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[2019] ZAFSHC 164
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Khokho NO v Road Accident Fund (804/2019) [2019] ZAFSHC 164 (12 September 2019)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
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IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Case
number:
804/2019
In
the matter between:
ADVOCATE
NGAKA DAVID KHOKHO N.O.
(curator
ad litem
to M
M)
Plaintiff
and
ROAD
ACCIDENT
FUND
Defendant
JUDGMENT
BY:
S.G.MEINTJES,
AJ
DELIVERED
ON:
12
SEPTEMBER 2019
[1]
This is an action for damages arising out of a collision involving a
motor vehicle with registration letters and numbers […]
FS
which occurred on 18 July 2013 along George Lubbe Street,
Bloemfontein. At the time of the collision, the said motor
vehicle was being driven by one Tiisetso Samuel Lusie and M M (M) was
a pedestrian.
In
consequence of the collision M, who was 6 years of age at the time,
sustained certain severe bodily injuries.
M’s
grandmother, Ms.L M, initially instituted the action in her capacity
as grandmother and guardian of M against the Road
Accident Fund.
However
in due course, Adv.Khokho was on 6 June 2019 appointed as curator ad
litem to M, by the High Court, Free State Division,
Bloemfontein.
He is therefore suing in his representative capacity as curator to M,
as Plaintiff.
[2]
No oral evidence was led in this case. The parties to this
action presented a Stated Case.
The
issues of liability and future medical expenses have been settled
between the parties. They have agreed that it may be
ordered,
by consent, that the Defendant is liable for 100% of the Plaintiff’s
agreed or proven damages, in his representative
capacity, suffered by
M as a result of the collision. They have also agreed that the
Defendant shall furnish the Plaintiff,
in his representative
capacity, with an Undertaking in terms of section 17(4)(a) of the
Road Accident Fund Act,56 of 1996.
The
issues in dispute and to be decided on, are the determination of the
quantum of the Plaintiff’s claim in his representative
capacity, in relation to M’s future loss of earnings and
general damages.
[3]
The parties agreed, based on medico-legal reports of a number of
experts as submitted, (the Expert Notices)that:
3.1
as a result of the collision, M suffered a very severe brain injury,
consisting of: a diffuse cerebral oedema; a (R) temporal
subdural
haematoma; a subarachnoid haemorrhage and an occipital skull
fracture. This resulted in, amongst other conditions,
in
spasticity; multiple convulsions and an increased risk of seizures;
3.2
he was after the collision admitted to the Pelonomi Hospital in
Bloemfontein, where he was detained for 3 months, during which
he was
admitted to the intensive care unit of the hospital immediately after
the collision. There in hospital, he was sedated;
splints were
applied due to the spasticity as a result of the brain injury;
he was intubated and ventilated; he underwent
the insertion of
an external CSF drain and he received blood transfusions on no
less than 3 occasions;
3.3
he was discharged from the intensive care unit on 23 July 2013;
3.4
he was readmitted to the intensive care unit on 25 July 2013 due to
respiratory distress as he developed septic complications
of the
respiratory system and streptococcus viridians infection in the
blood;
3.5
he received Epanutin to prevent seizures and Epilim to prevent fits;
3.6
he received naso-gastric feeds;
3.7
he developed a urethral stricture and subsequent circumcision to
relieve urinary symptoms experienced;
3.8
he was discharged from the intensive care unit again on 31 July 2013;
3.9
he underwent a CT scan, occupational therapy, speech therapy and
physiotherapy;
3.10
he was finally discharged and carried out of hospital due to
spasticity on 13 October 2013;
3.11
he presents with significant organic brain damage to his young and
immature brain, and it being anticipated that,
besides
causing brain tissue and functional tissue damage, there will be
impaired development of his brain, with either retardation
of
function or absence of outcome functions, that he will have some
permanent and irreversible damage, the effect of which coupled
with
the effect on brain function development will be more significant as
he grows older and is faced with more complex interactions
and tasks
to do, with problems academically, socially and as regards eventually
martially and occupationally, the so-called “sleeper
effect”.
He also presents severe neurocognitive deficits in several areas as
found. He presents a major personality
change after the
collision, and he has impaired insight and reasoning ability.
He presents major physical, cognitive, emotional
and behavioural
losses, including amongst others, chronic fatigue, daytime
somnolence, weakness of the (L) arm and (L) leg, abnormal
speech
profile and severe dyslexia.
These
deficits to be considered as permanent and irreversible;
3.12
M will in future require ongoing long-term psychiatric treatment, use
medication and undergo psychotherapy. It was also
agreed that
the prognosis for good improvement is poor as a result of the
permancy of organicity.
[4]
LOSS
OF EARNING CAPACITY:
Apart
from the above, the parties relied on this aspect of the case on a
Joint Minute, compiled by their respective industrial psychologists,
i.e, Mr. B. Mendelowitz and Mrs. M. Kheswa.
It
seemed that M before the accident, resided with his grandmother,
mother and half-brother in Bloemfontein. He was in good
health,
not suffering from any physical, neuropsychological, psychological
and psychiatric issues and attending a mainstream school,
considered
to have had intellectual potential in the average range.
The
industrial psychologists in their Joint Minute, agreed that M “had
the potential, had the accident not occurred, to obtain
and qualify
for a Higher Diploma at a university of technology…It is more
than likely that he would have had financial assistance
like a
bursary or some other similar source to fund his studies.
It is reasonable to expect that he would have so qualified
by age of
25 and after job seeking for about 2 years, he would have found
suitable employment in the corporate sector at about
age 27,by virtue
of his tertiary qualification. He would have started earning in
the corporate sector at a LOWER QUARTILE
B4 LEVEL, total packages,
progressing continuously in the formal sector to an UPPER QUARTILE C4
LEVEL, by age 48, remaining at
this plateau level, with annual
inflationary increases until his normal retirement age of 65”.They
also agreed that M would
have been continuously employed to age 65.
It
seemed that after the accident, M is still residing with his
grandmother and half-brother at the same address. His mother
has passed away. His father being unknown to him and his
grandmother. He never returned to a mainstream school, but
in
fact commenced schooling in 2015 at a special school and will remain
in special education until such time as he is old enough
to terminate
his education, i.e. until he is 15 years old, whereupon he will exit
the education system with severe deficiencies.
He is in fact
regarded as a severe handicapped person. The industrial
psychologists agreed “that he will not cope in
the workplace
and will never be able to participate in the open labour market.
This renders him unable to earn any income,
post morbidly”.
They
agreed “that it is highly probable that his post- accident
potential has been seriously and permanently affected and
decreased
to naught by this accident and its sequelae. He is…not
suited to any work in the open or sheltered labour
market”.
They agreed that due to his injuries, M will never be employed in the
open labour market and should be afforded
the opportunity to receive
expert recommended treatments.
The
Plaintiff obtained an actuarial report from Koch Consulting
Actuaries, which report is based upon the agreed facts. The
actuarial calculations reflecting M’s future loss as R5 891
844.00, with no deduction for general contingencies.
That was
left to the parties to negotiate, or for the Court to decide.
The
Defendant also obtained an actuarial calculation, prepared by
Rosewood Technologies (Pty) Ltd, based upon the Joint Minutes
by the
industrial psychologists. They calculated M’s future loss
as R6 182 521.00.General contingency deductions also
still to be
taken into account.
Counsel
for Plaintiff argued that a contingency deduction of 25% in respect
of M’s uninjured earnings should be applied to
his loss of
income (R5 891 844.00).Counsel for Defendant argued that a
contingency deduction of 35% be applied. Also based
on a future
income of R5 891 844.00 as calculated by Plaintiff’s Actuary.
It
is clear,
in
casu
, that the Court is approached by the
parties, to make an assessment of M’s future loss on the basis
of actuarial calculations
of the income he would have made but for
the accident (R5 89 1844.00) and from which figure a contingency
deduction still has to
be made.
It
ought to be borne in mind that reports by experts like industrial
psychologists and actuaries, although based on expertise and
being of
huge benefit to a Court, are only a guide and ought to be evaluated
as part of the totality before the Court.
In
Road
Accident Fund v Guedes 2006(5) SA583 (SCA) at p586 para[8]
it was said:
“
It
is trite that a person is entitled to be compensated to the extent
that the person’s patrimony has been diminished in consequence
of a another’s negligence. Such damages include loss of
future earning capacity…The calculation of the quantum
of a
future amount, such as loss of earning capacity, is not, as I have
already indicated, a matter of exact mathematical calculation.
By its nature, such an enquiry is speculative and a court can
therefore only make an estimate of the present value of the loss
that
is often a very rough estimate…The court necessarily exercises
a wide discretion when it assesses the quantum of damages
due to loss
of earning capacity and has a large discretion to award what it
considers right. Courts have adopted the approach
that, in
order to assist in such a calculation, an actuarial computation is a
useful basis for establishing the quantum of damages.
Even
then, the trial court has a wide discretion to award what it believes
is just…”.
The
contingency factors to be applied in any given case are to be
considered on the facts of that case.(See Corbett: The Quantum
of
Damages in Bodily and Fatal Injury cases vol 1 (General Principles)
at 51-52).The usual considerations include the possibility
of errors
in the estimation of the injured party’s life expectancy, the
likelihood of illness and unemployment which would
have occurred in
any event or which may in fact occur, inflation or deflation of the
value of money, tax, alterations in the costs
of living allowances
and accidents or other contingencies which would have affected the
relevant party’s own capacity in
any event. In Southern
Insurance Association Limited v Bailey NO1984 (1) SA 98 it was stated
as follows at 116 G-117 A:
“Where the method of actuarial
computation is adopted, it does not mean that the trial Judge is”
tied down by inexorable
actuarial calculations” He has “a
large discretion to award what he considers right” (per HOLMES
JA in
Legal Assurance Co v Botes
1963 (1) SA 608
(A) at 614 F)
.
One of the elements in exercising that discretion is the making of a
discount for “contingencies” or the “vicissitudes
of life”. These include such matters as the possibility
that the plaintiff may in the result have less than a “normal”
expectation of life; and that he may experience periods of
unemployment by reason of incapacity due to illness or accident, or
to labour unrest or general economic conditions. The amount of
any discount may vary, depending upon the circumstances of
the case.
See
Van der Plaats v South African Mutual Fire and General
Insurance Co Ltd
1980 (3) SA 105
at 114-5
. The rate of the
discount cannot of course be assessed on any logical basis; the
assessment must be largely arbitrary and
must depend upon the trial
Judge’s impression of the case”
The
actuarial calculations of Koch upon which both parties relied on, are
based upon an allowance having been for M to be continuously
employed
until normal retirement age of 65.He has been assumed to have average
mortality expectations.
Having
regard to all the facts and circumstances of this case, including M’s
tender age at the time of the accident and actually
very grim and
restrictive expectations of life, I am of the view that a contingency
factor of 25% should be applied. In the
circumstances M is
therefore entitled to be awarded in the sum of R4 418 883.00 in
respect of future loss of earnings. Calculated
as follows: Future
income: R5 891 844.00-R1 472 961.00(Contingency deduction of 25%)=R4
418 883.00.
[5]
GENERAL DAMAGES:
Counsel
for
the Plaintiff submitted, with
reference to relevant
case law, that the sum of R2 200 000.00 should be awarded
in respect in respect of Plaintiff’s
claim for general damages.
Counsel
for the Defendant also cited various decisions and contended that the
sum of R1 500 000.00 should be awarded as
such.
In
Bonesse
v Road Accident Fund 2014 JDR 0303 (ECP) p28 –p29
it
was stated as follows:
“
The
principles relevant to the assessment of general damages are
well-known and appear from cases such as Sandler v Wholesale Coal
Suppliers Ltd
1941 AD 194
;Protea v Lamb
1971 (1) SA 530
(A);
AA
Onderlinge Assuransie Assosiasie Bpk v Sodoms
1980 (3) SA 134
(A) and
Southern Insurance Association v Bailey N.O. 1984(1) SA 98 (AD) at
119 G-H.
In
summary, in determining what would constitute fair compensation in a
particular matter the court has regard, inter alia, to the
circumstances of the case, amounts previously awarded in broadly
comparable cases and the decrease in the value of money since
those
previous cases were decided. The court must bear in mind,
however, that awards made in previous cases can only afford
broad and
general guidelines in view of the differences that inevitably arise
in each case”.
It
appeared from the agreed facts that M has suffered a severe head
injury, accompanied by brain damage. The brain damage
severe
and irreversible. The sequelae of his injury to be devastating
on his life as a whole. The effects of his injury
and condition
will become worse in future as he grows older. He will not cope
in the workplace one day. He will never
be able to participate
in the open labour market. In fact, he is unable to earn any
income and will need life-long support.
Prior
to the accident he was only 6 years old. Being a normal and
healthy boy without any restrictions. His whole life
with all
its promise laying ahead. He attended a mainstream school with
the intellectual potential in the average range as
most of us and had
the potential to obtain a Higher Diploma at a university of
technology, had it not been for the accident .But
now, since then, he
seems uneducable in a special school and does not make any progress.
His mortality expectancy to be assumed
as average. He will
therefor endure his dismal future until he is 65 as estimated.
He has suffered a severe loss and
should be compensated well.
Having
regard to all the circumstances of this case, the comparable cases as
cited by counsel and the decrease in the value of money
since those
cases were decided, I am of the opinion that a fair amount would be
one of R2 200 000.00.R1 500 000.00
as contended
by counsel for Defendant as an appropriate award, just too low.
[6]
ORDER:
6.1
Defendant is liable for 100% of the Plaintiff’s agreed or
proven damages, in his representative capacity, suffered by
M as a
result of the collision which forms the subject matter of this Stated
Case;
6.2
Defendant shall pay to the Plaintiff, in his representative capacity
as duly appointed curator ad litem to M M (M), a minor
male, born on
the 6
th
day of December 2006 the sum of:
6.2.1
R4 418 883.00 in respect of M’s future loss of income
and;
6.2.2
R2 200 000.00 in respect of M’s general damages,
together with interest thereon at the rate of 10.25% per
annum,
calculated from the day following the lapse of a period of 14 days
from the date of the grant of this order to date of final
payment;
6.3
The payment referred to in paragraph 6.2,supra,and the costs
referred to in paragraph 6.5, infra, shall be made into the
trust
account of the Plaintiff’s attorneys, being S.S.H. Mehlomakulu
& Company Trust Account, (First National Bank Account
Number:
[…]) pending the establishment of the trust contemplated in
paragraph 6.6 ,infra;
6.4
Defendant shall furnish the Plaintiff, in his representative
capacity, with an undertaking, as contemplated in section17(4)(a)
of
the
Road Accident Fund Act, 58 of 1996
, to compensate M for the cost
of his future accommodation in a hospital or a nursing home, or for
the treatment of, or rendering
of a service or supply of goods to
him, arising from injuries sustained by M in a motor vehicle
collision which occurred on the
18
th
day of July 2013, after such costs have been incurred and on proof
thereof, which undertaking shall include an undertaking to pay
the
reasonable costs to be incurred for purposes of:-
6.4.1
The establishment of a trust and the appointment of a trustee;
6.4.2
The fees of the trustee in administering the aforesaid nett capital
amount and the costs of administering the aforesaid undertaking
as
determined by the
Administration of Estates Act, 66 of 1965
;
6.4.3
The furnishing of security by the trustee and obtaining of annual
security bond to meet the requirements of the Master of
the High
Court in terms of
Section 77
of the Administration of Estates Act.66
of 1965.
Subject
thereto that the costs referred to in 6.4.1, 6.4.2 and 6.4.3 above
are limited to the prescribed tariff applicable to a
curator
bonis
;
6.5
The Defendant shall pay the Plaintiff’s costs of suit as taxed
or agreed, on a scale as between party and party, together
with
interest thereon calculated at the rate of 10.25% per annum,
calculated from the day following the lapse of a period of 14
days
from the date of the allocator to date of payment, such costs to
include the costs occasioned by the:-
6.5.1
Appointment of the curator ad litem in this matter;
6.5.2
Employment of the following expert witnesses, including their
reservation and qualifying fees, fees for attending Court, if
any,
and the costs of such expert witnesses attendant upon the
consultations between such expert witnesses and the Plaintiff’s
legal representatives to attend such consultations:-
6.5.2.1
Dr Wilkenson (neurosurgeon);
6.5.2.2
Dr Fine (psychiatrist);
6.5.2.3
Mr Mashaba (occupational therapist);
6.5.2.4
Mrs Gibson (neuro-psychologist);
6.5.2.5
Mr Mendelowitz (industrial
psychologist);
6.5.2.6
Mrs F van Vuuren (educational psychologist);
6.5.2.7
Dr R.J.Koch (actuary);
6.5.2.8
Dr Guy (speech and language therapist).
(“The
Expert Witnesses”)
6.6
The Plaintiff’s attorneys are hereby directed to:-
6.6.1
Cause a trust to be established in accordance with the Trust Property
Control Act,57 of 1988;
6.6.2
Pay such amount as may be due to M to the trust for the benefit of M;
[7]
The trust instrument contemplated in paragraph 6.6
supra
,
shall provide that:-
7.1
M will be the sole beneficiary of the trust;
7.2
The first trustee(s) shall be Mahalia Molefe as nominee for and on
behalf of ABSA Trust Limited;
7.3
The trustee(s) shall provide security to the satisfaction of the
Master of the High Court of South Africa;
7.4
The ownership of the Trust Property shall vest in the trustee(s) of
the trust, in his/her/their capacity as trustees;
7.5
Procedures to resolve a potential dispute, shall be subject to the
review of the above Honourable Court;
7.6
The trustee(s) shall be authorized to recover the remuneration of as
well as the costs incurred by the trustee(s) in administrating
the
Undertaking as envisaged in paragraph 6.4,supra;
7.7
There shall be an exclusion of any community of property in the event
of the marriage of M;
7.8
The amendment of the trust instrument shall be subject to the leave
of the Honourable Court;
7.9
The trust shall terminate upon the death of M in which event the
trust assets shall pass to the estate of M;
7.10
The trust property and the administration thereof shall be subject to
an annual audit;
7.11
The trustee(s) shall maintain M as may be reasonably required from
time to time.
[8]
The attorneys shall be entitled to make payment of and or recover all
disbursements incurred by them in the action, including,
but not
limited to, accounts rendered by:-
8.1
The expert witnesses;
8.2
Counsel employed in behalf of M;
8.3
The curator ad litem;
from
the aforesaid funds received by them in trust for and on behalf of M.
[9]
The attorneys shall be entitled to payment, from the aforesaid funds
received by them in the trust and on behalf of M, of their
fees.
_________________
S.G.MEINTJES,AJ
On
behalf of the plaintiff: Adv. S.STRYDOM
Instructed
by:
S.S.H.Mehlomakulu
&CO
Attorneys
BLOEMFONTEIN
On
behalf of the defendant: Adv. M.SHATA
Instructed
by:
Maduba
Attorneys
BLOEMFONTEIN