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[2018] ZAGPPHC 602
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Matshilwane v Road Accident Fund (57635/2016) [2018] ZAGPPHC 602 (28 March 2018)
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Certain
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IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG LOCAL DIVISION, PRETORIA
CASE
NO
.:
57635/2016
28/3/2018
In
the matter between:
SIBUSISO
NKOSINATHI MATSHILWANE
And
ROAD
ACCIDENT FUND
JUDGMENT
MOSOPA,
AJ
INTRODUCTION
[1]
The
plaintiff, who is currently 22 years of age, born on the 13 June
1996, was a pedestrian on the 01 .Ju ne 2014 when the motor
vehicle
collision occurred on the Gammakola road, Mpumalanga, driven by an
unknown driver.
[2]
The
plaintiff was at the time of the motor vehicle collision a grade 8
learner at Makhosane Senior Secondary School, Mpumalanga.
[3]
At
paragraph 6 of the plaintiff's particulars of claim it is averred
that;
6
"As a result of the aforesaid
collision, the plaintiff sustained the following bodily injuries;
-
6.1Head injury;
-
6.2. Severe laceration to the occiput;
-
6.3. Abrasion on the nose, upper lip,
chin and left wrist;
-
6.4. Mild swelling on the left shoulder;
-
6.5. Small wound in the big toe;
-
6.6. Fractured teeth 13 - 21;
-
6.7. Knee abrasion;
-
6.8. Abrasion on the toe."
ISSUES FOR DETERMANATION
[4]
Mr
Dredge on behalf on the plaintiff informed me at the commencement of
the proceedings that the merits were settled 100% in favour
of the
plaintiffs proven damages.
[5]
The
general damages were also settled in the amount of R400, 000 (Four
Hundred Thousand Rand) in favour of the plaintiff. The only
outstanding issues are the contingencies to be applied, pre and post
morbid for the loss of earning or earning capacity. It was
further
brought to my attention that the fund made an interim payment of
R500, 000 (Five Hundred Thousand Rand) in November 2017
and such an
amount is to be deducted from the amount arrived at after the
deduction of the contingencies.
THE APPLICABLE LEGAL PRINCIPLES
[6]
Nicholas
JA said the following in the matter of
Southern
Insurance Association Ltd v Bailey NO 1984(1) SA 98 (A) at 114 C - D;
"In a case where the court has
before it material on which an actuarial calculation can usefully be
made, I do not think that
the first approach offers any advantage
over the second. On the contrary, while the result of an actuarial
computation may be no
more than the "informed guess" it has
the advantage of an attempt to ascertain the value of what was lost
on logical
basis, whereas the trial Judges gut feeling (to use the
words of the appellants counsel) as to what is fair and reasonable is
nothing
more than a blind guess.
(Goldie
v City Council of Johannesburg 1948(2) SA 913 (W) at 920
)"
[7]
In
the Southern Insurance Association Ltd (supra) at 116G to 117A the
following was stated. "Where the actuarial method of
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 is right (per
Holmes
JA in Legal Insurance Company Ltd v Botes 1963(1) SA 608 (A) at 611
F.
One of the elements of exercising
that discretion is the making of a discount for "contingencies"
or the "vicissitudes
of life". That includes such matters
as the possibility that plaintiff may as 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 to the general economic condition.
The amount of any discount varies depending on
the circumstances of each case. See
Van Der Plaats v South African
Mutual and General Insurance Co Ltd 1980(3) SA 105 (A) at 114 - 115.
The rate of any discount cannot of course be assessed on any
logical basis the assessment must be largely arbitrary and must
depend
upon the trial Judges impression of the case."
[8]
In
AA Mutual Insurance Association Ltd
Magagula 1978(1) 805 (A) at 813 D - E,
the
following was stated "Having due regard to all these factors in
the light of particular circumstances of the matter, I
am of the
opinion that it would be proper and correct to provide for
contingency of 50 percent of past loss of income as well as
future
loss of income."
There is in principle no reason for
distinguishing between the two categories of income for purposes of
contingencies. Mr Munro
merely for the sake of convenience in making
his calculations, distinguished between loss of income before and
after date of calculation
on 10 December 1976. In my opinion the
court erred in fixing a contingency of 10 per cent in respect of past
loss income and 20
per cent in respect of future loss of income.
[9]
In
Road Accident Fund v Guedes 2006(5)
SA 583 at paragraph 8, Zulman
JA
stated " It is trite that a person is entitled to be compensated
to the extent that a person's patrimony has been diminished
in
consequence of another's negligence. Such damages include loss of
future earning capacity (see for
example
President Insurance Co Ltd v Mathews 1992 (1) SA (1) A at 5 C- E).
The calculation of the quantum of a
future amount such as loss of earning capacity is not, as I have
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 (see for example,
Southern Insurance Association Ltd v Bailey NO 1984(1) SA 98(A).
The court necessarily exercises a wide discretion when it assess
the quantum of damages due to the loss of earning capacity and has
large discretion to award what it considers right.
Courts have adopted the approach that, in order
to assist with such a calculation, an actuarial computation is a
useful basis for
establishing the quantum of damages. Even then trial
court has a wide discretion to award what it is just( see for example
the
Bailey Case and Van der Plaats v South African Mutual Fire and
General Insurance Co Ltd 1980(3) SA 105(A) at 1141150)"
[10]
Robert J Krech in his book The Quantum
Year Book 2018 at page 114 under the heading "General
Contingencies" provides the
following, "When assessing
damages for loss of earnings or support it is usual for a deduction
to be made for general contingencies
for which no explicit allowances
has been made on the actual calculation. The deduction is the
prerogative of the courts. However,
most matters do not go to court
so the relevant deduction becomes a matter of negotiation. Even where
matters don't go to court
some Judges seek advice from expert
witnesses as regards the appropriate deduction to make.
General contingencies cover a wide range of
considerations which may vary from case to case and may include
taxation, early death;
saved travel costs, loss of employment
promotion prospects, divorce etc. There are no fixed rules as regards
general contingencies.
The following guidelines can be helpful.
Sliding scale: % percent per year to retirement age, i.e.: 25% for a
child claims, 20%
for youths and 10% in the middle age (see
Goodall
v President Insurance 1978(1) SA 389(W), for claim see Bailey v
Southern Insurance
1984 (1) SA 98(A)
"
THE
EVIDENCE OF NEUROSURGEONS
[11]
The
experts in their joint minutes dated the 06 November 2016 agreed that
the plaintiff who was a pedestrian at the time of the
motor vehicle
accident was physically fit and healthy prior to the accident. He
never suffered a head injury previously.
[12]
As
a result of the motor vehicle accident the plaintiff sustained a mild
concussive brain injury, injury to the teeth, shoulder
and knee
injury.
[13]
Post-
accident the plaintiff complains of recurrent headaches and also
complains of memory loss. He has no residual neurological
deficits.
He also complains of painful teeth and gums and also pains in his
right leg. The plaintiffs risk for developing late
post traumatic
epilepsy is equivalent to that of the population. The plaintiffs
longevity has not been affected by his injuries.
THE
EVIDENCE OF THE EDUCATIONAL PSYCHOLOGISTS
[14]
The
expert in their joint minutes dated 18-19 January 2018 agreed that
when the plaintiff was involved in the motor vehicle accident
as a
pedestrian on the 01 June 2014 he was 17 years and 11 months' old.
[15]
The
plaintiff sustained a mild concussive brain injury with associated
facial bone fractures, injury to the teeth, shoulder and
knee injury.
[16]
The
experts agreed that pre-morbid there was a normal pre-natal and early
childhood development. No notable head injury or loss
of
consciousness was reported. The plaintiff was never involved in a
motor vehicle accident prior to the motor vehicle accident
of the
01st June 2014.
[17]
The
plaintiff's parents have both attained grade 12. The plaintiffs
mother is employed as a domestic worker and his father's occupation
is unknown. The plaintiffs uncle and cousin have Grade 12 and 11
educations respectively.
[18]
The
experts agreed that the plaintiffs pre-morbid estimate was of average
intellectual ability, which is consistent with functioning
at a level
where he could have progressed through mainstream school system,
matriculated and progressed to obtain a tertiary qualification,
at
least a diploma(should they have the financial means or access
bursaries in the form of NSFAS) considering that it is documented
in
recent studies that children are achieving better qualifications than
their parents. The candidate would been a good candidate
for the
labour market
[19]
Post-morbid
learning potential the experts agreed that plaintiff has been dealing
with substantial psychological and psychiatric
sequelae caused
directly by the motor vehicle accident. They further agreed that the
plaintiff will not cope with the demands of
his school work
especially in the senior grades, where higher order of thinking and
learning skills are required, particularly
in view of scholastic,
cognitive, behavioural and psychological difficulties.
[20]
They
also agreed that based on all available information, (such as
depressed cognitive profile, behavioural difficulties including
impulsivity, lapses of concentration and slow psychomotor speed which
will serve as an added barrier to his studies, emotional
trauma due
to the accident and sequelae of his injuries) given an accident in
question in all likelihood the plaintiffs highest
qualification would
be grade 11.
THE
EVIDENCE OF THE INDUSTRIAL PSYCHOLOGISTS
[21]
The
experts in their joint minutes dated 08 February 2018 agreed that the
plaintiff pre-accident upon completion of a diploma (assuming
he
would have studied on a full time basis) he would have entered the
labour market within 1-2 years on completion of a 2-year
diploma
earning a total package per annum in line with Paterson 84/85 median
level according to the plaintiffs expert and Paterson:
83/84 medium
according to the defendants expert. It was agreed by the experts that
for purpose of settlement that they take the
average.
[22]
They
further agreed that the plaintiff with further training and
experience would have progressed to reach his career ceiling, by
the
age of 45. Upon reaching his career ceiling the plaintiff would have
been earning a total annual package in line with the Paterson
C4/C5
according to the plaintiff's experts and Paterson C3/C4 according to
the defendant's experts.
[23]
The
plaintiff's expert suggested that the appropriate pre morbid
contingency be applied to account for pre-existing cognitive
vulnerabilities
that may have caused a delay in his career
progression. The defendant expert agreed that if the pre-existing
cognitive difficulties
are confirmed by the appropriate expert then
the pre-morbid contingency should be applied.
[24]
The
experts agreed post-accident that there is no past loss of earning
which has been incurred as the plaintiff was a scholar at
the time of
the accident. Further agreed that from a physical perspective based
on the expert opinion, the plaintiff did not sustain
serious
injuries, he remains suited for sedentary light to medium natured
work (Ms Burger, Occupational Therapist, did not comment
on his
ability to handle heavy loads it seems that the claimant ability to
only handle up to medium natured work is due to his
natural abilities
and not due to reduced abilities due to his injuries)
[25]
It
must be noted that there was difference in opinion from the experts
with regard to post accident calculations. The plaintiff's
expert
opines that the plaintiff has been rendered unemployable in the open
labour market. It is unlikely that he will be placed
in a sheltered
employment factory (SEF) as there are only 12 nationally. Taking into
account the extensive waiting list, the plaintiff's
chances of being
placed in such an environment are poor.
The defendant's expert opines that the
application of an appropriate contingency must be considered due to
the accident exacerbating/contributing
to his psychological cognitive
difficulties. Such difficulties will negatively impact on the
plaintiff's ability to compete for
employment and also sustain
employment, his ability to interact with others and will likely be
dependent on an accommodating employer,
he will likely struggle to
secure employment and may be at risk to experience extended periods
of unemployment in future as a result.
The defendant's expert recommends that
appropriate apportionments should be applied considering the
pre-existing difficulties mentioned
by Ms Jonker. It was further the
opinion of the defendant's expert that the plaintiff will enter open
labour market in an unskilled/semi-skilled
position.
CONTINGENCY
ALLOWANCES
[26]
In
the present matter the calculations were made by R IMMERMANN , FIA;
of Geraci Jacobson Consulting Actuaries on the 12 February
2018. The
calculations were based on the joint minutes of the industrial
psychologist MS Talia Talmud for the plaintiff and industrial
psychologist for the defendant Ms Leanie Coetzer.
[27]
Two
bases were laid in the actuarial report, Basis I, based on Mrs
Talmuns opinion and Basis 11, based on Ms Cotzers opinion. Mr
Smit
for the defendant in his informative and helpful heads of argument
and oral submissions, submitted that they admit that the
calculation
and underlying actuarial assumptions are correct and that the
defendants accepts the "value of income but for
the accident"
in Basis II as correct.
[28]
It
is common cause in determining the correct deduction to be made with
regard to contingencies that the court will follow the calculations
as contained in Basis II. The only contention raised by the defendant
with regard to basis II is the contingency deduction of 20%
and
contends that a higher deduction of 40% should be effected.
[29]
The calculation of future loss of income
was tabled as follows by the actuary.
29.1.
Value of Income but for the
accident
R 7, 859,472
20% contingency
deduction
R 1. 571.894
R 6. 287,458
Value of income having regard to the
accident
R1, 304,458
30% contingency deduction
R 391.337
R 913. 121
R5, 374,457
[30]
The
plaintiff at the time of the motor vehicle collision was only 18
years of age and a scholar. From the expert reports it is clear
that
the plaintiff failed grade 2 level of education and grade 8 level of
education, meaning that the plaintiff in his scholastic
career failed
twice. Both educational psychologists agreed that the plaintiffs
pre-morbid estimate was that of average intellectual
ability. The
experts agreed that there is no loss of income as the plaintiff was a
scholar at the time of the incident. The court's
focus as consequence
will be on future loss of income.
[31]
However,
they further agreed that the plaintiff could have progressed through
the mainstream school system, matriculated and proceeded
to obtain a
tertiary qualification, at least a diploma (should they have
financial means or access to bursaries in the form of
NSFAS)
considering that it is well documented in recent studies that
children achieve better qualifications than their parents.
He would
have been considered a candidate for the open labour market.
[32] I must also take
judicial notice of the announcement that was made by the government
declaring higher
education to be free for household earning a
combined salary of R350, 000, 00 or less. The plaintiff's mother is a
domestic worker
and if it was not for the accident, based on the
expert opinion, the plaintiff could have qualified as a beneficiary
of free higher
education.
[33]
Mr Smit on behalf of the Fund strongly
argued that the plaintiff failed grade 2 and grade 8 and he was lazy
student and as a result
was not academically inclined as he also
mentioned that he wanted to become a traffic officer. A higher
contingency should be deducted
in the region of 20% to 40%. However,
he did not have an issue with the post-morbid contingency deduction
of 30% as indicated by
the actuary.
[34]
On
the other hand, Mr Dredge contended that the pre-morbid 20%
contingency deduction is too low and submitted that
2
5%
contingency is a reasonable deduction. Mr Dredge further contented
that every 5% increase means that the plaintiff loses 10 years
based
on the concept of %% per year to the age of retirement. He then
recommended 30% of the contingency deduction, with regard
to the
post-morbid contingency deductions; he suggested that we start with
same contingency as in the pre-morbid of 25% or 30%
and look at the
risk factors that the plaintiff would face.
Mr Dredge submitted that the overall
contingency deduction in the region of 40% - 50% will be reasonable
looking at the fact that
the plaintiff is currently unemployed and
was a young man who could have competed in the higher echelons of the
labour market,
also taking into account the attitude of the employers
that they cannot employ somebody who they will have to accommodate.
[35]
It is trite that contingency deductions
are within the discretion of the court and depend upon the Judge's
impression of the case
(see
Southern
Insurance Association v Bailey NO (supra).
We
were provided with the contingency deductions in the actuarial report
but it seems that both parties have placed in dispute the
contingency
deductions for the pre-morbid. Mr Dredge is in favour of 25% - 30%
deduction, whereas Mr Smit favours the 40% contingency
deduction.
[36]
I
agree with Mr Dredge's contention which is also supported by the
Education Psychologists that the plaintiff could have competed
in the
higher echelons of the labour market as he could have progressed to
obtain a diploma qualification but for the accident.
The plaintiff
remains unemployed and it will be very difficult for the plaintiff to
compete in the open labour market as employers
are not willing to
accommodate employees with risk factors as the plaintiff.
[37]
It
is therefore my considered view that it will be fair, just and
reasonable if the following contingencies are ordered.
37.1.
Value of income but for the accident 25%
contingency deduction;
37.2.
Value of income having regard to the
accident 30% contingency deduction
[38] A further amount
of R500 000 (Five Hundred Thousand Rand) must also be deducted from
the capital amount
arrived at after the contingency deductions.
ORDER
I
therefore grant the following order
1.
Draft order marked X is made an order of
court.
M.J. MOSOPA
ACTING JUDGE OF
THE HIGH COURT
FOR
THE PLAINTIFF:
MR
C.M. DREDGE
Instructed
by:
EHLERS ATTONEYS
FOR THE
DEFENDANT:
ADV AM. SMIT
Instructed
BORMAN DUMA ZITHA
ATTORNEYS
DATE
OF JUDGEMENT:
28 MARCH 2018
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, PRETORIA
Case
No: 57635/16
23/3/2018
On
28 March 2018, before the Honourable Justice Mosopa AJ
In
the matter between:
S B
MATSHILWANE
PLAINTIFF
And
ROAD
ACCIDENT
FUND
DEFENDANT
DRAFT
ORDER
Having
heard Counsel
IT IS ORDERED THAT:
1.
Merits
are settled 100% in favour of the Plaintiff.
2.
The
Defendant pay the Plaintiff an amount of R 4 481 483.40 (Four Million
Four Hundred Eighty One Thousand and Four Hundred and
Eighty Three
Rand and Forty Cents) in full and final settlement of the Plaintiff's
claim for Loss of Earnings, payable into the
Plaintiff's attorneys of
record trust account with the following details:
Account Holder : Ehlers Attorneys
Bank Name : FNB
Branch Code : 261550
Account Number:[….]
3.
The
Defendant will not be liable for interest on the above mentioned
amount, save in the event of failing to pay on the due date,
in which
event the Defendant will be liable to pay interest on the outstanding
amount at a rate of 10.25%per annum.
4.
The
Defendant is ordered to pay the Plaintiffs taxed or agreed party and
party costs on High Court scale, subject to the discretion
of the
Taxing Master, which costs will include, but will not be limited to
the following:
4.1
The
reasonable taxed fees for consultation with the experts mentioned
below, together with delivery of expert bundles including
travelling
and time spent travelling to deliver such bundles, preparation for
trial, qualifying and reservation fees (if any and
on proof thereof),
including the costs (fees and disbursements) of all consultations
(inclusive of telephonic consultations) with
Counsel and/or
Plaintiff's attorney and the costs (fees and disbursements) of all
consultations between the Plaintiffs and Defendant's
experts, as well
as costs of the reports, addendum reports, joint minutes and addendum
joint minutes and full day fees for court
attendance (if at Court) of
the following experts:
4.1.1
Dr P Engelbrecht - Orthopaedic Surgeon;
4.1.2
Dr. Smuts - Neurologist;
4.1.3
Dr. Moja - Neurosurgeon;
4.1.4
Ingrid Jonker - Neuropsychologist;
4.1.5
Dr. M Naidoo - Psychiatrist;
4.1.6
Dr.Pienaar - Plastic Surgeon;
4.1.7
Dr.
S Naidoo - Maxilla facial Surgeon;
4.1.8
M
Sisisson - Clinical Psychologist;
4.1.9
Prof-J Seabi - Educational Therapist;
4.1.10
N
September - Occupational Therapist;
4.1.11
Jacobson
IP's - Industrial Psychologist;
4.1.12
Dr. Fredericks - Disability and
Impairment Assessor;
4.1.13
G Jacobson - Actuary
4.2
The
costs for accommodation and transportation of the injured as well as
a family member, with JT Transportation Services or any
alternative
transport provider, to the medical legal examination(s) arranged by
Plaintiff.
4.3
The
costs incurred for appointment of an Interpreter to attend the
medical legal examination(s) arranged by Plaintiff.
4.5
The
costs for accommodation and transport with JT Transportation Services
or any alternative transport provider, for the injured
as well as a
family member, to attend Court on the 7th of November 2017 and the
13th of February 2018 .
4.6
The
costs of the interpreter for attending court on the 7
th
of November 2017 and the 13
th
of February 2018.
4.7
The
costs for the Plaintiff s attorney travelling to and spending time
travelling to pre-trial conferences and attendance at pre-trial
conferences by the Plaintiffs attorney.
4.8
The
costs for preparation of Plaintiffs bundles of documents for trial
purposes, as well as the travelling costs and time spent
to deliver
these bundles.
4.9
The
costs for preparation of Plaintiffs bundles of documents for experts,
as well as the travelling costs and time spent to deliver
these
bundles.
4.10
The
costs of Caleb Dredge a senior attorney briefed for Trial, including
but not limited to the following:
4.10.1
Preparation
for Trial;
4.10.2
Consultation
with Plaintiff s Attorneys in respect of preparation for Trial;
4.10.3
Consultation
with Plaintiffs Experts in respect of preparation for Trial;
4.10.4
Consultation
with Plaintiff and a family member in respect or preparation for
Trial;
4.10.5
Drafting of the Final Pre-Trial minutes;
4.10.6
Day fees for 7 November2017 and 13
February 2018;
5.
The
Defendant i ordered to pay the Plaintiffs taxed and/or agreed party
and party costs within 14 days from the date upon which
the accounts
are taxed by the Taxing master and/or agreed between the parties.
6.
Should
payment of taxed costs not be effected timeously, Plaintiff will be
entitled to recover interest at the rate of 10.25% on
the taxed or
agreed costs from date of allocator to date of payment.
Counsel for the Plaintiff: Caleb Dredge: 083
271 8350
Counsel for the Defendant: Adv Smith 078 622
6276
BY
ORDER
REGISTRAR