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2017
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[2017] ZAFSHC 154
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Mokwena and Others v Government Employees Medical Scheme (3196/2017) [2017] ZAFSHC 154 (21 September 2017)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Case number:
3196/2017
In
the matter between:
DR
LUCAS SELLO
MOKWENA
1
st
Applicant
DR
NTHABISENG
MOKWENA
2
nd
Applicant
DR
LS MOKWENA & ASSOCIATES (PTY)
LTD
3
rd
Applicant
and
GOVERNMENT
EMPLOYEES MEDICAL SCHEME
Respondent
HEARD
ON:
17
AUGUST 2017
JUDGMENT
BY:
RAMPAI, J
DELIVERED
ON:
21
SEPTEMBER 2017
[1]
These are motion proceedings. The relief sought by the
applicants is to have the respondent interdicted from declining
payment of all future claims which the applicants contemplate
submitting to the respondent for certain medical services rendered
or
still be rendered. The respondent opposes the application.
This is the one matter before me.
[2]
The second matter before me concerns Dr LS Mokoena & Others
versus The Government Employees Medical Scheme, Gems in short.
The relevant case number is 3196/2017. The interdictory relief
sought in this instance is an order whereby the respondent
is
compelled to effect payment of all claims which the applicants
contemplate submitting to the respondent in the future concerning
medical services still to be rendered. The respondent also
opposes the second application as well.
[3]
Seeing that in both matters the applicants are doctors; the
respondent is one and the same medical aid scheme; the medical
services in question are the same and the cause of action is the same
– the parties agreed that the two matters be consolidated.
It made practical sense to me. In view of the consolidation
agreement the outcome of this matter of Dr Ramantsi & Another
will also apply to the matter of Dr Mokoena & Others.
[4]
The respondent is a medical scheme enterprise. Its members are
government employees. They and the government contribute
to the
respondent’s medical aid scheme. The respondent’s
core business is granting financial assistance or medical
aid to its
members. It pays for medical expenses incurred by its members
in connection with health care services rendered
to them by health
care service providers.
[5]
The applicants are medical doctors. They practise medicine in
Bloemfontein. They provide health care services.
The
majority of their patients, as already indicated, are government
employees. In other words a huge number of their patients
belongs to the respondent. They and their employer contribute
to the medical aid scheme established and administered by the
respondent.
[6]
The applicants and the respondent are parties to an agreement termed,
“Gems Network Agreement”. The relationship
between
the parties is governed by agreement, “anx b”, which was
concluded on 1 February 2010 in the case of Dr Ramantsi,
read
together the provisions of the
Medical Schemes Act, 131 of 1998
, the
statutory regulations and the domestic rules of the respondent.
The applicants are required to render health care services
to the
members of the respondent; to bill them in accordance with the
tariff of fees prescribed by the South African Medical
Control
Council and to submit their valid claims, relative to the health care
services rendered, to the respondent for payment.
[7]
The respondent is required to interrogate a doctor’s claim in
order to ensure that it is procedurally compliant;
to
scrutinise a doctor’s claim in order to make doubly certain
that it is based on a member’s actual medical account,
to
ensure that the medical treatment as specified on the account was
actually rendered by the doctor concerned and to pay to its
member or
to a doctor as a provider of health care service within thirty days
after date on which the doctor’s valid claim
was received.
See
59
Medical Schemes Act No 131/1998.
[8
]
The respondent received a four page document, from an anonymous
author – See “anx gg2”. The author alleged
that (s)he once worked for the applicants; that they submit
irregular claims to medical aid schemes and that Gems, Discovery
and
Medscheme were the worst defrauded. The document was neither
signed nor dated. Needless to say its serious allegations
were
not verified by way of a confirmatory affidavit. Consequently
it had all the hallmarks of an inadmissible hearsay.
[9]
The revelations of fraud and irregularity as fully set out in the
anonymous document prompted the respondent to take certain
steps. The
respondent decided to investigate the anonymous claims. Investigators
were appointed. Preliminary findings unfavourable
to the applicants
were made. Explanations were requested from the applicants concerning
the adverse preliminary findings.
[10]
The applicants were engaged and afforded an opportunity to explain
the irregularities and to rebut the claims. They failed
to do
so. Instead they admitted the irregular claims. For
instance they admitted that in additional to claiming a fee
for
emergency consultation, they also charged a separate fee for ordinary
consultation. Such double billing was expressly
prohibited by
the tariff rules of their medical council. Their admissions
corroborated and verified the anonymous whistle-blower’s
claims
somehow. It tended to give some credence to the anonymous
informant’s allegations. On the strength of
the adverse
outcome of the investigation, the respondent suspended the
applicants.
[11]
Aggrieved by the suspension, the applicants launched the current
proceedings by way of an urgent application. The purpose
of the
interdictory relief sought was to compel the respondent to honour its
obligations towards the applicants as it used to do
before the
suspension.
[12]
The applicants raised a point
in
limine
.
The essence of the point was that their suspension by the respondent
was legally untenable because, as counsel argued, it
was based on
inadmissible hearsay foundation. In my view the submission
cannot be sustained. Since the admissions by
the applicants
were materially consistent with the anonymous claims, such anonymous
allegations were cleansed of all their hearsay
blemishes by those
admissions. Those admissions enhanced the probative value of
the hearsay evidence and they eliminated
any potential prejudice
which the reception of such anonymous hearsay might otherwise
entail. Having considered all the factors
as enumerated in
sec
3(1)(c)
of The
Law of Evidence Amendment Act 45 of 1988
, I am of the
opinion that such anonymous hearsay – “exi gg2” –
should be received or admitted in the interest
of justice – See
Steyn
and Others NNO v Blockpave (Pty) Ltd
2011 (3) SA 528
(FB) pars 27-30. Viewed from that perspective,
it cannot be contended, with conviction, that the suspension of the
applicants
was irredeemably tarnished or nullified by inadmissible
hearsay.
[13]
It has now become common cause that the applicants claimed fees based
on incorrect tariff codes and that as a result of such
irregular
practices they received payments to which they were not entitled.
A number of irregular claims were identified
during the verification
process. The applicants did not dispute that they submitted
irregular claims. However, they
offered ignorance as an
excuse. I deem it unnecessary to consider the substantive
merits and demerits of the two versions.
The reasons for this
will soon become apparent.
[14]
The respondent decided to suspend payment of claim’s pending
further investigation. It is undisputed that the claiming
patterns of all the applicants were similar and that the claims they
submitted were irregular. The respondent’s contractual
right to suspend payment is not dependent upon its contractual right
to terminate the network agreement. In other words,
the
respondent is not obliged to first establish its right to terminate
the agreement before it can exercise its right to suspend
its
operation. If this is so, then the applicants are not entitled
to a court order, whereby the respondent is compelled
to pay all
their future claims since the operation of the agreement, from which
their right to claim stems, has been put on hold.
It would not
be proper for me to make a blanket order compelling the respondent to
pay all future claims which have not yet been
submitted, identified
and verified. Such an order would clearly undermine the
respondent’s contractual right to suspend
as well as its
discretion to pay either the doctor or the patient.
[15]
I cannot indefinitely sanction payment to the applicants of all
future claims before the applicants have actually rendered
any health
care services to specific members of the respondent. It would
be absurd to make such an onerous and final order
without knowing
what such future claims will be all about. Such an order will
effectively deprive the respondent of its rights
and obligations to
investigate and to interrogate the validity of claims still to be
submitted in the future by the applicants.
This proposition is
untenable.
[16]
The relief sought, if it were to be granted, would exacerbate the
situation. On their own version, the applicants have
submitted
irregular claims to the respondent in the past. They have
already received payments from the respondent.
They were not
entitled to those previous payments. Such payment were not
due. There was no lawful causa for them.
Granting the
order would basically be tantamount to licensing the submission of
further questionable claims and stripping the respondent
of any
powers to interrogate such claims in the future.
[17]
I have some reservations about the merits of the applicants’
case. However, I refrain from deciding the fate of
the matter
on the merits, notwithstanding my reservations. Now that I have
given some background to the dispute. I
deem it prudent to deal
with the preliminary points raised by the respondent. There
were two. The one concerned urgency
and the other jurisdiction.
[18]
As regards the second point
in
limine
,
the respondent contends that the court does not have jurisdiction to
decide the application. To that point I turn now.
[19]
The parties were privy to the network agreement. The dispute
resolution provisions are embodied in clause 10 of the network
agreement. It provides
“
10.1
Should any dispute arise between the Parties in relation to this
Agreement, the Parties shall first attempt to resolve the
dispute by
mediation. The dispute shall be referred to a senior
representative of the Scheme and the Doctor who shall attempt
to
resolve the dispute within 14 (fourteen) days of giving notice of a
dispute.
10.2
Should the Parties be unable to resolve the dispute within the above
14 (fourteen) days, such dispute shall then be referred
to, and
resolved by, arbitration and shall, unless otherwise agreed in
writing by the Parties, be held in accordance with the rules
of the
Arbitration Foundation of South Africa.
10.3
Only after following the above process will the Parties be allowed to
approach a court of competent jurisdiction to obtain
further relief
should a party wish to appeal the decision of the arbitrator.”
[20]
The respondent contends that the applicant was not supposed to have
brought the dispute to this court, as the forum of first
instance.
The applicants contend that there was no need to follow the avenues
of mediation and arbitration because, as the
applicants say, there
was no dispute as envisaged in clause 10. According to them,
any arbitration proceedings would seriously
retard the finalisation
of the matter. A delay of six months, for instance, would
financially prejudice them a great deal
and ruine their medical
practices. They cannot run their practise for such a long
period if the respondent does not regularly
pay them in the meantime
as in the past.
[21]
In
Lufuno
Mphaphuli & Associates (Pty) Ltd v Andrews & Another
2009 (6) BCLR 527
(CC) the court held:
“
The
decision to refer a dispute to private arbitration is a choice which,
as long as it is voluntarily made, should be respected
by the
courts. Parties are entitled to determine what matters are to
be arbitrated, the identity of the arbitrator, the process
to be
followed in the arbitration, whether there will be an appeal to an
arbitral appeal body and other similar matters.”
It
was not the case of the applicants that they did not voluntarily made
a choice to have any dispute resolved in accordance with
the
all-inclusive clause 10. They also did not contend that they
had mutually determined to exclude the matter from the provisions
of
the change.
[22]
It follows from the above authoritative decision, that an arbitration
clause is a binding clause. It cannot be circumvented
for
flimsy reasons. In view of its binding force, any party who
unilaterally disregards the domestic arbitration forum and
rushes out
to initiate court proceedings, does so at his or her own peril.
[23]
The onus is on the party resisting referral of the dispute to a
private arbitrator to show good cause why the dispute should
not be
referred to a private arbitrator for resolution on the arbitration
forum in terms of the agreement. The onus is a
heavy one and
the discretion of a court to refuse arbitration has to be judicially
and sparingly exercised, “and only when
a very strong case has
been made out” See
Universiteit
van Stellenbosch v JA Louw (Edms) Bpk
1983 (4) SA 321
(A) at 334A.
[24]
In their founding affidavit, the applicants have advanced no argument
to show why the current dispute was not referred to arbitration
in
accordance with the mutual choice made by the parties to have the
dispute privately resolved by an arbitrator.
During
the cause of argument, counsel for the applicants, timidly argued
that there was no real dispute to be referred to private
arbitration. I was not impressed. The mere fact that the
parties differed as to whether clause 10 was applicable or
not was,
in itself a dispute that triggered the invocation of the arbitration
procedure.
[25]
The parties, in their wisdom, freely decided that disputes between
them should be resolved by way of private arbitration.
There
was no dispute excempted from private arbitration. Arbitration
was the preferred choice of the parties for the resolution
of their
disputes. There are no special circumstances to justify the
circumvention of the dispute resolution mechanism agreed
upon.
In my view no sound reason was given and I could find no good cause
as to why such mechanism should not be respected
and implemented.
[26]
In the circumstances I am inclined to sustain the objection that the
court on whose bench I am sitting lacks jurisdiction to
adjudicate
the matter. It being the conclusion I have reached, the
application falls to be struck off the roll with costs.
In view
of this conclusion, it becomes unnecessary to deal with the first
point
in
limine
being the preliminary point relative to the question of urgency.
[27]
Accordingly I make the following order:
27.1
The application is struck off.
27.2
The applicants pay the costs.
_____________
MH
RAMPAI, J
On
behalf of applicants: Adv
WJ Groenewald
Instructed
by:
Matsepes Inc
Bloemfontein
On
behalf of respondent: Adv PL Uys
Instructed
by:
Geldenhuys Malatsi Inc
Johannesburg
Honey Attorneys
Bloemfontein