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[2011] ZASCA 223
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Road Accident Fund v Zulu and Others (50/11) [2011] ZASCA 223 (30 November 2011)
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THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case
No: 50/11
In
the matter between
ROAD ACCIDENT FUND
…..........................................................
Appellant
and
PHILILE
ROSELINE ZULU
…...........................................
First
Respondent
MANDLAKAYISE
MTEMBENI
KA-AMBROSE
ZULU
…..................................................
Second
Respondent
SIPHELE
MLAMULU MACPHERSON ZULU
…..........
Third
Respondent
Neutral
citation:
RAF v ZULU
(50/11)
[2011] ZASCA 223
(30 November
2011)
Coram:
HEHER, MHLANTLA and SERITI JJA
Heard:
3 November 2011
Delivered:
30 November 2011
Summary:
Motor vehicle collision ─ death of breadwinner ─
dependants' claim against RAF ─ quantum of damages.
___________________________________________________________
ORDER
___________________________________________________________
On appeal from:
KwaZulu-Natal High Court, Durban
(Griffiths J sitting as court of first instance):
1 The appeal is upheld with costs.
2 The order of the court below is set aside and replaced
with an order in the following terms:
'There shall be judgment for the plaintiffs as follows:
(a) First plaintiff, payment of the sum of R13 556 539;
(b) Third plaintiff, payment of the sum of R566 867.'
3 The cross-appeal is dismissed with costs.
___________________________________________________________
JUDGMENT
___________________________________________________________
MHLANTLA JA (HEHER and SERITI JJA concurring):
[1] This is an appeal with leave of the KwaZulu-Natal
High Court, Durban (Griffiths J) against the quantum of an award of
damages
made in favour of the first and third respondents in an
amount of R19 227 337 for loss of support. The claim on behalf of the
second
respondent had been settled between the parties, and is
accordingly not relevant for purposes of this appeal. Prof Mthembeni
MacPherson
Zulu was fatally injured in a motor vehicle collision on
18 October 1997. During his lifetime, he was married to Mrs Philile
Roseline
Zulu, the first respondent in this matter and they had two
children, the second and third respondents respectively.
[2] Before identifying the issues, it will be apposite
for a better understanding of the case to set out a brief background
of Prof
Zulu. It is not in dispute that he was a man who had achieved
much and had enormous potential to achieve more. The main features
of
his illustrious career are as follows:
(a) Prof Zulu commenced his career as a lecturer at the
University of Zululand in 1975.
(b) In 1988 he obtained a PhD from the State University
of New York in Inorganic Chemistry. In 1989 he was awarded the
prestigious
Zappert Award by the American Chemical Society for the
best PhD.
(c) In 1993, he was awarded the prestigious Humboldt
Award and studied in Germany as an Alexander van Humboldt Fellow at
the University
of Stuttgart for eight months.
(d) On 1 September 1997, he was promoted to the position
of senior professor in the Department of Chemistry. He was also the
head
of that department as well as Vice-Dean of the Faculty of
Science and Agriculture. Shortly before his death, he had applied for
a post of Dean of Science at Vista University, Johannesburg. Prof
Zulu earned a good salary and had considerable security of
employment.
He was passionate about his work and had a keen interest
in the education and upliftment of the students.
(e) Prof Zulu was an internationally acclaimed scientist
and leading academic. He worked very closely with Prof O’Brien
of
the University of Manchester, United Kingdom, who has since been
involved in the corporate world in his field of inorganic chemistry
and has achieved great wealth. Prof Zulu was a key participant in an
international project known as the Royal Society Evaluation
Report,
between a number of South African and UK universities. The progress
of the project was delayed by at least ten months due
to his death.
(f) He sat on numerous academic and scientific boards
and committees. He represented South Africa on the International
Council of
Scientific Unions Board and on the International Union for
Pure and Applied Chemistry (IUPAC). He also represented the country
at international conferences.
[3] Prof Zulu was a member of the Zulu royal family and
was recognized as a leader by his peers in academia, other
professions and
in business. Some of his colleagues, namely Prof
Magi, Prof Revaprasadu, Prof Sibaya and Mr Mapisa testified that Prof
Zulu, due
to his exceptional attributes and abilities, was destined
for the top post at the university and possibly in the private
sector.
They described him as a man who had the drive to succeed and
ability to motivate. He had great charisma, the ability to network
and work with people. None had any doubt that he would have been
appointed as Vice-Chancellor of any university in the country.
[4] Prof Zulu had close connections with influential
persons in government ─ one of whom was Dr Ben Ngubane, a
former Minister
of Arts, Culture, Science and Technology. Prof Zulu
was committed to the upliftment of persons who had been disadvantaged
by apartheid
and the transformation of society. He died at the age of
49 years and during the era of Broad Based Black Economic Empowerment
(BEE). Both expert witnesses agreed that he aspired and had the
potential to enter the corporate track at a senior executive level,
particularly having regard to the BEE policies in place at the time
of his untimely death and thereafter. Sadly his life was cut
short as
a result of this tragic incident. At the time of his death he had not
sought full time employment outside the academic
field. I will
hereafter refer to Prof Zulu as the deceased.
[5] Against that background the respondents instituted
action in the KwaZulu-Natal High Court, Durban against the Road
Accident
Fund, a statutory insurer and appellant in this matter, for
damages arising out of the death of the first respondent's husband
and the father of the second and third respondents. In an earlier
hearing on the merits, Olsen AJ held that the respondents were
entitled to 100 per cent of the proven damages.
[6] The issue relating to the determination of quantum
came before Griffiths J. The court below was required to determine
the salary
the deceased would have earned between his 49
th
and 65
th
year. This amount would be used as a base line
for the calculation of maintenance for the respondents and thus
determine quantum.
The extent of the damages to be awarded to the
respondents was in dispute between the parties. Both parties adduced
evidence and
called witnesses including industrial psychologists to
provide expert assistance to the court in making the assessment
required.
[7] At the end of the trial, the learned judge placed
considerable emphasis on the evidence of Dr Ben Ngubane and Dr
Richard Holmes,
an industrial psychologist. The judge, however, took
the view that he was not prepared to accede to the approach of Dr
Holmes that
the deceased would have left the university by 2002. The
judge adopted a conservative approach and held that it was more
probable
that the deceased would have left academia by 2005 and
progress to a Chief Executive Officer position by 2010. He applied a
contingency
deduction of ten per cent and awarded the first
respondent damages in an amount of R18 630 992 and the third
respondent damages
in the amount of R614 604. As I mentioned at the
beginning of this judgment the appellant now appeals against this
finding, in
particular the extent of the award, with the leave of the
court below.
[8] The issue on appeal and conditional cross-appeal is
whether it was established that the deceased would have exercised the
choice
to move to the corporate track if and when the opportunity
presented itself. Aligned to this question is the nature of the
discretion
exercised by the trial court.
[9] On appeal before us counsel for the respondents
submitted that the discretion exercised by the trial court should be
treated
as one in a strict sense. I shall assume, without deciding
the matter, that this was a strict discretion. However that is not
the
end of the enquiry. I have to determine whether the court below
exercised that discretion judiciously and properly. In
Southern
Insurance Association Ltd v Bailey NO
,
1
Nicholas JA enunciated the proper approach of an appeal
court in appeals against awards of damages as follows:
'It is well settled that this Court does not interfere with awards of
damages made by a trial Court unless there is "a substantial
variation" or "a striking disparity" between the award
of the trial Court and what this Court considers ought to
have been
awarded; or the trial Court did not give due effect to all the
factors which properly entered into the assessment; or
the trial
Court made an error in principle, or misdirected itself in a material
respect.'
[10] It has to be borne in mind that an enquiry into
damages for loss of earning capacity is of its nature speculative.
The court
below had to determine the issues on predictions based on
facts.
It is evident that the deceased was an
academic. There is no evidence that any employment offer outside the
academic field had ever
been made to him. On the contrary, he is
likely to have ascended to the highest academic rank in one of the
South African universities.
Against that background the deceased
clearly had the ability and credentials to fill a position in the
parastatal or corporate
world. The question to be answered is whether
the deceased would have exercised the choice when the opportunity
arose when regard
is had to the evidence and his background. There is
no evidence to support this contention save the opinion of Dr Ngubane
and Dr
Holmes. It is therefore necessary to evaluate their evidence.
[11] Dr Ben Ngubane when he testified described the
deceased as an intelligent and competent person. He and the deceased
formed part of an elite group of prominent black persons
in KwaZulu-Natal who engaged with business people in Richards Bay. He
consulted
on a part time basis for corporations like Richards Bay
Minerals, Foskor, Billiton etc. Dr Ngubane was of the view that the
deceased
would have joined the corporate sector as a senior executive
as early as 2000 as there were many opportunities for persons of his
caliber. In my view, Dr Ngubane's evidence was based on personal
experiences and on the general pressure on very able academics
to
take up parastatal and corporate employment. He did not testify to
any job offer made to the deceased. His opinion can thus
not be
regarded as certainty in so far as the deceased is concerned, more
particularly, in view of his academic background.
[12] Dr Holmes had adopted a conservative approach in
his expert notice. He had stated that the deceased, given his
academic, research,
leadership and management skills would have moved
into fields related to his profession. In his opinion, the deceased
would probably
have been offered the position of CEO or President at
a parastatal institution like the National Research Foundation or the
Council
for Scientific and Industrial Research by not later than
2008.
[13] During the trial, Dr Holmes was in court when Dr
Ngubane testified. He changed his opinion during his testimony and
stated
that the deceased would have moved out of academia by 2002 to
join the corporate world as a senior executive. He further stated
that the deceased would have attained the rank of CEO by 2005 where
he would have remained until retirement. Dr Holmes admitted
that his
opinion had largely been influenced by Dr Ngubane's testimony.
[14] I have already alluded to the fact that the learned
judge in the court below relied heavily on the evidence of Dr Holmes,
an
expert witness. A useful guide to the approach of expert evidence
is found in
Michael v Linksfield Park Clinic
(Pty) Ltd
2
where the court stated:
'. . . what is required in the evaluation of such evidence is to
determine whether and to what extent their opinions advanced are
founded on logical reasoning.'
At paras 39 and 40, the court further stated:
'[I]t would be wrong to decide a case by simple preference where
there are conflicting views on either side, both capable of logical
support. Only where expert opinion cannot be logically supported at
all will it fail to provide "the benchmark by reference
to which
the defendant's conduct falls to be assessed."
Finally, it must be borne in mind that expert scientific witnesses do
tend to assess likelihood in terms of scientific certainty
. . . This
essential difference between the scientific and the judicial measure
of proof was aptly highlighted by the House of
Lords in the Scottish
case of
Dingley v The Chief Constable, Strathclyde Police
200
SC (HL) 77 and the warning given at 89D-E that
"(o)ne cannot entirely discount the risk that by immersing
himself in every detail and by looking deeply into the minds of
the
experts, a Judge may be seduced into a position where he applies to
the expert evidence the standards which the expert himself
will apply
to the question whether a particular thesis has been proved or
disproved – instead of assessing, as a Judge must
do, where the
balance of probabilities lies on a review of the whole of the
evidence".'
[15] In my judgment, Dr Holmes, as an expert witness,
had a limited role in the proceedings. His duty was to advise the
court on
the availability of employment positions. He is not
qualified to predict and state as a fact that the deceased, whom he
had never
met, would with certainty have moved to the corporate
world. His expert notice did not provide for this conclusion. It is
the court's
duty to assess the evidence and decide the probabilities.
[16] Before us counsel for the appellant conceded that a
possibility did exist that the deceased would have entered the
corporate
world around 2005. He however submitted that it was more
probable that the deceased would have remained in the academic field
when
regard is had to his academic background. He argued that the
court below misdirected itself when it wholly based the deceased's
future income after 2005 on his entry to the corporate world without
applying any contingencies reflecting a possibility of the
deceased
remaining in academia.
[17] I agree with this submission. The court below,
after accepting Dr Holmes and Dr Ngubane's evidence, only adjusted
the dates.
The judge treated the deceased's entry to the corporate
world from 2005 as a certainty. He did not diminish the probability
by
any percentage. This was despite the lack of evidence and
certainty in that regard. It has to be borne in mind that the
deceased
was academically inclined. He was a research scientist and
served on boards linked with education. He was committed to the
upliftment
of communities and children in the field of science. He
undertook initiatives to promote and provide scientific and
laboratory
services. He clearly was not an avaricious person
motivated by wealth. In my view, it cannot be said with certainty
that the deceased
would have been appointed as a senior executive or
CEO in the corporate sector. A chance exists that the deceased, due
to his academic
background, could have remained at the university.
There was no evidence which could have raised the probability of
employment
in the corporate sector to the level of certainty.
[18] In my view, the learned judge did not give due
effect to all the relevant factors in the assessment of the
deceased's earnings.
The judge should have treated the period after
2005 differently and take into account the probability ─
however slight ─
that the deceased could have remained in
academia and reflect that in the assumptions and final award. In the
result, the award
made by the trial court reflects a striking
disparity to the amount which this court would have awarded. We are
accordingly at
large to interfere with the award and consider the
issue of quantum afresh.
[19] I now proceed to deal with the pertinent issue,
that is, the determination of the salary the deceased would have
earned. The
conditional cross-appeal relates to this aspect. In
Burger v Union National South British
Insurance Co
3
Colman J stated:
'. . . it is recognised as proper in an appropriate case, to have
regard to relevant events which may occur, or relevant conditions
which may arise in the future. Even when it cannot be said to have
been proved, on a preponderance of probability, that they will
occur
or arise, justice may require that what is called a contingency
allowance be made for a possibility of that kind. . . . The
contingency is allowed for by including in the damages a figure
representing a percentage of that which would have been included
if
amputation had been a certainty.'
[20] Before us counsel for the respondent submitted that
the court below should have accepted Dr Holmes' evidence that the
deceased
would as a certainty have moved to the corporate world from
July 2002 instead of 2005. In this regard counsel urged us to apply
the figures in the actuarial report dated 21 June 2010 when
determining quantum, effectively increasing the award made by the
trial court.
[21] This submission is without merit. The evidence
established that the deceased was an academic, primarily within the
field of
research and more concerned about the upliftment of
students. There is no admissible evidence that he ever contemplated
leaving
the university for greener pastures in the immediate future.
There is only hearsay evidence from the deceased's widow which was
presented by Dr Holmes and which is not acceptable. The views of Dr
Holmes are highly speculative. The evidence disclosed that
the
policies regarding transformation opportunities were strong. These
would be available for persons of the deceased's caliber.
Indeed
pressure was put on these persons to assume leadership positions in
business and government as there was a shortage of suitable
candidates of that caliber. In the court a quo there was insufficient
evidence with regard to the deceased's desire to leave the
university
despite the existence or emergence of these BEE opportunities. On the
contrary the evidence revealed that the deceased
remained passionate
within his vocation until his untimely death.
[22] It appears that the judge may have been swayed by
the evidence of Dr Holmes who saw the deceased as a person who would
have
moved to the corporate world as a certainty. This perception is
not unwarranted. The problem is that he saw the move to corporate
as
a real possibility despite the lack of evidence in that regard. In my
view a contingency deduction should be applied to reflect
a
possibility of the deceased remaining in academia. Counsel for the
appellant submitted that the court should apply a contingency
of 66
per cent on the deceased remaining at the university. I do not agree
with this submission. It has to be accepted that due
to his proven
competence, the deceased would have continued on an upwardly mobile
career path. In my view a 40 per cent contingency
would accurately
reflect the balance of the evidence. Put another way, there was a 40
per cent prospect that the deceased would
have remained in academia,
and a 60 per cent chance that he would have moved into the corporate
sector from 2005 and earned a salary
appropriate to the post of a
senior executive and thereafter assume promotion to CEO level.
[23] In the result, a proper approach would be to
determine the deceased’s future earning capacity taking into
account the
contingency deductions set out in para 22 above as
follows:
(a) that the deceased would have assumed promotion to
Vice-Chancellor in 2000 and remained at the university until 2005.
(b) that he would thereafter have entered the corporate
sector as an executive; and
(c) that he would have been appointed as CEO in 2010,
where he would have remained until his retirement age.
[24] The parties were agreed that should the court
require new calculations, the actuary, Mr Morris of Wells Faber-Human
Morris
who had performed the calculation would be available to
recalculate the deceased's earnings. He has accordingly adjusted the
computation
of the deceased's earnings in accordance with the
directives given by this court on 4 November 2011. The court is
grateful for
the exercise and the prompt response thereto. In that
report, the actuary arrived at a figure of R13 556 539 for the first
respondent
and R566 867 for the third respondent. In the result the
award made by the trial court has to be reduced by an amount of
approximately
R5 million. Its order in that regard must be set aside.
It follows that the cross-appeal has to fail.
[25] This brings me to the question of costs. The
decisive fact is that the appellant had to come to this court to have
the order
of the court below set aside and the quantum of damages
reduced. In my view, it has had substantial success on appeal. It is
accordingly
entitled to its costs of appeal.
[26] The following order is made:
1 The appeal is upheld with costs.
2 The order of the court below is set aside and replaced
with an order in the following terms:
'There shall be judgment for the plaintiffs as follows:
(a) First plaintiff, payment of the sum of R13 556 539;
(b) Third plaintiff, payment of the sum of R566 867.'
3 The cross-appeal is dismissed with costs.
_____________
N Z MHLANTLA
JUDGE OF APPEAL
APPEARANCE:
For
Appellant: K J Kemp SC
Livingston
Leandy Incorporated, Durban
McIntyre
& van der Post, Bloemfontein
For
Respondent: M Pillener SC
Kevin
Duke Attorneys, Durban
Lovius
Block, Bloemfontein
1
Southern
Insurance Association Ltd v Bailey NO
1984
(1) SA 98
(A) at 109H. See also
Road
Accident Fund v Guedes
2006 (5) SA 583
(SCA) para 8.
2
Michael
v Linksfield Park Clinic (Pty) Ltd
2001
(3) SA 1188
(SCA) para 36.
3
Burger
v Union National South British Insurance Co
1975 (4) SA 72
(W)
at 75D-F.