risk.
41
The
common law claim was however “truncated” as Applicants
put it, whilst victims however retained the right to be fully
compensated for their past hospital and medical expenses, such future
expenses, loss of earnings – past and present, or,
where
applicable, diminution of their earning capacity, and general damages
for pain, suffering, loss of amenities of life, disfigurement
and
disablement.
THE
ABOLITION OF THE COMMON LAW CLAIMS:
It
would be practical if I briefly set out the new amendment scheme in
outline before dealing specifically with section 21 of the
Act. The
new scheme departs from its predecessors substantially, and it is
common cause that collectively the provisions introduce
a system
based on the following features:
Compensation
under the common-law for loss not compensated by the Road Accident
Fund, is abolished;
Compensation
for general (non pecuniary) loss is excluded, unless the loss
qualifies as “serious injury” in terms
of the
prescribed guidelines;
Compensation
for special (pecuniary) loss is limited to either R160 000,00 per
annum (in respect of loss of earnings or support)
or a prescribed
tariff (in respect of emergency and other hospital and medical
care). In their heads of argument, First to
Fourth Applicants made
the following submissions:
13.3.1 The
flawed rationale is to protect the wrongdoer, in preference to the
victim;
42
It purports to introduce a move away from a “compensatory
system”
43
to a protectionist system. It seeks to protect wrongdoers from the
consequences of their conduct and to guard “investment
and
economic growth”
44
against “the cost burden” of rehabilitating and
compensating road accident victims. Parliament thus opted for a
scheme
which prioritizes the financial interest of
motor
owners and drivers over their victims. The justification therefore is
that a mere moment of inattention “should not
give rise to
lifelong punishment meted out in the form of compensation payable to
the victim who suffers lifelong misery because
of the driver’s
negligence.”
45
The Applicants submitted that the 2008 amendments are
unconstitutional on numerous separate grounds i.e. on account of
numerous
procedural irregularities, the impermissible abolition of
the common-law claim, unlawfully ousting access to Courts, and on
various
miscellaneous grounds which were argued. It was also
submitted that the alleged procedural irregularities would normally
vitiate
the impugned provisions, but because of the public issues at
stake I was asked not to resolve the matter only on a procedural
basis,
but to deal with the substantive issues first.
46
13.4.2 In
the founding affidavit the First Applicant’s deponent submitted
that the abolition of the common-law claim, except
where
section 21(2) applies, is in breach of the right of road accident
victims to security of the person, the right to an appropriate
and
effective remedy for breaches of that right, and the obligation of
the State to respect, protect, promote and fulfill those
rights. It
is submitted that abolishing victims common law claims, while
simultaneously reducing their compensation, unreasonably
and
irrationally deprived them of their right to obtain effective relief
in violation of section 38 of the Constitution. He also
submitted
that no adequate justification had been advanced for this, and in
particular submitted that deprivation or limitation
of these rights
was not justifiable in an open and democratic society based on human
dignity, equality and freedom. During argument
it appeared that
Applicants relied in this context on sections 12(2) and 38 of the
Constitution, as well as section 25 thereof,
although this was not
dealt with in the founding affidavits. Applicants submitted that the
abolition of the common-law claim patently
entails the abrogation of
an established right anchored in the
Constitution.
That being so, it was argued, on the wording of the Constitution
itself,
47
that it requires to be justified. This the Respondents’
affidavits allegedly failed to do, and I will deal with this
submission
in a proper context hereunder.
THE
FIRST RESPONDENT’S ANSWERING AFFIDAVIT:
48
The
First Respondent noted, apart from what I have already said above,
the changes brought about by the Amendment Act, noted that
it also
obviously extended the liability of the Fund by abolishing the R25
000,00 limit on the claim of a passenger against the
Fund, in respect
of damages caused by the negligence of the driver or owner of the
vehicle in which the passenger was travelling.
As far as the limit
for past and future loss of income or support was concerned (the
limit of R160 000,00 per year as per section
17(4)(c)), it should be
noted
that this amount is adjusted quarterly in order to counter the affect
of inflation. With effect from 31 October 2009, the
amount was set at
R175 887,00.
49
It was submitted that the Amendment Act and the regulations must be
viewed in an historical context, inasmuch as debates about
the
fairness, efficiency and sustainability of the statutory system of
compensation for loss or damage caused by motor vehicle
accidents,
span across many decades in South Africa. As elsewhere in the world,
statutory intervention in respect of road accidents,
was necessitated
by the large and increasing number of deaths and injuries on the
roads, and the inability of claimants in many
instances to extract
compensation from wrongdoers who are improvident, or just do not have
the means to pay compensation. The first
principal Act was the Motor
Vehicle Assurance Act 29 of 1942 as amended, which came into effect
on 1 May 1946, and has been under
review ever since. Over the
decades, the Government appointed no less than 9 Commissions to
review the system, including its funding,
management and levels of
compensation. Because of the nature of the Applicants’
challenge to the present legislation (i.e.
as infringing upon a
number of human rights as well as being irrational), I deem it
necessary to briefly deal with the relevant
legislative history.
Motor
Vehicle Insurance Act 29 of 1942:
This
act was amended a number of times and was subject to 4 Commissions of
Enquiry. Under this Act, the Motor Insurer’s Association
of
Southern Africa was formed which undertook to meet unsatisfied
judgments obtained against owners and drivers of uninsured vehicles.
In response to the liquidation of a number of insurers and
malpractices to the detriment of the public, the Motor Vehicle
Accident
(MVA) Fund was established in 1965, which acted as a
re-insurer of those companies which undertook compulsory MVA
insurance.
The
Compulsory Motor Vehicle Insurance Act 56 of 1972 (as amended):
The
1972 Act shifted the requirement for insurance from the owner or
driver to the vehicle itself. It also provided cover,
for the
first time, for loss occasioned by an uninsured or unidentified
motor vehicle. It provided for prescription of claims,
excluded
liability of the Fund under certain specified
circumstances,
and increased the benefits for passengers. It was the subject of two
commissions of enquiry, one of which called
for an investigation into
the possibility of entered a no-fault system of compensation, which
by then had been introduced in some
foreign countries. One such a
Commission also contained a (minority) recommendation to fund the
system through fuel levies.
The
third principal Act was the Motor Vehicle Accident Act 84 of 1986,
which introduced the fuel levy to fund the system of
compensation.
The
Fourth principal Act was the Multilateral Motor Vehicle Accident
Fund Act 93 of 1989 (as amended). This Act made provision
for a
uniform compensation system, between the Republic and the
so-called former other TBVC States. Another enquiry, the
Melamet
Commission of Enquiry, was appointed in 1992, when an actuarial
deficit of approximately R1 billion was
reported.
50
The Commission found widespread inefficiencies in the system which
were supported by an audit of the Auditor-General. Specific
areas of
abuse which were highlighted included:
unneccessary
delays by attorneys in lodging claims;
overstated
or fraudulent claims and overstated legal costs. It was found that
these practices were not prevented or controlled
by the agents or
the Fund.
The
Fifth principal Act was the Road Accident Act, 56 of 1996 (as
amended). This Act terminated the use of agents, as they
were not
protecting the financial interest of the Fund. A decision was
taken to equip the Fund to handle all claims. The
Road Accident
Fund Commission of Enquiry (RAFC) was appointed in terms of the
Road Accident Fund Commission Act 71 of 1998
and
brought out a report in 2002.
51
This is also referred to as the “Satchwell Commission”.
I
have mentioned that as a result of the nature of the Applicants
challenge, I need to decide whether the Amendment Act of
2005
infringes any of the Applicants human rights, albeit in their
stated capacity as envisaged by section 38 of the Constitution,
as
well as whether or not the amendments to the Act itself are
irrational. I deem it therefore expedient at this stage to
briefly
deal with the differentiation aspect that First Respondent claims
resulted from the earlier legislation, and which
became
constitutionally unacceptable, and therefore resulted in
Government’s intention to remove arbitrary forms of
differentiation from the system. After the South African
Constitution Act come into force on 27 April 1994, and in the
light of the justiciable Bill of Rights that it contained, the
differentiation between passengers and others became
vulnerable
to legal challenge. It therefore became imperative, so it is alleged,
to amend the legislation in order to give effect
to constitutional
requirements regarding:
expenditure
which is efficient, effective and economical;
the
prohibition of their irrational differentiation; and
access
to social security and health care.
However,
lack of affordability stood in the way of speedy reform and it is
clear that in the year end of 1995 the deficit
was some R4,183
billion.
52
First Respondent therefore states
53
that the challenge was to design a system of compensation which
would not only be economically viable, but would also channel
available
resources on a more equitable basis towards all road users. Economic
viability and equitability were however not the only
long-term goals,
as a new system of compensation for road accident victims had to be
integrated in a clear comprehensive social
security system. The
Commission of Enquiry remarked in 2002 that a case could be made out
in South Africa for an integrated system
of compensation that offers
life, disability and health insurance cover for all accidents and
diseases,
54
as a fault based, common-law system of compensation for road accident
victims could not easily be alligned with a comprehensive
social
security model. The idea was therefore to replace such common-law
system with a set of limited no-fault benefits, which
would form part
of the broader social security net of public financial support for
the poor and disabled. The Cabinet therefore
decided to publish for
consultation a draft no-fault policy.
55
Applicants counsel suggested that I ignore this
document,
in-as-much as only the unconstitutionality of the present system was
before me, and that Government’s stated intention
for the
future was in law irrelevant. In as much as Applicants have also
alleged that the present legislative scheme is irrational,
I have to
disagree, and I will deal with this topic further hereunder when I
separately discuss the challenge to the legislation
based on
irrationality.
First
Respondent stated that it would take a considerable time for the
new system to be designed and legislated. Something
had to be done
in the interim about the financial crisis which was developing.
“Temporary measures” were therefore
accepted, and
these would introduce greater equity while also ensuring the
viability of the system.
First
Respondent accepted
56
that the wisdom of the policy choice to abolish the common-law
claim was a matter for debate, and was open to legitimate
difference of opinion. The
RAFC,
for example, was divided on the issue of whether the common-law
claims should be retained or not.
57
It was however argued that the wisdom of the policy was not before
this Court, and that the question was whether the abolition
of the
common-law right violated the Constitution. I agree with this
contention.
First
Applicant’s supplementary affidavit:
58
This
affidavit was filed subsequently to the Respondents’ filing
the relevant Uniform Rule 53 record, if I can refer
to it as such.
It is necessary, for the determination of what the Applicants case
actually is, to refer to First Applicant’s
“conclusion
on the abolition of the common-law claim” in the
supplementary founding affidavit. First Applicant
stated the
following:
“
59. Victims
who have now been “non-suited” under the RAF Act may have
substantial common-law claims
against
the wrongdoers who caused their injuries. As I have pointed out in
the founding affidavit, in some 40% of cases the vehicle
owner or
operator or employer holds liability insurance.
60. This
real possibility of compensation has now been destroyed by the
abolition of the common-law claim. Most poor road accident
victims
have been deprived of this right under law, and in return they have
received nothing. I submit that this in breach of the
Government’s
constitutional duty to respect, protect, promote and fulfill the
right to security of the person; it constitutes
unfair discrimination
against road accident victims who are poor; it constitutes unfair,
indirect racial discrimination against
black people; and it is
irrational and unreasonable.”
As
far as the challenge to section 21 of the Act is concerned
(abolition
of certain common-law claims) I understand Applicant’s case to
be based on the following:
the
abolition offends against section 9(1) and 9(3) of the Constitution
(the right to equality);
it
offends against section 12(2) of the Constitution (the right to
security of the person);
it
offends against section 25 of the Constitution (the right to
property);
it
offends against section 34 of the Constitution (the right to access
to Courts).
The
section is also irrational and unreasonable. This argument also
applies of course to prayers 2.1, 2.2 and 2.3 of the amended
notice of motion which deals with sections 17(1),
17(4)(c)
and 17(4B) of the Act respectively. The right to property in terms of
section 25 was relied upon by the Eleventh Applicant,
who otherwise
also associated himself with the approach of the first four
Applicants.
THE
APPROACH OF THE COURT: (IN THE CONTEXT OF THE CHALLENGE THAT SECTION
21 INFRINGES CERTAIN HUMAN RIGHTS):
The
first question to be asked is whether the provision in question
infringes the rights protected by the substantive clauses of
the Bill
of Rights. If it does, the next question that arises will be whether
that infringement is justifiable. At the second stage
of the
Constitutional enquiry, the relevant questions are: what is the
purpose of the impugned provision, what is its effect on
Constitutional rights and is the provision well-tailored to that
purpose? Of course, in that context, section 36 of the Constitution
applies.
59
DOES
SECTION 21 OFFEND AGAINST THE APPLICANTS’ RIGHT TO EQUALITY?
(SECTION 9 OF THE CONSTITUTION):
In
the founding affidavit the First Applicant does not rely on section
9 of the Constitution directly. Rather it alleges that
the fact
that the legislature has substantially reduced, and in some
instances entirely removed, the right to compensation
which they
have always had, is in breach of the right of road accident victims
to security of the person, the right to an appropriate
and
effective remedy for breaches of that right, and the obligation of
the State to respect, protect, promote and fulfill those
rights. It
also unreasonably and irrationally deprives victims of their right
to obtain effective relief, in violation of section
38 of the
Constitution.
60
A further submission is then made that the affect of the Act is to
deny the victims of road accidents the right of access to
such
services, because it impedes and obstructs the access to health
care services where these are not provided under the Act.
It was
then
submitted that for all of these reasons section 21 of the Act is
inconsistent with the Constitution and accordingly invalid.
61
It is noticeable that no reliance is placed on an infringement of
section 9 of the Constitution, be it section 9(1) or 9(3) or
(4).
The
Second Applicant does not refer to any right contained in the Bill
of Rights at all, apart from fairly obscurely stating
that
“abolition of victims common-law claims will impose
particular hardship on seriously injured victims who cannot
purchase “top up” disability insurance because they are
children, students, young workers, have HIV or because
they cannot
afford it.” This is of course partly a factual matter which I
will refer to later when I deal with the other
prayers sought in
the amended notice of motion.
The
Third Respondent similarly makes no reference to any right
contained in the Bill of Rights at all, but seems to base its
attack on the amended legislation as a whole, by saying that State
facilities do not provide the care and services which the
vulnerable members that it represents, need. Further, it is
concerned about the reduction of compensation, and the
consequences
which such would have for quadriplegic or paraplegic persons.
62
The
Fourth Applicant similarly makes no reference to any right
contained in the Bill of Rights at all.
63
I am aware of cause that all Applicants have associated themselves
with the course of action set out by the first two Applicants.
It
is only in First Applicant’s supplementary founding
affidavit, in the context of the abolition of the so-called
common-law right, that First Applicant alleges that
“…it
constitutes unfair discrimination against road accident victims who
are poor; it constitutes unfair, indirect
racial discrimination
against black people…”
64
In
its heads of argument
65
First Applicant submitted that the abolition of the common-law
claim patently entailed the abrogation of an established right.
That being so, its required to be justified, which Respondents’
affidavits allegedly failed to do. The submission is
then made that
section 21 is not rational, which is a separate challenge to
constitutionality which I will deal with hereunder.
In the context
of irrationality the submission is made that the effect on poor and
vulnerable renders the abolition of the
common-law claim
unreasonable. Again, the challenge as to the reasonableness or
otherwise of the abolition of the common-law
claim is something
that I will deal with when I turned to the challenge relating to
irrationality of the abolition. It is after
those submissions that
the counsel for the First Applicant then submits
66
that “the demonstrably, discriminatory effect of the current
scheme is yet a further basis for striking the amended scheme
down
on account of being irrational. A scheme like the present, which
discriminates against certain individuals, must be founded
on a
rational relationship between differentiation and a legitimate
Government purpose. The Respondents failed to establish
such
relationship.” Again, that part of First Applicant’s
argument relates to the irrationality of the Scheme,
which in my
view is a separate challenge that I will deal with.
In
the context of the challenge to the constitutionality of section
21, I could find no reference in First Applicant’s
heads of
argument to section 9 of the Constitution. section 9, was only
referred to in the context of Regulation
6(2)
and which I will deal with later.
67
During argument Applicants’ counsel did not rely on section 9
of the Constitution in the context of the alleged unconstitutionality
of the abolition of the common-law claim. In this context, the
provisions of section 9 of the Bill of Rights was accordingly also
not dealt with by counsel for the Respondents. I must emphasize “in
the present context” in as much as I will deal
with any alleged
discriminatory effect when I deal with the irrationality argument,
and the impugned regulations. On behalf of
the First Respondent it
was submitted in its heads of argument
68
in as much as Applicants rely on discrimination under section 9 of
the Constitution, they are not permitted to do so directly,
and were
obliged to bring their challenge within the four corners of the
Promotion of Equality and Prevention of Unfair Discrimination Act 4
of 2000
. It was submitted that the Constitutional Court had held that
a litigant cannot circumvent legislation enacted to give effect to
a
constitutional right
(section 9(4))
by attempting to rely directly on
the constitutional right.
69
Although the MEC for Education decision referred (paragraph 40) to
the
fact
that the Constitutional Court had decided that in the context of
Administrative and Labour Law, it must be remembered that
the same
Court
70
held that there was considerable force in the argument that if this
approach were not to be followed, the result might well be
the
creation of dual systems of jurisprudence under the Constitution and
other legislation. Although “discrimination”
as defined
in the Act means any act or omission including a policy or a law
amongst others, I have some doubts whether the Act
was intended to
give the Equality Court the power to declare an Act of Parliament or
a section thereof unconstitutional, on the
grounds of discrimination.
The powers and functions of the Equality Court as per section 21 of
that Act do not seem to provide
for that: to the contrary, it seems
to deal with conduct or omissions or practices that can be
interdicted if they impose burdens
or disadvantages on any person on
one or more of the prohibited grounds. For present purposes however,
I do not intend to finally
pronounce on that issue. In my view, for
the other reasons listed above, I cannot find that section 21 of the
Amendment Act is
unconstitutional because it infringes the provisions
of section 9 of the Constitution. However, as I said, I intend
dealing with
the alleged discrimination resulting from this section
when I deal with the impugned provisions of section 17 of the Act,
and some
of the regulations made under it. I must however add at this
stage, for the sake of clarity, that even the previous legislative
dispensation, had the effect of substantially discriminating between
victims of accidents (in the sense of differentiation).
FREEDOM
AND SECURITY OF THE PERSON (SECTION 12 OF THE CONSTITUTION):
17.1 The
First Applicant also alleged that the abolition of the common-law
right amounts to a breach of a road accident victim’s
right to
security of the person.
71
Nothing else of substance was submitted in this context. Its written
heads of argument did also not take this challenge any further.
Mr
Gauntlett SC, on behalf of the first four Applicants, however relied
on the provisions of section 12(2), and submitted that
the abolition
of the common-law right amounted to an abrogation of an existing
right which was unjustifiable, and that the provisions
of section 36
of the Constitution therefore became applicable. When reading the
founding affidavit I had serious doubts as to whether
section 12 and
more particularly 12(2) of the Constitution, could by any means of
the imagination, be applicable to the present
facts and to the
Constitutional challenge. I say this because in First Respondent’s
answering affidavit the following appeared:
“
141.1 The
right to freedom and security of the person (section 12). This right
is relied upon by the Applicants in the founding
papers. First
Respondent accepts that section 12, which protects freedom and
security of the person, read with sections 7(2) and
38 of the
Constitution, means that the State is obliged to afford an
appropriate remedy to the victims of motor vehicle accidents
who
suffer bodily injury as a result of someone else’s
negligence.”
72
17.2 During
argument however, First Respondent’s counsel informed me that
this concession was not relied upon any further,
and that he had
informed Applicants senior counsel of that stance at some prior
stage. I mentioned to
counsel
that a Court was not bound by an incorrect legal concession, and
First Respondent’s counsel then referred me to the
relevant
authority.
73
17.3 In
that case the Constitutional Court held that it was not bound by a
legal concession if it considered the concession to be
wrong in law.
To me the reasoning behind that dictum is obvious: it would be absurd
if I were to hold that a section in an act
is unconstitutional or
inconsistent with the Constitution on the basis of a concession made.
I was later given further authorities
(upon my request), and I was
referred to the fact that Second Respondent had also made the
admission relating to the applicability
of section 12 of the
Constitution.
74
In my view this is a mere confirmation, (as usually happens) by one
deponent of the allegations made by another party. However,
I was
then asked to apply the principle laid down by the Appellate
Division, which is to the effect that a judicial officer in
civil
proceedings must resolve the dispute on the issues raised by the
parties and confine the enquiry to the facts placed before
it.
75
This is so in ordinary civil proceedings, but I do not agree that it
applies when a constitutional
issue
is raised before the Court. The reason should be obvious, as I have
said. The test for that enquiry is on the one hand objective,
and on
the other hand a Court cannot declare a statutory provision
consistent or inconsistent with the Constitution merely on the
basis
of concessions wrongly made.
17.4 In
my view section 12.2 of the Constitution does not apply, nor was it
intended to apply, to victims of motor vehicle accidents
in the
context of the State being obliged to afford “an appropriate
remedy” to such victims.
For
this reason I do not uphold the complaint that section 21 of the
Amendment Act is unconstitutional in that it infringes the
provisions
of section 12(2) of the Constitution.
THE
RIGHT OF PROPERTY (SECTION 25):
Applicants
do not rely on an infringement of this right in the present context,
except
the Eleventh Applicant, whose attorney submitted that the abolition
of the
common-law
right removes a proprietary right of victims of accidents, and it is
given “nothing in return”. In this context
Eleventh
Applicant’s attorney relied on the provisions of section 25(1)
and suggested that if an existing right was removed,
such legislation
had to be reasonable. I will deal with this latter submission
hereunder under the heading of “Irrationality”.
At this
stage however, I find that the relevant Amendment Act does not affect
any right to property, and that section 25 of the
Constitution is not
applicable. My question as to when this alleged right would vest in a
person, and what the nature of the right
would be in the context of
the Constitution, and the present dispute, was left unanswered.
THE
RIGHT TO ACCESS TO HEALTH CARE SERVICES (SECTION 27 OF THE
CONSTITUTION):
76
The
First Applicant’s submission was that the effect of the Act –
which defines and limits the compensation which a
victim may claim in
respect of medical and
hospital
expenses – is to deny the victims of road accidents the right
of access to health care services, because it impedes
and obstructs
their access to such services where these are not provided under the
Act. In my view there may be an argument about
this topic in the
context of prayers 2.1 to 2.3 of the amended notice of motion, but
there is no merit in an argument relating
to section 21 of the
Amendment Act. The abolition of the common-law right does not
per
se
mean that any person’s right to have access to health care
services, is unlawfully infringed. The Constitutional Court has
in
any event held, in the context of section 27 of the Constitution that
all that can be expected of the State, is that it acts
reasonably to
provide the relevant services on a progressive basis. It must also be
kept in mind in that context, that it is necessary
to recognize that
a wide range of possible measures could be adopted by the State, to
meet its obligations. The Courts are therefore
ill-suited to
adjudicate upon issues which could have multiple social- and economic
consequences for their community. The Constitution
contemplates
rather a restrained and focussed role for the Courts, namely, to
require the State to take measures to meet its Constitutional
obligations, and to subject the reasonableness of these measures to
evaluation. Such determinations of reasonableness may in fact
have
budgetary implications, but are not in themselves directed at
re-arranging budgets. Section 27(1) of the Constitution does
not give
rise to a self-standing and independent positive right, enforceable
irrespective of the considerations mentioned in section
27(2).
77
Accordingly
I am of the view that section 21 of the Act does not infringe upon
any right within the parameters of section 27 of
the Constitution.
ACCESS
TO COURT (SECTION 34 OF THE CONSTITUTION):
78
Prayer
9 of the amended notice of motion specifically relies on this right,
but in the context of Regulations 3(4) to 3(13) of the
Road Accident
Fund Regulations of 2008. The First Applicant’s founding
affidavit is silent on the possible question whether
or not the
abolition of the common-law right infringes the provisions of section
34 of the Constitution. The topic was not dealt
with in any of the
affidavits in this particular context. During argument however, it
was suggested by Mr Gauntlett SC, that on
the present facts, section
21 of the RAF Act offended against the provisions of section 34 of
the Constitution
per
se
.
The argument was
not
developed much further than the mere suggestion in the context of
section 21, but I can reasonably presume that it is based
on the
wording of that section, which abolishes a person’s right to
sue the particular wrongdoer in the certain circumstances.
I cannot
accept that the relevant common-law right cannot be removed by
Parliament if it acts lawfully in the context of the Constitution.
Nothing in the Constitution calls for the retention of all common-law
rights of action, and it is obvious, simply by reference
to some
examples, that substantial common-law rights have been removed by the
Compensation for Occupational Injuries and Diseases
Act,
79
the Labour Relations Act,
80
and the Basic Conditions of Employment Act.
81
.
I will deal with the Constitutional Court decision in Jooste
82
when I deal with the argument of irrationality, and prayer 9 of the
amended notice of motion.
THE
IRRATIONALITY ARGUMENT:
As
an alternative to the argument that section 21 of the RAF Act was
unconstitutional
for the reasons mentioned above, Mr Gauntlett SC on behalf of the
First Applicant argued that section 21, inasmuch
as it abolishes the
relevant common-law claim, is irrational and unreasonable. The
affidavits before me contain literally hundreds
of pages of facts
that I allegedly need to consider in this context, arguments
surrounding those facts, annexures giving rise to
those facts, and
alternatives that the Government should reasonably have considered or
enacted. A detailed analysis of all those
facts placed before me in
this context would take up another few hundred pages. I do intend
however dealing with the most important
considerations in this
regard, and my failure to deal with part of those, or all of them,
must not be regarded as an indication
that I have not read the
affidavits, nor considered the facts before me. I must also add that
Mr Gauntlett SC correctly stated
that if there were any conflicts of
fact apparent from the affidavits, I needed to follow the approach
expounded in the Plascon-Evans
decision.
83
In essence this means that I need to consider the facts in the
Applicants affidavits which have been admitted by the Respondent,
together with the facts alleged by the Respondent. This is of course
the correct approach in the usual proceedings on notice of
motion. I
am however not quite convinced that this
is
the correct approach in constitutional litigation, and in the present
context, where I need to look at the relevant legislation,
and what
gave rise to it and why. It seems to me that in such an instance a
Court would be obliged to look more closely at the
facts alleged by
the State, than would otherwise perhaps be the case. In the context
of the rationality argument however, it seems
to me that the relevant
facts are largely common cause. What is in issue would be the
inferences or conclusions that I need to
make arising from those
facts.
Before
dealing with that, I deem it necessary to briefly refer to the
doctrine of separation of powers that our present Constitution
reflects. The judiciary functions separately from other branches of
the Government, and it is the role of the Courts to ensure
that the
limits to the exercise of public power are not transgressed. There is
no exact or fine line between the three branches
of the State, but it
is beyond doubt that an independent judiciary is crucial to a State
based upon the Rule of Law.
84
It cannot be disputed that the exercise of all legislative power is
subject to at least two constitutional constraints. Legislation
must
not infringe any
of
the fundamental rights enshrined in the Bill of Rights. These rights
may, however, be limited by a law of general application
and, as I
have said, the provisions of section 36(1) then apply.
85
The
other constitutional constraint is that there must be a rational
connection between the legislation and the achievement of a
legitimate Government purpose. The idea of the Constitutional State
based on the Rule of Law presupposes a system whose operation
can be
rationally tested.
86
Parliament can also enact legislation that differentiates between
groups and individuals, but in this context it is then required
to
act in a rational manner. The Constitutional Court put it as follows:
“Parliament
cannot act capriciously or arbitrarily. The absence of such a
rational connection will result in a measure be
unconstitutional.”
87
The rationality test, and its ambit, was at the heart of the
well-known Pharmaceutical Manufacturers’ decision of the
Constitutional
Court.
88
Although the decision was concerned with the conduct of the President
(the executive), the rationality test was clearly also applicable
to
the exercise of legislative power, and the Affordable
Medicines
Trust decision of the Constitutional Court makes that clear.
89
It is abundantly clear from the decisions of the Constitutional
Court, that I cannot do the following in the present context:
I
cannot say that the decision of the legislature to enact the
Amendment Bill and especially section 21, is unreasonable;
I
cannot say that it is not desirable;
I
cannot say that it ought to be improved, and suggest or order such
improvements in any specific context;
Although
I can show (as I have), compassion and understanding of the plight
of certain individuals, I cannot legislate for them;
I
cannot draw a budget for the legislature or order it how to spend
public funds.
What
I can do however, and must do, is to consider whether or not the
legislative scheme is rational, having regard to the question
whether or not a legitimate Governmental purpose is achieved
thereby. If there is no rational connection between the scheme
and
such purpose, I can declare to be unconstitutional (subject to
confirmation by the Constitutional Court of course).
In
this same context the Constitutional Court has said the following:
“As
the Lawrence case makes plain,
90
the Court sought to achieve a proper balance between the role of the
Legislature on the one hand, and the role of the Courts on
the other.
The rational basis test involves restraint on the part of the Court.
It respects the respective roles of the courts
and the Legislature.
In the exercise of its legislative powers, the Legislature has the
widest possible latitude within the limits
of the Constitution. In
the exercise of that power to review legislation, court should strive
to preserve to the Legislature its
rightful role in a democratic
society.”
91
FIRST
APPLICANT’S CASE IN THE CONTEXT OF IRRATIONALITY:
In
its founding affidavit it was submitted that the abolition of the
common-law claims, while simultaneously reducing the compensation,
unreasonably and irrationally deprives them of their right to obtain
effective relief, in violation of section 38
(sic
)
of the Constitution.
92
It was also alleged that the “compensation scheme” is
inconsistent with the Constitution as it is “deprivative”
of common-law rights, it is not rational, it is arbitrary, and it is
unreasonable in its effect.
93
The allegations in the context of irrationality or arbitrariness are
made in relation to certain parts of section 17 of the Act
and/or the
regulations promulgated there under. Second Applicant, in its
founding affidavit referred to “the unfairness and
the
one-sidedness of the Act and the regulations…”
94
I
will as briefly as I can (but without losing the essential meaning of
First
Applicant’s
argument) deal with the submissions made in its heads of argument and
in Court: in the written argument
95
it submits that it is not rational to take away a right of recourse
on the basis that the current system is unaffordable. What
follows
essentially summarizes the argument of First Applicant in this
particular context: even if the existing benefits (prior
to the
amendments) were unaffordable, and the scheme was therefore no longer
viable, (which is also challenged) this premise cannot
serve as a
justification for the abolition of the right of recourse against
others. It is contended that the less the State gives,
the stronger
the entitlement for a victim to make good his or her loss against the
violator. There can also be no adequate justification
that the
wrongdoer has to be protected disproportionately to the victim. The
“crude” limit of R160 000,00 to claims
for loss of income
or support is clearly arbitrary. It operates regardless of the
circumstances of a particular victim. It wholly
disregards the
victim’s earning capacity and duty to provide support to
dependants. The wrongdoer’s capacity to compensate
is likewise
disregarded. The irrationality of imposing a categorical limitation
of R160 000,00 is further borne out by the flawed
rationale. The
expressed rationale in that context is that would-be victims can
insure themselves against losses beyond the R160
000,00 limit. The
evidence however clearly
shows
that this is unresearched, and also an unverified premise based on
erroneous data, and assumptions based thereon. Children
are unable to
either obtain, or obtain adequate insurance in this context. It is
also equally factual erroneous to say that the
poor were subsidizing
the rich under the previous scheme, and that a limitation would
therefore prevent the perpetuation of this
social injustice. The R160
000,00 limitation is therefore non-existent on a factual substratum
premise, and any decision based
thereon is devoid of any rationality.
The scheme is also invalid because it reduces and exclude numerous
entitlements to victims
who would otherwise have benefited, but does
so without substituting them with satisfactorily benefits. Although
certain restrictions
to victims’ rights may be validly imposed
by an act of parliament, such restriction must provide for a
proportionate benefit,
in the absence of which it would be invalid
for being irrational. In contrast to the Jooste decision
96
where a number of novel benefits were introduced by the relevant
statutory compensation scheme, the current scheme created a large
class of injuries for which no compensation can be claimed, and it
would have particularly negative consequences for the poor,
children
and students, young workers, people who suffer from chronic
conditions like HIV/AIDS, obesity, diabetes and heart conditions,
and
those in
high
risk professions. This group of victims allegedly comprise at least
43% of road accident victims. This expansive group was
particularly
exposed since they were not eligible for private insurance. No new
benefits were given, and with reference to the
Jooste-decision it was
then submitted that this Court was competent to enquire into the
“impugned provisions substantive
constitutional compatibility.”
The argument was therefore that I must be satisfied that a
comprehensive scheme has struck
an appropriate balance between
entitlements created, and common law rights abolished. This was not
substituting my policy choices
for that of Parliament, so it was
argued, but a constitutionally mandated exercise to ascertain whether
the rights protected by
the common law as sacrosanct, and by the
Constitution as fundamental, were abolished in such a balanced way as
to satisfy the constitutional
requirement of rationality. The
Jooste-decision was therefore clearly distinguishable, and the
present scheme was not only haphazard
and unbalanced, nor
comprehensive and thus inherently flawed. Furthermore, the inherent
irrationality resulting in the section
20(1) “scheme”
could also not be justified in terms of section 36 of the
Constitution. It was also contended that “the
Courts are
constitutionally compelled to act as final arbiter where financial
issues are involved”.
97
This
argument was substantially repeated in Court and a more colloquial
summary of First Applicant’s case would be:
“What
is given is not proportional to what was taken away.”
In the context of the submission, however widely it was formulated,
that the Court must act as the final arbiter also where financial
issues were involved, I must immediately refer to section 27(2) of
the Constitution, which clearly does not support this wide
contention, in that the State is only obliged to take reasonable
legislative and other measures to achieve the right to have access
to
health care services “within its available resources”. In
my view it is clear, and never seriously contended otherwise,
that
socio-economic rights do not form the basis of Applicant’s
challenge in these proceedings. It follows that whether or
not the
present legislation is “reasonable or not” is irrelevant
in law. In any event, if a Court were to test legislation
for
reasonableness, it would never reach the end of its enquiry, nor
would it act with its confined sphere of power that I have
already
referred to.
The
complaints, and the basis for such by the Applicants is wide ranging,
and I may say in this context that the affidavits before
me comprise
almost 4 500 pages (without the annexures). It is impossible even to
give an approximate summary of all the allegations
made therein, but
it is also not necessary. I propose to refer to the Second
Respondent’s argument, and then to the most
pertinent facts
upon which they rely, and thereafter to decide whether or not the new
“scheme” is rational, having
regard to the stated
Government purpose. (I must add that Mr Gauntlett SC agreed that I
can decide the issue on the Respondent’s
version of the facts).
In First Respondent’s answering affidavit
98
the principal rationale for the abolition of the common-law claim by
the Amendment Act was as follows:
The
compensation payable under the Act remains fault-based (see however
Government Gazette 32940 of 12 February 2010 which deals
with the
no-fault scheme envisaged). Road accident victims are entitled to
compensation
only if, and to the extent that the loss was due to someone else’s
fault. They are paid compensation under the
Act in lieu of the claim
they would otherwise have had at common law against the wrongdoer.
The substitution of a statutory claim
for the common-law claim is to
the advantage of claimants insofar as they now have a debtor with a
“deep pocket”. They
would otherwise have been at risk of
having a good common-law claim against the debtor who cannot afford
to pay. This is a significant
risk. The substitution of the risky
common-law claim with a statutory claim against the public fund, is a
significant advantage.
The
trade-off is in the first place that the compensation payable under
the Amendment Act is limited. The limitations are designed
to
ensure that the basic needs of all are met from public funds but to
limit the overall cost of the scheme.
The
second element of the trade-off is that the victims’
common-law claim is abolished to afford immunity from liability
to
drivers and owners. They are afforded this immunity because they
are the funders of the scheme through
the
fuel levies they pay. If they were not afforded this protection, they
would have to pay both the cost of the scheme and the
cost of
liability insurance to cover themselves against the risk of claims by
the victims of road accidents.
The
First Respondent therefore believed that these considerations
constituted a powerful rationale for the abolition of the common-law
claim. It was, in short, a legitimate State objective to require
motorists to fund the compensation payable to the victims of motor
vehicle accidents under the Act, and in return to give them immunity
against claims for damages by those victims. It was then alleged
that
this rationale appeared in one form or another in the position
adopted by Government in the White Paper process and in the
report of
the Melamet Commission.
99
Contrary
to Mr Gauntlett’s SC submission that I need not consider the
“past”, or
even
the “future”, I propose to do so, and especially the
former, in as much as I would have a clearer understanding
as to
whether or not a consistent rationale is apparent, having regard to
First Respondent’s reasoning in the answering affidavit.
The
relevant Parliamentary process involves the publishing of what is
called “the final White Paper”.
100
It sets out the position of the Government in the relevant context
with great detail, but at the same time recognised that amendments
to
the then existing system would not fully integrate it into the
envisaged social-security system, and accordingly called for
a
Commission of Enquiry with the mandate to make recommendations
regarding an equitable, reasonable, affordable and sustainable
system
of compensation.
101
This final White Paper gave a number of explicit reasons for the
intended abolition of the common-law claim, amongst others referring
to the statutory precedent that existed under the Compensation for
Occupational Injuries and Diseases Act, No. 130 of 1993. The
Satchwell Commission was divided on the issue of whether the
common-law claim should be retained or not.
102
First Respondent accepts that the wisdom of the policy choice to
abolish the Common-law claim is a matter for debate, and is open
to
legitimate difference of opinion. The wisdom of this policy
is
however not before this Court, and the only question is whether or
not the abolition of the common-law right violates the Constitution.
First
Respondent then made the following further contentions:
In
the previous system the rich obtained much more value in the form
of insurance, whilst paying the same fuel levy as the poor.
The
rich obtained insurance for any amount of loss of earnings /
earning capacity; insurance for any form of medical treatment
that
they could somehow justify; and the rich could motivate for
substantial amounts of general damages with reference to quite
“frankly nebulous concepts” such as a loss of amenities
or enjoyment of life;
While
contributing the same fuel levy, the poor obtained much less
because the could claim less (if anything) for loss of earnings
/
earning capacity; they were less likely to institute large claims
for medical expenses because they could not afford to pay
for the
treatment upfront, and they
were
less likely to obtain the same quantum of general damages as the
rich, having regard to the consistency and the quality of
treatment
in respect of general damages;
The
previous system therefore produced perverse results, because it
resulted in the poor subsidizing the rich, and it had to
be changed
to remove discrimination against the poor.
103
It is contended that the Amendment Act now seeks to assist the poor
rather than to discriminate against them. It is also
constitutionally legitimate to differentiate between the victims of
road accidents, and the victims of other forms of crimes.
In any
event, it is legitimate for the State to devise a special scheme to
deal with injury and death as a result of motor
vehicle accidents,
and it is not for a Court to set aside a law which it considers to
be ineffective or because there are other
or better ways of dealing
with a problem. As long as a law is objectively rational, a Court
cannot interfere with it simply
because it disagrees with it, or
considers the power to make law to be exercised inappropriately. It
is also not the task of
a Court to second-guess the
wisdom
of policy decisions made by elected bodies. The Courts are not
allowed to make policy choices under the guise of rationality
review.
The following submission is then made and I prefer to quote it:
104
“It
is clear that the Act passes muster under this test. Injury and death
as a result of motor vehicle accidents constitute
a particular and
very significant socio-economic phenomenon. It is legitimate for the
State to devise a special scheme to deal
with it. The Act creates
such a scheme. It is legitimate for the scheme specifically to
address losses suffered as a result of
bodily injury and death caused
by motor vehicle accidents, without also dealing with losses of other
kinds or due to other causes.
Within the context of such a scheme, it
is also legitimate for the State to require motorists to fund the
scheme on the one hand,
and to afford them immunity against liability
for injury or death arising from the use of their vehicles on the
other. The differentiation
made by the abolition of the common-law
claim is a rational and consequently defensible one under section
9(1) …The matter
is akin to the abolition of the common-law
claim of injured workers against their employers under section 35(1)
of the Compensation
for Occupational Injuries and Diseases’ Act
(“COIDA”).”
Before
continuing with First Respondent’s reasoning I deem it
appropriate to refer in more detail to the
Jooste
-decision.
This case concerned an action for
inter
alia
general damages by the employee (Jooste), which she alleged were a
direct result of the negligence of one or more employees of
the
employer during the course and scope of their employment. The
employer took the point that Jooste’s claim was barred
by
section 35(1) of the mentioned Compensation Act. Jooste then met that
plea with a replication that section 35(1) was inconsistent
with the
(1993) Constitution, in that its provisions violated the right to
equality before the law, and to equal protection of
the law, and the
right not to be unfairly discriminated against, the right of access
to Courts and the right to fair labour practices.
The Constitutional
Court unanimously rejected the challenge. Stated in essence, the
contention amounted to the conclusion that
the nature of the balance
achieved by the Legislature throught the Compensation Act tilted
somewhat in favour of the employer,
while requirements of policy and
the nature of the relationship between the employee and the employer
indicated that a
different
balance was appropriate. Accordingly, a section 35(1) was not
rationally related to the purpose of the legislation. Whilst
mentioning that Courts in other countries such as the United States
of America, Canada and Germany have found similar legislation
neither
irrational nor arbitrary, the Constitutional Court said the following
in paragraph 17:
“But
that argument fundamentally misconceives the nature and purpose of
rationality review and artificially and somewhat forcibly
attempts an
analysis of the import of the impugned section without reference to
the Compensation Act as a whole. It is clear that
the only purpose of
rationality review, is an enquiry as to whether the differentiation
is arbitrary or irrational, or manifests
naked preference and it is
irrelevant to this enquiry whether the scheme chosen by the
Legislature could be improved in one respect
or another. Whether an
employee ought to have retained the common-law right to claim
damages, either over and above or as an alternative
to the advantages
conferred by the Compensation Act, represents a highly debatable,
controversial and complex matter or policy.
It involves a policy
choice which the legislature and not a Court must make. The
contention represents an invitation to this Court
to make a policy
choice under guise of rationality review; an invitation which is
firmly declined. The Legislature clearly considered
that it was
appropriate
to
grant to employees certain benefits not available at common law. The
scheme is financed through the contributions from employers.
No doubt
for this reasons the employees’ common-law right against an
employer is excluded. Section 35(1) of the Compensation
Act is
therefore logically and rationally connected to the legitimate
purpose of the Compensation Act, namely a comprehensive regulation
of
compensation for disablement caused by occupational injuries or
diseases sustained or contacted by employees in the course of
their
employment.”
Although
there are certain differences between the facts of that case and the
present, the mentioned reasoning in my view remains
applicable and
has found approval in other jurisdictions as well.
105
In the context of a denial of right of access to a Court, the
Constitutional Court decided that that section did not deny such
access, but that such denial already followed from the removal of the
right to claim common-law damages. I have already mentioned
that
nowhere does the present Constitution call for the retention of all
common-law claims of action which existed at any stage.
To my mind
the contrary is true and this is clear merely by reference to
sections 8(3)(b) and 39(3) of the Constitution. I have
read
the
affidavit by Dr R Campbell in the context of the lack of any, or
proper and adequate, health care facilities for spinal cord
injury
patients. If I could I would sell all fighter-planes and expensive
Government vehicles and with the proceeds provide for
health care
facilities in rural areas for all I would. My personal views in this
particular context are of course irrelevant, but
I mention them
having regard to the said affidavit (assuming the facts therein are
correct) and what was submitted in First Respondent’s
heads of
argument, namely that “the Courts are constitutionally
compelled to act as final arbiter also where financial issues
are
involved”. The article of Brand
106
suggests
“that
there is indeed room for the recognition and development of a new
distinct part of constitutional law in South Africa,
namely financial
constitutional law”.
He
suggest that financial constitutional law would consist of five
elements, namely, economic and fiscal considerations; constitutional
allocation of functions and division of financial resources;
financial and fiscal legislation; policy consideration; and
justifiability
of the financial Constitutional league of provisions.
This was not an academic debate, but according to the author, close
to the
heart of the new Constitutional system in South Africa.
I
have little doubt that the author (who relies on the development in
German Constitutional Law) is correct at the very least in
the
context of sections 26 and 27 of the Constitution. In this
application however we are not dealing with socio-economic rights.
The relevant affidavits of the parties also did not present the case
on that basis. It was also not sought to place the application
in the
context of whatever rights may be flowing from the provisions of
section 10 of the Constitution, namely the right to human
dignity. I
mention that in passing because of the recent decision of the German
Constitutional Court
107
which dealt with the payment of social security amounts for children
(amongst others), and in the context of the right to dignity,
held
that the Government was obliged to pay a subsistence minimum that was
in line with human dignity, and it therefore had to
assess all the
expenditure that was necessary for one’s existence,
consistently in a transparent and appropriate procedure
according to
the actual needs of the persons i.e. in line with reality. This is
not such a case, but I have little doubt that at
the appropriate
stage such issues will be raised, and will have to be considered in
the light of all the relevant facts that will
have to be available to
the Court.
On
behalf of First Respondent it was also submitted that the following
considerations in the context of rationality need to be considered:
It
was not unfair to require high-income earners to acquire top-up
accident insurance. Many would already have such insurance
to cover
themselves in respect of other forms of accidents or harm. The risk
posed by high-income earners were shared by many
millions of poor
South Africans who contributed to the Fund through the fuel levy,
but who could claim little or no compensation
for loss of income or
support. The insurance afforded to the rich by the system was cheap
only because the millions of poor
people (who posed little risk to
the system) subsidized the rich;
Liability
insurance would always be more expensive than accident insurance,
and cannot be tailored by the motorist to suit his
or her needs;
Default
may consist of a moment’s inattention and, in many instances,
it would be unfair to publish a wrongdoer with a
financial ruin;
It
is unfair that the victim without means is unable to claim from a
wrongdoer with means and that the latter cannot claim from
the
former;
The
retention of the common law would increase the cost of doing
business in South Africa.
108
The
affidavits, not surprisingly, then contain numerous allegations and
counter allegations with factual debates and disagreements
about
the availability of “top-up” insurance for the young,
the students and those with certain disabilities. The
debate
concerned essentially the question to which extent such insurance
was available, affordable and in existence. It would
be beyond the
scope of this judgment if I had to enter into this debate in
greater detail. I conclude however from the relevant
affidavits
that personal liability insurance is available, that it is limited
to some extent for certain classes of people,
but that it will also
develop in future to take account of the demands of the market
place.
109
I
do not believe that any of the mentioned deficiencies of the “new
scheme” can
lead
me, as invited, to the morass of re-arranging budgets and taxes in
the present context, and I again refer to the dictum of
the
Constitutional Court that is relevant here:
“The
Courts are not constitutionally equipped to make the wide-ranging
factual and political enquiries necessary… for
deciding how
public remedies should most effectively be spent. There are many
pressing demands on the public purse. As was said
in Soobramoney:
‘The State has to manage its limited resources in order to
address all its claims. There will be times when
this requires it to
adopt a holistic approach to the larger needs of society rather than
to focus on the specific needs of particular
individuals within
society.’”
110
In the as yet unreported decision of the Constitutional Court in
Poverty Alleviation Network
111
the following was said:
“As
this Court observed in Pharmaceutical Manufacturer’s
Association a Court cannot interfere with legislation simply
because
it disagrees with its purpose or believes that it should be achieved
in a different way. Unless it can be shown that the
objective is
arbitrary, capricious or manifest naked preferences, it is irrelevant
to this enquiry whether the scheme chosen by
the Legislature could be
improved in one respect or another’. Indeed, lawmaking is a
function of Parliament alone”.
It
is not the function of the Courts to review laws for reasonableness
in the present context.
112
Having
regard to First Respondent’s reasoning, I asked counsel what
the position would be if I were to find that one or other
of the
stated reasons for the introduction of the new system was in fact the
irrational / unjustifiable / unfounded. In that context
I was then
referred to a decision
113
which was the basis for the argument that if one irrational reason
appeared, the relevant statutory provision could be impugned.
There
was no further debate on this in Court and I was thereafter asked by
First and Second Respondents to admit a further brief
written
argument, which I did. It was then submitted that the relevant dicta
appearing in the Rustenburg Platinum Mines decision
were
distinguishable in the present context, and that the reasoning that
appeared therein was inappropriate because considerations
in
Administrative Law do not necessarily apply in the context of a
Constitutional challenge to a statute. It was pointed out that
the
Constitutional Court had made it quite clear that constitutional
review of legislation was very
different
from judicial review of administrative action.
114
It was also argued that the motives for those waiting for – or
introducing the legislation was irrelevant, in that the Court
is
concerned with the actual purpose of the legislation and hence its
rationality, and not the motives of the legislators.
115
Also, as stated, the standard of rationality involved the application
of an “objective enquiry”
116
In reviewing whether or not legislation is rational, the enquiry is
not
whether the legislative measure is reasonable or proportional but
only whether or not there is a rational connection between it
and the
achievement of a legitimate Government purpose.
117
For the Applicants to succeed in their irrationality attack, they
must demonstrate that the impugned provisions serve no legitimate
Governmental purpose.
In
reply the First to Fourth Applicants submitted a further written
argument, and persisted in the submission that:
Respondents
cannot now escape (as they tellingly now contrive to do) the
official
statement of the purposes of the 2008 amendments which they
themselves choose to put up as evidence before me;
Government
purposes behind its own “transitional scheme” are not
to be equated with the motives behind statements
of individual
legislators;
Several
of these purposes are simply indefensible as being legitimate
current Governmental objectives – particularly in
traducing
the fault principle, protecting wrongdoers and hand-wringing over
the cost to them of insuring against the supposed
“moment of
inattention” which devastates an innocent life;
They
cannot be disregarded, on the absurd reasoning that establishing
any single legitimate Governmental objective will blind
the Court
to other indefensible purposes mixed with it as equally “primary”,
If
it is not clear that the legislative provision would have been
adopted in the absence of the recorded repugnant purposes,
it
cannot stand, in the light of sections 1 and 8 of the Constitution,
In
any event, the rationality enquiry cannot be undertaken without
regard for proportionality;
On
the Respondents own papers, the purposes behind the abolition of
the right of recourse at common law lies in what the Respondents
accept is a single “transitional scheme”, comprise a
mixed group which do not pass the test articulated in Patel.
118
This debate was unleashed because when I put the relevant question
to counsel I had in mind the Government purpose relating
to the
“moment of inattention” as one can logically accept,
merely by reading the Law Reports, that many moments
of inattention
have resulted in many tragic consequences. The same reasoning
however applies also to many moments of reckless
conduct, or even
intentional conduct, which is frustratingly clear on one’s
way home, and noticing how just about every
rule of traffic is
repeatedly and consistently ignored by certain drivers. In my view
however, even if I find that this “moment
of inattention”
is totally unacceptable reasoning, and therefore irrational, I
cannot find that this would defeat the
whole of the Government
purpose expressed in the “new scheme”
In
the light of the above therefore I cannot hold that the enactment of
section 21 of the Amendment Act is irrational. In the premises,
therefore I refuse to declare that
section 21
of the
Road Accident
Fund Act, 56 of 1996
as substituted by
section 9
of the
Road Accident
Fund Amendment Act 19 of 2005
, is inconsistent with the Constitution
on the grounds of its irrationality. (Prayer 1).
IS
THE PROVISO TO SECTION 17(1) READ WITH SECTION 17(1A)(a) OF THE ACT
INCONSISTENT WITH THE CONSTITUTION AND INVALID? (PRAYER 2.1):
The
relevant sections read as follows:
“
17.
Liability
of Fund
(1) the
Fund or an agent shall-
(a) subject
to this Act, in the case of a claim for compensation under this
section arising from the driving of a motor vehicle
where the
identity of the owner or the driver thereof has been established;
subject
to any regulation made under section 26, in the case of a claim for
compensation under this section arising from the driving
of a motor
vehicle where the identity of neither the owner nor the driver
thereof has been established,
be
obliged to compensate any person (the third party) for any loss or
damage which the third party has suffered as a result of any
bodily
injury to himself or herself or the death of or any bodily injury to
any other person, caused by or arising from the driving
of a motor
vehicle by any person at any place within the Republic, if the injury
or death is due to the negligence or other wrongful
act of the driver
or of the owner of the motor vehicle or of his or her employee in the
performance of the employee’s duties
as employee: Provided that
the obligation of the Fund to compensate a third party for
non-pecuniary loss shall be limited to
compensation
for a serious injury as contemplated in subsection (1A) and shall be
paid by way of a lump sum.
(1A)(a)
Assessment of a serious injury shall be based on a prescribed method
adopted after consultation with medical service providers
and shall
be reasonable ensuring that injuries are assessed in relation to the
circumstances of the third party.
(b)
The assessment shall be carried out by a medical practitioner
registered as such under the Health Professions Act, 1974 (Act
56 of
1974).”
APPLICANT’S
ARGUMENT:
The
effect of this amendment is that the obligation of the Fund to
compensate a third party for non-pecuniary loss (general damages)
shall be limited to compensation for a serious injury. “Serious
injury” is not defined. It is however an injury “as
contemplated” in subsection (1A). It is difficult to ascertain
from the First
Applicant’s
founding affidavit on which basis the proviso to section 17(1) is
allegedly inconsistent with the Constitution.
The same applies to the
founding affidavits of the other Applicants, and also to the First
Applicant’s heads of argument.
Neither was there any coherent
argument presented in Court in this particular context, and it is
difficult therefore to discern
on which possible basis the proviso
should be declared unconstitutional. Persons with non-serious
injuries cannot claim general
damages for pain and suffering and loss
of amenities of life for instance, but they can still claim medical
expenses and loss of
earnings. I can only presume that the attack is
that a common law right has been removed, but to that extent I have
dealt with
argument in the context of section 21 of the Amendment
Act. Accordingly the relief sought in paragraph 2.1 of the amended
notice
of motion is refused.
IS
SECTION 17(4)(c)
OF THE
ROAD ACCIDENT FUND ACT INCONSISTENT
WITH THE
CONSTITUTION? (PRAYER 2.2):
The
section reads as follows:
“Where
a claim for compensation under subsection (1)… includes a
claim for loss of income or support, the annual loss,
irrespective of
the actual loss, shall be proportionately calculated to an amount not
exceeding
(i) R160
000,00 per year in the case of a claim for loss of income; and
(ii) R160
000,00 per year, in respect of each deceased breadwinner, in the case
of a claim for loss of support.”
These
were the amounts at the time the Amendment Act came into force, and
are in terms of section 17(4A), subject to quarterly adjustment
to
avoid the affects of inflation. They presently stand at R176 535,00.
The
First Applicant has argued that “this is an especially
irrational aspect of the new scheme”. They submit that the
mere
fact that the common-law claim – which has provided for full
compensation to the extent that compensation was unavailable
under
the previous regimes – is excluded simultaneously with the
introduction of an absolute limitation on the only remaining
recourse, is strikingly irrational. They submit that the scheme thus
reduces the amount recoverable from the RAF while completely
removing
the residual top-up remedy under the
common
law. The explanation for this double attenuation of victims’
remedies is that it is necessary to save funds. Yet, the
common law
claim clearly has no adverse bearing on the RAF’s funds. To the
contrary, the wrongdoer’s ability to bear
the burden of his or
her negligence could alleviate the financial pressure on the RAF. In
any event, the evidence shows that the
RAF has broken even for the
last four years. In this light the imposition of a cap is
demonstrably not necessary, and clearly disproportionate.
The amount
of the cap is unjustifiable. It was set to operate without any regard
to the actual loss of an individual victim. First
Applicant further
submits that there is no evidence of a recent analysis of how this
limit relates to the purpose it is intended
to serve. Nor is any
evidence provided on what competing financial priorities the
Department of Transport and Treasury may have
or how tax payers’
money is appropriated. That the Minister of Transport fails to do so
is significant in the light of the
Minister of Finance imputing much
of the financial woes of the RAD to maladministration and
mismanagement.
119
The
submission is that not only does the “crude” amount
imposed completely disregard the victims’ situation, but
it
also ignores the wrongdoer’s ability to pay
compensation.
This is particularly inexplicable in the light of the evidence that
40% of motorists are insured against third party
claims. In addition,
the claimed escape valve for locking all victims in under a R160
000,00 cap is an equally irrational construct.
The evidence allegedly
clearly establishes that the possibility that victims can buy top-up
insurance – to compensate for
Parliament’s abolition of
victims’ common law top-up claim against the wrongdoer –
is no viable alternative.
120
It is also submitted that not only is it demonstrably unworkable to
expect innocent victims to shoulder the burden of indemnifying
themselves against losses caused by negligent drivers, it is also
utterly unfair to do so. It’s unfairness is so striking
in the
context of the common sense of fairness in developed societies around
the world (as developed through the millennia), that
it cannot be
said that any reasonable Legislator could reach this result after
having applied its mind properly. Thus shifting
the burden to victims
to insure themselves in order to protect wrongdoers against liability
for their negligent conduct –
and purportedly protecting the
RAF funds – is clearly irrational. It was submitted that the
Respondents did not respond meaningfully
to the issues identified
above – indeed, they confirm that future earnings by children
and young victims are uninsurable.
121
First Applicant also suggests that the contention on behalf of First
Respondent
that claims for over R160 000,00 constitutes only 1% of all claims
122
is insightfull. Because these are extremely limited, a categorical
exclusion of compensation for the additional loss suffered in
such
instances cannot be justifiable. Further, the contention that the
losses of this pre-limited group of would-be insured drivers
are
readily uninsurable evidences a complete lack of understanding of the
insurance market. The smaller the group, the less viable
the policy.
Such failure to comprehend the true position in the insurance market
confirms the measures irrationality. First Applicant
then suggested
alternatives such as alleviating the RAF’s financial position
by curbing costs on the acquisition of defence
equipment,
123
by capping the common law claim, by codifying the common law
principle governing contingency allowances, and by reinforcing and
refining the existing common law principle that the law of delict
should strike a balance between the interest of the victim, the
wrongdoer and society. The failure to consider alternatives is
particularly inexplicable when regard is had to the disproportionate
effect on children and young victims. According to statistics, they
comprise half of the population of seriously injured victims,
and the
earning capacities are usually completely destroyed by the serious
accidents.
124
Reliance
is
then also placed on international law obligations to ensure that a
child-sensitive and child-centered approach to social security
is
adopted. Considering therefore that the best interest of child
victims could be ensured by a mere extra cost of R1,28 per litre
on
the fuel levy (constituting a 2% increase only, which on average
amounts to an additional R19,68 per year per motorist),
125
the decision is utterly irrational. Similarly, as a matter of fact
too, they argue that the imposition of the R160 000,00 on claims
for
loss of earning capacity and loss of support, has to be satisfied on
the basis of irrationality as well.
It
is noted that nowhere have the Applicants suggested what the actual
amount instead of the R160 000,00 (now R175 887,00) should
be.
I
have already dealt with the irrationality argument and the irrelevant
authorities in the context of Prayer 1.
The
Second Respondent’s answering affidavit,
126
although understanding the position to be that the primary
responsibility of responding to the merits of the Applicants’
constitutional attack on the provisions of the Amendment Act, rests
on the Minister of Transport, relies on certain background
facts,
statistics and reasoning in the context of the relevant amendments.
The views and recommendations of the Satchwell Commission
are dealt
with in some detail, and its reasoning
127
and it is practical in this context to refer to one of such views
relied on:
“It
is not reasonable to expect a developing country such as South Africa
to provide unlimited benefits or compensation to
road users. The lack
of moderation in the system that allows for and perpetrates
disparities of wealth between road users cannot
meet the standard of
reasonableness. The absence of any relationship between the fuel levy
and the compensation to which a victim
may be entitled is not
economical and is therefore unaffordable. A system of compensation
without limits or boundaries is unreasonable.
The absence of a
congruence
between the fuel levy, risk and cover is inequitable, unaffordable,
unreasonable and unsustainable.”
128
Other
problems identified by the Commission were overspending on minor or
negligible injuries, disproportionate spending on non-financial
loss
compared with actual losses, and the failure of the financing basis
to connect revenue and the scheme’s liability to
pay claims.
The commission also found that a fault-based delictual system failed
to meet the needs of the public and in this case
noted as follows:
“The
current system fails to ensure access to timeous and effective health
care and rehabilitation, to provide protection
against impoverishment
and to offer solace for suffering. The cost of access to an
implementation system diverts compensation funds
from their true
purpose. Where funds are directed towards road accident victims they
are frequently expended upon non-catastrophic
and non-life changing
injuries. A significant portion of compensation funds is expended on
the illusionary premise that money can
restore happiness.”
129
The Commission also noted certain practical difficulties facing an
injured person attempting to claim damages, and said that the
practical and procedural problems such as access to legal advice,
lack of evidence, uncertainty about whether the evidence proves
fault, difficulties in the medical prognosis, and delay in the
settlement process all contribute to reducing both the chances of
recovery of damages and the amount of damages recovered. In the same
vain it noted that the delict liability insurance system is
so
unpredictable and unreliable, that no injured person can be sure of
receiving compensation and plan his personal finances accordingly.
Quite apart from the legal uncertainties associated with the concept
of negligence and causation, they are very considerable practical
difficulties to be overcome in proving a claim. Most accidents,
particularly road accidents, occur so quickly and unexpectedly
that
to establish with any degree of certainty precisely what caused the
accident is seldom easy. Even if there were witnesses
present and
were prepared to come forward, the fallibility of the human brain in
grasping accurate detail in a moment and the time
lapse between
accident and trial, are such that the evidences is often not
reliable.
130
It
was therefore the view of the RAF that the delict pay system has
failed to meet
the
needs of users of South African roads, in that it was not only
complex and arbitrary, but also time consuming, expensive, open
to
abuse and wasteful. It was also fraught with practical difficulties,
and the outcome was unpredictable and unreliable. It was
particularly
so in the context of unlimited compensation for injuries. The
Amendment Act was a transitional measure pending the
introduction of
a more comprehensive change to the system, including the possible
move to a no-fault system. Parliament recognised
however that the RAF
could not survive with the pre-amendment Act in place, while debates,
discussions and legislative processes
around the no-fault system
occurred. The pre-amendment Act system was unaffordable, inequitable,
unreasonable and unsustainable
as well as highly discriminatory and
likely unconstitutional in view of the stark difference between the
treatment of mostly poor
passengers and others. That was the reason
for the introduction of the Amendment Act as a transitional measure,
and it pointed
out the inequities in the pre-amendment system which
are again relevant to the irrational argument and the so-called
“capping”
argument: The most glaring inequities were then
said to be the following:
131
For
certain categories of claimants, including certain drivers,
compensation was unlimited;
In
stark contrast certain passenger claims were capped at a maximum of
R25 000,00;
Claims
of foreigners were treated identically to claims of South Africans,
despite the minimum contribution that they would
make to the RAF
via the fuel levy;
The
complete exclusion of various claimants, such as members of the
same household or persons who were responsible in law for
the
maintenance of the driver;
The
problem of unreasonable cross-subsidization was especially acute,
as the delictual system required that a victim be placed
in the
position they would have been in but for the accident, educated
employed persons with entrepreneurial or professional
careers, and
who were financially
successful,
will have suffered, and would be able to prove greater financial loss
than the unemployed, the poor and the less advantaged.
These however
pay the same fuel levy as the rich. Preference was then made to
international research that has shown that the poor
are at greater
risk of being injured or killed in motor vehicle accidents, and they
are also the hardest hit by the financial pressure
resulting from
such injuries.
132
Certain examples were then given of this unreasonable
cross-subsidization with reference to amounts paid to victims way
above
R10 million. A further example of the inequity of the
cross-subsidiaries of rich foreigners by poor South Africans was
illustrated
by a recent claim where a Swiss national claimed an
excess of R4,4 billion from the RAF after being injured in South
Africa whilst
on holiday. This claim was settled for approximately
R500 million, with the RAF paying R69,5 million of the settlement
amount.
The balance was paid by the RAF’s re-insurers from whom
cover had been purchased by the RAF. The number of foreign visitors
had increased substantially over the last years, and another major
influx was expected during the FIFA World Cup.
South
Africa provided automatic cover at the same unlimited level and at
the same premium to foreigners, as they provided to citizens.
However, foreign jurisdictions do not reciprocate by providing South
Africans with automatic cover against injury or death as a
result of
road traffic accidents.
Second
Respondent then referred to the compensation that was paid during the
2009 financial year. It is worthwhile repeating the
figures:
R4,9
billion was paid out as general damages. This represents 57% of the
compensation paid (excluding legal fees);
Medical
payments, at R0,85 billion for the year represented 9,9% of the
compensation paid;
Loss
of income and support payments at R2,83 billion for the year
represented 33% of compensation paid;
Funeral
costs, at R0,026 billion for the year represented 0,3% of
compensation paid.
133
I have mentioned that the vast majority of personal injury claims
paid by the RAF are for less than R50 000,00 i.e. of the
claims
finalised by the RAF in 2009, excluding supplier claims, 92% were
below R50 000,00. This is of course a relevant figure
in my view,
having regard to the alleged unconstitutionality of the R160 000,00
capping. This occured in 2008 as well, and
the Second Respondent’s
reasoning then was that most of these claims of less than R50
000,00 relate to matters where
less severe injuries have been
sustained. It was not unusual in these claims for only general
damages to be claimed, indicating
that no medical treatment was
required, and no time was required or would be required of work due
to the injuries. The RAF
was thus utilizing its scarce resources to
pay claimants who had not suffered serious injuries. This was
inappropriate, given
that the focus should be on treatment and
rehabilitation of injuries so as to
restore
the injured back to physical and economic life, rather than
compensate the victim for short term discomfort.
Second
Respondent also raised the issue of the ballooning of its liability
and the unaffordability of the pre-amendment system with
reference to
the following facts:
By
the 2009 financial year end, the RAF’s total liabilities were
R43,2 billion;
The
number of factors which contributed to this growth and liability
were the increasing accident rates, inflation of medical
expenses,
increase in the number of claims lodged, and ever increasing and
more subjective damages award by the Courts.
134
South
Africa has an exceptionally high number of road accident
fatalities, even when compared to other developing countries.
Between January and December 2008, 14 057 people died on South
African roads, averaging 38
people
per day. It was estimated that approximately 280 000 people are
injured on South African roads every year.
There
was no fundamental proper connection between the income of the Fund
and its expenditure.
135
By
allowing unlimited insurance cover with no pricing for risk, the
pre-amendment Act position made the system unaffordable.
In this
particular context, the Satchwell Commission had the following to
say:
“(Any
scheme)… cannot redeem every insult, remedy each affliction,
restore full wellbeing and return the road accident
victim to the
position… prior to the accident and the injury of fatality.
Such responsibility is not consonant with
the obligations of the
State to other members of society in times of trouble or distress.
Full compensation for all loss suffered
in road accidents is
compatible in either with Government’s responsibility towards
road users nor with the resources
available to Government.”
136
On
behalf of the National Treasury
137
it was stated that the pre-amendment system was wholly uneconomic
and, in consequence, failed to meet the standards of efficiency,
effectiveness and economy in spending funds raised through statute.
While the current system, assessed with reference to these
standards,
may itself prove expensive, the National Treasury contends that it is
reasonable and fair as an interim step towards
an arrangement that
appropriately and in a sustainable manner balances the statutory
provisions of benefits, on the one hand, and
self-insurance on the
other. What could not be countenanced, however, was an increase in
the financial burden of the system of
compensation for personal
injury or deaths without a proper structure for financing it. Nothing
in the application amounted by
the Applicants provided a sensible
solution to the question of how the previous system, if reinstated,
was to be funded. Whilst
the Treasury contended that the previous
system, based as it was upon unlimited liability, was both unfair to
the taxpayer and
unaffordable to the economy, it did not contend that
the system contemplated under the Amendment Act was
necessarily
the best system. (Indeed, it passed no comment thereon). It did
however contend that it had the virtue of being more
efficient and
was more capable of more effective control from an expenditure
perspective. It therefore contended that in the interest
of ensuring
efficiency and spending, sound public entity governance, proper
financial management and enhancing financial solvency,
it was
necessary to replace the unlimited liability scheme. This unlimited
liability system created an unreasonable burden on tax
payers in
order to finance a disproportionate structure of benefits to a
limited number of beneficiaries. In the light of the stringent
fuel
restraints on the economy and taking into account the rising unfunded
liability of the RAF, there was a material risk that
the RAF would be
placed in a position where it was unable to meet its obligations if
the Amendment Act was struck down. It is interesting
to note that it
stated that economic modeling by the Treasury showed that increasing
the fuel levy would result in slower investment
and economic growth.
Increases in the fuel levy therefore would have to be considered with
great circumspection, having regard
to both the associated cost
burden, on the one hand, and the intended benefits, on the other,
which in turn compete with other
compelling claims on the fiscus. As
far as the absence of or deficiency in the insurance system is
concerned, it noted
that
the system of third party compensation had been in place for more
than half a century. The insurance industry therefore had
no
incentive to provide top-up cover in respect of those aspects not
covered by the Road Accident Fund. Once the Amendment Act
began to
gain traction in the marketplace, so it contended, the insurance
industry would undoubtedly respond to the vacuum and
would provide
cover which was specific to the vacuum.
I
have referred to the report of GRS Actuarial Consulting
138
which is an annexure to First Respondent’s answering affidavit.
I note that the envisaged savings on the crucial matters
of the 2008
Amendment Act would be in the region of 35%. This is substantial, and
it must also be considered against the light
of the allegation by
First Respondent that the limit introduced by the Act of R160 000,00
for future loss of earnings only affects
about 1% of the population
who, by virtue of their increased earnings, would be eligible for
increased insurance cover. Whilst
it stood to reason that children
and other persons who do not earn an income could not obtain income
replacement disability insurance,
such person would be entitled
to
obtain cover for personal accident insurance, which would pay upon
the occurrence of an accident irrespective of a victim’s
medical profile, and non-income replacement disability insurance
which would pay benefits in the event that the victim was rendered
disabled as a result of an insured event. The First Respondent did
however admit that in this context and in the overall context
when a
solution was sought that would bring about a generally equitable,
fair, transparent and sustainable compensation system,
the Government
had to make hard policy choices. I have referred to the various
arguments and considerations required to be considered
when deciding
whether or not Government has acted irrationality in producing a
statute that is not rationally related to its intended
purpose in the
context of prayer 1 above. As I have said, most of those
considerations apply here as well. First Respondent explained
how the
R160 000,00 cap came about.
139
Initially, a global limitation of R600 000,00 was proposed. This
initial global limitation was based on information available which
demonstrated that between the years 2000 and 2004 only 4,8% of
victims could substantiate a loss a claim for loss of income above
R600 000,00. This globally amount of R600 000,00 was criticized as
having a negative impact on the very
young.
It was therefore replaced with an annual limitation based on a
working life of 47 years, which translated into a cap of R160
000,00
per year. In the light of the mentioned decisions of the
Constitutional Court, I also have to decline First Applicant’s
invitation to act as the holder of the public purse in the present
context. This must be done by Parliament. I cannot say that
the R160
000,00 is not rationally connected to a legitimate Governmental
objective, nor can I say that it is so arbitrary that
I can set it
aside. Applicants have also sought to challenge this cap on the basis
that it is “unjustifiable”, “unfair”
and
“unreasonable”. In the present context it is in my view
not permissible to seek to apply these standards. It is
not
appropriate to review legislation on the basis of reasonableness
(certainly not in the present context), because to do so would
be to
impermissibly encroach on the terrain on the Legislature.
Reasonableness has only to do with socio-economic rights that are
referred to in the Constitution, and the limitation clause, once it
has been found that a legislative provision has encroached
on a
fundamental right.
140
The Applicants have therefore not made out a case that the imposition
of the R160 000,00 cap infringes on their rights as infringed
in the
Bill of Rights. There is no basis for the rationality review. It is
therefore misguided to suggest that the Legislature
should have
considered other alternatives, or even
those
alternatives put forward herein. As I have said, no suggestions to
what the R160 000,00 should in fact have been, has been
made in these
proceedings. Certain “top-up” insurance is indeed
available I may add, but I have noted that at present
there is no
form of disability insurance which will indemnify victims for an
increased ability to earn in the future. It is therefore
not correct
for the First Applicant to state that it is impossible for children
and young victims to obtain top-up insurance.
141
It must not be forgotten that the R160 000,00 base amount, is
adjusted for inflation periodically for the duration of the claim
for
future loss of earnings. This means that the victim is entitled to
compensation for loss of earnings which takes into account
inflation
calculated from the base amount being the amount determined in the
last Government Gazette issued before the cause of
action arose.
142
As
a result I refuse to declare that section 17(4c) of the Amendment Act
is inconsistent with the Constitution (Prayer 2.2).
IS
SECTION 17(4B) OF THE ROAD ACCIDENT FUND INCONSISTENT WITH THE
CONSTITUTION? (PRAYER 2.3):
Section
17(4B) reads as follows:
“
17(4B)(a) The
liability of the Fund or an agent regarding any tariff contemplated
in subsections (4)(a), (5) and (6) shall be based
on the tariffs for
health services provided by public health establishments contemplated
in the National Health Act, 2003 (Act
61 of 2003), and shall be
prescribed after consultation with the Minister of Health.
(b) The
tariff for emergency medical treatment provided by health care
provider contemplated in the
National Health Act, 2-
(i) shall
be negotiated between the Fund and such health care providers; and
(ii) shall
be reasonable taking into account factors such as the costs of such
treatment and the ability of the Fund to pay.
(c) In
the absence of a tariff for emergency medical treatment the tariffs
contemplated in paragraph (a) shall apply.”
The
First Applicant only has one ground of attack against this section,
namely that it unfairly discriminates against indigent road
accident
victims. They say that this section now provides that the RAF’s
liability for future medical treatment, direct claims
by health care
providers and interim payments are based on the tariffs for health
services provided by public health establishments,
and because
section 17(4B)(a)
makes no reference to claims by victims themselves
for past hospital and medical treatment, the Uniform Patient Fee
Schedule (UPFS)
tariff does not apply to such claims. Thus, road
accident victims who cannot provide security for hospital costs are
discriminated
against. The consequences of this discrimination are
particularly harsh, so it was argued. The common practice for private
hospitals
and health care providers was to reject patients who could
not provide security for hospital costs. Thus poor victims who are
unable
to provide security are unable to obtain private medical care
even if the RAF was ultimately liable to compensate them for the cost
of their treatment. This differentiation does not turn on relevant
criteria but rather on the social and financial status of the
victim.
This is clearly unfair, arbitrary and irrational, and infringes
section 9 of the Constitution,
so
it was contended. First Respondent argued that this reasoning behind
this challenge was manifestly flawed in that the relevant
section
does not in any way differentiate between classes of people. It also
does not have a disparate impact. It merely provides
that people are
able to claim compensation based on the amount of money they expended
on past medical expenses. This section is
therefore not
discriminatory, and certainly not unfairly discriminatory in the
context of sections 9 of the Constitution. Second
Respondent in its
heads of argument contended that three brief considerations were the
answer to this attack:
First,
Applicants do not contend that it is constitutionally impermissible
for the RAF Act to provide that compensation for
medical expenses
would take place at the said tariff rather than according to the
actual medical expenses incurred;
While
the relief sought by Applicants in Prayer 2.3 is to have the whole
of section 17(4B) of the Act declared invalid, the
Applicants’
attack is in fact limited only to section 17(4B)(a) of the Act –
that is the tariff for future non-emergency
medical treatment. The
Applicants do not impugne the remainder of this section at all;
In
the course of setting out their attack on section 17(4B)(a) of the
Act, the Applicants return to the issue that they addressed
in
their affidavits, namely the power of the RAF to issue undertakings
in terms of section 17(4)(a) of the Act. Yet, there
has been no
attack on section 17(4)(a) of the Act in these proceedings and
accordingly the section must be presumed to be constitutionally
valid.
143
I
agree with the contention of the Respondents and accordingly refuse
to find that
section 17(4B)
of the
Road Accident Fund Act is
inconsistent with the Constitution and invalid. No human right is
infringed by this section nor is it irrational in the proper
context.
THE
REGULATIONS:
144
Prayers
3 to 10 of the amended notice of motion seek a declaration of
invalidity on various grounds of parts of Regulation 3. I
will deal
with each prayer separately although the argument in respect of these
regulations will overlap to some extent.
REGULATION
3(1)(b):
An
order is sought that I declare this regulation as being not
authorised by the Act and therefore invalid, in that it prescribes
a
method of assessment that was promulgated without consultation with
medical service providers,
alternatively
without proper regard to use and advice expressed by medical service
providers. Regulation 3 deals with assessments of serious
injuries in
terms of section 17(1A)
of
the Amendment. Regulation 3(1)(b) is wide-ranging, but in the context
of prayer 3 the challenge is that the method of assessment
was
promulgated without prior consultation by the Minister with medical
service providers prescribed by section 17(1A) of the Act.
“Medical
Service Providers” is not defined in the Act nor in the
Regulations. On behalf of the Applicants it was argued
that the
record of decision shows that the Minister of Transport impermissibly
purported to act without prior consultation as required
by the Act in
each of two respects: not only did he promulgate the method for
assessing “a serious injury” without
consulting the
Minister of Health, but also failed to consult “health care
providers”. Section 17, as I have said,
does not refer to
“health care providers” but to “medical service
providers”. The Act defines neither but
“health care
provider” refers to the relevant definition in the
National
Health Act No. 61 of 2003
. The Act provides an assessment based on a
prescribed method adopted after consultation with medical service
providers. The method
itself is obviously not contained in the Act
itself, but in Regulation 3. The Minister of Transport, the First
Respondent, may
make regulations provided for in section 26 of the
Act. This includes regulations regarding the method of assessment to
determine
whether, for purposes of section 17, a serious injury has
been incurred, which injuries are, for purposes of
section
17, not regarded as serious injuries, and the resolution of disputes
arising from any matter provided for in the Act. Any
regulation made
under section 26(1)(A)(a) or (b) must be made after consultation with
the Minister of Health.
The
attack on Regulation 3(1)(b) as formulated in prayer 3 is one aimed
at a factual situation, namely whether the First Respondent
failed to
consult with the Minister of Health. The mentioned sections of the
Act require First Respondent to act “after consultation”
with the Minister of Health and medical service providers. The
obvious question is what is the nature of the obligation imposed
on
First Respondent? It has been held that this obligation requires no
more than that the decision must be taken in good faith,
after
consulting and giving serious consideration to the views of the other
functionary.
145
“Consult
with”
also means
“confer
with”
and whether this so happened was again a substantial debate in these
affidavits. It would burden this judgment unacceptively if
I had to
refer to all the correspondence in this context. The allegations on
behalf of the First
Respondent
are set out in First Respondent’s answering affidavit and I
have considered these.
146
In the context of the consultation process which summarizes the
events referred to in First Respondent’s answering affidavit,
it may be practical to refer to the letter of First Respondent to the
then Minister of Health dated 9 June 2008.
”
My
letters of 13 June 2007, 20 July 2007, our meeting on 10 October,
your letter dated 16 October 2007 and my letter of 8 May 2008
refer.
It
is my intention to promulgate the sections of the
Road Accident Fund
Amendment Act dealing
with the liability of the Fund as soon as
reasonably possible due to inter alia the financial situation of the
Road Accident Fund.
The Road Accident Fund has indicated that it is
losing R6 million per day due to delays in implementing the
Road
Accident Fund Amendment Act, 2005
.
Your
concurrence as requested in my letter dated 8 May 2008 would enable
the finalisation of the assessment method, which is the
major
outstanding aspect preventing finalisation of the process of
implementation of the
Road Accident Fund Amendment Act.
I
therefore request your assistance in finalising this process by
communicating your concurrence as a matter of urgency.”
The
Minister of Health replied on 25 June 2008 and stated:
“Your
letter dated 8 May 2008 has reference.
I
concur with the implementation of the AMA Guide VI in the short term
but request the RAD to explore the development of an assessment
tool
within the international classification of function framework which
is an international approved framework.
My
other concern is the disability sector not being involved in the said
meetings.”
The
Minister of Health also made an affidavit
147
and confirmed that the requisite consultations did take place.
Inasmuch as the so-called “narrative tests” was
concerned,
such was not formally put to the Minister of Health as
part of the consultation process, but it was added after
consultations with
medical service providers on 3 April 2008 as an
alternative to the AMA Guides. The Minister said that if that had
been referred
to him he would have concurred with the implementation
of the AMA Guides 6
th
Edition and the narrative tests in the short term.
As
far as consultation with medical service providers is concerned, this
topic was
again
debated at great length in the affidavits. First Respondent also
dealt with this complaint in great detail.
148
He gave details of the relevant invitations to medical service
providers to present their views on the assessment method, wrote
letters to various such providers inviting them to attend a meeting,
and then ultimately held a meeting on 3 April 2008. A record
of this
meeting is available and reflects what was debated thereat. In my
view the consultation process, as emanates from the minute
of the
particular meeting and all surrounding correspondence indicates that
there was at the very least substantial compliance,
if not total
compliance with the procedural requirements demanded by the Act.
149
As
a result the granting of Prayer 3 is not justified by the facts in
this case, and it is accordingly refused.
IS
REGULATION 3 (1)(b) NOT AUTHORISED BY THE ACT AND THEREFORE INVALID,
IN THAT IT PRESCRIBES A METHOD OF ASSESSMENT WHICH IS NOT
REASONABLE
IN ENSURING THAT INJURIES ARE ASSESSED IN RELATION TO THE
CIRCUMSTANCES OF THE THIRD PARTY? (PRAYER 4):
Section
17(1A)(a) of the Act requires an assessment method of a serious
injury to be reasonable in ensuring that injuries are assessed
in
relation to the circumstances of the third party.
At
this stage it may be appropriate to quote the whole of Regulation
3(1)(b) inasmuch as it is also relevant to other prayers herein:
”
3. Assessment
of serious injury in terms of section 17(1A)
(1) (a) A
third party who wishes to claim compensation for non-pecuniary loss
shall submit himself or herself to an assessment by
a medical
practitioner in accordance with these Regulations.
(b) The
medical practitioner shall assess whether the third party’s
injury is serious in accordance with the following method:
The
Minister may publish in the Gazette, after consultation with the
Minister of Health, a list of injuries which are for
purposes of
section 17 of the Act not to be regarded as serious injuries and
no injury shall be assessed as serious if that
injury meets the
description of an injury which appears on the list.
If
the injury resulted on 30 per cent or more Impairment of the Whole
Person as provided in the AMA Guides, the injury shall
be assessed
as serious.
AN
injury which does not result in 30 per cent or more Impairment of
the Whole Person may only be assessed as serious if that
injury:
resulted
in a serious long-term impairment or loss of a body function;
constitutes
permanent serious disfigurement;
resulted
in severe long-term mental or severe long-term behavioural
disturbance or disorder; or
resulted
in loss of a foetus.
The
AMA Guides must be applied by the medical practitioner in
accordance with operational guidelines or amendments, if any,
published by the Minister from time to time by notice in the
Gazette.
Despite
anything to the contrary in the AMA Guides, in assessing the
degree of impairment, no number stipulated in the AMA
Guides is to
be rounded up or
down,
regardless of whether the number presents an initial, an
intermediate, a combined or a final value, unless the rounding is
expressly required or permitted by the guidelines issued by the
Minister.
The
Minister may approve a training course in the application of the
AMA Guides by notice in the Gazette and then the assessment
must
be done by a medical practitioner who has successfully completed
such a course.”
The
topic relating to the “AMA Guides” has been dealt with to
an extraordinary extent, and it is my conscious decision
to confine
this written judgment to the actual crux of the prayer, without
referring each time to the hundreds of arguments, deductions,
inferences and examples that appear in the affidavits and their
annexures.
“
AMA
GUIDES”:
According
to the definition section of the Regulations it means “the
American Medical Association’s Guides to the Evaluation
of
Permanent Impairment, 6
th
Edition, or such edition thereof as a Fund may from time to time give
notice of in the Gazette”. I was handed a copy of these
guides
and they alone comprise some 615 pages. In the founding affidavit
150
the First Applicant makes the following assertion:
“The
method of assessment for ‘serious injury’ which the
Minister has prescribed consists of the test under the
AMA Guides and
the alternative test, also referred to as the narrative test. Both
tests exclude, by definition, the explicit requirement
of section
17(1A) of the Act, i.e. that the method “shall be reasonable in
ensuring that injuries are assessed in relation
to the circumstances
of the third party. The method of assessment which the Minister has
prescribed does therefore not comply with
the Act.”
First Respondent denied this allegation in the answering affidavit
151
He says that neither the AMA 6 nor the narrative exclude
“
by
definition” the circumstances of the individual. They are
required to be considered in terms of both methods, and, even
on its
own, the AMA 6 is reasonable to ensure that the circumstances of the
individual are considered. However, certainly and without
any doubt,
if used collectively with the narrative, which focuses on the
consequences of the injury to the individual concern,
the assessment
method must be regarded as reasonable, to ensure that the individual
circumstances are taken into account. First
Applicant alleges that
those guides purport only to measure “impairment” which
the Guides expressly distinguish from
“disability”.
Impairment determines only the immediate physiological consequences
of an injury, while disability measures
the consequence and abilities
lost as a result of an injury. First Respondent again denies this
allegation, and says that while
there is a distinction between
“impairment’ and “disability”, this
distinction is not relevant for present
purposes in that it does not
follow that the Legislature intended the assessment method to measure
“disability”. It
is essentially the First Applicant’s
case in the present context that an assessment under the Guides
provides a standardized
assessment of how an injury limits or impairs
bodily structure or bodily function of any person with that injury.
No assessment
is made to the extent to which a
specific
victim is disabled by the injury, i.e. how the injury limits the
individual’s ability to perform or participate in
his or her
particular work, home or personal care.
152
First Respondent denies that in the answering affidavit.
153
It is necessary that I refer to the affidavit of Dr M Ranavaya. He is
one of the co-authors of the AMA Guides who made an affidavit
which
was filed on 15 January 2010, and I accepted a further affidavit
dated 3 March 2010.
154
His first affidavit can be identified as to its filing date, and not
to its own date which I accepted for logistical reasons.
155
As mentioned, the deponent is one of the authors of the 6
th
Edition and is also one of the editors of those guides. He is also
been teaching the AMA Guides to doctors around the world for
over two
decades and has trained over 10 000 doctors in the skills of
impairment assessment and the use of the guides, including
doctors
Domingo and LeFévre, both of whom made affidavits on behalf of
the First Applicant. I intend hereafter as briefly
as it is
practically possible to deal with certain of the opinions expounded
by this deponent. He agrees that the AMA Guide is
not a treatise for
diagnosis or therapeutics. It is however an internationally
recognised standard for evaluation of impairment,
which is
defined
as a
“significant
deviation, loss or loss of use of any body structure or function in
an individual with a health condition, disorder,
or disease.
In
other
words,
it reflects the seriousness of the injury and the percentage of the
impairment is the consensus derived estimate of loss
of activity to
reflects severity or seriousness of given health condition or an
injury and the agree of associated limitations
in terms of activities
of daily living.”
156
He says that the Guides are used wherever a fair, standardized and
evidence based comprehensive evaluation is desired to bring
uniformity in the assessment of injuries whether they are in the
context of workers’ compensation or any other personal
injuries, including motor vehicle accidents. They are used in various
North American States, in Australia, in New Zealand and a
number of
North European countries. The use of an objective tool such as the
AMA Guides that removes the speculation on the part
of expert
witnesses serves the common law intention of fairly compensating the
victim without needless litigation. (Reference is
made to Australia
in this context). He mentions that what the victim’s position
would have been “but for” the
wrongdoing, is obviously a
highly speculative one, leading to endless litigation with parades of
experts with their own opinions
about pain and suffering. The use of
the AMA Guides brings objectivity in the assessment of
injured
parties leading to a fair assessment and less disputes and less
litigation. His view in the light of his two decades experience
with
the use of these guides leads him to say with confidence that 90% of
medical practitioners of all nationalities find the AMA
Guides a
valuable objective evidence based tool that allows them to
consistently and uniformly assess personal injuries without
having to
resort to speculation and compelled to base impairment decisions on
the patient’s subjective complaints alone.
There is no evidence
that there are any impairment assessment guidelines in the world that
are as comprehensive and as objective
as the AMA Guides to the
evaluation of permanent impairment. Comprehensive also does not mean
complex. The World Health Organization
classification should not be
used in this context as it is merely a conceptual model and not a
guideline in itself. Contextually,
the AMA Guides is no more complex
than any other clinical assessment school in medicine. It is in fact
a medical textbook like
any other. Training is neither mandatory nor
required, but like any other textbook it requires reading and
understanding in the
methodology. He accepts however that training is
useful and probably essential to properly apply the guides. This can
be self-learning
or formal training by attending a relevant training
seminar. Such training is also not burdensome and any South African
doctor
would be able to do the relevant assessments. That is by way of some
of the relevant background. In the context of prayer
4 he says that
the whole person impairment rating cannot be used to predict an
individual’s ability to work. This is so because
work tasks may
be variable and work accommodation can lead to an individual with the
impairment being able to perform that same
task as before. The guides
are not blind to individual circumstances because when considering
the medical history of the patient,
the doctor has obliged to
ascertain the personal data and educational skills, social and
personal history, and consider other factors
such as cultural
background. More over, the functional history is used as a grade
modifier within the class of impairment and allows
the doctor to
assign an impairment rating to a higher or lower percentage within
the class based on personal circumstances. These
functional history
grade modification factors can include consideration of age and
circumstances such as absence of the mass transport
system and the
fact that an injured person may not have access to running water in
the house. The same goes for hobbies, for example,
the fact that the
individual being assessed was a keen long-distance runner prior to
the injury. On the face of it, the manner
in which the AMA6 allows
circumstances of the victim to be taken into account may it be
limited; however, it actually has a very
reasonable
effect on the outcome. The main advantage of using the AMA Guides is
that it provides an objective assessment of injury
as a starting
point. This objective of the Guides facilitates congruence among the
assessment of the same or similar injuries.
Objective assessment
methodology, such as the AMA Guides, also reduces the transaction
cost to all parties involved. A good reading
of the AMA 6 would make
it clear to the reader that the AMA 6 takes cognisance of the
individual circumstances to a greater extent
in previous additions as
well as provide the degree of validity and reliability to the
greatest extent possible. It does not compromise
objectivity and
consistency, and yet allows the petitioner to consider the personal
circumstances of the victim.
157
He
disagrees with the motion that the impact of impairment on
individuals will be greater in developing countries than in the
so-called
first world countries such as the United States. He
disagrees because it mixes up the issues of impairment and
disability. Human
medicine and the anatomy, physiology and pathology
is the same all over the globe. Therefore, the percent of whole
person impairment
resulting
from injuries would be the same all over the world, but the impact on
the activities of the individual could be different.
For instance,
the same impairment could also have a devastating affect on the
victim in the so-called first world but may have
little or no impact
on a rural citizen in the developing world who walks back and forth
for his needs of activities of daily living
and does not have to keep
up with the complicated cellphone, e-mail and digital living of the
first world. He therefore finds a
debate about “first and third
world” quite ghastly and arbitrary. Certain parts of the United
States, according to
him, are as rural and inaccessible as any
developing country. He also does not agree that the AMA uses a
“snapshot”
approach which does not account for pain
experienced in the past or pain that will be suffered in the future,
because the AMA Guides
state that in all diagnosis-based impairment
categories, the pain and suffering has been accounted for in the
impairment rating.
Subjective symptoms are taken into account as the
subjective symptom is the beginning of the process of diagnosis which
is then
further corroborated by the objective findings. Additionally,
the subjective symptoms also get taken into account through the
functional
history assessment.
The
deponent also disagrees with several issues raised by Dr Le’Fevré.
He says that his comments are inaccurate and
misrepresent the AMA 6
methodology. He gives details of his objections to Dr Le’Fevré’s
approach and especially
in the context of so-called psychiatric
injuries and consequences. In conclusion he points out that the AMA
Guides is not a perfect
document as by the very nature of human
function, which is dynamic, it is impossible to create a perfect
document that would work
in all circumstances. However, at this
point, it remains the best objective in evidence-based methodology to
assess the residual
impairment of the injuries and are used across
the globe from the Northern hemisphere to the Southern, providing
fair and equitable
assessment for injured persons.
In
the March 2010 affidavit, Dr Ranavaya deals with various responses to
his previous affidavit, and states that he was surprised
when he read
some of the highly critical responses to his first affidavit. He
appreciated that the key issue
issue
before me was the extent to which the AMA 6 and the circumstances of
the individual were taken into account when impairment
rating is
determined. He endeavoured in that affidavit to focus on that issue
and to provide context and had to place certain explanations
in
perspective. He now says that a number of completely new and broad
ranging attacks are made on the AMA Guides which have nothing
to do
with the key issue. He mentions these attacks, and says that
Applicants have raised a new matter in that context. He therefore
provided a response, but complained about the unacceptedly short
period of time. The deponent then goes to great length to answer
the
critics’ context of his first affidavit and deal with the new
challenges to the use of the AMA 6. Referring to certain
of the
arguments he suggest that the true complaint is in fact not that
individual circumstances are not taking into account, but
that such
individual circumstances do not make enough of a difference to the
outcome of the assessment.
158
He discusses impact of the grade modifier, the separate rating for
mental and behavioral disorders, the use of AMA Guides in the
United
States, the combination of multiple impairments and concludes that
some of the experts that First Applicant relies on have
not been
involved with the development or even the use of the AMA 6, let alone
being an expert therein.
On
behalf of First Respondent it was argued in any event that even if it
is found that the AMA 6 does not sufficiently take the
circumstances
of the individual into account, then it should be kept in mind that
the assessment method contains a safety net,
in the form of a
narrative test, which focuses on the circumstances of the individual.
The manner in which the narrative test work
in Victoria, Australia
and how it takes account and indeed focuses on the circumstances of
the individual have been fully described
in the affidavit by Dr John
Bolitho.
159
It is contended that this evidence stands uncontested and that I am
entitled to take into account and have regard to the Australian
approach on the meaning of the narrative.
160
Dr
Bolitho explained the relevant process in the State of Victoria,
dealt with the
narrative
tests as being a safety net, demonstrated the differences between the
narrative and impairment thresholds, and showed
how the narrative
tests took an individual circumstance into account, and the
conclusion is that section 3(1)(b) provides for an
assessment process
which is indeed reasonable having regard to the factors that I could
practically mention in this judgment.
In
considering the arguments, I have not lost sight of the fact that the
question whether or not more efficient means could have
been applied
to provide for a reasonable assessment in the present context, or
whether such assessment could be made more efficient,
or even
adapted, could not in law be the basis for a challenge on the grounds
formulated. I therefore agree with the reasoning
employed in State v
Frames (Cape Town) (Pty) Ltd
161
and accordingly I refuse to grant prayer 4.
IS
REGULATION 3(1)(b) NOT AUTHORISED BY THE ACT AND THEREFORE INVALID,
IN THAT IT PRESCRIBES A METHOD OF ASSESSMENT AND A PROCEDURE
FOR
LODGING CLAIMS WHICH UNREASONABLY IMPEDE ROAD ACCIDENT VICTIMS’
ABILITY TO ENFORCE THEIR STATUTORY RIGHT TO COMPENSATION?
(PRAYER 5):
Having
regard to the relevant allegations in First Applicant’s
founding affidavit
162
it is difficult to discern on which basis this prayer is actually
formulated.
163
Five grounds giving rise to an alleged invalidity are given, but none
of them deals with prayer 5, unless one is very imaginative,
but even
then one can at best refer to prayer 9, which may or may not overlap
to some extent with prayer 5. Regulation 3(1)(b)
does also not
contain “a procedure for lodging claims.” It is also not
clear which “statutory right to compensation”
is
contemplated in the context of that prayer. As far as an unreasonable
method is concerned, I have referred to the power of the
Court in the
context of prayer 4, and I apply the same reasoning to
this
vague prayer. Not surprisingly, First Respondent only dealt with the
five grounds referred to in First Applicant’s founding
affidavit, and obviously then did not address what one imagines
prayer 5 could relate to.
164
In the premises prayer 5 is refused.
IS
REGULATION 3(1)(b)(ii) AND (iii) INVALID, IN THAT FIRST RESPONDENT
HAS IMPERMISSIBLY PURPORTED TO DEFINE WHAT CONSTITUTES A “SERIOUS
INJURY” IN TERMS OF THE ACT? (PRAYER 6):
It
is clear that regulation 3(1)(b)(ii) refers to an injury that “shall
be assessed as serious”. Similarly regulation
3(1)(b)(iii)
refers to an injury that may be assessed as “serious”.
The Act does not define “serious injury”.
The proviso to
section 17(1) limits the obligation of the Fund to compensate a third
party for non-pecuniary loss to compensation
“for a serious
injury” as contemplated in subsection (1A). This section in
turn provides that
“assessment
of a serious injury shall be based
on
a prescribed method…”
It is wrong to read any of the regulations in isolation. Regulation
3(1)(b)(i) allows the Minister to publish in the Gazette a
list of
injuries which are for purposes of section 17 of the Act not to be
regarded as serious injuries.
First
Applicant argued that the regulation defines “serious injury”
itself, which it is not authorised to do. It was
submitted that the
Minister was only empowered to prescribe a method which would ensure
that doctors assess injuries by giving
proper consideration to the
victims’ circumstances. Instead, the Minister has purported to
take away substantially the assessment
function from the skilled
practitioner with an a priori definition of “serious injury”
limiting it to the categories
the Minister has chosen to define. The
submission is that the Minister was not authorised to do that. No
reason is given for this
conclusion. No clear submission was made as
to how section 17(1A)(a) was to be applied in practice, and by whom.
A “prescribed
method” could only be a method prescribed
by law
either
in the Act or in a regulation. Section 26 of the Act deals with
regulations, and amongst others allows him to make such regarding
any
matter that shall or may be prescribed in terms of the Act, or which
is necessary or expedient to prescribe in order to achieve
or promote
the object of the Act. Section 26(1A) is more specific and allows the
Minister to make regulations regarding the method
of assessment to
determine whether, for purposes of section 17, a serious injury has
been incurred. It also allows him, for purposes
of section 17 to
regulate what is not to be regarded as serious injuries. It is
difficult to appreciate on which basis section
17(1A)(a) and section
26(1A) are to be interpreted and applied in practice, if there is no
definition or descriptive regulation
of what is regarded as being
“serious injuries”. Within the parameters of those
sections, and of course section 26(1)
of the Act, I hold that
regulations 3(1)(b)(ii) and (iii) are not invalid, and that First
Respondent has not impermissibly purported
to define what constitutes
a “serious injury” in terms of the Act. First Applicant’s
contention was that the
Minister may only identify certain injuries
as being non-serious
per
se
,
but that for all other injuries it was within the province of the
assessing doctor to make the determination using a method prescribed
by the Minister. I do not agree with this submission, and accordingly
prayer 6 is refused.
IS
REGULATION 3(1)(b)(ii) AND (iii) OF THE REGULATIONS INVALID, IN THAT
THEY EXCLUDE ROAD ACCIDENT VICTIMS WHO HAVE SUFFERED SERIOUS
INJURY
FROM THE RIGHT TO CLAIM COMPENSATION FOR NON-PECUNIARY LOSS? (PRAYER
7):
Section
17(1), in the proviso, provides that the obligation of the Fund to
compensate a third party for non-pecuniary loss shall
be limited to
compensation to a serious injury. Section 17(1A)(a) requires an
assessment of a serious injury to take account of
the circumstances
of the third party. There is no direct reference in the Applicant’s
founding affidavit to this relief sought.
165
It was put to me that regulation 3(1)(b)(iii) deals with the
so-called “narrative test” that I have already referred
to herein. The argument seems to be that the requirements for
“serious injury” are rigidly defined in the narrative
test, and, like the AMA Guides, are focussed entirely on functional
loss of impairment, disfigurement and severe mental or behavioral
disorders. These conditions are by definition focussed on the
injury
itself, and not how the injury affects the victim and his or her
personal circumstances, as required by section 17(1A) of
the Act. It
was submitted that by reason of the Minister incorporating both tests
into the method of assessment, the term “impairment”
in
the narrative test will be and should be construed to mean in the
same as in the AMA Guides. This means that only purely functional
impairments will be considered with no reference to the victim’s
circumstances. There are also a number of “serious
injuries”
which do not qualify as “serious” under the narrative
test, and this argument was raised in the context
of a number of
orthopedic and neuro-surgical conditions. Accordingly, it was
submitted that these regulations are not authorised
by the Act and
are invalid. The Act, as I have said, provides that persons who have
suffered serious injury have a right to claim
compensation for
general damages. The Minister has by regulation excluded this right.
This argument is in my view conclusively
refuted by the mentioned
affidavits of Drs Ranavaya and Bolitho. The First Respondent, in its
answering affidavit
166
explained, as do the mentioned affidavits of the experts (with
reference where appropriate to decisions of the Victorian Supreme
Court and Court of Appeal, which decisions I ought to take into
account), that First Applicant’s argument is
misplaced
for the following reasons (which again I need to put in summary
only):
Firstly,
the assessment method consists of three parts (the list of
non-serious injuries, the AMA 6 threshold of 30% WPI and
the
narrative tests). While the three parts form part of one assessment
method, they are intended to complement each other,
and the
validity of the method must be determined with reference to all
three as a collective (and not separately). The Applicants
attack
on the assessment method is premised on the assumption that the AMA
6 and the narrative test should comply separately
and as
stand-alones with the requirements of the Amendment Act.
While
the AMA 6 and the narrative are part of one assessment method, they
present alternative options (or, as it is referred
to in the State
of Victoria, “gateways”) to the victim to access
general damages. The narrative is a “safety
net”.
In
essence this means that as the first step, the medical
practitioners are required to ascertain whether the third party’s
injury appears on the list of
non-serious
injuries. If the injury does not appear on the list, then, as a
second step, the medical practitioner is required to
apply either the
AMA Guides or the narrative tests in order to determine whether the
injury is serious. There is clear authority
as to how the narrative
test is applied in the State of Victoria in Australia.
167
It is contended that First Applicant has ignored how this test is
applied in that State and why, and has further made no effort
to
ascertain why the narrative test was selected to supplement the AMA
Guides. This was done precisely because the focus of the
narrative is
on the consequences of the injury to the individual.
A
lthough
the two tests form part of one assessment method, they present
alternative options to the victims to access general damages.
Narrative tests is a “safety net”, as I have said, which
victims may invoke, if they believe that the 30% WPI threshold
works
unfairly in respect of that particular injury. Viewed in this manner,
there cannot be the slightest doubt or even serious
debate, it is
contended, that the assessment method complies with the requirement
that it is reasonable to ensure that the circumstances
of the
individual are taken into account. Put differently: The list of
non-serious injuries is a screening
mechanism
which should result in the elimination of most injuries which are
obviously not serious. It is an uncomplicated and cheap
method to do
so. The 30% WPI threshold in the AMA 6 (“the impairment of the
whole person”), on the other hand, can
be used by those victims
who obviously suffered a serious injury, and who wish to substantiate
their claim for general damages
with reference to an objective
medical assessment, and one which has the advantage of minimizing the
potential for disputes. The
narrative test then presents an
opportunity for those who believe that the injury may not be assessed
as 30% WPI under the AMA
Guides, but that the injury resulted in
serious consequences to them, so that they should nevertheless
qualify for general damages.
First Respondent therefore contends
that, viewed as a collective, the 3 part test is the best possible
assessment method it could
have chosen.
The
list of non-serious injuries has not yet been published by the First
Respondent but will be published soon for public comment.
It cannot
simply be ignored when the validity of the assessment method is
considered.
With
reference to the affidavits of Dr Ranavaya the following needs to be
pointed out:
The
AMA Guides do not merely assess the agree of damage to a body
structure or body function without regard to the impact this
has on
the overall function of the individual. This can be seen from the
cursory review of chapters 1 and 2 of the AMA Guides.
The whole
person impairment resulting from injury after all ultimately
reflects the loss of personal function, i.e. mobility
and
self-care.
It
is inaccurate to say that the AMA Guides are blind to individual
circumstances because when considering the medical history
of the
patient, the doctor is obliged to ascertain the personal data and
educational skills, personal history, and consider
other factors
such as cultural background;
Functional
history is used as a grade modifier within the class of impairment,
and allows a doctor to assign an impairment rating
to a higher or
lower percentage within the class based on personal circumstances;
While
the manner in which the AMA 6 requires the circumstances of the
victim to be taken into account may appear limited, compared
to,
for example, the narrative test, it has actually a very reasonable
effect on the outcome. It provides an objective assessment
of
injury as a starting point. It takes account of the individual
circumstances to a greater extent than previous editions
and there
is complete clarity, from the affidavit of Dr John Bohlito how the
narrative tests work in Australia, and what guidance
that would
give in the local context.
168
First Respondent also points out that it is not possible to predict
with certainty the outcome of an assessment under the AMA
6 with
reference to hypothetical examples as the Applicants have sought,
to do. The AMA 6 allows for significant adjustment
of the
percentage WPI in various ways with reference to the circumstances
of the
individual.
It is accordingly my view that at best the attack on this regulation
is premature, and at worst no case has been made
out for the relief
sought taking into account, as I do, the opinions of Drs Bohlito and
Ravanaya. This prayer is accordingly not
granted.
IS
REGULATION 3(3) OF THE REGULATIONS NOT AUTHORISED BY THE ACT AND
THEREFORE INVALID, IN THAT IT PRESCRIBES A PROCEDURE FOR LODGING
CLAIMS FOR NON-PECUNIARY LOSS WHICH CONFLICTS WITH SECTIONS 24 AND/OR
17 OF THE ACT AND/OR WHICH UNREASONABLY IMPEDES ROAD ACCIDENT
VICTIMS’ ABILITY TO ENFORCE THEIR STATUTORY RIGHT TO
COMPENSATION? (PRAYER 8):
Regulation
3(3) reads as follows:
“
3(3)(a) A
third party whose injury has been assessed in terms of these
Regulations
shall obtain from the medical practitioner concerned a serious injury
assessment report.
(b) A
claim for compensation for non-pecuniary loss in terms of section 17
of the Act shall be submitted in accordance with the
Act and these
Regulations, provided that:
(i) the
serious injury assessment report may be submitted separately after
the submission of the claim at any time before the expiry
of the
periods for the lodgement of the claim prescribed in the Act and
these Regulations; and
(ii) where
maximal medical improvement, as provided in the AMA Guides, in
respect of the third party’s injury has not yet
been reached
and where the periods for lodgement of the claim prescribed in terms
of the Act and these Regulations will expire
before such improvement
is reached, the third party shall, notwithstanding anything to the
contrary contained in the AMA Guides,
submit himself or herself to an
assessment and
lodge
the claim and the serious injury assessment report prior to the
expiry of the relevant period.
(c) The
Fund or an agent shall only be obliged to compensate a third party
for non-pecuniary loss as provided in the Act if a claim
is supported
by a serious injury assessment report submitted in terms of the Act
and these Regulations and the Fund or an agent
is satisfied that the
injury has been correctly assessed as serious in terms of the method
provided in these Regulations.
(d) If
the Fund or an agent is not satisfied that the injury has been
correctly assessed, the Fund or an agent must:
(i) reject
the serious injury assessment report and furnish the third party with
reasons for the rejection; or
(ii) direct
that the third party submit himself or herself, at the cost of the
Fund or an agent, to a further assessment to ascertain
whether the
injury is serious, in terms of the method set out in
these
Regulations, by a medical practitioner designated by the Fund or an
agent.
(e) The
Fund or an agent must either accept the further assessment or dispute
the further assessment in the manner provided in these
Regulations.
Applicants
challenge seems to be limited to regulation 3(3)(b) and (c).
169
It is submitted that regulations 3(3)(b) and (c) are inconsistent
with sections 23 and 24 of the Act, although the relevant prayer
refers only to section 24 and 17. These regulations allegedly
unreasonably impede victims’ ability to enforce their claims
for general damages. It is said that filing a claim in section 24 is
a crucial step in the claims process, because sections 23(1)
and (3)
of the Act provide that timeous filing of the claim extends the
period of prescription to five years. Thus, if a claim
is lodged in
terms of section 24 within the three year period, prescription is
extended to five years. The Minister has however
allegedly expanded
the
requirements
for “lodgment” beyond what section 24 of the Act
requires, and has effectively introduced an additional
prescription
period for claims for serious injury. This is in violation of section
23. This additional requirement in the case
of claims for general
damages, is not authorised by – and is inconsistent with
sections 23 and 24 of the Act. It seems that
First Applicant’s
case in this context is that the RAF4 form could be lodged at any
time of the claimant’s choosing
- even if this is long after
the period for lodgment of the claim has expired. It is important to
note that the RAF Act provides
a substantially more generous
prescription regime than for example the Prescription Act 68 of 1969.
In respect of all claims other
than hit-and-run claims, sections
17(1), 23 and 24 of the RAF Act, when read together, require that a
claimant lodge his or her
claim with the RAF within 3 years of the
date on which the cause of action arises. Provided that this is done,
the claimant then
has an additional 2 years to issue summons against
the RAF before the claim prescribes. Regulations 3(3)(b) and (c) do
not alter
this, it was submitted. All that they provide is that
amongst the documents that must be lodged before the 3 year cut-off,
is the
serious injury assessment report. The purpose of this is to
ensure that claims can be assessed and finalised reasonably
speedily.
170
Second Respondent submitted that there can be no objection to this.
Regulation
3(3)(b) and (c) do not expand the requirements for lodgment as the
Applicants contend. All they do is to indicate
when
a serious injury report assessment must be lodged. This question is
manifestly a matter that has to be dealt with by the regulations.
If
these regulations did not prescribe any time limit for the lodging or
serious injury assessment reports, claims would drag out,
and the RAF
would be placed in the position where it has received claims, but
could not properly assess and deal with them. These
consequences
would be at odds with the recognition our Courts have given the
importance of reasonable prescription provisions.
171
In the circumstances, it was submitted, regulations 3(3)(b) and (c)
deal with matters that are, in the language of section 26 of
the Act
“necessary or expedient to…. to achieve or promote the
object of this Act”.
I
agree with this contention and accordingly prayer 8 is not granted.
ARE
REGULATIONS 3(4) TO 3(13) OF THE REGULATIONS INCONSISTENT WITH THE
CONSTITUTION AND INVALID ON THE GROUNDS THAT THEY DEPRIVE
VICTIMS OF
ROAD ACCIDENTS OF ACCESS TO COURTS AND THE RIGHT TO A FAIR TRIAL TO
WHICH THEY ARE ENTITLED IN TERMS OF SECTION 34 OF
THE CONSTITUTION?
(PRAYER 9):
In
the context of prayer 9, these regulations essentially deal with an
appeal tribunal which is constituted in terms of regulation
3(8),
consisting of 3 independent medical practitioners with expertise in
the appropriate areas of medicines, appointed by the
Registrar, who
shall designate one of them as the presiding officer. This appeal
tribunal will essentially resolve disputes regarding
whether
particular injuries qualify as “serious”. First Applicant
contends that installing such a tribunal,
prima
facie
infringes section 34 of the Constitution and that there is also no
valid justification for such infringement. Section 34 of the
Constitution, does provide, in the context of resolving a dispute by
the application of law, where appropriate, for another independent
and impartial tribunal or forum
other
than the Court. Regulation 3(13) provides that the findings of the
appeal tribunal “shall be final and binding”.
First
Applicant contended that the installation of this appeal tribunal
purports to oust the Court’s jurisdiction, and that
only a
circumscribed power of review by a Court remains, that the tribunal
would not be independent and impartial, that it lacks
the necessary
expertise, and that there would be no “equality of arms”
which would make any hearing unfair.
In
my view the jurisdiction of the Courts within the ambit of section 34
is not ousted. The finality clauses are usually interpreted
as only
excluding or restricting the possibility of an appeal.
172
The Courts are obviously the general constitutionally appropriate
forum for resolving legal disputes, but the Constitution itself
has
recognised that other fora may be appropriate, as long as they are
independent or impartial. In my view this particular forum
is an
appropriate body having regard to the issues it needs to decide. If
in any given case an unfairness does occur, the particular
affected
party in such instance would be able to
approach
a Court for the appropriate relief. First Respondent contended in its
answering affidavit
173
that the relevant regulation intended to make it clear that the
decision of the appeal tribunal would mark the end of the internal
administrative process, and that no further objections or
representations would be entertained. The Fund would also be bound by
the decision of the appeal tribunal, and at present there is nothing
before me to suggest that such a tribunal would not act lawfully
and
ethically and with integrity. If it did not, its decisions would be
able to be reviewed by a Court of law. The claimant would
also have
the right to object to any appointment made by the Registrar,
(Regulation 3(9)(b)) and no doubt an aggrieved claimant,
under
appropriate circumstances, could raise such objections during the
actual hearing. The fact that the Fund is responsible for
administrative costs and payment of such members is not
per
se
constitutionally objectionable. In the appropriate circumstances it
could obtain assistance in deciding legal issues, (Regulation
3(10))
and, as a whole, I cannot find that regulation 3(4) to 3(13) in the
context of prayer 9 are unconstitutional because they
infringe the
provisions of section 34 of the Constitution. Accordingly prayer 9 is
not granted.
IS
REGULATION 3 OF THE REGULATIONS INVALID IN THAT IT WAS PROMULGATED
WITHOUT PRIOR CONSULTATION WITH THE MINISTER OF HEALTH,
ALTERNATIVELY
WAS IT PROMULGATED WITHOUT DUE REGARD TO USE THE VIEWS AND ADVICE
EXPRESSED BY THE MINISTER OF HEALTH? (PRAYER 10):
The
whole of regulation 3 is impugned, and the argument pertaining
thereto to a great extent overlaps with, that pertaining to prayer
3.
First Applicant contended that the consultation process was
perfunctory, factually flawed and critically incomplete. The
correspondence
that I have referred to in the context of prayer 3 is
dealt with, and the submission was that the whole of the consultation
process
was flawed and its conclusion
fait
accompli.
It is alleged that in fact no genuine exchange of ideas on the merits
of the proposed method of assessment occurred.
I
do not agree that there was no prior consultation. I have referred to
the most
important
correspondence and the meeting of 3 April 2008, and have considered
what occurred thereafter in the context of providing
for the
narrative test as an alternative to AMA 6 which was added in order to
make absolutely sure that the assessment method could
not be
challenged on the basis that it insufficiently catered for the
circumstances of the individual, or that the AMA 6 and the
30% WPI
threshold did not provide for injuries which should be regarded as
serious.
174
It is in my view also not a requirement that there be an exchange of
ideas with the Minister of Health, and I have referred to
the views
of that Minister as well. Accordingly, I find that there is no merit
in prayer 10 and it is accordingly refused.
IS
REGULATION 5(1) NOT AUTHORISED BY THE ACT, AND INVALID ON THE GROUNDS
THAT THE LIABILITY OF THE FUND UNDER SECTION 17(4B)(a)
OF THE ACT AS
SET OUT THEREIN IS IRRATIONAL AND ARBITRARY, AND WAS NOT PRESCRIBED
AFTER CONSULTATION WITH THE MINISTER OF HEALTH,
ALTERNATIVELY
WAS PRESCRIBED WITHOUT
DUE
REGARD TO THE VIEWS AND ADVICE EXPRESSED BY THE MINISTER OF HEALTH?
(PRAYER 11):
This
prayer seems to entail the argument that because section 17(4B)(a) of
the Act is irrational and arbitrary, regulation 5(1)
is therefore not
authorised and invalid. Further, it is contended that there was no
consultation with the Minister of Health.
Section
17(4B)(a) reads as follows:
“The
liability of the Fund or an agent regarding any tariff contemplated
in subsections (4)(a), (5) and (6) shall be based
on the tariffs for
health services provided by public health establishments contemplated
in the National Health Act, 2003 (Act
61 of 2003), and shall be
prescribed after consultation with the Minister of Health.”
The
same argument as pertains to prayer 1 in the context of irrationality
applies and how a Court must deal with it, and I will
not repeat it.
In
the context of this prayer it seems to be contended that the 2008
amendments which limits the RAF’s liability for hospital
and
medical treatment to the UPFS tariff, while removing victims’
common law right to claim compensation from wrongdoers,
is arbitrary,
unjustifiable and will unreasonably impede victims’ right of
access to health care services. Reliance is then
placed on the view
of Dr Edeling and it is submitted that because the UPFS tariff is so
low, it would be unreasonable to expect
that victims would
consistently be able to obtain hospital or medical treatment from the
private sector at that tariff. According
to Dr Edeling, the UPFS
makes no provision for numerous types of treatment which road
accident victims needs outside State hospitals
and clinics. Poor
victims will therefore only be able to receive treatment at State
hospitals and clinics, where treatment is either
not available or of
an unacceptably low standard. If they tried to obtain private care
instead, the UPFS tariffs will either be
too low to pay for it, or do
not make provision for such treatment at all. Reference is then made
in that context to overcrowding
State facilities, the lack of
resources and the overwhelming numbers of HIV/Aids and tuberculosis
sufferers. The alleged result
is
that the overall standard of medical care in State hospitals and
clinics has been dropping dangerously, especially in rural areas.
Many accident victims need not only emergency medical care but
specialized, long-term and rehabilitative care, both in hospital,
and
at home, or in long-term care facilities. This cannot be achieved
especially in rural areas. Quadriplegic and paraplegic victims
suffer
the most and require the most intense treatment. Certain services are
only available from private health care providers,
and, it was
contended, it was unreasonable and inhuman, to consign these
vulnerable victims to the inadequacies of the State health
care
system. Reference was then made to certain comments by the Satchwell
Commission, and the submission then was that for all
of those reasons
section 17(4B)(a) of the Act unreasonably and irrationally deprives
road accident victims of the right of access
to health care, in
breach of their constitutional rights. Oblique reference therefore
seems to be made again to section 27(1)(a)
of the Constitution,
although no breach of section 27 rights is directly relied upon in
these proceedings.
175
In
the context of prayer 11, I have already dealt with the alleged
failure to consult with the Minister of Health when I dealt with
prayer 10, and I will not repeat that herein. As far as the
rationality argument is concerned it is necessary to again refer to
the affidavit by the Minister of Health which I admitted in these
proceedings. An annexure thereto is an affidavit by Dr Lekalakala,
the Director: Hospital Management employed by the Department of
Health since 1999. It is necessary in the overall context to refer
to
certain of his factual contentions. By way of a broad summary his
assertions are the following:
Applicants
do not put their allegations into the proper perspective which is
that the development of public health care must
be seen not only in
the historical context, but also within the applicable legislation;
The
Constitution (and especially section 27) brought about significant
changes to many aspects in our country, including the
public health
sector, which, prior to 1999 had only been available to those who
had the means,
or
those that enjoyed benefits directly from Government. The majority of
the population was excluded, and denied health care services
both
from the public and the private sector. Black people had virtually no
access to health care facilities in the public sector,
let alone the
private sector. If they did have such access, health care services
they received, were not of the same standard as
those afforded to
white people. Many of them lived in abject poverty and exposed to
life threatening diseases, and yet did not
receive the health care
they required from the State. Further, black people were denied
access to education that would enable them
to acquire the necessary
knowledge and skill to provide such services for themselves;
The
Constitution changed all that, and pursuant to section 27(2)
thereof, Parliament enacted the
National Health Act 61 of 2003
,
which came into force on 2 May 2005. The object of this Act was to
regulate national health and to provide uniformity in respect
of
health services across the nation. section 3 of this Act records
the responsibility of the Minister of Health, as well as
those of
Health Departments at national, provincial and local level;
In
this context the provision of health care services in the public
sector must be construed, and any relevant provision must
be made
within the limits of available resources, to everyone in this
country, and not only to a select few or a particular
section of
the population;
The
deponent annexed a document titled “Modernization of Tertiary
Services Plan”.
176
In the context of the new challenges posed to the State by the
relevant legislation that I have mentioned, funding remains
a major
problem, and where they are not enough resources, the State has to
make the unenviable task of having to make choices.
The executive
summary of the mentioned services plan puts it as follows: “The
inadequate financing of the health sector
has placed the provision
of tertiary and quaternary care in the public hospital sector under
enormous pressure. Also adversely
affected are regional hospitals,
which are increasingly becoming financially squeezed between
primary health care and tertiary
and regional hospitals.” The
Department of Health therefore has the responsibility to develop
policies which are in line
with the Constitution not only for
today, but also
for
the medium and long term. It sets out in some detail the guiding
policies for the Department, and states that to meet the
Constitutional
obligations and achieve the quality care goals, the
State has to develop appropriate and quality plans, as well as
monitor and
report on these. Most importantly, the State must have
the resources required to honor these obligations. While good
progress has
been made in developing good policies, programs, quality
health sector plans, resource availability in the public health
sector,
and vast disparities between public and private sectors
remain the key challenges which deccelerate progress towards the
progressive
realization of the right to access to health care
services, as well as attaining the excellent quality care;
South
Africa is undergoing democratic and epidemiological changes. The
population is estimated to have increased from 47,3 million
in 2006
to 48,6 million in 2008. The country is also facing a quadruple
burden of diseases associated with the epidemiological
transition
namely, communicable diseases associated with poverty,
non-communicable diseases associated with lifestyles, trauma,
violence, HIV and Aids. He referred to the various
chapters
of the Health Care Act, and what is required in terms thereof, and
mentioned certain policy implementation structures,
levels of care,
district health services, regional hospital services, tertiary
hospital services, referral patterns, what has been
achieved to date
in the context of new hospitals, improving quality of care, and also
referred to Applicants allegation that the
State medical facilities
are unable, countrywide, to provide comprehensive medical and
rehabilitative care. He says that State
medical service has the
widest cover for all citizens of the country. In fact, access in
rural areas is better than the private
sector can assert to possess.
The private sector has concentrated in the main urban centers.
Unfortunately this is the only scenario
for access to the market for
profit, as compared to the public sector, which has both a
legislative mandate and moral obligation
to provide services for all
the citizens within the means available. The annual report published
by the Department of Health shows
that access to public facilities
has increased and stands at more than 85% of the population within
5km of a health facility. Rehabilitation
services are offered in all
of their hospitals, but there are challenges with regard to
recruitment
and retention of scarce skills such as clinical psychologists,
physio-therapists, occupation therapists, speech therapists
etc.
177
The
Modernization of Tertiary Services Plan and the relevant report of
June 2001
178
and of June 2001
179
do not convince me that section 17(4B)(a) is irrational or arbitrary
within the confines of the power that a Court can exercise
in that
particular context.
As
far as the uniform patient fees schedule is concerned, an affidavit
of Ms U le Roux is annexed.
180
She deals with the affidavit of Dr Edeling in some detail and asserts
that many of his allegations reflect a lack of understanding
of the
UPFS tariff structure, and knowledge how it is in fact applied. She
gives sufficient detail,
of
a highly technical nature with reference to the actual “Uniform
Patient Fee Schedule (revised June 2009)”
181
which essentially indicates that the UPFS in not wholly inadequate
and unsuitable for compensation for the medical treatment of
road
accident victims. It should be borne in mind she says, that most of
the Health Department practitioners are employed by Government
and
receive remuneration. Thus, the intent of charging a professional fee
is by no means seen as a cost recovery nor revenue generator.
Where
private doctors attend to their patients in a public health facility
they have the prerogative of applying a professional
fee suitable to
them, subject that the patient is informed prior to treatment. This
practice ensured that the public health institution
is then only
eligible to bill the facility fee. I have had further regard to the
“User Guide – UPFS 2009” annexed
to the Department
of Health affidavits.
182
It is descriptive of its intent, of the classification of patient
categories, and its basic principles with reference to the various
medical treatment that can be applied for each particular case.
Within
the ambit of my powers referred to in the context of prayer 1
hereinabove, I cannot whole at all, if that is the contention
find
that either section 17(4B)(a) or regulation 5(1) is irrational and
arbitrary. I have already decided in the context of prayer
10 that
there was adequate consultation with the Minister of Health.
Accordingly prayer 11 is not granted.
Prayers
11, 16 and 17 have been deleted in the amended notice of motion.
IS
REGULATION 5(2) OF THE REGULATIONS AUTHORISED BY THE ACT AND IS IT
INVALID ON THE GROUND THAT IT IMPERMISSIBLY DELEGATES TO THE
ROAD
ACCIDENT FUND THE POWER TO DETERMINE THE TARIFF FOR EMERGENCY MEDICAL
TREATMENT APPLICABLE UNDER SECTION
17(4B)(b)
OF THE ACT? (PRAYER 13):
Section
17(4B)(b) reads as follows:
“The
tariff for emergency medical treatment provided by a health care
provider contemplated in the National Heath Act, 2003
–
shall
be negotiated between the Fund and such health care providers; and
shall
be reasonable taking into account factors such as the cost of such
treatment and the ability of the Fund to pay.”
Regulation
5(2) reads as follows:
“The
liability of the Fund or an agent contemplated in section 17(4B)(b)
of the Act shall be determined in accordance with
the tariff
published by the Fund from time to time in the Gazette and such
tariff shall apply only in the case of the immediate,
appropriate and
justifiable medical evaluation, treatment and care required in an
emergency situation in order to preserve the
person’s life or
bodily functions, or both.”
First
Applicant argued that in this context that the Fund acted on a
“misconstrued authority” and that the delegation
was
unlawful. Regulation 5, in terms of which the Minister purported to
empower the Fund to promulgate the tariff for emergency
medical care
is
ultra
vires,
it was argued. In terms of section 26 of the Act only the Minister is
authorised to make regulations under the Act. The Fund is
only
empowered to negotiate the tariff, and its prescription, after
negotiation, is something only the Minister is authorised to
do under
the Act. The Minister’s purported sub-delegation is also
inconsistent with section 238(a) of the Constitution. This
section
provides that an executive organ of State may delegate a power or
function to the extent that the delegation is consistent
with the
legislation in terms of which the power is exercised or the function
is performed. Because sub-delegation is not authorised
by the RAF
Act, the Minister acted unconstitutionally in purporting to delegate
his powers. Hence, any conduct pursuant thereto
by the RAF is
unlawful for being contrary to the principle of legality. Further,
the common law presumption
delegatus
delegare non potest
negates
this delegation and Respondents have not rebutted it, so the argument
proceeded.
The
tariff published by the RAF pursuant to section 17(4B)(b) of the RAF
Act is a tariff drawn from the 2008 National Health Reference
Price
List (“NHPRL”). By notice R.771 published in the
Government Gazette on 21 July 2008 the RAF gave notice in terms
of
regulation 5(2) of the Emergency Medical Tariff which would apply. It
is also contended in the First Applicant’s founding
affidavit
that not only was the delegation impermissible, but also that the RAF
unilaterally adopted this tariff instead of negotiating
it with a
representative group of health care providers who provide emergency
medical services. (This is the subject matter of
prayer 15).
Second
Respondent’s argument in the context of the allegation is that
there is no merit in that contention in that section
17(4B)(b)(i) of
the RAF Act expressly provides that the tariff shall be negotiated
“between the Fund and …health care
providers.” It
does not envisage a role for the Minister and accordingly no
question
of sub delegation arises. It was also contended that even if the
Applicants submissions were correct, the high water mark
of its case
in this regard is that the RAF and health care providers should have
agreed on the tariff, tell the Minister what they
agreed, and the
Minister would then have published the agreed tariff. If that is my
finding, then the most that the Applicants
would be entitled to is an
order directing the Minister to re-publish the tariff already
published by the RAF. It is my view that
section 17(4B)(b) of the Act
and the subsequent regulation 5(2) does not indicate any role for the
Minister therein. By necessary
implication the section envisages that
the tariff for emergency medical treatment be negotiated between the
Fund and such health
care providers as mentioned and I do not agree
that the Minister must promulgate the tariff under section 26 of the
Act. Prayer
13 does not deal with the other complaints of the First
Applicant as set out in the founding affidavit
183
and accordingly I do not intend dealing with those in the context of
this prayer.
Prayer
13 is therefore not granted.
IS
THE EMERGENCY MEDICAL TARIFF INVALID, ON THE GROUND THAT IT WAS NOT
NEGOTIATED BETWEEN THE FUND AND HEALTH CARE PROVIDERS AS
REQUIRED BY
SECTION 17(4B)(b) OF THE ACT? (PRAYER 15):
In
the founding affidavit First Applicant alleges that the Fund
unilaterally adopted the tariff published in the Gazette op 21 July
2008, instead of negotiating it with a representative group of health
care providers who provide emergency medical services.
184
First Applicant then relies on a record of the Funds negotiations
before the tariff was published and refers in that instance to
a
meeting of 3 April 2008. It is alleged that no tariff was in fact
negotiated, and the health care providers who were present
were not
representative of the health care providers envisaged by the Act.
Extracts from the record were then annexed, and this
included the
Fund’s invitation to service providers, a list of persons who
attended the meeting, a visual presentation and
a transcript of the
proceedings at the
meeting.
These annexures were then analyzed in great detail and the submission
is in the context of prayer 15 that instead of negotiating
an
emergency tariff which was acceptable to the emergency health care
providers, the Fund unilaterally adopted the NHRPL tariff.
185
It
is not in dispute herein that “negotiate” means that the
relevant interchange between the involved parties should
proceed
until agreement or deadlock is reached.
186
What occurred on 3 April 2008 must in my view not be seen in
isolation, and it is relevant what had previously occurred. Previous
events in this particular context are set out in Second Respondent’s
answering affidavit
187
The substance of Second Respondent’s contentions are the
following in respect of the meeting of 3 April 2008:
Invitations
were sent out;
Invitations
were published in the mass media;
There
was no limitation as to who could attend;
There
was a specific invitation for submissions to be made in relation to
the emergency care tariff;
Mr
Modise, the Chief Executive Officer of the Fund gave a presentation
which captured the discussion of a meeting held on 21
October 2008
which was convened to commence negotiations on the emergency
medical tariffs. This was also widely advertised
and there was an
extensive question and answer session;
188
Dr
A J Herbst, an expert on medical tariffs, gave a presentation;
Delegates
were allowed to raise all questions they desired, which were
responded to by the Fund’s CEO and Dr Herbst;
No
delegate indicated disagreement with the proposal that the tariff
be equivalent to NHRPL 2008 with no premium, and there
was
ultimately an agreement on this tariff.
On
23 July 2007 the Department of Health published regulation 681
pursuant to the
National Health Act. Regulation
related to obtaining
information and determining and publishing the NHRPL. The outcome of
this process (which happened quite independently
from any Fund
process) was that the NRHPL became a formal and legal instrument.
This regulation and the guidelines published in
terms thereof made
the cost-based nature of the NHRPL clear.
In
respect of the background and the meeting on 3 April 2008 the Second
Respondent submitted that at no stage did any health care
provider at
the meeting indicate that it disagreed with the proposal that the
emergency medical
tariff
be the NHRPL 2008 without the premium and it was pointed out to me
that Applicants have been unable to put up a single affidavit
from a
health care provider who attended the meeting, and who now allegedly
contends that it did not agree with the tariff or that
it was forced
to agree with such tariffs. It is therefore contended that the
meeting of 3 April 2008 produced the agreement required
and this
agreement is also not surprising in the light of the (now) common
cause possession that the NHRPL serves as a reasonable
and fairly
accurate proxy for the average amounts actually paid by private
patients for health care.
189
In regard to the evidence put before me, I am unable to find that the
tariff was not negotiated and accordingly prayer 15 is dismissed.
IS
REGULATION 6(1) OF THE REGULATIONS NOT AUTHORISED BY THE ACT AND
INVALID ON THE GROUND THAT IT IMPERMISSIBLY PURPORTS TO RESTRICT
THE
AMBIT OF SECTION 24(1)(b) OF THE ACT AND IMPERMISSIBLY LIMITS WHERE A
CLAIM FOR COMPENSATION MAY BE
SENT
BY REGISTERED POST OR DELIVERED BY HAND (i.e. LODGED) IN COMPLIANCE
WITH SECTION 24(1)(b)? (PRAYER 18):
Section
24(1)(b) reads as follows:
“
(1) A
claim for compensation and accompanying medical report under section
17(1) shall –
(a) …;
(b) be
sent by registered post or delivered by hand to the Fund at its
principal, branch or regional office, or to the agent who
in terms of
section 8 must handle the claim, at the agent’s registered
office or local branch office, and the Fund or such
agent shall at
the time of delivery by hand acknowledge receipt thereof and the date
of such receipt in writing.”
Regulation
6(1) in turn reads as follows:
“
(1) Any
reference in section 24(1)(b) of the Act to the Fund’s
principal, branch or regional office, or to an agent’s
registered office or local branch office, shall for the purposes of
compliance with that section, referred to such principal, branch
or
regional office of the Fund, or registered office or local branch
office of an agent, as the case may be –
(a) which
is situated nearest to the location where the occurrence from which
the claim arose took place; or
(b) which
is situated nearest to the location where the third party resides.”
Applicants
contend that by denying the ability of victims to file their claims
at any of the RAF’s “principal, branch
or regional
office”, regulation 6(1) unlawfully infringes on their rights.
Victims may have been severally injured and undergone
lengthy
treatment far away from home or from where the accident occurred.
Such
offices
may be remote. Accordingly, the provision is patently unreasonable,
arbitrary and also discriminatory in effect inasmuch
as it bears down
hardest on the poorest overwhelming the rural people. In its
answering affidavit
190
the Second Respondent states that the intention behind Regulation
6(1) was to avoid the suggestion, the claimant could only lodge
his
or her claim at the principal, branch or regional office closest to
where the accident occurred. The regulation was accordingly
intended
to expand the claimant’s option by ensuring that the claimant
could lodge at the office closest to where the accident
occurred or
the office closest to where or she lives. The Fund has opened branch
offices at various offices in the country, for
instance, and this was
an RAF initiative to facilitate the submissions of claims in
instances where accident victims wished to
lodge their claims
directly with the RAF.
I
agree that a regulation may not limit the ambit of a statute.
Regulation 6(1) was clearly introduced for the benefit of the third
party but cannot detract from section 24(b) and therefore must be
read to mean that judgment of claim can take place at the Fund’s
principal, branch or regional office or at the agent’s
registered office
or
local branch office as well as those offices referred to in
regulation 6(1). Misinterpretation would give effect to the Act on
the one hand and would clearly expand on it to the benefit of the
third party if the third party so chooses. Obviously regulation
6(1)
cannot exclude the peremptory provisions of sections 24(1)(b). It
can, and must, in my view, be interpreted on the basis that
the words
“in addition” between the word “section” and
“refer” in the introductory part to
regulation 6(1).
Failing such, the regulation would in my view be invalid in that it
impermissibly restricted the ambit of section
24(1)(b) of the Act.
IS
REGULATION 6(1) OF THE REGULATIONS INVALID IN THAT IT PRESCRIBES A
METHOD OF ASSESSMENT AND A PROCEDURE FOR LODGING CLAIMS WHICH
UNREASONABLY IMPEDES ROAD ACCIDENT VICTIMS’ ABILITY TO ENFORCE
THEIR STATUTORY RIGHT TO COMPENSATION? (PRAYER 19):
This
regulation does not refer to any “method of assessment”.
The procedure for
lodging
claims is also not unreasonable (that was intended to be a separate
attack on regulation 6(1) in that it sensibly intends
to expand the
claimant’s options that section 21(1)(b) offer. Very little, if
any at all argument, be it written or oral,
was addressed to me in
the context of this particular prayer and in my view there is in any
event no merit in it. Prayer 19 is
accordingly not granted.
IS
REGULATION 6(2) INVALID IN THAT IT AFFORDS THE FUND THE RIGHT TO
INTERROGATE A THIRD PARTY AND/OR DEPRIVE VICTIMS OF ROAD ACCIDENTS
THE RIGHT TO BE EQUAL BEFORE THE LAW AND TO A FAIR TRIAL TO WHICH
THEY ARE ENTITLED IN TERMS OF SECTIONS 9 AND 34 OF THE CONSTITUTION?
(PRAYER 20):
Regulation
6(2) reads as follows:
“
(2)(a) The
Fund or an agent shall at any time after having received a claim for
compensation referred to in section 17(1) of the
Act, be entitled to
require
the
third party concerned to submit to questioning by the Fund or an
agent at a place indicated by the Fund or an agent or to make
a
further sworn statement regarding the circumstances of the occurrence
concerned or any aspect of it.
(b) In
the event of the Fund or an agent requiring the third party to submit
to questioning or to make a sworn statement, or both,
in terms of
paragraph (a), no claim shall be enforceable by legal proceedings
commenced by summons served on the Fund or an agent
before the third
party has submitted himself or herself to questioning or has made the
sworn statement, or both.”
It
was submitted that this requirement is not contained in, or
authorised by the Act. It leaves victims vulnerable to abuse and
violates their rights to equal protection of, an excess to justice
and a fair trial in terms of sections 9 and 34 of the Constitution.
The regulation also exceeds the Minister’s powers to make
regulations.
Regulation 6(2) contains much broader terminology than sections
19(f)(i) and (ii) of the Act. It is contended, that
these powers are
neither necessary nor expedient in order to achieve or promote the
objects of the Act. The practical effect of
the interrogation is that
one of the parties to an actual or potential dispute – the RAF
– may interrogate its opponent,
without the opponent being
legally represented. This creates the potential for abuse. The
procedure is fundamentally unfair and
so unreasonable that it falls
foul of the empowering provisions of the Act when construed congruent
with the Constitution. These
powers also unreasonably subvert
victims’ right to a fair public hearing under section 34 of the
Constitution.
In
answer
191
First Respondent contended that the mechanism of regulation 6(2) is
not in principle any different from that in the Act and the
regulations, which require a third party to provide a range of
relevant information as condition for making and enforcing a claim.
Section 19(e) and (f) already includes wide ranging
requirements
that the third party has to comply with before the Fund is obliged to
compensate that person. This includes a medical
examination, the
furnishing of copies of all medical reports, the inspection of all
relevant records, the making of an affidavit,
the submission of all
statements and documents. First Respondent in this context says that
Regulation 6(2) “merely goes a
step further by recognizing that
the information ordinarily required and supplied may sometimes not be
enough to enable the Fund
to judge and decide whether and if so, to
what extend, it should accept liability for the third party’s
claim. The regulation
is not constitutionally objectionable, it does
not engage the rights to dignity and privacy and nor is there any
right to “equal
access to the Courts”. In the context of
whether this regulation features the right to equality in section
9(1) of the Constitution
or the right to a fair public hearing in
terms of section 34 of the Constitution the First Respondent
contended as follows:
192
The
need for the mechanism created by regulation 6(2) in the case of
hit-and-run claims is obvious. The Fund normally has no
knowledge
of nor any witness to the accident and is entirely dependent on the
third party for information about it. It needs
a mechanism to
enable it to find out more about the accident so as to decide
whether to pay the claim or to oppose it;
The
Fund is often in the same position, even if when the driver or
owner of the offending vehicle has been identified;
In
any given context the Fund is an unusual litigant in that it never
has personal knowledge of the circumstances giving rise
to the
claims against it, and often has no other evidence, or in any event
no other satisfactory evidence of those circumstances.
It is more
over a public Fund and is obliged to manage its resources in the
public interest, and not in its own interest. It
is accordingly
reasonable, so it was submitted, that in these circumstances and in
the public interest the mechanism is given
to the Fund by way of
regulation 6(2) to assist it in its determination to decide whether
to pay or oppose the claims against
it;
It
referred to the analogy in the case of trustees of insolvent
estates and the liquidators of companies in winding-up, who
will
also have the powers of interrogation to determine
inter
alia
whether to pursue or resist claims
subject
to litigation. Those powers are also given to them because they are
also required to meet or resist claims arising from
circumstances of
which they have no personal knowledge, and often no other evidence;
The
very purpose of the power to question is to enable the Fund to
litigate on equal terms with the third party. Any abuse of
that
power can be controlled by the Courts.
193
Should
a third party’s rights be infringed, whether in the context of
prayer 20 or any other prayer that deals with procedure,
the Courts
will have the power to deal with any such injustice or irregularity
at the appropriate time. The regulation also does
also not prohibit
the third party from being represented if questioned, and its overall
purpose seems to be not to defeat any claim,
but to enable the Fund
to litigate on equal terms with the third party should such
litigation become necessary. Regulation 6(2)
does also not deal with
and does not preclude a
summons
from being issued or served, but merely renders the third party’s
claim unenforceable in a Court of law until he or
she has complied
with the request of the Fund. It cannot at this stage be assumed that
the Fund will exercise any of its given
powers in bad faith or
unreasonably. The powers of the Fund are constrained by law and
subject to judicial control.
I
therefore decline to grant prayer 20.
IS
REGULATION 6(2) OF THE REGULATIONS INCONSISTENT WITH THE CONSTITUTION
AND INVALID ON THE GROUNDS THAT IT IS ARBITRARY AND IRRATIONAL
AND
UNREASONABLY IMPEDES ROAD ACCIDENT VICTIMS’ ABILITY TO ENFORCE
THEIR STATUTORY RIGHT TO COMPENSATION? (PRAYER 21):
What
I have said about irrationality in the context of prayer 1 and
reasonableness in the context of prayer 20, applies here as
well. No
other discernable argument in the context of prayer 21 was placed
before me, but besides that I am of the
considered
view that the regulation is neither arbitrary nor irrational, or
otherwise impedes the third party’s ability to
enforce his or
her right to compensation.
It
is accordingly not granted.
IS
FORM RAF1 DESCRIBED IN REGULATION 7 INVALID IN THAT IT:
Is
not authorised by the Act; or
Is
arbitrary and irrational, or
Is
incapable of implementation; or
Unreasonably
impedes a victim’s ability to enforce his or her statutory
right to compensation; or
Does
not achieve or promote the object of the Act? (Prayer 22).
According
to Regulation 7(1), a claim for compensation and accompanying medical
report referred to in section 24(1)(a) of the Act,
shall be in the
Form RAF1 attached as Annexure “A” to the regulations, or
such amendment or substitution thereof as
the Fund may from time to
time give notice of in the Gazette. Section 24(1)(a) of the Act
requires that a claim for compensation
and accompanying medical
report under section 17(1) shall be set out in the prescribed form,
which shall be completed in all its
particulars.
RAF1
– the third party claim form is a 12 page form annexed to the
regulations. It requires, amongst others, the personal
details of the
claimant, the accident details, workman compensation details, witness
details, employer details, employment details,
details of claims for
loss of support and compensation claimed. A separate paragraph draws
the person’s attention to details
which are substantially
required for compliance with section 24 of the Act. A 3 - page
medical
report is part thereof in compliance with section 24(2)(a) of the
Act. There is a provision for details of the third party’s
bank
account that in the light of the previous judgment of this Court this
does not have to be completed and the claim cannot be
rejected on the
basis of non-completion or any other non-compliance in that context.
194
Second
Respondent contended, in the context of the irrationality argument
that I have already dealt with, that this is a very difficult
threshold to overcome. The Applicants obviously have a number of
complaints and views that differ from those of the Minister as
to
what the content of the RAF1 (and RAF4 for that matter) should be.
However, this does not justify conclusion that the forms
(or any part
of them) are irrational or indeed otherwise unlawful. Form RAF1 also
correctly reflects section 24(2)(a) of the Act,
which has not been
challenged in these proceedings. There is also nothing to prevent the
claimant submitting a letter or report
from a medical practitioner,
if this is required, together with the
RAF
form, dealing with additional information desired in the context of
the recordal of the actual injuries sustained.
In
my view there is no basis for finding that RAF1 has not been
authorised by the Act or that it is arbitrary or irrational or that
it is indeed incapable of implementation. It also does not
unreasonably impede the third party’s ability to enforce his or
her statutory right to compensation. I also cannot hold that it does
not achieve or promote the object of the Act and accordingly
there is
no basis for granting prayer 22.
IS
FORM RAF4 INVALID FOR THE SAME REASONS RAISED IN RESPECT OF FORM
RAF1? (PRAYER 23):
Form
RAF4 is the “serious injury assessment report” which is
also referred to in Regulation 3(3)(b)(i) of the regulations
consist
of 7 pages, also annexed to the
Regulations.
It contains an explanatory paragraph as to what is required, details
of the patient, details of the medical practitioner,
a list of
non-serious injuries, AMA impairment rating, in the case of a serious
injury, the narrative test details and annexures
relating to an upper
and lower extremity impairment evaluation, and a spine and pelvis
impairment evaluation.
In
the Applicants written heads of argument it was initially contended
that this form is “equally obstructive, if not vindictive”.
A gentle questioning by myself resulted in withdrawal of the
allegation that the form was vindictive or that it was an example
of
bad faith for some or other reason. It was however submitted that
some of the detail could not be provided by a medical practitioner,
some information was irrelevant to the AMA impairment rating, some
information was “unnecessary and all in all the form reflected
quite an utter irrationality” and it also constituted “an
unwarranted attempt to extract multiple potentially conflicting
versions on behalf of a claimant. This constituted an unlawful and
unfair weapon in the RAF’s already formidable armory against
victims.
In
respect of both forms the further submission was then made that their
inherent flaws and anomalies render their prescription
arbitrary,
irrational, unfair, incapable of implementation and
ultra
vires.
In
this context Second Respondent submitted Applicants complaints were
unfounded and flawed. The reason for requesting a medical
practitioner to set out the nature of the accident was to deter and
detect fraud. The RAF experiences claims from claimants who
were
either injured in accidents which have nothing to do with a motor
vehicle, or claims for injuries which are not consistent
with the
type of motor vehicle accident in which they were allegedly involved.
Including this issue on the RAF4 form, was therefor
a lawful and
rational decision.
195
Also, issues such as the “social and personal history”
and “educational and occupational history” are not
irrelevant to the AMA assessment. Including these on the RAF form was
therefore also lawful and rational. The fact that a “better”
or
“
different”
form could have been produced by the Applicants, by a medical
practitioner or by myself for that matter, is of
no consequence. Any
such defects do not make the form arbitrary or irrational, or
incapable of implementation. It is clearly authorised
by the Act and
it does not unreasonably impede a victim’s ability to enforce
his right. There is also no reason why it cannot
be amended at some
later stage by providing additional information and I certainly
cannot find that it does not achieve or promote
the object of the
Act. Accordingly I declined to grant prayer 23.
In
the result the application as a whole falls to be dismissed save
insofar as in the context of prayer 18, regulation 6(1) must
be read
as meaning in addition to what is required by section 24(1)(b) of the
Act.
COSTS:
Although
every possible imaginable complaint against the Second Respondent,
APPEARANCES:
For
the First, Second and Fourth Applicants:
ADV.
J.J. GAUNTLETT SC
ADV.
N. MAYOSI
Instructed
by Bowman Gilfillan Attorneys
For
the Third Applicant:
ADV.
I.J. TRENGROVE
ADV.
F.B. PELSER
Instructed
by Bowman Gilfillan Attorneys
Johannesburg
For
the Eleventh Applicant:
Attorney
K.M.
R
ÖNTGEN
Instructed
by R
ö
ntgen
and R
ö
ntgen
Inc.
Pretoria
For
the First Respondent:
ADV.
M.R. MADLANGA SC
ADV.
H.J. DE WAAL
ADV.
K. PILLAY
Instructed
by the State Attorney
Johannesburg
For
the Second Respondent:
ADV.
S. BUDLENDER
ADV.
B. MAKALA
ADV.
N. MJI
Instructed
by Bell Dewar Attorneys
Johannesburg
For
the First Intervenor (Minister of Finance):
ADV.
M.S. BRASSEY SC
ADV.
G.I. HULLEY
Instructed
by the State Attorney
Johannesburg
For
the Second Intervenor (Minister of Health):
ADV.
P.M. MTSHAULANA SC
ADV,
P.G. SELEKA
Instructed
by the State Attorney
Pretoria
No
appearance for the Fifth to Tenth Applicants
1
Shilubana & Others v Nwamitwa 2007(5) SA
620CC
2
Vol 9 p
3065 to 3100 of the record
3
Act 1 of 1999
4
See vol 9 p3094
5
Vol 10 p
3112 to 3127
6
See Civil Procedure in the Superior Courts, LTC
Harms, Lexis Nexis at B-111 and the authorities referred to therein
7
See City of Tshwane v Cable City (232/08)
[2009]
ZASCA 87
, the as yet unreported judgment of the Supreme Court of
Appeal dated 10 September 2009. The Constitutional Court refused an
application
for leave to appeal on 3 December 2009 under Case Nr.
ZACC34
8
The text reflects (marked in bold) clarifications
of relief sought; deletions are also marked
9
First to Fourth Applicants’ Heads of
Argument, paras 65 – 118, p30 - 53
10
First to Fourth Applicants’ Heads of
Argument, para 54, p25
11
First to Fourth Applicants’ Heads of
Argument, paras 239 – 250, p99 - 104
12
First to Fourth Applicants’ Heads of
Argument, paras 159 – 197, p71 - 86
13
First to Fourth Applicants Heads of Argument,
paras 295 – 312, p121 - 128
14
First to Fourth Applicants Heads of Argument,
paras 265 – 283, p110 - 117
15
First to Fourth Applicants Heads of Argument,
paras 265 – 283, p110 - 117
16
First to Fourth Applicants Heads of Argument,
paras 257 – 264, p107 - 110
17
First to Fourth Applicants Heads of Argument,
paras 263, p109, paras 265 – 283, p110 - 117
18
First to Fourth Applicants Heads of Argument,
paras 198 – 214, p86 - 91
19
First to Fourth Applicants Heads of Argument,
paras 2119– 158, p53 - 71
20
First to Fourth Applicants Heads of Argument,
paras 313 – 321, p128 - 133
21
First to Fourth Applicants Heads of Argument,
paras 313 – 321, p128 - 133
22
First to Fourth Applicants Heads of Argument,
paras 331 – 337, p137 - 139
23
First to Fourth Applicants Heads of Argument,
paras 322 – 337, p133 - 139
24
First to Fourth Applicants Heads of Argument,
paras 322 – 330, p133 - 137
25
First to Fourth Applicants Heads of Argument,
paras 215 – 221, p91 - 93
26
First to Fourth Applicants Heads of Argument,
paras 215 – 221, p91 - 93
27
First to Fourth Applicants Heads of Argument,
paras 222 – 230, p93 - 96
28
First to Fourth Applicants Heads of Argument,
paras 222 – 230, p93 - 96
29
First to Fourth Applicants Heads of Argument,
paras 231 – 238, p96 - 99
30
First to Fourth Applicants Heads of Argument,
paras 231 – 238, p96 - 99
31
First to Fourth Applicants Heads of Argument,
para 60, p28
32
See record, vol 1, p26
33
Vol 5, p1566
34
See Vol 5, p1568, par 116, footnote 326
35
Act 108 of 1996
36
Ferreira v Levin N.O. & Others 1996(1) BCLR 1
Paragraph 165
37
See also National Coalition for Gay and Lesbian
Quality & Others v Minister of Home Affairs & Others 2000(1)
BCLR 39 (CC)
38
See Chief Direko Lesapo v North West Agricultural
Bank & Others 2000(1) SA 409 CC and Ferreira v Levin
supra
Paragraph 26
39
For First Applicant’s contentions see Vol
1, p35
40
See Kruger v Coetzee 1996(2) SA 428(AD);
Minister
of Safety and Security v Van Duivenboden 2002(6) SA 431 (SCA)
41
See Cape Metropolitan Council v Graham 2001(1) SA
1197 (SCA)
42
See record, Vol 5, p1516 – 1517, par 36.4
43
See record Vol 9, p3089, par 42
44
See record Vol 9, p3093, par 51
45
See record, Vol 9, p3097, par 60
46
First to Fourth Applicants heads of argument,
p30, par 64
47
See Section 36(1) of the Constitution and on the
highest authority;
See
State v Makwanyane 1995(3) SA 3191 (CC) at par 102
48
See Vol 5, p1486 to 1844. This affidavit
comprises some ten affidavits in total and is dated 15 January 2010
49
See Government Gazette 32655 of 30 October 2009.
From 31 January 2010 the new amount would be R176 535,00.
50
See the Department of Transport’s draft
policy paper on the restructuring of the Road Accident Fund, Vol 8,
p2567 (“DoT
20”)
51
The
Report of the Road Accident Commission Fund
is not annexed to the papers before me. See Vol 5, p1513, footnote
64. Various findings
and recommendations of the Commission are
however referred to in the Respondent’s answering affidavits
52
See Tsotetsi v Mutual & Federal Insurance
Company Ltd 1997(1) SA 585 (CC) in which the Court dealt with the
income and expenses
of the Fund in the years 1993 to 1995 regarding
the cash flow aspect. The lack of cash is merely the symptom of the
real problem,
which is that the Fund had not been “fully
funded” for decades, in that its projected income, including
income from
investment, never matched its projected expenditure.
There is in fact no direct relationship between its income (the fuel
levy)
and its liabilities.
53
Vol
5, p1500, par 16
54
See Vol 5, p1501, footnote 9
55
See Government Gazette Nr. 32940 of 12 February
2010 which invites the parties to submit within 60 days of this date
representations
or comments of the “Draft Policy on the
restructuring of the Road Accident Fund as compulsory social
insurance in relation
to the Comprehensive Social Security System”
56
Vol 5, p1580, par 140
57
See DoT 4, Appendix H at p50
58
See Vol 3, p0852
59
See South African National Defence Force Union v
Minister of Defence 1999(4) SA 469 CC at 480, par 18
60
See par 52, 53 and 75 of the First Applicant’s
founding affidavit, vol I, p37 and 46
61
See par 76 to78 of the founding affidavit, vol I,
p47
62
See Third Applicant’s founding affidavit,
vol I, p163, par 20, 21 and 23
63
See Fourth Applicant’s founding affidavit,
vol I, p176
64
See First Applicant’s supplementary
founding affidavit, vol 3, p870, par 60
65
Some 146 pages
66
First Applicant’s heads of argument, p45,
par 94
67
See First Applicant’s heads of argument,
p94, p223. Prayer 20 of the notice of motion deals with Regulation
6(2)
68
See First Respondent’s heads of argument,
p35, Section F, parr 70 and 71
69
See MEC for Education, KwaZulu-Natal & Others
v Pillay 2008(1) SA 474 CC and Mazibuko & Others v City of
Johannesburg
& Others 2010(3) PCLR 239 CC
70
See South African National Defence Force Union v
Minister of Defence 2007(5) SA 400 CC at 419 with reference to
Minister of Health
& Another v New Clicks South Africa (Pty) Ltd
2006(2) SA 311 CC
71
See Vol I, p37, par 53 and p46, par 75
72
See First Respondent’s answering affidavit,
vol 3 p1580, par 141.1
73
Matatiele Municipality & Others v President
of the RSA & Others (No. 2) 2006(5) SA 47 CC at par 67
74
See Second Respondent’s answering
affidavit, vol 9, p3041, par 291 to 292
75
See Director of Hospital Services v Mistry
1979(1) SA 626 (AD) at 635F - H
76
See First Applicant’s founding affidavit,
vol 1, p46, par 76
77
See Minister of Health v Treatment Action
Campaign (2) 2002(5) SA 721 CC
78
“Everyone has a right to have any dispute
that can be resolved by the application of law decided in a fair
public hearing
before a Court or, where appropriate, another
independent and impartial tribunal or forum”
79
Act 130 of 1993
80
Act 66 of 1995
81
Act 75 of 1997
82
See Jooste v Score Supermarket Trading (Pty) Ltd
1992(2) SA 1 CC at par 20 to 22
83
See Plascon-Evans Paints v Van Riebeeck Paints
1984(3) SA 623 AD at 634
84
See SA Association of Personal Injury Lawyers v
Heath & Others 2001(1) SA 883 CC at 898 and the cases referred
to in footnotes
46 to 48 thereat
85
See Affordable Medicines Trust v Minister of
Health 2006(3) SA 247 (cc)
86
See Affordable Medicines Trust v Minister of
Health
supra
at p278
87
See New National Party of South Africa v
Government of the Republic of South Africa and Others 1999(3) SA 191
CC
88
The Pharmaceutical Manufacturers of South Africa: In re ex-parte
President of the RSA 2000(2) SA 674 CC at 708 to 709
89
See at 278, paragraph 74 to 75
90
S v Lawrence; S v Neval; S v Selberg 1997(4) SA
1176 CC
91
See Affordable Medicine’s Trust v Minister
of Health
supra
,
at paragraph 86
92
See founding affidavit, p37, par 53
93
See founding affidavit, p47, par 77
94
See Second Applicant’s founding affidavit
at p109, par 24.1
95
P32 from par 68
96
Supra,
footnote
82
97
See First Applicant’s heads of argument,
p38, footnote 102 and Brand,
2008, TSAR 89
at 97 – “Financial
Constitutional Law – a new concept.
Reference was also
made to Executive Council, Western Cape Legislature v President of
the Republic of South Africa, 1995(4) SA
877 CC at par 100
98
See Vol 5 at p1577, par 134 and further
99
See First Respondent’s answering affidavit,
vol 5, p1578, par 136, footnote 342 and Annexure “DoT25”
at p58
100
See First Respondent’s answering affidavit,
vol 5, p1507, par 31 and further.
101
See Annexure “DoD4”, vol 6, p1977
(Government Gazette 18658 of 4 February 1998)
102
See First Respondent’s answering affidavit,
vol 5 at p1580, at paragraph 140 and footnote 344
103
See the Satchwell Commission report and its
opinion quoted in First Respondent’s answering affidavit, vol
5, p1642 - 1643,
par 326 and 327
104
See First Respondent’s answering affidavit,
vol 5, p1648, par 350
105
See Jooste, p12, footnote 31
106
Vol 3, p1260,
See footnote 97
supra
107
BVerfG, 1BvL 1/09 of 9 February 2010
108
See Generally Vol 5, p1579, 1526, 1588, 1540, and
1530 respectively.
109
See the affidavit of S Swanepoel, Vol 5, p1711 as
example in this context
110
See Minister of Health & Others v Treatment
Action Campaign supra, at par 37
111
Poverty Alleviation Network & Others v
President of the RSA & Others
[2010] ZA CC5
, judgment delivered
on 24 February 2010, at par 71.
112
Bel Porto School of Governing Body & Others v
Premier Western Cape, and Another 2002(3) SA 265 CC, at parr 45 to
46
113
See Rustenburg Platinum Mines Ltd (Rustenburg
Section) v CCMA 2007(1) SA 576 (SCA)
114
See Merafong Demarcation Forum & Others v
President of the Republic of South Africa & Others 2008(5) SA
171 (CC) at par
73
115
See Poverty Alleviation Network
supra
at par 73
116
See Pharmaceutical Manufacturers’
Association
supra
at par 86
117
See Affordable Medicines Trust
supra
at parr 74 and 83
118
See Patel v Witbank Town Council
1931 TPD 384
119
Reference is made in this context to volume 9,
p3094 at par 52
120
In this context reference is made to vol 1, p40,
par 60 and vol 11, p3556 to 3557, parr 29 – 31
121
In this context the reliance is placed on vol 5,
p1726 to 1727, parr 43 to 44
122
See vol 5, p1586, par 153
123
See vol 11, p3473, par 27
124
In this context reliance is placed on vol 1, p42,
parr 63 to 64
125
See vol 11, p3474, par 31; vol 11, p3552, parr 21
to 22
126
See vol 9, p2920 and further
127
See vol 9, p2928 at par and further
128
See vol 9, p2931, footnote 4
129
See vol 9, p2933 and the Commission Report 2002,
vol 1, chapter 14, par 14.106, p371
130
See vol 9, p2934, par 24.3
131
See vol 9, p2936, par 28
132
See vol 9, p2938, par 31
133
See vol 9, p2943, par 40
134
See vol 9, p2949
135
For all of these respects see the RAF’s 209
Annual Report, p6 to 11 and 32 to 35. See also vol 9, p3045, a
summary of the
5-year review between 2005 and 2009
136
See vol 9, p2952, par 60 and footnote 21
137
See vol 9, p3081
138
Vol 5, p1757
139
See vol 5, p1529, par 49.1
140
See New National Party of South Africa
supra
at par 24
141
See vol 6, p1729, par 53 and vol 5, p1585, par
152
142
See Section 17(4A)(a) of the Amendment Act
143
S v Dzukuda & Others 2000(4) SA 1078 (CC) at
80 par 5; Ingledew v Financial Services Board in re: Financial
Services Board
v Van der Merwe & Another 2003(4) SA 584 (CC) at
par 20, and Giddey N.O. v JC Barnard & Partners 2007(5) SA 525
CC (at
par 18)
144
See Government Gazette R770 of 21 July 2008
145
Unlawful Occupiers, School Site v City of
Johannesburg 2005(4) SA 199 SCA at par 13
146
See vol 5, p1558, par 95 and further. The
relevant correspondence is contained in a file of extracts of the
record of First Respondent
and in its answering affidavit is
referred to as MRi, especially p1292 to 1293
147
See vol 10, p3111
148
See vol 5, p1554, par 91 and further and MRi at
1131 and further
149
See Minister of Health & Another v New Clicks
South Africa (Pty) Ltd & Others 2006(2) SA 311 CC at par 484
150
See vol 1, p55, parr 93 and further
151
See vol 5, p1599, par 180
152
See founding affidavit, vol 1, p57, par 97
153
See answering affidavit, vol 5, p1607, par 184
154
See additional volume, p4314
155
See answering affidavit, vol 5, p1783 to p1806
156
See vol 5, p1785, par 6
157
See vol 5, p1798, par 37
158
See additional file, p4323 par 24
159
See vol 5, p1811
160
See Minister of Health v New Clicks
supra
,
at par 537, w
here the Constitutional accepted certain
reasoning articulated by the Australian cases which were applicable
in our context
161
1995(8) BCLR 981C at 991H
162
See vol 1, p20
163
See vol 1, p48, paragraph 80
164
See First Respondent’s answering affidavit,
vol 5, p1591, par 171
165
See vol 1, p48, par 80 to this prayer
166
See vol 5, p1594 to 1609, parr 176 to 212
167
See Humphries v Poljak [1992] 2 VR129 by way of
example
168
See the reasoning of Ngcobo J (as he then was) in
Minister of Health N.O. v New Clicks SA (Pty) Ltd
supra,
footnote 70 at 537
169
See vol 1, p74, par 138 to 140, and heads of
argument, par 198
170
See vol 9, p3032, par 262
171
See Mohlomi v Minister of Defence 1997(1) SA 124
(CC) at par 11
172
See De Ville Judicial Review of Administrative
Action in South Africa, 2003 at p460
173
Vol 5 at p1621, par 246
174
See vol 5, p1667, par 407 and further
175
See First Applicant’s founding affidavit,
vol 1, p90, par 177 to 188
176
See his affidavit, vol 10, p3162 and the annexure
at 3187 and further
177
See vol 10, p3180, parr 48 to 49
178
See vol 10, p3187
179
See vol 10, p3288A
180
See vol 10, p3290
181
See vol 10, p3300
182
See vol 10 at p3365 to 3393
183
See vol 1, p82
184
See founding affidavit, vol 1, p82, par 158
185
See founding affidavit, vol 1, p83, parr 160 -
168
186
See Minister of Economic Affairs and Technology v
Chamber of Mines SA 1991(2) SA 834 (T) at 836G to J
187
See First Respondent’s answering affidavit,
vol 9 at p2994, par 165 to p3004, par 193
188
As to details of the discussions on 21 October
2006, see vol 9, p2997, footnotes 29 and 30
189
See Second Respondent’s answering
affidavit, vol 9, pp3007 to 3010, parr 201 to 202
190
See vol 9, p3033, parr 267 to 270
191
See vol 5, p1692, par 496 and further
192
See First Respondent’s answering affidavit,
vol 5, p1693, parr 500 to 501
193
See Bernstein & Others v Bester & Others
1996(2) SA 751CC at par 36, 106 and 121
194
See Law Society of South Africa v Road Accident
Fund 2009(1) SA 206C
195
See Second Respondent’s answering
affidavit, vol 9, p3039, par 285.2