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[2022] ZAECELLC 34
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S.J.D obo M.A v Road Accident Fund (EL 781/2021) [2022] ZAECELLC 34 (29 November 2022)
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IN
THE HIGH COURT OF SOUTH AFRICA
(EAST
LONDON CIRCUIT LOCAL DIVISION)
Case
no. EL 781/2021
In
the matter between:
S[....]
J[....] D[....]
on
behalf of M[....]
A[....]
Plaintiff
and
ROAD
ACCIDENT
FUND
Defendant
JUDGMENT
LAING
J
[1]
This is an application for
default judgment in terms of which the plaintiff seeks compensation
for damages arising from the negligent driving of a motor vehicle.
Backround
[2]
The plaintiff is the natural guardian and biological mother of a
seven-year-old male,
MA. On 6 March 2020, at Phumla Mqeshi Location,
in the Sterkstroom district, a motor vehicle struck MA while he had
been walking
along the pavement. As a result, MA sustained a severe
brain injury and blunt abdominal trauma, requiring hospitalisation
and medical
treatment.
[3]
Proceedings were instituted against the defendant for the payment of
damages in the
amount of R 11 million. The parties have reached
settlement regarding the claims for medical expenses and general
damages. The
plaintiff now seeks an order for payment of the amount
of R 9,319,588 for future loss of earnings.
Plaintiff’s
evidence
[4]
At the hearing of the matter, an occupational therapist, Ms Ncumisa
Magakwe, testified
in relation to a medico-legal report that she had
prepared. She indicated that MA displayed significant limitations
regarding his
cognitive and perceptual skills and presented with
behavioural problems. He would benefit from attendance at a special
needs school.
Ms Magakwe stated that MA’s future learning
capacity and the probabilities of his entering the labour market
remained uncertain.
[5]
The next witness was a counselling psychologist, Ms Linda Maye. She
referred to an
assessment that she had carried out on MA and averred
that there was strong evidence to suggest that he had suffered brain
impairment.
There was, however, no clear indication that MA’s
neuro-cognitive functions had been significantly different prior to
the
accident by reason of the limited cognitive abilities and demands
that characterised MA’s developmental age at the time. He
remained vulnerable to more adverse consequences than if he had
sustained the injury later in his formative years.
[6]
An educational psychologist, Dr Geoff Swana, then testified for the
plaintiff. He
confirmed that MA did not come from a high-functioning
background; family members had not progressed significantly in their
education.
It was not possible to assess MA’s pre-accident
scholastic potential with certainty because he had been four years
old at
the time, but it was probable that he would have passed grade
12 and entered the labour market with better earning prospects than
his parents. His post-accident learning abilities had been
compromised and it would be best for him to be placed at a special
needs school. It was now unlikely that he would reach and pass grade
12.
[7]
The final witness for the plaintiff was an industrial psychologist,
Mr Tshepo Kalanko.
He stated that he had prepared a medico-legal
report to deal with the question of MA’s future loss of
earnings. To that effect,
Mr Kalanko sketched various pre-morbid
employment scenarios, considering,
inter alia
, his
socio-economic background and education potential; these fell within
the range of semi-skilled to middle management positions.
He went on
to testify about the possible post-morbid scenarios, the first of
which being that MA would not acquire a qualification
and would
remain unemployed, the second of which being that he would secure
employment as an unskilled worker. Overall, Mr Kalanko
asserted that
MA’s future loss of earnings could be calculated as the
difference between his pre- and post-morbid potential.
Discussion
[8]
The court is required to determine the quantum of damages for future
loss of earnings.
This will entail taking into consideration the
evidence of the plaintiff’s witnesses as well as the actuarial
report provided.
By reason of MA’s being a young child, it is
especially difficult in these circumstances to arrive at an amount on
a purely
mathematical basis. The law makes provision, in claims for
prospective loss, for contingencies. These are described in academic
writing as follows:
‘‘
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 damages. In a wide sense,
contingencies are described as “hazards
that normally beset the
lives and circumstances of ordinary people”. 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.’
[1]
[9]
The determination of the relevant contingencies to take into
consideration in any
matter is certainly not an exact science. The
court is dealing with future events that may have either positive or
negative implications
(or both) for the claimant.
[2]
Whereas a likely trajectory for the different stages of life can be
postulated, having regard for the general socio-economic
circumstances
of a claimant, the truth is that each person’s
journey is different. Consequently, it would seem inevitable that
arbitrary
considerations would play a part in the determination
required.
[3]
A useful guide,
however, remains the actuarial evidence available.
[4]
[10]
In the present matter, the actuarial report relies considerably on Mr
Kalanko’s medico-legal
report, which sets out employment
scenarios upon which pre- and post-morbid income levels were
calculated. The key assumptions
used in the actuarial report are: (a)
that MA would have passed grade 12, obtained a tertiary degree, and
eventually advanced to
a middle management position in the corporate
sector, but for the accident;
[5]
and (b) that, as a result of the accident, MA will not earn any
income at all. The actuarial report, as pointed out by senior counsel
for the plaintiff, is based on a ‘best case’ scenario.
[11]
In his report, Mr Kalanko presents an alternative pre-morbid
employment scenario, in terms of
which he postulates that MA would
have passed grade 12 (at best) before entering the labour market,
whereafter he would have become
a skilled worker in the corporate
sector.
[6]
From the evidence of
Ms Maye and Dr Swana, it is clear that MA did not come from a
high-functioning background. Of the numerous
family members
mentioned, only an uncle has reached grade 12 and found employment.
Furthermore, it is clear that MA has suffered
a brain impairment and
that his learning abilities have been compromised. It is also clear,
from the evidence of Ms Makagwe, that
his future learning abilities
and the chances of his entering the labour market remain uncertain.
It would seem reasonable to find
that the ‘best case’
scenario that informs the actuarial report is unrealistic. It appears
that both key assumptions
can be criticised. Firstly, it is unlikely,
from the evidence of the witnesses, that MA would have advanced to a
middle management
position in the corporate sector; and, secondly, it
is unlikely that MA stands to earn no income at all.
[12]
Consequently, the ‘best case’ scenario relied upon for
purposes of the actuarial
report ought to be modified by taking into
consideration the alternative scenario presented by Mr Kalanko.
Senior counsel for the
plaintiff submitted a set of calculations that
takes the alternative scenario into account; it also makes provision
for contingencies
and residual earning capacity and ultimately
arrives at an amount based on the mid-point of the ‘best case’
and alternative
scenarios. In that regard, provision for residual
earning capacity could possibly be better accommodated under the
umbrella of
contingencies overall. Moreover, the calculations may
result in under-compensation. The damages amount is usually reduced
by 10%
to 50%, on average;
[7]
here, the figure is closer to 55%.
Relief
and order
[13]
The court enjoys a discretion in deciding what is reasonable and fair
in relation to the determination
of contingencies and (ultimately)
the claimant’s loss of earnings.
[8]
Mindful of the comments made in the preceding paragraphs, the court
is satisfied that the amount claimed, based upon the ‘best
case’ scenario indicated in the actuarial report, must be
adjusted by a percentage of 40%. This would seem to be a fair and
reasonable percentage for the contingencies involved.
[14]
In the circumstances, the following order is made:
(a)
the defendant is directed to pay the plaintiff the amount of R
5,591,753 for future loss
of earnings;
(b)
the defendant is further directed to pay:
(i)
interest on the above amount at the prescribed legal rate, calculated
from the
date of this order until the date of payment;
(ii)
costs of suit, including those of senior counsel and the plaintiff’s
experts
(plus qualifying expenses, if any); and
(iii)
interest on the above costs, calculated from ten (10) court days
after the finalisation
of taxation.
JGA
LAING
JUDGE
OF THE HIGH COURT
Appearing on behalf of
the Plaintiff:
Adv Cole SC, instructed by N. Tyatyeka attorneys, EL.
Appearing
on behalf of the Defendant:
No appearance
Date
heard: 30 August 2022
Date
delivered: 29 November 2022
[1]
Dendy
M, ‘Damages’, in
LAWSA
(vol 14(1), 3ed, 2018), at paragraph 27.
[2]
See
Southern
Insurance Association Ltd v Bailey
1984 (1) SA 98
(A), at 117B-D.
[3]
Dendy
M,
op
cit
,
at paragraph 89.
[4]
See
Paton
v Santam Insurance Co Ltd
1965
(1) QOD 637 (E) 645.
[5]
This
is described in Mr Kalanko’s report as a ‘career ceiling
within the lower quartile and median range for Paterson
level D1…
by the approximate age of 45.’
[6]
He
indicates a ‘career ceiling within the lower quartile and
median range for Paterson level C1/C2… by the approximate
age
of 45.’
[7]
See
Van
der Plaats v SA Mutual Fire & General Insurance Co Ltd
1980 (3) SA 105
(A), at 114-115. In relation to young children, see
Singh
and another v Ebrahim (2)
[2010] 3 All SA 240
(D), at paragraph [9].
[8]
See
Southern
Insurance Association Ltd
(n 2,
supra
);
also see
Nationwide
Airlines (Pty) Ltd (in liquidation) v SA Airways (Pty) Ltd
[2016] 4 All SA 153
(GJ), at paragraph [147].