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[2023] ZAECMKHC 78
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Cannon v Road Accident Fund (2189/2020) [2023] ZAECMKHC 78 (27 June 2023)
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Certain personal/private
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IN THE HIGH COURT OF
SOUTH AFRICA
(EASTERN CAPE
DIVISION, MAKHANDA)
CASE NO. 2189/2020
In
the matter between:
NESLYNNE
UDEAN CANNON
Plaintiff
and
ROAD
ACCIDENT FUND
Defendant
JUDGMENT
LAING
J
[1] This is a claim for
damages arising from a motor vehicle accident that occurred on 29
March 2018 along the N10, between Gqeberha
and Cradock.
Background
[2] The plaintiff alleged
that she had been a passenger in a motor vehicle driven by her
fiancé, Mr Devane Salter. It had
collided with a truck and
trailer, resulting in severe injuries to the plaintiff, including
fractures of the right humerus and
left clavicle, lacerations and
abrasions, and psychological harm. She had been 23 years old at the
time.
[3] The plaintiff pleaded
that the cause of the accident had been the sole negligence of either
Mr Salter or the other driver, alternatively
it had been caused by
their joint negligence. She claimed damages in the amount of R
10,741,161.
[4] The defendant
defended the matter. Its plea amounted to a bare denial of the
plaintiff’s allegations.
History
of litigation and issues to be decided
[5] On the day of trial,
27 July 2022, the defendant admitted liability. It agreed to pay an
amount of R 700,000 to the plaintiff
for general damages and gave an
undertaking in terms of
section 17(4)(a)
of the
Road Accident Fund
Act 56 of 1996
to pay the costs of future hospital accommodation and
medical treatment. An order was made to that effect, also
incorporating the
payment of interest and costs of suit to date. The
question of whether the plaintiff was entitled to the costs of two
counsel was
reserved. The plaintiff’s claim for past hospital
and medical expenses, as well as her claim for past and future loss
of
income and earning capacity, were separated from the remaining
claim for damages. The trial was postponed until 7 November 2022.
[6] The subsequent
proceedings were marked by a considerable degree of acrimony in
relation to the admission or otherwise of the
joint minute of the
parties’ respective industrial psychologists. The defendant
eventually admitted the joint minute on 24
March 2023, shortly before
the trial resumed on 27 March 2023.
[7] The main issue for
determination, at the conclusion of the present proceedings, is the
quantum of damages for past and future
loss of income and earning
capacity. This forms the basis of the enquiry to follow, beginning
with an outline of the principles
involved.
Legal
framework
[8] The determination of
damages for past and future loss of income and earning capacity is
not a straightforward exercise. It involves
considering the
uncertainties inherent to a claimant’s unique set of personal
circumstances, as well as the influence of
external factors on the
possible contribution of his or her skills and abilities to the
market. To that effect, the making of deductions
from an award to
accommodate the contingencies of life serves as a useful legal tool.
[9] Dendy observes as
follows:
‘
In awarding
damages for future loss courts usually make provision for
contingencies. Contingencies include any possible relevant
future
event which might otherwise have caused the damage or a part thereof,
or which may otherwise influence the extent of the
plaintiff's
damage. In a wide sense, contingencies are described as “hazards
that normally beset the lives and circumstances
of ordinary
people”.
[1]
This may, for example,
imply that provision is made for the fact that the prospective loss
which is possible at the time of assessment
of damage might in any
event possibly have occurred independently of the delict or the
breach of contract in question.’
[2]
[10]
Contingencies have also
been described as ‘the vicissitudes of life, such as illness,
unemployment, life expectancy, early
retirement and other unforeseen
factors’.
[3]
The courts have
recognised, however, that the fortunes of life are not always
adverse; they may be favourable.
[4]
[11]
The
court enjoys a discretion in its determination of the contingency
deduction; it must decide what is fair and reasonable.
[5]
The exercise is not an
exact science. To that effect, Trollip JA observed in
Shield
Insurance Co Ltd v Booysen
,
[6]
that the determination of
contingencies involves ‘a process of subjective impression or
estimation rather than objective calculation’.
Similarly, in
Goodall
v President Insurance Co Ltd
,
[7]
Margo J remarked:
‘
In the assessment
of a proper allowance for contingencies, arbitrary considerations
must inevitably play a part, for the art or
science of foretelling
the future, so confidently practised by ancient prophets and
soothsayers, and by modern authors of a certain
type of almanack, is
not numbered among the qualifications for judicial office.’
[8]
[12]
Practically, the
determination of a contingency deduction has the result that damages
are reduced by anything between 5% and 50%.
[9]
The facts and
circumstances of each case dictate how and where the line must be
drawn.
[13] At this point, it is
necessary to summarise the expert reports, and to record and evaluate
the evidence of the witnesses called
to testify.
Expert
reports
[14] The defendant
admitted the facts and opinions contained in several expert reports.
These are set out in the paragraphs that
follow.
Dr
Mark Tarboton
[15] In his capacity as a
diagnostic radiologist, Dr Tarboton outlined his assessment of the
plaintiff in a medico-legal report,
dated 12 March 2020. His findings
in relation to various x-ray examinations were described.
Dr
Piet Olivier
[16] An orthopaedic
surgeon, Dr Olivier, completed a serious injury assessment report,
dated 22 April 2020. He recorded that the
plaintiff had sustained a
fractured left clavicle with a dislocation of the left
acromioclavicular joint, a fractured right humerus,
and facial
lacerations. Dr Olivier also recorded, in a medico-legal report of
the same date, the history of the injuries sustained,
current
complaints, and the outcomes of examinations made. He was of the view
that the functional restrictions in relation to the
plaintiff’s
left shoulder girdle were of a permanent nature; she would have
trouble in performing overhead manual activities.
[17] Regarding
employability, Dr Olivier stated that the accident had had a negative
impact. Her physical endurance had been significantly
compromised and
she would be unable to compete with uninjured individuals in the
future. She would be unable to perform the usual
functions of a
hairstylist. She would be limited to work that entailed light or
administrative activities.
Dr
Estelle de Wit
[18] A medico-legal
report, dated 20 December 2021, was prepared by Dr de Wit in her
capacity as a clinical psychologist. She recorded
the history of the
accident and injuries sustained, discussed post-accident management
and adjustment, reviewed the available specialist
reports and current
complaints, set out the plaintiff’s personal history, and
described her clinical presentation. Dr de
Wit diagnosed the
plaintiff as suffering from persistent complex bereavement and
post-traumatic stress disorders, accompanied by
persistent
orthopaedic pain and instability of the superior shoulder suspensory
complex. Her prognosis for recovery was poor. This
was because of the
particularly tragic nature of the circumstances: the loss of her
fiancé and mother, significant changes
in the family
structure, the brain injury suffered by her son, and her limited set
of internal resources.
[19] In relation to
future employment, Dr de Wit stated that this was highly speculative
given the nature of the plaintiff's injuries.
She noted that, in
addition to severe orthopaedic injuries that had an impact on
functionality, pain levels, endurance, and mobility,
the plaintiff
had also presented with severe psychological symptoms of
post-traumatic stress disorder and depression. She had few
protective
factors, and the loss of family members would serve as a constant
reminder of the accident. She had limited intellectual
resources to
secure employment. It was the view of Dr de Wit that the plaintiff
was not employable in the open labour market.
Witnesses
[20] The plaintiff
presented the evidence of several lay witnesses and experts who were
called to testify, to be addressed sequentially
below. The defendant
presented no evidence.
Mr
Lani Martiny
[21] The witness
testified that he was an industrial and organizational psychologist
and that he had been involved in medico-legal
work since
approximately 1997. He stated that he had prepared a draft joint
minute on 9 November 2022, based on information obtained
from the
plaintiff and her attorneys.
[22] The minute recorded
that, prior to the accident, the plaintiff had worked from home as a
hairstylist, earning between R 6,000
and R 7,000 during the quieter
months, increasing to between R 13,000 and R 15,000 when it was
busier. She had also worked as a
volunteer teacher, earning
approximately R 2,165 per month.
[23] Mr Martiny indicated
that he had prepared two pre-morbid career scenarios, postulating the
paths that the plaintiff would probably
have followed, but for the
accident. The first scenario projected a career as a hairstylist had
the plaintiff not succeeded in
becoming a teacher. She would have
increased her earnings from approximately R 10,000 per month to at
least R 20,000 per month
by the time that she was 45 years old,
whereafter it would have increased at slightly higher than the
inflationary rate, until
she was 65 years old. The second scenario
projected a career as a teacher after the plaintiff had completed a
four-year degree
in education. She would probably have commenced as
an assistant teacher with a monthly salary of approximately R 23,417
after which
it was likely that she would have been appointed to a
permanent position as a junior teacher, earning a monthly salary of
approximately
R 39,167. Subsequently, the plaintiff, it was assumed,
would have been promoted to the level of principal by the time that
she
was 45 years old, earning a monthly salary of approximately R
69,000. Her salary thereafter, until she was 65 years old, would have
been subject to inflationary increases.
[24] The minute also
recorded a post-morbid career scenario. To that effect, Mr Martiny
indicated that it was probable that the
plaintiff would not be able
to work by reason of her injuries and state of mental health.
Overall, stated Mr Martiny, the possibility
that the plaintiff had
residual earning potential and the risks associated with the career
path envisaged under the second scenario,
above, could best be
addressed in the determination of contingencies.
[25] Mr Martiny went on
to testify about a medico-legal report that he had prepared, dated 16
March 2022. It was based on several
medical documents, and interviews
with the plaintiff and other hairstylists. He described the
plaintiff’s injuries, the various
expert opinions on her
employability, her current complaints, family details, and personal
history, and pre- and post-morbid career
scenarios.
[26] Under
cross-examination, Mr Martiny admitted that he had not obtained
documentary proof of the plaintiff’s earnings before
or after
the accident. He also admitted that the plaintiff was not a qualified
hairstylist but could be described as semi-skilled.
[27] In his subsequent
testimony, after having been recalled, Mr Martiny confirmed that he
and the defendant’s industrial
psychologist, Mr Simon Nteso,
had reached agreement on the draft minute. It was signed without
amendment.
Ms
Ansie van Zyl
[28] The plaintiff’s
next witness stated that she was an occupational therapist. She had
previously worked at Aurora Hospital,
specialising in the
rehabilitation of people with severe injuries and other medical
conditions. She had been involved in medico-legal
work since 2000.
[29] Ms van Zyl confirmed
that she had prepared a report that was based on an interview with
the plaintiff, medical records, and
various other medical reports.
She recorded the plaintiff’s personal, medical, and work
histories, outlined her current complaints,
indicated the clinical
observations that she had made, and described the physical,
cognitive, and work assessments that she had
carried out.
[30] In her summary of
findings, Ms van Zyl stated that the plaintiff’s loss of
amenities had been significant. The plaintiff’s
scarring and
functional limitations were permanent in nature. Dealing with
residual working capacity, Ms van Zyl testified that
the plaintiff
had demonstrated that she could manage light physical demands or
completely sedentary employment. Her load-handling
ability meant that
she could only work at waist level and would not be able to tolerate
the use of her left arm above the level
of shoulder height for the
remainder of any career. The plaintiff’s ability to work in the
open labour market had been compromised
significantly. It was
unlikely, said Ms van Zyl, that she would be able to re-enter the
market or resume activities as a self-employed
hairstylist. The
recommendations were those contained in Ms van Zyl’s report.
[31] The witness
testified that, in her opinion, it was highly unlikely that the
plaintiff could become a teacher given the combination
of the severe
emotional consequences of the accident and the orthopaedic injuries
suffered. It was improbable that she would be
able complete her
teaching studies and control a classroom of learners.
[32] Ms van Zyl
confirmed, during cross-examination, that the plaintiff was an
unskilled hairstylist, with no formal training.
Ms
Leslie Cannon
[33] The next witness for
the plaintiff was her sister. She testified that she had accompanied
the plaintiff in some of the consultations
with various experts,
including Mr Martiny and Dr Estelle de Wit. The plaintiff’s
emotional state had not been good at the
time.
[34] Ms Cannon went on to
testify that she came from a closely-knit and supportive family. Her
father was a retired captain in the
South African Police Services,
her mother was a hairstylist. She indicated that education was
important to her family and that
her uncles and aunts all held
various qualifications. She, herself, had trained as a nurse.
[35] The witness stated
that she and the plaintiff had been at school together. She said that
the plaintiff had performed better
academically, had earned several
certificates, and had been appointed as a prefect at both primary and
high school. The plaintiff
was goal orientated and had achieved a
B-aggregate. In her final year at high school, the plaintiff had
informed her family that
she very much wished to become a teacher.
She had waited before commencing studies because her father had not
had the financial
means at the time and because she had fallen
pregnant. The plaintiff had subsequently informed Ms Cannon that she
and her fiancé,
the late Mr Salter, had planned to allow him
to complete his studies in education while the plaintiff looked after
their son, D.
As soon as Mr Salter had completed his studies, the
plaintiff would commence with her own studies in 2019, also to become
a teacher.
[36] Ms Cannon testified
that the plaintiff had worked as a volunteer teacher on a part-time
basis at the primary and high schools
in Alexandria. After the
accident, the plaintiff had worked as a hairstylist to earn an
income. Ms Cannon confirmed that she had
informed Dr de Wit that the
plaintiff had been unable to continue working full-time as a
hairstylist because of persistent pain.
She had worked from home and
was supported by her family.
[37] In relation to the
plaintiff’s emotional state, Ms Cannon described her as a
broken person. If the accident had never
happened, said Ms Cannon,
then the plaintiff would have been successful in her studies and
become a teacher. She had a great deal
of potential and family
support. There were, moreover, other examples of teachers in her
family: two of her uncles were school
principals, and three of her
aunts as well as a cousin were teachers. In relation to the
plaintiff’s late fiancé,
Ms Cannon described him as a
hard-working person who would have supported the plaintiff in her
studies and career as a teacher.
[38] Under
cross-examination, Ms Cannon stated that the plaintiff had never
operated a hair salon prior to the accident. She had
merely cut and
styled family members’ hair at their respective homes. Ms
Cannon was not aware that the plaintiff had offered
her services to
the public. She was also not aware whether the plaintiff had already
applied successfully to study education at
the time that the accident
occurred.
Ms
Neslynne Cannon
[39] The plaintiff then
testified on her own behalf. She confirmed that she was presently 26
years old and had a son, D, who had
also been involved in the
accident and had sustained a serious head injury.
[40] Regarding her
education, the plaintiff confirmed that she had obtained a bachelor’s
pass at high school and had wanted
to become a teacher. She had not
been able to commence with her studies immediately because her
parents had lacked the necessary
resources. Consequently, she and her
fiancé, the late Mr Salter, had agreed that he would study
first after which he would
assist her to do the same. Mr Salter had
graduated in 2017 and secured a permanent teaching post in 2018 at
the primary school
in Alexandria. The plaintiff had intended to
register for studies in education later that year, which was also
when she and Mr
Salter had intended to marry. She had wished to
secure a post as a teacher at the same school as Mr Salter.
[41] The plaintiff
described Mr Salter as a very respectable person. They had known each
other since primary school. He, too, had
obtained a B-aggregate.
[42] Regarding the
plaintiff’s work as a hairstylist, she testified that she had
cut and styled family members’ hair.
She had not done so with a
view to becoming a hairstylist, she had done so to assist Mr Salter.
[43] The plaintiff
indicated that she had matriculated in 2012. She had worked as a
cashier in 2013 and 2014 at a building retail
store, and as a casual
receptionist in 2015 and 2016 at a medical practice. She worked as a
volunteer teacher in 2017 at the high
school in Alexandria. After the
accident in 2018, the plaintiff had been unable to work for a period
of seven months. She had subsequently
opened a hair salon to cover
some of the costs of caring for D, as well as to assist her parents
financially. In 2019, she had
earned a net amount of approximately R
8,000 per month but had become increasingly troubled by shoulder,
arm, and back pain, causing
her to employ her aunt to assist at the
salon. In 2020, her net earnings had decreased to between R 3,000 and
R 4,000 per month.
In 2021, circumstances compelled her to close the
salon and to operate, only on Fridays, from her father’s home.
The plaintiff
had also employed her cousin. Currently, her net
earnings were between R 2,000 and R 2,500 per month, but she had
trouble in working,
with constant lower back pain, and swelling and
pain in the upper right arm. She battled to sleep at night. The
plaintiff testified
that she had been struggling to adjust to the
death of her fiancé and had found it difficult to raise D on
her own. She
was unable to concentrate on tasks at hand.
[44] It was the
plaintiff’s evidence that, but for the accident, it would have
been her intention to have entered and remained
in the field of
education until she was 65 years old. She saw no prospects of working
at all in the future.
[45] The plaintiff
confirmed, during cross-examination, that she had worked as a
hairstylist before the accident to assist the late
Mr Salter
financially. She had cut and styled family members’ hair. Most
of her income at that time had been derived from
her work as a
hairstylist, rather than what she had earned as a volunteer teacher.
In relation to Mr Martiny’s description
of her earnings as
having been between R 6,000 and R 7,000 during the quieter months,
increasing to between R 13,000 and R 15,000
when it was busier, the
plaintiff pointed out that this had been the situation when she had
operated the salon after the accident.
She was adamant, when
confronted with apparent discrepancies between what she had testified
and what she had told to various experts,
that she had mainly cut and
styled family members’ hair prior to the accident but admitted
that she had also provided such
services to members of the public,
albeit on a limited scale. The plaintiff admitted, too, that she did
not know whether she had
supplied the various experts with all
relevant information because she had been in an emotional state at
the time.
[46] When asked whether
she had applied for and had been accepted to study education at a
university, the plaintiff stated that
she and her fiancé had
had an agreement. They would wait until the late Mr Salter had
completed his own studies and commenced
employment, after which he
would assist her with the costs of registration. To the assertion,
made by counsel for the defendant,
that the plaintiff would have
continued working as a hairstylist until the age of retirement, but
for the accident, she was certain
that she would have studied to
become a teacher.
[47] In re-examination,
the plaintiff confirmed that, in 2017, she had worked as a volunteer
teacher in accordance with the usual
school hours. She had only done
hairstyling in the evenings and over weekends. When she opened the
salon in 2018, after the accident,
she had worked in the mornings
from Tuesday until Saturday. This was when she had earned the amounts
indicated in Mr Martiny’s
report.
Mr
Colin Williams
[48] The plaintiff’s
evidence was followed by that of her final witness, Mr Williams, who
stated that he had been a teacher
since 1987 and was currently the
principal at Bhongweni Primary School. He knew the plaintiff and her
family well; his wife and
the plaintiff’s father were siblings.
[49] Mr Williams
confirmed that numerous of the plaintiff’s relations were
teachers, some in leadership positions. He described
the plaintiff as
a dedicated volunteer teacher and a dedicated person in general. She
came from a family of high achievers.
Evaluation
of witnesses and reports
[50] Mr Martiny was a
credible witness. There was no obvious bias in his testimony, besides
his having been under the instructions
of the plaintiff in relation
to the preparation of a medico-legal report. The calibre and cogency
of his performance were satisfactory.
Inasmuch as apparent
contradictions emerged later during the trial, in relation to what he
had recorded about when the plaintiff
first opened and operated her
hair salon, he was never confronted with these during
cross-examination. Ultimately, such contradictions
proved to be
inconsequential when the respective industrial psychologists reached
agreement on the contents of the draft minute.
As to reliability,
there was nothing to suggest that the quality, integrity, and
independence of Mr Martiny’s interactions
with the plaintiff
had been compromised. He was a recognised expert, with considerable
medico-legal experience.
[51] The same could be
said of Ms van Zyl. She was a credible and reliable witness whose
testimony was never seriously challenged.
[52] Turning to the lay
witnesses, both Ms Cannon and Mr Williams would have been affected by
a bias towards the plaintiff by reason
of their direct or indirect
familial relationship to her. Their testimonies, nevertheless, were
free of contradictions, and their
performances were cogent and of a
good calibre. Furthermore, their familiarity with the plaintiff’s
circumstances enhanced
the quality, integrity, and independence of
their evidence. The court is satisfied that they were credible and
reliable witnesses,
and that it was indeed probable that it had been
the plaintiff’s intention all along to pursue a career as a
teacher, rather
than continue as a hairstylist.
[53] The plaintiff
herself was, understandably, not a star witness. Apart from her
inherent bias, as would have been expected, she
was unable to explain
the apparent contradictions in relation to the nature, extent, and
history of her work as a hairstylist both
before and after the
accident. She was also unable to reconcile her testimony with that of
Mr Martiny. She was, notwithstanding,
consistent in her assertion
that she had only opened and operated her salon after the accident,
which was corroborated by the evidence
of her sister, Ms Cannon. The
cogency and calibre of the plaintiff’s performance was
unremarkable, but should, nevertheless,
be evaluated in light of the
undisputed and lasting physical and psychological injuries that she
has sustained. These could be
said to have had an impact on her
credibility and reliability as a witness, which were far from
exemplary but nevertheless satisfactory
overall.
[54] Considering all the
evidence, including the facts and opinions contained in the expert
reports that were admitted by the defendant,
it is probable that the
plaintiff was a dedicated learner and a high achiever during her
primary and secondary schooling and matriculated
with a B-aggregate.
It is also probable that she came from a wide family of educators and
that this aspect, together with her academic
ability and career
potential, influenced her decision to follow a path that would fulfil
her ambitions in the field of education.
This included her work as a
volunteer teacher at the primary and high schools in Alexandria. It
is, moreover, probable that the
plaintiff’s work as a
hairstylist had been necessary purely to accommodate her needs at the
time. Both she and her sister,
Ms Cannon, testified that financial
resources in her immediate family were scarce. The income that the
plaintiff derived from her
work as a hairstylist would also have
supported her fiancé, the late Mr Salter, while he completed
his studies in teaching.
After the accident, the income was,
tragically, required to care for her son, D, suffering from the head
injury that he had sustained.
There was no indication at all that the
plaintiff had ever chosen the work of a hairstylist as her
occupation. It was simply a
means to an end. Teaching seems to have
been her true vocation.
[55] Mindful of the legal
framework, the summary of the expert reports, and the recording and
evaluation of the evidence of the
witnesses, the court is required to
discuss and apply the relevant principles to the matter at hand.
Discussion
[56]
As
a starting point for purposes of the determination of a general
contingency deduction, the
Quantum
Yearbook
remains
a useful guideline.
[10]
The learned authors
observe that a sliding scale of 25% for a child, 20% for a youth, and
10% in middle age, can serve as a basis
for the deduction to be made.
Moreover, the so-called ‘normal contingencies’ of 5% for
pre-morbid and 15% for post-morbid
loss of earning capacity are still
relevant.
[11]
[57]
During
argument, counsel for the plaintiff referred the court to several
authorities pertaining to the subject. In
Krugell
v Shield Versekeringsmaatskappy Bpk
,
[12]
Van Diykhorst J was
prepared to depart from the application of the usual 10% deduction
for a middle-aged claimant
[13]
and to increase this to
35% to make provision for future earnings. Although the learned judge
admitted that this was an unscientific
approach, he held that this
was the only way in which to do justice to the matter.
[14]
[58]
In
this division, the same approach was adopted in
Van
Eeden v Road Accident Fund
,
[15]
where Huisamen AJ held
that it would be fair to increase the deduction. This was because of
the theoretical ability of the claimant
to perform sedentary
activities, the advantages that would accrue to him by reason of the
possible stricter application of the
Employment Equity Act 55 of
1998
, and the fact that he had worked after the accident, albeit with
difficulty. The learned judge, nevertheless, applied a 25% deduction
on the basis that the facts of the matter were distinguishable from
those in
Krugell
since the claimant in the
latter was able to work again in the future.
[16]
[59]
Shortly afterwards,
Roberson J considered the correct deduction to be applied in the
matter of
Dolf
v Road Accident Fund
.
[17]
She referred to
Van
Eeden
and
took into consideration the fact that the claimant had studied
further and gone on to secure a higher level of employment worked
after the accident and also acknowledged the possibility that the
claimant could obtain contract work as a truck driver beyond
the age
of 65. The learned judge did, however, accept that employment
prospects in Beaufort West were limited. She applied a 20%
deduction.
[60]
In
Ngesi v
Road Accident Fund
,
[18]
Revelas J dealt with a
set of facts not entirely dissimilar to those in the present matter.
The claimant was a 32-year-old woman
who had sustained lasting
injuries in an accident. She had been 36 weeks pregnant at the time
and had given birth to a stillborn
baby the following day because of
the trauma. She had also lost a close friend, who had been trapped in
the wreckage. The claimant
had been studying towards a diploma in
public finance and resource management but had been unable to
complete the course after
the accident. The experts in the matter
agreed that she had suffered severe emotional consequences. They
were, nevertheless, of
the view that she had residual earning
capacity and had, in fact, secured employment subsequently, albeit
not very successfully.
The learned judge held that, based on the
probabilities, the possibility could not be excluded that the
claimant might work from
time to time. However, the nature and
duration of such work and the income to be derived therefrom depended
on guesswork. Revelas
J adopted the
Krugell
approach and applied a
35% deduction.
[61]
Importantly, counsel for
the plaintiff in the present matter drew the court’s attention
to the decision of the Supreme Court
of Appeal (‘SCA’) in
Road
Accident Fund v Kerridge
.
[19]
In that matter, the
claimant had been 23 years old at the time of the accident and had
been studying engineering with a view to
becoming a diesel mechanic.
He had, at the same time, assisted his father in the operation of a
laundry business and had also been
a co-owner (with his brother) of a
business that sold motor vehicle accessories and spare parts. After
the accident, the claimant
had been unable to continue assisting his
father because of his injuries. He had, nevertheless, returned to
operate the motor vehicle
business.
[62]
Nicholls AJA, for the
majority, found that the determination of the claimant’s
pre-morbid future earning capacity had been
based on ‘highly
optimistic assumptions’. It was improbable that the claimant
would have entered the labour market
at such an early stage. The
salary scales used for the above determination were, moreover, not
compatible with the evidence. Furthermore,
Nicholls AJA found that
there was nothing to indicate that the claimant had no residual
earning capacity whatsoever.
[20]
The learned judge went on
to remark as follows:
‘…
we are
faced with a situation where our only option is to apply random
contingencies to the pre-morbid scenario on an
ad
hoc
and
uninformed basis to compensate for any possible post-morbid residual
earnings capacity. This is precisely what was suggested
in the final
actuarial report- to apply higher general contingency deductions to
allow for any residual earning capacity. This
court in
Bee
[21]
increased the general
pre-morbid contingency deductions for future loss of earnings to 25
per cent notwithstanding the claimant
in that matter was 54 years old
and therefore in the latter half of his working career. The court
took into account various factors
including that the claimant was
diabetic and involved in adventure sports.’
[22]
[63]
Consequently, Nicholls
AJA found that there were three factors that militated against a
general contingency deduction of 15%: firstly,
the claimant was 23
years old when the accident occurred, which made him more subject to
the ‘vicissitudes of life’,
and which also created
greater uncertainty in the assessment of his career path, especially
in light of his limited employment
history; secondly, his pre-morbid
future earning capacity had been inflated, as discussed above; and
thirdly, there was some residual
earning capacity that had not been
considered. The learned judge, in the circumstances, applied a 35%
deduction.
[23]
[64]
The
Kerridge
approach was subsequently
adopted in the matter of
NDB
obo JWK v Road Accident Fund
,
[24]
where Bands AJ dealt with
a claim brought on behalf of a minor child who had been seven years
old at the time of the accident. The
plaintiff had contended that a
25% deduction would have been appropriate, which would have
considered both the age of the child
and any remote residual earning
capacity. The defendant, in contrast, had asserted that a 25% to 40%
deduction was required. In
reaching her decision, Bands AJ observed
as follows:
‘…
[w]hat
complicates the present matter is that JWK was only 7 years old at
the time of the collision and is presently 12 years of
age.
Accordingly, and as set out in
RAF
v Kerridge
…
the
younger the claimant, the more time he or she has to fall prey to the
vicissitudes and imponderables of life, which are impossible
to
enumerate, but which in the context of future loss of earning
capacity include inter alia, a downturn in the economy leading
to
reduction in salary; retrenchment; unemployment; ill health; death;
and the myriad of events that may occur in one’s everyday
life.
The court went on to comment that “the longer the remaining
working life of a claimant, the more likely the possibility
of an
unforeseen event impacting on the assumed trajectory of his or her
remaining career.” I remain mindful of this.’
[25]
[65]
The
court subsequently applied a 25% deduction, holding that this was
fair in the circumstances. There was no reason why a higher
deduction
was necessary.
[26]
Application
to the facts
[66] In the present
matter, the defendant’s legal representative contended that the
most important issue that remained at
the end of the trial was the
plaintiff’s uninjured, post-morbid career scenario. It was the
defendant’s case that the
plaintiff had failed to lead
sufficient evidence to support her claim that she had intended to
become a teacher, alternatively
she had failed to prove her loss in
terms thereof. The case appeared to rest on several key arguments:
the plaintiff had achieved
no higher than a grade 12 education; she
had been working as a hairstylist at the time of the accident and had
continued to operate
a hair salon; and there was no evidence to
demonstrate what she had earned either as a volunteer teacher or as a
hairstylist.
[67] The above argument,
however, conveniently ignores the evidence that was presented. The
reports and testimonies of Mr Martiny
and Ms van Zyl, and the oral
evidence of Ms Cannon, the plaintiff, and Mr Williams, indicate on a
balance of probabilities that
the plaintiff would have indeed
registered for and commenced with her studies in 2019 before taking
up employment as a teacher
in 2023. The defendant failed to present
any evidence to the contrary.
[68] The plaintiff was,
admittedly, unable to substantiate her income as a volunteer teacher.
She was also unable to substantiate
what she had earned as a
hairstylist either before the accident or afterwards, when she had
opened the salon. Her testimony in
relation to the quantum of her
earnings, nevertheless, was not seriously challenged and the court is
satisfied that, at the very
least, it amounts to the best available
evidence and cannot be excluded from the determination of the
plaintiff’s past and
future loss of income and earning
capacity. Any attendant uncertainties can be managed by application
of the general contingency
deduction.
[69] Crucially, the
parties’ respective industrial psychologists eventually reached
agreement on the joint minute that had
previously been prepared by Mr
Martiny. The plaintiff’s pleadings and evidence do not support
the first scenario that was
presented therein, i.e., that she would
have continued working as a hairstylist. They support, however, the
second scenario. It
is probable, as the court has already found, that
the plaintiff would have continued working as a volunteer teacher and
hairstylist
only until the end of 2018, after which she would have
commenced studies in education in early 2019, and then entered the
teaching
profession in 2023.
[70] The joint minute and
Mr Martiny’s earlier medico-legal report, to which he testified
during proceedings, informed the
calculations carried out by the
plaintiff’s actuaries in relation to her past and future loss
of income and earning capacity.
There was no dispute about the
accuracy and correctness of the calculations, which reflected the
information provided by the plaintiff
and the assumptions made.
[71]
The
actuaries in question, Arch Actuarial Consulting, presented a
scenario where the plaintiff would have continued working as a
self-employed hairstylist until retirement, and another where the
plaintiff would have studied, qualified, and worked as a teacher.
In
the latter scenario, the actuaries assumed that the plaintiff would
have entered the profession as an assistant teacher at Paterson
B3
level, after which she would have obtained a permanent position at C1
level, advancing in time to become a principal at C5 level.
The
actuaries went on to apply the relevant contingency deductions. They
implemented a uniform deduction of 5% to the plaintiff’s
past
loss of income for both scenarios. They implemented a 15% deduction
in relation to future loss of income and earning capacity
under the
hairstylist scenario, to arrive at a net loss of R 4,029,948.
Furthermore, they implemented deductions of 25%, 30%, and
35%, as
three distinct options under the teaching scenario, to arrive at net
losses of R 8,996,161 and R 8,558,650 and R 7,967,860
respectively.
In both scenarios (hairstylist and teacher), the actuaries considered
the impact of the statutory cap.
[27]
[72] There is no reason
to doubt the accuracy and correctness of the actuaries’
calculations. The information relied upon,
and assumptions made,
correspond with the evidence presented during trial. The calculations
display an underlying logic and line
of reasoning that cannot be
criticised. Mindful of the court’s earlier finding to the
effect that the pleadings and evidence
do not support the hairstylist
scenario, the court is satisfied that the actuarial calculations in
relation to the teaching scenario
can be accepted, subject to
determination of the correct deduction.
[73] The defendant’s
legal representative asserted that it would be fair and just to apply
a considerably higher deduction
(55%) to the plaintiff’s
pre-morbid future earning capacity. No authority was cited in direct
support thereof.
[74] The plaintiff’s
youthfulness immediately invites the application of a higher
deduction. She was 23 at the time of the
accident, which was the age
of the claimant in the
Kerridge
matter. The lack of
substantiation for her earnings as a volunteer teacher and
hairstylist, both before and after the accident,
cannot be
overlooked.
[75] Of some importance
is the question of residual earning capacity. To that effect, Dr
Olivier expressed the view that the plaintiff
would be unable to
compete with uninjured work-seekers and would be restricted to
employment that entailed light or administrative
activities. Dr de
Wit stated that her future employment was highly speculative; she
went so far as to assert that the plaintiff
was not employable in the
open labour market. Mr Martiny maintained that it was unlikely that
the plaintiff would secure future
employment, given her limited work
experience in other capacities, lack of qualifications, the nature of
her injuries, and the
high rate of unemployment in general. In their
joint minute, Mr Martiny and the defendant’s industrial
psychologist, Mr Nteso,
remarked as follows:
‘
[i]n reference to
the opinions of Dr Olivier, Dr de Wit and Mrs van Zyl she is probably
not going to be able to work. She cannot
do the kind of work she
performed prior to the MVA. Her injuries and her mental state make
finding suitable employment an unlikely
event. In this regard, we
agree with the other experts who are of the opinion that it is
probable that she will not be employed
in the future.’
[76] Ms van Zyl indicated
that the plaintiff could manage light physical demands or completely
sedentary employment; her ability
to work in the open labour market
had been compromised significantly.
[77] Whereas the various
experts were clearly of the opinion that the plaintiff’s
earning capacity had been severely affected,
only Dr de Wit was of
the view that she was entirely unemployable. The remaining experts,
while expressing significant misgivings,
never unequivocally excluded
the possibility of the plaintiff’s securing employment, albeit
of an undemanding nature. Considering
the plaintiff’s academic
and leadership potential, her dedication to her personal development
and advancement, and the values
and support of her wider family, all
of which having gone undisputed in the testimonies of Ms Cannon, Mr
Williams, and the plaintiff
herself, it would be fair and reasonable
to find that the plaintiff had retained a measure of earning
capacity. There remains a
possibility that, over time, she could
still obtain suitable employment. To attempt to say what such work
would entail would amount
to pure speculation.
[78] The above factors
must be considered for purposes of arriving at the deduction to be
made.
Relief
to be granted
[79] When all is said and
done, the determination of the general contingency deduction remains
a frustratingly imprecise exercise.
The opinions of industrial
psychologists, occupational therapists, and other medical
professionals, as well as the methods and
calculations of actuaries,
undoubtedly assist the court. It may well be that the task could be
aided and enhanced in future by
the benefits of artificial
intelligence (dare it be spoken), provided that there is proper
adherence to the principles of evidence
and procedure. Nevertheless,
the determination of the correct deduction remains, for now, more of
an art than a science.
[80] Having had regard to
the evidence led, the arguments presented, and the case law in
question, the court is persuaded that the
Kerridge
approach
finds application in the present matter. The plaintiff’s age,
the lack of substantiation for her pre- and post-morbid
income, and
her residual earning capacity, create sufficient uncertainty to
warrant a 35% deduction to the plaintiff’s claim
for past and
future loss of income and earning capacity. This would seem to be
fair and just in the circumstances. The court finds
no basis upon
which to implement the higher deduction proposed by the defendant.
Costs
[81] In relation to
costs, counsel for the plaintiff set out a history of the litigation
between the parties, drawing attention
to the unacceptable level of
tardiness that appears to have characterised the defendant’s
conduct in the matter. Counsel
drew attention, especially, to the
defendant’s failure to have filed the report of its industrial
psychologist in accordance
with the order of court, only attempting
to do so on the date of the trial itself without explanation and in
the absence of any
application for condonation. Furthermore, much was
made of the defendant’s refusal to accept the draft joint
minute of the
industrial psychologists in question, compelling the
plaintiff to call Mr Martiny as a witness, at considerable expense,
only for
the defendant subsequently to accept the joint minute.
[82]
The
courts have previously criticised, heavily, the way the defendant has
conducted itself in matters of this nature.
[28]
Counsel for the plaintiff referred to
Scheepers
v Road Accident Fund
,
[29]
where Goosen J made the following remarks:
‘…
[a]
consideration of the trial roll in this division indicates that the
overwhelming majority of cases involve personal injury claims
against
the Fund. The judges of this division regularly encounter pleadings
drafted on behalf of the Fund in which the defence
consists of a bald
denial or where the Fund pleads that it has no knowledge and the
plaintiff is put to the proof of the allegations,
this feature- in
which no substantive defence is raised- is more often than not
carried through trial preparation.
Rule 37
minutes too often reflect
a litany of responses in which the Fund “will revert” in
respect of crucial matters which
parties are required to address in
pre-trial conferences.
…
The result of
this state of affairs is illustrated in this matter where the
defendant could offer no substantive defence at trial.
Notwithstanding this, three days of valuable court time was wasted.
Primary responsibility may well rest on the shoulders of those
employees of the Fund whose duty it is to manage claims against the
Fund but it is not their responsibility alone. Such is the
nature of
the duty that legal representatives owe to the court. For this reason
it is appropriate, in my view, to extend Plasket
J’s warning in
Mlatsheni
to legal practitioners.
They should ensure that they act in accordance with the duty that
they owe to the courts and are in no way
party to the conduct of
proceedings which result in the unnecessary waste of court time and
resources. Such conduct, where it is
established, may be dealt with
by an appropriate costs sanction against them.’
[30]
[83] The court in
Scheepers
ordered the defendant to pay costs on the scale of
attorney and own client. Counsel for the plaintiff in the present
matter urged
the court to adopt the same stance.
[84]
There
is some debate about whether there is any real difference between
costs on an attorney and own client basis and costs simply
on an
attorney and client basis.
[31]
Nevertheless, Van Loggerenberg observes that:
‘
An award of costs
as between attorney and own client has been described as exceptional
(“uitsonderlik”), very punitive
and as indicative of
extreme opprobrium. It must be seen as an attempt by the court to go
a step further than the usual order of
costs as between attorney and
client, to ensure that the successful party is indemnified in respect
of all the reasonable costs
of the litigation. Taxation of a bill of
costs as between attorney and own client will be on a more liberal
and lenient basis,
but exorbitant or unreasonable costs will not be
sanctioned. In
Public
Protector v South African Reserve Bank
,
[32]
the majority of the Constitutional Court stated:
“
The question
whether a party should bear the full brunt of a costs order on an
attorney and own client scale must be answered with
reference to what
would be just and equitable in the circumstances of a particular
case. A court is bound to secure a just and
fair outcome.”
[33]
’
[34]
[85] From the above, an
order for costs on an attorney and own client basis, to the extent
that such a category exists independently,
must be relied upon very
sparingly.
[86] The defendant’s
legal representative argued that the costs order sought by the
plaintiff was too harsh. There was no
evidence of
mala fides
on the part of the defendant and public funds were at stake. The
defendant’s legal representative went on to explain that
the
defendant had been unable to agree to the draft minute because the
report of its own industrial psychologist had not been properly
before court. This had been brought about by the defendant’s
failure to have complied with the previous order. Its attempt
to file
the report on the day of trial, without any explanation or
application for condonation, had met with the court’s
rejection
thereof.
[87] The correctness of
the defendant’s reasoning and decision not to agree to the
draft minute are not issues for the court
to decide. The defendant
has, however, provided at least some account for its conduct in that
regard.
[88] Nevertheless, it has
not been able to explain why it never complied with the previous
order. The defendant, moreover, failed
to put up any meaningful
resistance to the plaintiff’s case. No experts or lay witnesses
were introduced to counter the evidence
of those called by the
plaintiff. For a claim of the scale and proportion brought by the
plaintiff, running into millions of rand,
the defendant offered a
defence that was perfunctory at best.
[89] It must be
emphasized that the defendant has a duty to manage properly the
public finances under its authority. This extends
to the proper
preparation and conduct of a defence against any claim for damages
such as the one at hand. The court is not persuaded
that an order for
costs on an attorney and own client basis would be justified but is
of the view that it would be remiss not to
mark its disapproval of
the way the defendant has conducted itself. An order for costs on an
attorney and client basis would be
just and equitable.
[90] The plaintiff has
claimed the costs of two counsel. By reason of the complexity and
nature of the matter, the court is satisfied
that an order to that
effect would be fair.
Order
[91] In the
circumstances, the following order is made:
(a) the defendant is
directed to pay to the plaintiff the amount of R 7,967,860 as damages
for the past and future loss of income
and earning capacity, because
of the injuries sustained by the plaintiff;
(b) the defendant is
directed to pay the plaintiff’s costs on an attorney and client
scale, from 28 July 2022 until and including
28 March 2023,
including:
(i) the reasonable
qualifying and travelling expenses, if any, for;
(aa) Dr A Landman;
(bb) Dr PA Olivier;
(cc) Dr M Tarboton;
(dd) Dr E de Wit;
(ee) Ms A van Zyl;
(ff) Mr L Martiny;
and
(gg) Arch Actuarial
Consulting;
(ii) the costs of all
joint minutes and supplementary reports of:
(aa) Mr L Martiny; and
(bb) Arch Actuarial
Consulting;
(iii) the attendance and
testifying fees of:
(aa) Mr L Martiny, for 7,
8 and 9 November 2022; and
(bb) Ms A van Zyl, for 7
and 8 November 2022;
(iv) the travelling
costs, including flight tickets and accommodation, incurred by or on
behalf of the plaintiff for Mr L Martiny’s
attendance at trial;
(v) the reasonable costs
of consultations involving the plaintiff’s counsel, attorneys,
and witnesses, in preparation for
trial;
(vi) the costs of the
interpreter employed at trial; and
(vii) the costs of
trial for 7, 8, 9 and 11 November 2022, and 27 and 28 March 2023;
(viii) the defendant is
directed to pay the costs of two counsel, where so employed,
including the costs reserved in terms of paragraph
7 of the order of
27 July 2022;
(ix) the defendant is
directed to pay interest on the above amounts, at the prescribed
legal rate, calculated from:
(i) 14 calendar days
after the date of this order until date of payment, in relation to
paragraph (a), above; and
(ii) 14 calendar days
after the date of
allocatur
or written agreement until date of
payment, in relation to paragraphs (b) and (c), above;
(x) the issue of the
plaintiff’s claim for past hospital and medical expenses be and
is hereby separated in terms of
rule 33(4)
from the remainder of the
plaintiff’s claim for damages, the determination thereof being
postponed
sine die
.
JGA LAING
JUDGE OF THE HIGH
COURT
Appearance:
For
the plaintiff:
Adv
A Frost and Adv K Pask,
instructed
by
Meyer
Incorporated, c/o Netteltons Attorneys, 118A High Street, Makhanda
(ref: Ms I Pienaar / Daisy)
For
the defendant:
Ms
V Jeram, State Attorney, c/o Zilwa Attorneys, 41 African Street,
Makhanda (ref: Cannon / 704 / VJ)
Dates
of trial:
7
- 9 and 11 November 2022, and 27 - 28 March 2023
Date
of judgment:
27
June 2023
[1]
AA
Mutual Insurance Association Ltd v Van Jaarsveld
(1)
1974 2 QOD 360 (A), at 367.
[2]
M
Dendy, ‘Damages’, in
LAWSA
(LexisNexis,
vol 14(1), 3ed, 2018), at paragraph 27.
[3]
Road
Accident Fund v Guedes
2006
(5) SA 583
(SCA), at paragraph [3].
[4]
Southern
Insurance Association Ltd v Bailey
1984
(1) SA 98
(A), at 117B.
[5]
Fulton
v Road Accident Fund
2012
(3) SA 255
(GSJ), at paragraphs [95] to [96]; and
Nationwide
Airlines (Pty) Ltd (in liquidation) v SA Airways (Pty) Ltd
[2016]
4 All SA 153
(GJ), at paragraph [147].
[6]
1979
(3) SA 953
(A), at 965G.
[7]
1978
(1) SA 389 (W).
[8]
At
392H-392A.
[9]
Van
der Plaats v SA Mutual Fire & General Insurance Co Ltd
[1980]
2 All SA 129 (A).
[10]
Robert
Koch,
The
Quantum Yearbook
(Van
Zyl Rudd & Associates (Pty) Ltd, Port Elizabeth, 2021).
[11]
At
118.
[12]
1982
(4) SA 95 (T).
[13]
The
claimant in
Krugell
was a
42-year-old telecommunications electrician, employed by the
erstwhile Department of Post and Telecommunications at the time
of
the accident.
[14]
At
105E.
[15]
Unreported, ECG case number 2069/2011, dated 9 April 2013.
[16]
At
paragraph [69].
[17]
(3038/2014)
[2014] ZAECPEHC 99 (11 December 2014).
[18]
Unreported,
ECG case number 850/2016, dated 17 April 2018.
[19]
2019
(2) SA 233
(SCA).
[20]
At
paragraphs [45] to [53].
[21]
Bee
v Road Accident Fund
2018
(4) SA 366 (SCA).
[22]
Kerridge
,
at paragraph [54].
[23]
At
paragraphs [55] and [56].
[24]
(1100/2020)
[2023] ZAECQBHC 7 (10 February 2023). See, too, the recent decision
of Govindjee J in
Krebs
v Road Accident Fund
2023
JDR 1464 (ECP), at paragraph [64].
[25]
NDB obo
JWK
,
op cit
,
a
t
paragraph [59]. Emphasis omitted.
[26]
At
paragraph [63].
[27]
Section
17(4)(c)
of the
Road Accident Fund Act, 56 of 1996
.
[28]
See,
for example,
Road
Accident Fund v Klisiewicz
[2002]
9847 (A); and
Mlatsheni
v Road Accident Fund
2009
(2) SA 401 (E).
[29]
2013
JDR 2500 (ECP).
[30]
At
paragraphs [43] and [44].
[31]
See
Nel
v Waterberg Landbouers Ko-operatiewe Vereniging
1946
AD 597
, at 607-8;
Hawkins
v Gelb
1959
(1) SA 703
(W), at 705C-F. See, too, the discussion in DE van
Loggerenberg,
Erasmus:
Superior Court Practice
(Jutastat,
e-publications, RS 17, 2021), at D5-28.
[32]
2019
(6) SA 253 (CC).
[33]
At
318B.
[34]
Van
Loggerenberg, (RS 20, 2022), n 31 above, at D5-30.