About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Free State High Court, Bloemfontein
SAFLII
>>
Databases
>>
South Africa: Free State High Court, Bloemfontein
>>
2022
>>
[2022] ZAFSHC 226
|
|
T.K.M v Road Accident Fund (431/2021) [2022] ZAFSHC 226 (9 September 2022)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
and
SAFLII
Policy
IN
THE HIGH COURT OF SOUTH AFRICA
FREE
STATE DIVISION, BLOEMFONTEIN
Reportable:
YES/NO
Of
Interest to other Judges: YES/NO
Circulate
to Magistrates: YES/NO
Case
Number:
431/2021
In
the matter between:
T[....]
K[....]
M[....]
Plaintiff
and
ROAD
ACCIDENT
FUND
Defendant
JUDGMENT
BY:
VAN RHYN J
HEARD
ON:
19, 20 AND 22 JULY 2022
HEADS
OF ARGUMENT SUBMITTED ON: PLAINTIFF:
27 JULY 2022
DEFENDANT:
12 AUGUST 2022
DELIVERED:
9 SEPTEMBER 2022
INTRODUCTION:
[1]
The plaintiff instituted action against the defendant
in
terms of the provisions of the Road Accident Fund Act
[1]
(“the Act”) for
the
payment of the amount of R10 931 488.00 in damages arising from an
incident which occurred on 1 December 2018. A motor cycle
with
registration letters-and-numbers [....], driven by Morgan Peter Wracc
(the “first insured vehicle”) collided with
a motor
vehicle with registration letters-and-numbers [....] driven by
Thabiso S Motaung (the “second insured motor vehicle”)
and wherein the plaintiff was a passenger at the time of the
collision. The collision occurred along the R 712 Main road between
Phuthaditjhaba and Harrismith, Free State Province.
The
plaintiff’s action is based on the negligence of the first
insured driver.
[2]
On the 20
th
of July 2022 the defendant conceded the merits
and its liability to compensate the plaintiff for 100% of the proven
or agreed damages,
arising from the collision. The general damages
and future medical expenses have also been settled and the court has
been provided
with an draft order in terms whereof the defendant is
liable for payment to the plaintiff in the amount of R500 000.00
(FIVE
HUNDRED THOUSAND RAND) in respect of general damages and to
furnish to the plaintiff an undertaking in terms of the provisions of
s 17(4)(a) of the Act in respect of future accommodation of the
plaintiff in a hospital or nursing home or the rendering of future
medical treatment arising from the injuries sustained in the motor
vehicle accident.
[3]
The remaining issue in dispute and which the court is called upon to
adjudicate is
in respect of the loss of earnings, more specifically
the contingencies that need to be applied in respect of the future
loss of
earnings. By agreement between the parties and in terms of
Rule 38(2) of the Uniform Rules of Court, plaintiff ‘s expert
reports were received by way of affidavit.
The
plaintiff did not adduce any evidence regarding his claim for loss of
future earnings and neither did the respondent present
any evidence
in this regard.
By agreement, the legal
representatives filed heads of argument pertaining to the percentage
to be applied in respect of the contingencies
regarding future loss
of income of the plaintiff.
THE
INJURIES SUSTAINED BY THE PLAINTIFF
[4]
The plaintiff is an adult male who was born
on 29 April 2002. He was 16 years of age at the time of the motor
vehicle accident and
was a scholar at the time. He was transported to
the Mofumahadi Manapo Hospital subsequent to the incident where his
wounds were
cleaned and dressed and x-rays were taken. It is common
cause that the plaintiff sustained the following injuries during the
collision:
4.1
lacerations and abrasions to his face;
4.2
soft tissue injury to left shoulder;
4.3
lacerations and abrasions to left chest;
4.4
fracture right elbow.
[5]
Plaintiff was discharged on the 24
th
of December 2018. He
was referred for physiotherapy and provided with medication and a
review date. The plaintiff was re-admitted
at the same hospital on
11
th
of January 2019 for the internal fixation of his
right elbow. He was discharged on the 22
nd
of January
2019.
[6]
The plaintiff filed the following expert reports:
6.1 Dr
A Makau – general practitioner;
6.2 Dr
M A Scher – orthopaedic surgeon;
6.3 T
da Costa - clinical psychologist;
6.4 S
Fletcher – occupational therapist;
6.5 A
Mattheus – educational psychologist
6.6 l
Leibowitz – industrial Psychologist;
6.7 W
Loots – actuary.
[7]
Dr Scher, an orthopaedic surgeon at Medi-Clinic, Cape town, opined
that the plaintiff’s
compromised right elbow will probably
manifest with progressive functional impairment and will be a
significant handicap for the
rest of the plaintiff’s life. His
upper extremity impairment (UEI) would be at 38% and his Whole Person
Impairment (WPI)
at 23%. On examination Dr Scher found moderate loss
of right elbow movement but the plaintiff is able to reach his mouth
with his
right hand. The damaged right elbow will probably manifest
with secondary degenerative changes over the medium to longer term (7
– 17 years). Ongoing and increasing disability will probably
lead to surgery being considered. In the workplace ongoing impairment
of his dominant arm and elbow function will likely have variable
bearing on his job opportunities and earnings.
[8]
The clinical psychologist found that the plaintiff suffered from
moderate depression,
severe anxiety and post- traumatic stress
disorder which affects his overall functioning. From the medico legal
report compiled
by the educational psychologist, A Mattheus, it is
evident that the plaintiff’s father’s educational level
is unknown.
His biological mother completed Grade 12. He has two
siblings who completed respectively Grade 11 and Grade 8. The
plaintiff has
5 other siblings who are all still attending school.
[9]
With regards to his educational history, the plaintiff started his
formal schooling
in 2007 at Mojatsohle Primary School. He repeated
Grade 2. In 2015 he was enrolled at Mangaung Intermediate School
where he repeated
Grade 7. At the time of the accident, he was in
Grade 9. During 2019 he was enrolled at Nkhobiso Secondary School for
Grade 10.
He repeated Grade 10 in 2020. At the time of the assessment
by the educational psychologist in 2021, plaintiff was in Grade 11.
The educational psychologist opined that available academic results
suggest that the plaintiff is in danger of failing Grade 11
due to
poor performance in Accounting and Mathematics. It is furthermore
stated that school reports suggest that the plaintiff
had
pre-existing learning difficulties and that plaintiff is likely to
fail grade 11. He will most probably drop out of school
with a Grade
10 level of education and that he would then attempt to seek
employment. It is furthermore stated by the educational
psychologist
that the plaintiff may complete Grade 12, with low marks, and the
likelihood of repeating the Grade 12 cannot be excluded.
[10]
The occupational therapist opined that it is unlikely that the
plaintiff will ever be able to
engage in work that are demanding of
physical strength and fitness. The plaintiff is limited to sedentary
work options as a result
of his injuries. During the assessment it
was found that plaintiff suffers from decreased endurance and fatigue
and that he would
only be able to perform forward bending and walking
on an occasional basis during a working day. The occupational
therapist did
not provide any reason why the applicant presents with
endurance difficulties and what exactly is affecting his walking and
forward
bending abilities. However, it was noted that the plaintiff
would be able to perform the following on a frequent basis during a
working day:
10.1 sitting;
10.2 standing;
10.3 crouching;
10.4 squatting;
10.5 kneeling;
10.6 stairs.
[11]
The industrial psychologist, L Leibowitz, with a reference to the
educational psychologist’s
report is of the opinion that the
plaintiff would probably have relied largely on his physical
abilities to secure employment in
future. As a school leaver after
Grade 12, in a highly competitive market, a period of unemployment
would likely have ensued. Plaintiff’s
earnings upon entering
the labour market and after a further period of three years of
unemployment, may have somewhat aligned to
the national minimum wage
level and may have been around R 4 229.55 per month. Cognisant
of all the expert’s reports,
the industrial psychologist is of
the opinion that, should the plaintiff exit the schooling system with
a Grade 10 level of education,
the impact of his orthopaedic injuries
and related sequalae have rendered him an uncompetitive and
vulnerable individual. If it
is accepted that he would be limited to
sedentary employment, he is likely to struggle to secure, and more
importantly, sustain
employment.
[12]
The actuarial report compiled by Mr. Wim Loots and filed by the
plaintiff, to calculate the present
value of the potential loss of
earnings suffered by the plaintiff, is based on the assumption that
the plaintiff is regarded as
unemployable. The calculation is based
on the further assumptions that the plaintiff would have completed
Grade 12 in December
2022 where after a period of three years of
un-employment would follow. The plaintiff would then obtain
employment from 2026 and
would be remunerated in accordance with the
National Minimum Wage until the age of 47.5. From 1 November 2049 the
plaintiff’s
earnings are calculated at R 179 875.00 per
annum until the age of 65.
[13]
In paragraph 8 of the actuarial report the following is recorded:
“
The
actuarial calculations for loss of earnings take into account
mortality, taxation, inflation etc. but traditionally further
adjustments may be required for unforeseen factors. These factors
could include an allowance for illness, unemployment or injury
(possibly resulting in a reduced quantum) or the possibility that the
claimant could have experienced the earnings progression
beyond that
assumed (possibly resulting in an increased quantum). Allowance for
these contingencies should take into account the
specifics of the
case, are of a subjective nature and therefore not actuarially
determined. The following contingency deductions
were applied per
instruction:
·
Pre-accident: 20%
·
Post-accident: Not applicable”
[14]
The present value of the loss of earnings at 1 December 2021 is as
follows:
Earnings had the accident
not occurred
R 2 616 524.00
Less 20% contingency
deduction
R 523 304.00
Total loss of earnings
R 2 093 219.00.
[15]
It should be pointed out that the defendant approached the court
without any witnesses or medico
legal reports. The reports filed by
the plaintiff was accepted as uncontested evidence.
CONTINGENCIES.
[16]
In
Southern
Insurance Association v Bailey NO
,
[2]
Nicholson JA held as follows concerning computation of future loss of
earnings as a component of delictual damages:
“
Any
enquiry into damages for loss of earning capacity is of its nature
speculative, because it involves a prediction as to the future,
without the benefit of crystal balls, soothsayers, augurs or oracles.
All that the Court can do is to make an estimate, which is
often a
very rough estimate, of the present value of the loss.”
[17]
Contingencies are the “hazards of life that
normally beset the lives and circumstances of ordinary
people”
[3]
and should therefore, “by its very nature, be a process of
subjective impression or estimation rather than objective
calculation”
[4]
. In
Gillbanks v Sigournay
[5]
Henochsberg J held that in any estimate of a person’s loss of
earning capacity allowance must be made for all contingencies.
These
contingencies for which allowance should be made, would usually
include the following:
“
(i)
a possibility that plaintiff’s working life may have been less
than sixty-five years;
(ii)
the possibility of his death before he reaches the age of sixty-five
years;
(iii)
the likelihood of his suffering an illness of long duration;
(iv)
unemployment;
(v)
inflation and deflation
(vi)
alterations in the cost- of- living allowances;
(vii)
an accident whilst participating in sport such as hockey or cricket,
or at any other time which would affect his or
earning capacity; and
(viii)
any other contingency that might affect is the earning capacity.”
[6]
[18]
In
Sandler
v Wholesale Coal Suppliers Ltd
[7]
Watermeyer JA held as follows:
"The
amount to be awarded as compensation can only be determined by the
broadest general considerations and the figure arrived
at must
necessarily be uncertain, depending upon the Judge's view of what is
fair in all the circumstances of the
case".
[8]
In
the Quantum Yearbook
[9]
the
learned author points out that there are no fixed rules as regards
general contingencies. However, he suggests the following
guidelines:
‘
Sliding
scale: 0,5% per year to retirement age, i.e. 25% for a child, 20% for
a youth and 10% in the middle age…’
Normal
contingencies: The RAF usually agrees to deductions of 5% for past
loss and 15% for future loss, the so-called normal contingencies.”
[19]
Contingencies of whatever nature, generally serve as a control
mechanism to adjust the loss to
the circumstances of the individual
case in order to achieve justice and fairness to the parties.
[10]
There are no hard and fast rules of mathematical logic in the
determination of a contingency discount.
[20]
In her heads of argument, Mrs Hatting- Boonzaaier, counsel on behalf
of the plaintiff, contends
that the educational psychologist is of
the view that the plaintiff will most probably fail his 2021 school
year and will have
to repeat the year. As predicted, it turns out
that the plaintiff failed his Grade 11 year and is now repeating
Grade 11. The occupational
therapist agreed with Dr. Scher’s
findings regarding the impairment of the plaintiff’s elbow and
the bearing same will
have on his employment possibilities. It is
therefore contended that the plaintiff would be an extremely
vulnerable individual
in the open labour market and that it would be
unlikely for the plaintiff to obtain sedentary employment, more so,
to find any
employment in the open labour market. It is therefore
submitted that the contingencies applied as per the actuarial report
of Mr.
Wim Loots, who based the calculations on the industrial
psychologist’s report, are both fair and reasonable and that
same
be applied to equate the total loss of earnings.
[21]
On behalf of the defendant Mrs Gouws contends that the report of Mr.
Wim Loots includes only
one scenario as to the postulated career
progression of the plaintiff. It is therefore submitted that the
inclusion of only one
scenario, essentially usurps the court’s
duties as the court is prescribed the scenario which it should use.
The court should
actively evaluate the evidence and consider various
scenarios which may find application. Rarely would there be only one
scenario
which may find application on a set of facts, specifically
because the postulations are speculative by the very nature thereof.
Mrs Gouws furthermore contends that it should be noted that Mr. Wim
Loots was instructed to base his calculations on certain earnings
and
to use specific contingencies which effectively detracts from him
being an independent witness.
[22]
On behalf of the defendant it is furthermore argued that the
assumptions on which the actuarial
report is based are not in line
with the common cause facts, assumptions or conclusions reached by
the experts. The defendant did
not sustain a brain or head injury.
According to the clinical psychologist’s report it is likely
that the plaintiff had pre-existing
cognitive difficulties and had
failed Grades 2, 7, 10 and has recently also failed Grade 11. He
presents with working memory difficulties
which impacts negatively on
his learning abilities. Even though the educational psychologist
concluded that pre-morbid, the plaintiff
would “probably”
have been able to complete Grade 12 with low marks, the likelihood of
him repeating Grade 12 cannot
be excluded. As to the post-morbid
scenario the Educational Psychologist concluded that he is likely to
fail Grade 11 given the
severity of the emotional difficulties which
impacts on his cognitive performance and that he will most likely
drop out of school
with a Grade 10 level of education.
[23]
It is therefore contended that no logical and factual nexus between
the injury (to his elbow)
and plaintiff’s post-morbidly being
unable to obtain Grade 12 is provided and explained. Post-morbid the
plaintiff continued
academically on the same path as he did pre-
morbid and this cannot be as a result of the injuries sustained in
the accident. Mrs
Gouws thus contends that no specific and subjective
contingencies were however taken into consideration. The plaintiff’s
academic history, his family history in respect of limited academic
aptitude and his personal circumstances points to the plaintiff
pre-morbid most probably not being able to attain Grade 12. This
would have resulted in him being less competitive in the labour
market without taking cognisance of the sequelae of the accident.
[24]
I agree with the submissions made by Mrs Gouws that the mentioned
factors all militate against
a pre-morbid contingency deduction of
only 20%. I furthermore agree with her that there is no evidence to
the effect that the plaintiff
can be regarded as totally unemployable
as a result of the injuries sustained in the accident. The
occupational therapist clearly
indicated that the plaintiff will be
able to perform normal functions such as sitting, standing,
crouching, squatting, kneeling
and climbing stairs but walking only
on an occasional basis. There is no evidence before court that the
plaintiff is unable to
use a telephone, or drive a motorcycle and
therefore obtain employment as a delivery person, a taxi assistant or
selling fruit
and vegetables, to name but a few possible employment
options.
[25]
The plaintiff, according to the defendant, prior to the accident, in
any event had bleak prospects
of occupational advancement ahead of
him. Such possible buffets of poor prospects of employment must also
be taken into account.
However, the defendant adduced no evidence
whatsoever relating to the impairment of the right elbow or the upper
extremity impairment
as assessed by Dr Scher. To my mind the
defendant has not disputed the evidence of Dr Scher that the
plaintiff’s damaged
right elbow will probably manifest with
progressive functional impairment and secondary degenerative changes
over the medium to
longer term. The ongoing and increasing disability
will also probably require further surgery in future.
[26]
The plaintiff's legal representatives instructed the actuary, Mr Wim
Loots, to calculate his
future loss of earnings based on
contingencies of 20%. The actuary arrived at a loss of earnings in
the amount of R 2 093 219.00.
Counsel on behalf of the defendant
contends that a pre-morbid contingency deduction of 40% will be fair
under the circumstances.
As to the post-morbid un-employability of
the plaintiff, it is contended that this has not been proven on a
balance of probabilities
and he cannot be deemed to be “disabled”.
The plaintiff has a residual work capacity. It is contended that all
sedentary
work which the plaintiff may do or may be interested in
doing is not necessarily of an administrative nature. It is submitted
that
a post-morbid contingency deduction of 50% be applied.
[27]
Mrs Gouws therefore contends that the total future loss of earnings
will amount to R130 826.20
whereas the calculation presented by
Mrs Hatting- Boonzaaier amounts to R2 093 219.00. Having
regard to the facts of
this matter and the arguments on behalf of the
parties, I am convinced that a higher percentage contingency should
be applied in
respect of general contingencies and not only 20% as
suggested by the plaintiff. It is undisputed in my view that the
plaintiff
is an unfair competitor in the open labour market due to
the injuries sustained during the accident and the further
degeneration
of his elbow in future. I am however not convinced that
the contingencies as suggested by Mrs Gouws in respect of the
pre-morbid
and post- morbid scenarios have been substantiated by any
evidence. The plaintiff suffers from a permanent impairment of
earning
capacity.
[28]
In Southern Insurance Association v Baily NO
[11]
the two approaches that may be used to ascertain future loss of
earnings were discussed
[12]
by
Nicholas JA. Having regard to all the facts before the court and
having regard to what was held in Baily’s case, a trial
judge
is not necessarily tied down by inexorable actuarial calculations but
has “a large discretion to award what contingencies
he
considers right”. I find in the circumstances that a 30%
contingency deduction would be reasonable. Therefore, the amount
for
the loss of future earnings is calculated as follows:
Earnings had the accident
not occurred R 2 616 524.00;
Less 30% contingencies
R 784 957.20;
Total loss of future
earnings
R 1 831 566.80.
[29]
The settlement reached between the parties in respect of the claims
pertaining to General Damages,
and future medical expenses is
reflected in the draft order submitted by the plaintiff’s
counsel, which I intend to include
in the order of court.
[30]
ORDER
:
1.
The defendant is liable for 100% of the
plaintiffs proven or agreed damages.
2.
The defendant is ordered to compensate the
plaintiff in the amount of R500 000.00 (FIVE HUNDRED THOUSAND
RAND) in respect of
general damages resulting from the motor vehicle
collision that occurred on 1 December 2018.
3.
The defendant is ordered to furnish to the
plaintiff an undertaking in terms of
section 17(4)(a)
of the
Road
Accident Fund Act 56 of 1996
, for 100% of the costs of the future
accommodation of the plaintiff in a hospital or nursing home or the
treatment of or the rendering
of a service or the supplying of goods
to the plaintiff arising out of the injuries sustained by the
plaintiff in a motor vehicle
collision mentioned above, in terms of
which undertaking the defendant will be obliged to compensate
plaintiff in respect of the
said costs after the costs have been
incurred and on proof thereof.
4.
The abovementioned undertaking shall be
delivered by the defendant to Mokoduo Erasmus Davidson Attorneys.
5.
The defendant shall pay the plaintiff an
amount of R1 831 566.00 (ONE MILLION EIGHT HUNDRED AND
THIRTY-ONE THOUSAND FIVE HUNDRED
AND SIXTY- SIX RANDS) for loss of
future earnings.
6.
The defendant shall pay the plaintiff’s
taxed or agreed party and party costs on the High Court scale,
including the reasonable
qualifying fees of the following experts:
6.1
Dr Makau (General Practitioner);
6.2
Dr Scher (Orthopaedic Surgeon);
6.3
Burger Radiologists (Radiologist);
6.4
Alet Mattheus (Educational Psychologist);
6.5
Talita Da Costa (Clinical Psychologist);
6.6 S
Fletcher (Occupational Therapist);
6.7
L Leibowitz (Industrial Psychologist);
6.8
Wim Loots (Actuary).
7.
The payment provisions in respect of the
paragraph 2 and 5 above are as follows:
7.1
Payment of the capital amounts shall be made without the set- off or
deduction, within 180 (HUNDRED
AND EIGHTY) calendar days from date of
the granting of this order, directly into the trust account of the
plaintiff’s attorneys
of record by means of electronic
transfer, the details of which are the following:
Holder:
Mokoduo Erasmus
Davidson Attorneys Trust Account
Bank:
FNB
Branch:
Rosebank
Account Number:
[....]
Branch code:
253 305
Ref:
M3215
7.2
Payment of the taxed or agreed costs shall
be made within 180 (HUNDRED AND EIGHTY) days of taxation, and shall
likewise be effected
into the trust account of the plaintiff’s
attorney.
7.3
Interest
a tempore morae
to shall be calculated in accordance
with the
Prescribed Rate of Interest Act 55 of 1975
, read with
section 17(3)(a)
of the
Road Accident Fund Act 56 of 1996
, as
follows:
7.3.1 on the
capital amount of the claim, calculated 14 (FOURTEEN) days from the
date of this order;
7.3.2 on the taxed
or agreed costs, calculated 14 (FOURTEEN) days from date of taxation,
alternatively date of settlement
of such costs.
VAN
RHYN J
On
behalf of the Plaintiff:
ADV. D C HATTINGH-BOONZAAIER
Instructed
by:
MED Attorneys
On
behalf of the Defendant: MRS. J
GOUWS
Instructed
by:
State Attorneys, Bloemfontein
[1]
No
56 of 1996.
[2]
1984
(1) SA 98
(AD)
at
113G.
[3]
Corbett
& Buchanan, The Quantum of Damages, Vol II 360 at 367.
[4]
Shield
Ins. Co. Ltd v Booysen
1979 (3) SA 953
(A) at 965G-H.
[5]
1959
(2) SA 11 (NPD)
[6]
Gillbanks
v Sigournay at p17D-F.
[7]
1941
AD 194.
[8]
Sandler
v Wholesale Coal Suppliers Ltd at 199.
[9]
Robert
Koch, 2017 Edition, p 126.
[10]
Hall
v Road Accident Fund
[2013] JOL 30456
(GSJ) at paragraph 52; Road
Accident Fund v Guedes 2006 (5) SA (SCA) at paragraph 8.
[11]
1984
(1) SA 98 (A).
[12]
On
p 113.