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[2017] ZAFSHC 141
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X v Road Accident Fund (2127/2015) [2017] ZAFSHC 141 (7 September 2017)
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
Case
number:
2127/2015
In
the matter between:
M.
S. X.
Plaintiff
and
ROAD
ACCIDENT FUND (546/1974030/07/0)
Defendant
HEARD
ON:
9 JUNE 2017
JUDGMENT
BY:
PAMPAI, J
DELIVERED
ON:
7 SEPTEMBER 2017
[1]
The matter came to court by way of action proceedings. The
plaintiff sues the defendant for compensation in the sum of
R5 066 882.00. The claim is delictual in nature.
The claim is contested.
[2]
The matter was enrolled for hearing on 6 June 2017. I was
seized with the matter. It was partially settled by agreement
between
the parties as would fully appear from the order I made.
[3]
The material terms of the negotiated settlement may be condensed as
follows:
·
the
defendant conceded that the insured driver was negligent;
·
the
negligence of the insured driver was the exclusive cause of the
accident;
·
the
plaintiff’s claim in respect of general damages and medical
expenses were settled;
·
the
plaintiff’s claim in respect of loss of earnings was not
settled but postponed for later adjudication;
·
the
plaintiff’s assessment reports relative to the loss of earnings
were admitted by the defendant except the actuarial assessment
report
by Angen Actuaries;
·
the
joint minutes of the meeting held by the respective actuaries were
mutually admitted;
·
the
hearing was then rolled over to Friday 9 June 2017 for argument
relative to the unresolved aspects of the quantum.
[4]
He was born on [...] 1996. I could not ascertain where
but probably in Bloemfontein. He was named M. S. X..
His
mother had a normal pregnancy with him. His birth was natural.
His early development as a babe was normal.
His crawling,
standing up, walking, talking and developing as a toddler were all
without complications.
[5]
He was the one and only child between his parents. He has one
half-sister from his father’s side and two half-brothers
from
his mother’s side. He did grade R at K. Pre-primary
School at Phahameng in Bloemfontein. He started his
formal
school education at S. Primary School in Bloemfontein where,
according to his mother, he did grades 1 to 7 and never failed
a
grade. He completed his primary school career in 2007. He
never failed a grade.
[6]
In 2008 he started his secondary school career. He became a
grade 8 learner at L. B. THS in Bloemfontein. He progressed
to
grade 9 the next year. At the end of the year 2009 he failed.
He then left the particular school.
[7]
In 2010 he moved to Welkom where he was enrolled as a grade 9 learner
at W. THS. At the end of that year he again failed
grade 9.
[8]
In 2011 he repeated grade 9 for the third time. I could not
establish the result of the examination he had taken at the
end of
the particular year. It is unclear, on the papers, whether he
had passed or not.
[9]
On 27 December 2017 a road incident took place at Virginia.
Shortly before the incident M. and T. were passengers in a
motor
vehicle. T. was a front passenger whereas M. was a back
passenger. The motor vehicle was driven by Ms M. M. X.,
M.’s
mother. They were on their way to Welkom from Bloemfontein.
On the main road to Welkom, the driver lost
control over the
vehicle. It veered off the road, overturned and rolled.
In the process M. was ejected from the vehicle.
Its final
position of rest was on the left hand side of the road. He was
17 years of age at the time of the accident.
[10]
From the scene of the accident M. was rushed by an ambulance to
Virginia Hospital. He was unconscious. From there
he was
immediately transferred to Welkom Medi-clinic. On the same day
he was transferred to Bloemfontein Medi-clinic where
he was
admitted. On his admission he was still comatose. He was
treated in the intensive care unit for 4 weeks.
[11]
According to available clinical documentation, M. sustained the
following injuries:
·
severe
head injury with axomal brain injury;
·
compressed
chest injury with multiple rib fractures and haem pneumothorax;
·
pelvis
fracture;
·
laceration
of the left lower lip;
·
open
wounds left upper arm, right side of the chest and back of the head;
·
possible
subluxation of the neck;
·
abrasions
on the left leg;
·
loss
of one tooth
[12]
The consequences of the injuries which M. sustained in the accident
were that:
·
he
is now permanently clustered to an electric wheelchair to mobilize;
·
he
has virtually lost almost all strength of both legs a result of an
upper motor neuro pattern from multiple functional, physical,
psychosocial, perceptual and cognitive limitations or impairments;
·
his
right arm as a whole is now totally useless;
·
he
has a 45
°
contracture
of the right arm which is his dominant hand by nature;
·
he
requires full physical care and support by a care-giver seeing that
he is no longer able to live independently;
·
he
has a facial image paresis, in other words disfigurement;
·
he
suffers from severe loss of memory in the form of both retrograde
amnesia and post traumatic amnesia;
·
he
has several symptoms of severe impairments of mental faculties.
[13]
The defendant admitted that the tragic accident was occasioned by the
exclusive negligent driving of the insured driver.
Apart from
conceding 100% of the substantive merits in favour of the plaintiff,
the parties mutually agreed upon the quantum of
the plaintiff’s
claim in respect of loss of earnings. As regards past loss of
earnings the claim was quantified as
naught. As regards future
loss of earnings the claim was quantified as R4 283 659.00
– vide “exi a”
[14]
The issue in the case revolved around the appropriate rate of
contingency deduction. To that issue I turn now.
[15]
On the one hand, Mr Lubbe, counsel for the plaintiff, submitted that
the contingency rate of 15% would be an appropriate measure
of
deduction bearing in mind the peculiar circumstances of this
particular case. Accordingly, counsel urged me to exercise
my
discretion in favour of the plaintiff by not exceeding the proposed
contingency rate of 15%.
[16]
On the other hand, Mr Sander, counsel for the defendant sharply
disagreed. He submitted that the contingency rate of
25% and
not 15% would be an appropriate measure of deduction given the
plaintiff’s pre-accident prognosis. He argued
that 15%
contingency was too low. Accordingly counsel implored me to
exercise my discretion in favour of the defendant by
determining
contingency rate at 25%.
[17]
In
Goodall
v President Insurance Co Ltd
1978 (1) SA 389
(W) at 392H-393A the court, per Margo J, held that in
assessing delictual damages in respect of future loss of earnings,
arbitrary
considerations must inevitably play a role in order to make
proper allowance for contingencies. As the judge correctly
remarked,
the art or science of foretelling the future, so
confidently practised by ancient prophets and soothsayers, and by
modern authors
of certain type of almanac is not numbered under the
required qualifications for the contemporary judicial office.
Indeed
it does not form part of our job description.
[18]
In
Southern
Insurance Association Ltd v Bailey N.O
1984 (1) SA 98
(AD) at 116G-117A Nicholas JA had this to say about
the discretion of a trial judge:
“
Where
the method of actuarial computation is adopted in assessing damages
for loss of earning capacity, 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". 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.”
[19]
There are no hard and fast rules of mathematical logic in the
determination of contingency discount. One has to make
a value
judgment in determining a rate of contingent discount because the
nature of the complex problem is such that “one
can do no
better than adopt a rule of thumb” – in the words of
Ludorff J as quoted by the co-authors namely:
Corbett and
Buchanan in their work: The Quantum of Damages Vol 2 on p65.
An actuarial assessment report merely serves
as an assistive aid to
the court
Shield
Insurance Co Ltd v Hall
1976 (4) SA 431
(AD) at 444F.
[20]
In delictual claims of this type it has become customary for a court
hearing a case to make a deduction from the claimant’s
proven
loss of earnings for unforeseen circumstances of life which would
probably still have adversely or favourably affected his
earning
capacity anyway even if the accident did not occur.
[21]
In general a sliding scale of the contingent discount rate is often
applied. Caselaw shows that the older the claimant
the lower
the contingent discount rate. The converse also tends to hold
true. The younger the claimant the higher the
contingent
discount rate. This feature of the sliding scale is perfectly
understandable. It is largely influenced by
the period for
which contingencies, call them, if you will, vicissitudes or
unforeseen circumstances of life, must be taken into
account.
[22]
In the words of Windeyer J:
“
All
contingencies are not adverse:
All
vicissitudes are not harmful.”
See
Bresatz v Przibilla
[1962] HCA 54
;
(1962) 36 ALJR 212
(HCA) at 212
which is referred to in
Southern Insurance Association v Bailey
NO.
supra
, at 117B. On the one hand a particular
claimant might, prior to the accident, have had attractive prospects
of promotion
or advancement and increasingly remunerative career
ahead of him. Such prospective employment rewards of the future
cannot
be ignored. In such a scenario a claimant’s proven
future loss of earnings would be increased. Such an upswing
or
incremental impact of vicissitudes is termed positive contingency.
[23]
On the other hand, a particular claimant might, prior to the
accident, have had bleak prospects of advancement ahead of him.
Such
possible buffets of poor prospects of employment must also be taken
in account. In such a scenario claimant’s
proven quantum
of future loss of earnings would be decreased. Such a downswing
or decremental impact of vicissitudes of life
is termed negative
contingency.
[24]
In the first place, I deal with the pre-morbid scenario of the
present case. M., the claimant, passed grade 8.
However,
he struggled to pass grade 9. He repeated grade 9 in 2010 but
failed the examination again. He gave it a third
try yet again
in 2011. The exam results of his third endeavour were not
disclosed. They remained unknown to me.
[25]
Mr Sanders, was very critical of the claimant’s intellectual
ability. Since the claimant, at the age of 17, was
still
attempting to pass grade 9 instead of grade 11, counsel contended
that no reasonable possibility existed that he would have
matriculated; that he would have proceeded to a tertiary level
of learning; that he would have undergone a three or
four year
formal training there and that he would ultimately have obtained a
national diploma or an equivalent qualification.
[26]
The industrial psychologist, Dr Van Jaarsveld stated that since M.
was a 17 year old learner immediately before the accident,
the
probable career path he would have followed, had the accident not
taken place, must necessarily be assumed and that to obtain
a
realistic indication of his pre-accident income potential, an
analysis of the probable qualification he would have attained,
had it
not been for the accident, was recommended, in an attempt to link a
probable qualification to a probable career.
[27]
M.’s socio-economic background was a material consideration.
It was undisputed that his father, Mr SG X. was employed
as a traffic
officer in Bloemfontein; that his mother, Ms MM X. was a nurse
by profession; that she was employed as
such in Saudi Arabia –
in the United Arab Emerates; that his half-sister, B. was
employed as a financial advisor at
Rustenburg; that his one
half-brother N. was a full-time student at M. FET College in
Bloemfontein and that his other half-brother
B. was a work-seeker.
[28]
Having assessed the claimant and having considered the opinions of
various other experts, Dr Van Jaarsveld expressed the following
opinion:
“
Considering
Mr X.’s level of intellectual functioning and his
socio-economic background, the author is of the opinion that
had the
accident not taken place, he would have obtained at least a Grade 12
qualification and the possibility exists that he would
have undergone
formal training at a tertiary institution for a period of three to
four years, after which he would have obtained
a National Diploma or
an equivalent qualification.”
[29]
In my view the opinion of Dr Van Jaarsveld was logically sound.
Therefore, it could not be convincingly criticised.
The
argument of Mr Sanders failed to impress me. In the first place
such critical argument was not fortified by any opinion,
contrary to
that of Dr Van Jaarsveld, formed by an industrial psychologist called
on behalf of the defendant. In the second
place, Dr Stevens,
the clinical psychologist, gave reasonably sound explanation as to
why M. grappled with grade 9 in three years.
Therefore, the
ground of the defendant’s attack cannot succeed.
[30]
Dr Steven’s opinion is worth quoting. Under the heading:
“Development” he remarked:
“
6.2
He did grade 8 in the HTS L. B. and passed. Grade 9 was done in
the same school in 2009 but he failed.
His mother left for
Saudi-Arabia between 2008 and 2009.
He
then moved with his maternal grandmother to Welkom and started Grade
9 in 2010 for the second time in the HTS [...]. He
failed
again. The divorce of the parents, the separation from both his
mother and father, the mother that left the country,
the follow-up
move to Welkom, the change of schools, the absence of a
disciplinarian support system and him being in the adolescence
life
stage
seem
to have been the main factors underlying the poor scholastic
progress
.
During this period he apparently had seen a psychologist for the
mentioned problems.”
(my
emphasis)
[31]
I hasten to point out that Mr Sanders hardly levelled any critique
against Dr Steven’s postulation concerning the probable
causes
of M.’s poor scholastic progress after grade 8.
[32]
According to Dr Van Jaarsveld’s assessment, M. attended the
following schools:
“
1.1.10
Schools attended:
K.
Pre-Primary School, Phahameng (Grade R)
S.
Primary School, Bloemfontein (Grade 1)
M.
Primary School, O. (Grade 2)
S.
Primary School, Bloemfontein (Grade 2 - 7)
HTS
L. B. School, Bloemfontein (Grade 8 - 9)
T.
High School, Welkom (Grade 9)”
(my
emphasis)
M.
school history showed that
he
started his formal school education in the year 2000; that in
that year he was a pupil of S. Primary School in Bloemfontein;
that he passed grade 1 at the end of that year; that in the
year 2001 he was removed from home; and enrolled at M.
Primary
School at O. as a grade 2 pupil; that in the year 2002 he was
removed from O. and taken back home in Bloemfontein;
that he
had to repeat grade 2 at S. Primary School and that he progressed to
grade 3 in the year 2003; that from then he
steadily progressed
well for 5 years until he reached grade 9 in 2009.
[33]
What emerges from M. school history is that eh faired badly in 2001,
2009 and 2010 when he was separated from his parents.
His
failure in 2009 was a repetition of 2001. It was a
manifestation of the adverse impact of a child’s separation
from his parents, friends and familiar environment. At the
heart of his poor scholastic performance was an emotional turmoil
rather than profound intellectual disability. Consequently it
would not be correct to read too much in his dismal grade 9
showing
in determining his pre-accident income potential.
[34]
It would, therefore, appear to me that the breakdown of the family
togetherness was a disruptive event to the child’s
secondary
school career – Dr Stevens . The symptom of separation
problem first surfaced way back in 2001 when, at a
very tender age,
he was taken to a school at O.. His school progress improved
and stabilized when he was taken back home
in Bloemfontein where he
was re-united with his parents. He then rejoined his former
school mates at S. Primary School.
The re-union with parents
had instant positive effect on his school performance. He never
repeated a grade.
[35]
The positive progressive trend of his school career took a drastic
deterioration following the final disintegration of his
family
shortly before 2009. Again he was removed from the school in
Bloemfontein. He was taken to a new school in Welkom.
His
father remained in Bloemfontein. His mother left the country.
It seemed to me that the permanence of the family
breakdown hit him
very hard at the time he was grappling with teenage issues of life.
Therefore, the second ground of the
defendant’s attack cannot
succeed.
[36]
It was not apparent from the various assessment reports compiled by
the experts whether M. ultimately passed grade 9 or not
during his
third attempt in 2011. That being the case, I have to assume in
favour of the defendant that he did not make it,
yet again.
That assumption notwithstanding, I believe, and it is a very strong
belief, that his three grade 9 missteps were
not, by themselves,
indicative of an underlying severe or profound intellectual deficit.
Moreover, it is also of paramount
importance to bear in mind the fact
that the defendant had filed no psychological assessment report to
water down Dr Steven’s
clinical findings. Therefore, the
defendant’s attack on the claimant’s premorbid
intellectual potential to qualify
as a semi-skilled worker must also
fail on this ground as well.
[37]
In the second place, I turn to the post-morbid scenario of the
claimant’s income potential.
Mr
Sanders submitted:
“
28.
Bearing in mind the calculations provided for by Koch in Quantum of
Damages Yearbook, the Plaintiff’s claim
should be reduced by
more than the general contingencies.”
[38]
During the cause of his argument counsel for the defendant relied on
the methods used by Dr Koch to calculate rates of contingencies.
He said:
“
Taking
the aforementioned into account and without dealing with the
respective reports it is apparent that according to the opinion
of
Koch and, the generally applied principals, the general contingencies
applied would be 15% to future loss of income. However,
in the
present matter the Plaintiff was still attending school when the
accident occurred which rendered the Plaintiff incapacitated.
At date of the motor vehicle accident the Plaintiff was seventeen
(17) years of age. Applying this to the calculations of
Koch
(65-17=48x0.5=24%).
[39]
The actuarial formulas used by Dr Robert Koch, are useful
guidelines. They were not intended to supplant the
discretionary
powers of a trial judge. In a case like this the
rate of contingency determined in accordance with the subjective view
of
a trial judge overrides any actuarially predetermined rate.
This much Dr Koch himself recognises and accepts.
[40]
It was quite evident to me that counsel for the defendant heavily
relied on the formula 65 – 17x0.5% = 24%. One
should
resist the temptation of elevating a guideline to an inflexible
general rule of contingency deduction. Apart from
that, one
should also guard against the temptation of oversimplifying an
inherently complex problem such as the one at hand.
[41]
The complex nature of the instant task was aptly described by the
industrial psychologist, Dr Van Jaarsveld. He remarked:
“
6.7
Given the many difficulties that arise when attempting to determine
the education and vocational prospects of someone
having been injured
at a very young age, it is advisable to provide guidelines that would
be reasonable, broader based rather than
specific and which do not
assume a dogmatic approach to the task at hand.”
I
am in respectful agreement. I share those sentiments.
[42]
The claimant was injured in a road accident which took place at
Virginia on 27 December 2011. He was 17.25 years at the
time.
His lawyer, Mr BL Kretzmann, referred him to several experts. I
deem it prudent to quote some of them verbatim
in order to elucidate
the magnitude of the claimant’s post accident plight.
[43]
Dr Rhett Kahn, an occupational practitioner, saw the claimant in
Welkom on 20 November 2014 and wrote:
“
Executive
Summary: Mr. X. qualifies with 84% whole person impairment as
he suffered a severe head injury with loss of consciousness
for 3
weeks, post traumatic amnesia about 2 months and Glasgow Coma Scale
of 5/15.
He
required extensive rehabilitation to get him mobile and able to
perform some activities of daily living. The patient cannot
stand alone, cannot walk alone, cannot use his R arm at all, and has
a neurocognitive deficit as evidenced by a Montreal Cognitive
Assessment [MOCA] score of 20 out of 30. His Functional
Activities Questionnaire score of 19 also indicates neurocognitive
decline as it is greater than 9. His Katz Index of Independence
of Activities of Daily Score of 2 out of 6 indicates he has
loss of
basic activities of daily living. Likewise his Barthel Index of
Activities of Daily Living score of 8 out of 20 shows
he is only 40%
independent with regard to basic activities of daily living.
He
will need a permanent care giver to assist him
.”
(my
emphasis)
[44]
Dr L Stevens, a clinical psychologist, saw the claimant in Welkom on
3 March 2015 and wrote:
“
8.4
The results of this assessment demonstrated severe
neuro-psychological impairment in general. He has severe
impairment of simple motor speed, complex visual motoric
coordination, processing speed, attention and concentration, working
memory, implicit memory, memory for verbal and visual material,
recognition memory, verbal comprehension abilities, planning
organizing,
integration and problem solving abilities.”
“
10.1
Maximum
medical improvement (MMI):
The
patient was injured on 27 December 2011, more than 3 years ago.
MMI has
therefore been achieved and not further improvement of his
neuro-psychological condition is expected
.
10.2
Education:
Further progress in terms of his academic qualification is not
expected
.
10.3
Employment:
Mr
X. is permanently unfit for any work in the open labour market
.”
(my
emphasis)
[45]
Ms L Emmermis, an occupational therapist, saw the claimant in Welkom
on 25 February 2015. She wrote in conclusion:
“
1.1
SUMMARY
OF PHYSICAL EVALUATIONS
The
client presented with the following
physical
limitations:
·
Poor
posture
·
Poor
mobility with regards to standing, walking, ascending and descending
stairs, bending or stooping, driving standard wheelchair
mobility.
·
Reduced
active range of motion
·
Reduced
muscle strength
·
Reduced
grip strength of the right hand
·
Poor
coordination
·
Poor
balance of probabilities poor endurance
1.2
SUMMARY
OF PSYCHO-SOCIAL EVALUATION/OBSERVATIONS
The
client presented with the following psycho-social limitations or
difficulties:
·
Low
frustration tolerance
·
Increased
irritability
·
Poor
handling of unpleasant emotions
·
Feelings
of being unpleasant emotions
·
Feelings
of being isolated from his peers
·
“
Extremely
severe” scoring on Depression and Anxiety with the DASS
Questionnaire
·
“
Moderate”
scoring on Stress with the DASS Questionnaire
·
Increased
stress on interpersonal relationships due to a client’s
dependence on constant assistance”
[46]
Dr JA Smuts, a neurologist, saw the claimant in Pretoria on 12 May
2015. He wrote:
“
3.7
Personality
changes
He
has all the needs of a paraplegic
.
He gets angry and frustrated because he is not able to do the things
by himself and always needs help. At times his
mind is so busy
he cannot fall asleep but most of the time this is not a problem.
When he is alone in the dark he would see
shadows and when he stands
and urinate he has a feeling there is someone looking at him and he
would look behind his shoulders
but cannot see the person. He
sends his caregiver as he would say there is someone who just
arrived. According to the
caregiver as he would say there is
someone who just arrived. According to the caregiver he is
improving since he has been
working with him in the last year.
He does work along well and only sometimes gets stubborn and agitated
for failing or not
being able to do things by himself.”
(my
emphasis)
[47]
Dr H.E.T van de Bout, an orthopaedic surgeon, saw the claimant in
Pretoria on 9 June 2015. He wrote:
“
The
patient says that he feels sad and depressed because
his
whole life has been changed around by the severe injuries sustained.
He has suicidal thoughts
,
and he has even attempted suicide by stabbing himself with a knife.”
(my
emphasis)
“
The
patient has for his head injury with loss of his dominant right upper
limb function, according to Page 335, Table 13-11, Class
4 a 60%
whole person impairment.”
[48]
The claimant did not appear in the witness-box. It appeared
that he has a pleasant personality according to the experts
who
interviewed him. It also appeared that he is reasonably well spoken.
There is evidence of despair in almost every assessment
report
compiled about him. He can no longer do anything for himself.
There is no more room for his further rehabilitation.
He has
reached the maximum medical improvement. Dr Stevens, Dr Bout
and Dr Kahn described the claimant’s whole person
impairment as
35%, 60% and 84% respectively. The average of all these is
59.7%.
[49]
He was right hand dominant by nature. Now he can no longer use
it. He has lost complete function of his right hand.
The
injury resulted in the flexion deformity of the right elbow, wrist
and fingers. The range of movement of the affected
arm is
substantially impaired. The injury left him with impaired grip
strength of the right hand. It is feared that
contractures of
the joints would worsen and become permanent unless he receives
ongoing occupational therapy and physiotherapy.
However, the
prospects of him receiving such future rehabilitative treatment are
poor. The medical aid funds have been depleted.
Consequently it is not expected that his physically and functionally
disfigured right hand will improve in efficiency in the future.
Perhaps the defendant’s undertaking will alleviate the
claimant’s plight, to an extent, now that the costs of his
future medical treatment are secured.
[50]
As a result of the marked impairment of the claimant’s right
hand, he has been learning to use his left hand. To
a certain
extend he has achieved some measure of success. He has regained
some writing capacity. Determined to improve
his lot, he
returned to an adult school to further his education. However,
he could not make any progress. He hopelessly
failed because it
lamentally dawned upon him that recalling the study material was
extremely difficult – Van Emmenis,
supra
,
at par 2. The enormous memory problem was attributed to his
traumatic brain injury. “He has a significant memory
problem.” - Dr Smuts,
supra
,
at par 5.2.5. Further academic progress is unthinkable –
Dr Stevens, at par 10.1.
[51]
There is np doubt about it. The claimant’s capacity for
work is virtually naught. He is totally unemployable
in the
open labour market - Dr Van Jaarsveld. His impaired condition
as a whole is irreversible. The occupational prognosis
of this
young claimant is extremely poor – Ms Van Emmenis.
[52]
Seeing that he has now reached the maximum medical improvement, the
premorbid expectation that he was destined to obtain matric,
tertiary
education, national diploma and semi-skilled occupation in the
non-corporate sector has evaporated into thin air.
That
reasonable possibility, which existed before the accident and all its
adverse repercussions, can now be excluded. In
the absence of
any reasonable likelihood of future remunerative occupation, the
question of prospects of promotion to ameliorate
potential future
loss of earning does not arise.
[53]
On the other hand, it must be recognised that, the claimant, with his
postmorbid physical, occupational, psychological, and
neurological
handicaps which have rendered him totally unemployable, will not
incur transport costs ordinarily incurred by the
great majority of
able-bodied workers to go to and to come from their workplaces.
The premorbid assumption was that the claimant
would complete his
post matric tertiary qualification at the age of 24. He would
then have 41 years of gainful employment
ahead before he could reach
the retirement age of 65 years. The postmorbid absence of work
and related post morbid transport
costs over such a considerable
period is, therefore, a factor which must be take into account in
favour of the defendant.
This
disposes of the third ground of the attack on the generally suggested
15% detrimental contingency rate customarily applicable
to potential
future loss of earnings. There was merit in the
argument.
[54]
On the facts, I am persuaded that the prospect of the claimant’s
gainful employment in the future has not been established
as a matter
of probability. Sympathetic work opportunities for disabled
individuals are hard to come by. Sympathetic
employers, for
obvious reasons, tend to prefer disabled individuals with some degree
of personal independence. Sympathetic
employment opportunities
for a disabled individual who is totally dependent on caregiver or
assistant, as is the case with M.,
are very rare. Any argument
or suggestion that there exists a probability that he might be
sympathetically employed would
be inconsistent with the opinion
expressed by the majority of the experts. In my view, any
prospect of him obtaining sympathy
employment is not a probability
but a very remote possibility – and I shall treat it as nothing
more than that.
[55]
In
Southern
Insurance Association v Bailey NO
,
supra
,
at 113G Nicholson JA had this to say about 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.”
[56]
In the instant case, I do not have to make any rough estimate of an
amount which seems fair and reasonable. Doing so
would
obviously be a matter of guesswork, “
a
blind plunge into the unknown
”
– as Nicholas JA would say.
[57]
The appointed actuaries, Mr GJ Mellet and Mr A Sasinsky have done
mathematical calculations on the basis of certain mutually
agreed
actuarial assumptions. The results of their respective
quantification were tabulated in “exi a”.
As regard
the claimant’s potential loss of future earnings, the two
actuaries differed by R21823. This figure represented
the
difference before contingencies were taken into account. They
recommended that I should ignore the marginal differences
and use the
average. The average future loss of income is therefore
R4 272 747.50 (R4 261 836 + R4 283 659
÷ 2).
[58]
The aforesaid actuaries were unanimous that 15% contingency rate of
deduction appearted to them fair and reasonable.
Arbitrary
considerations must inevitably play a part in the assessment of a
proper allowance for contingencies – Margo J.
[59]
The following passage is instructive.
“
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 an "informed
guess", it has the advantage of an attempt to ascertain the
value of what was lost on a logical basis;
whereas the trial Judge's
"gut feeling" (to use the words of appellant's counsel) as
to what is fair and reasonable is
nothing more than a blind guess.”
In
the words of Nicholas JA in
Southern
Insurance Association v Bailey NO
,
supra
,
at 114C-E.
[60]
Although the 15% decremental contingency rate was challenged by the
defendant, the challenge so mounted was not persuasive.
On the
facts, I am not persuaded that the unforeseen or hazardous
circumstances of life would have been so unfavourable to the
young
claimant, had the accident not occur, as to justify the reduction of
his potential loss of earnings by a drastic reduction
of 24%
contingency rate.
[61]
In determining a fair and reasonable contingency rate I take into
account the factors mentioned and I make no nominal allowance
for the
possibility of sympathy employment. Nonetheless, I consider it
fair and appropriate to made nominal allowance for
a reasonable
possibility of a diminished postmorbid lifespan and for saving in
transport costs. Given all these peculiar
circumstances of this
particular case, I consider that the provision for decremental
contingencies should not excleed 16%.
[62]
According to the calculations by representative actuaries, which were
accepted by the parties, the claimant would have earned
a total
income whose capitalised current value is R4 272 747.50
which can be rounded off to R4 272 748.00.
This
figure includes 6% average annual increase to make provision for the
corrosive impact of inflation. My understanding
of “exi
a” was that the capital value of his expected prospective
income based on premorbid prospect of promotion had
also been taken
into account.
[63]
Seeing that the claimant’s earning capacity has been absolutely
and permanently ruined, the figure of R4 272 748
is
representative of his nett loss over a 41 year potential period of
gainful employment. From this sum 16% has to be deducted
in
respect of negative vicissitudes which, even if the accident did not
occur, would, in any way, have adversely affected his capacity
to
actually earn the income he was expected to earn. Consequently
the deduction leaves a nett amount of R3 589 109
being
(R4 272 748 x 84%) = (R4 272 748 –
16%).
[64]
To sum up:
·
Future
loss of earnings before contingencies
4 272 748
Given
- see “2 exi
a”
·
Less
16% decremental contingencies
683 639
My
guessed estimation – see caselaw
·
Future
loss of earning after contingencies
3 589 109
\
Mathematical
nett balance to be awarded to M. for loss of potential future
earnings
[65]
Accordingly I make the following order:
65.1
The defendant is ordered to pay R3 589 109 to the plaintiff
in respect of potential loss of future earnings;
65.2
The said capital amount shall bear interest at the rate of 15% per
annum from the 15
th
day hereof;
65.3
The costs pertaining to the adjudication of this particular component
of the quantum shall be borne and paid by the defendant.
_____________
MH
RAMPAI, J
On
behalf of plaintiff: Adv. EE Lubbe
Instructed
by:
BL Kretzmann Attorneys
Welkom
and
McIntyre Van der Post
Bloemfontein
On
behalf of defendant: Adv. A Sander
Instructed
by:
Maduba Attorneys
Bloemfontein