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[2016] ZAGPPHC 278
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Hugo v Road Accident Fund (5146/2012) [2016] ZAGPPHC 278 (3 May 2016)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
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IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
03/05/2016
Case Number: 5146/2012
Not reportable
Not of interest to other
judges
Revised.
In the matter between:
CHARL FRANCOIS
HUGO PLAINTIFF
and
ROAD ACCIDENT
FUND DEFENDENT
Coram:
HUGHES J
HUGHES J
[1] On 2 August 2008 the
plaintiff, CHARL FRANCOIS HUGO, was involved in motor vehicle
collision and as a result of the aforesaid
collision he sustained
various bodily injuries. The defendant, the ROAD ACCIDENT FUND,
conceded liability in
toto,
tendered to compensate the
plaintiff in full for his proven damages.
[2] The following heads
of damages has already been settled, on 14 October 2014, between the
parties as is set out below:
(a) General damages at
R400 000.00
(b) Interim payment of
Past Medical and Hospital Expenses at R71 780.59
(c) Future Medical
expenses an Undertaking in terms of Section 17(4)(a) of the Road
Accident Fund Act 56 of 1996 (the Act).
[3] The only issue to be
determined by this court is the issue of the plaintiff's past and
future loss of earnings and/or earning
capacity. The parties
confirmed that remaining claim for past hospital and medical expenses
was in the process of being settled
and I needed not adjudicate this
issue.
[4] In course of this
trial all of the plaintiff's expert's reports as well as those
reports of the defendant's expert's and the
joint minutes compiled by
the corresponding experts were admitted as evidence by the parties.
There was a supplementary joint minute
filed by the Industrial
Psychologists and the actuarial calculation, from the actuary of the
plaintiff, is produced along the lines
of this supplementary joint
minute of the Industrial Psychologist.
[5] The only two
witnesses who testified were, Ms Samantha Behrmann (Behrmann), an
Industrial Psychologist for the plaintiff and
Ms Rosinah Motau
(Motau), the Industrial Psychologist for the defendant. Their
testimony centred on the plaintiff's pre-morbid
career path or
progression and the earnings he would have attained.
[6] All that is captured
in the expert reports and joint minutes of Behrmann and Motau are
common cause, but for, the value of the
plaintiff's uninjured
earnings and the contingency deduction to be applied there to. A
determination is required of the latter
which is not common.
[7] It is prudent for a
brief background to be set out. The plaintiff was 29 years of age
when he was involved in the collision
in 2008. In 1999 he registered
for a BCom (Commercial Accounting) at Stellenbosch University which
was conferred upon him on March
2006 having completed the degree in
2005. During the course of his studies he took a gap year from 2003
to 2004 as he travelled
abroad. He states that he intended to
register for his MBA a year or two after the year of the collision.
His intended career path,
as stated by the plaintiff, having attained
his MBA, was that of a Director or Shareholder of a medium size
company.
[8] At the time of the
collision in 2008, he was employed at New Reclamation Group as a
Branch Accountant earning an annual salary
of R281 063.00. He only
returned to work in 2010 and was then retrenched. In January 2011 he
was employed as a Financial Manager
at Shastean Investments earning a
salary of R30 000. 00 per month. He resigned in October of the same
year as his position became
redundant. Fortunately, in November 2011
he gained employment at Stuttafords as an Assistant Financial Manager
earning R35 000.00
per month but resigned in September 2013. At Home
Mark, he commenced in September 2013 and remained there until August
2014. He
worked as a Financial Manager and earned R44 000.00 per
month. At the time of the trial, 2015, the plaintiff was employed by
Lyndvaal
as a Financial Manager and was earning R475 212.00 per
annum.
[9] All the expert's
opinion that the plaintiff has a residual capacity to remain
gainfully employed at a senior level in the Financial
Management
field, however, in competing in the open labour market he has been
compromised as he is more vulnerable as he has experienced
a mild
loss of work capacity. This is as a result of the degree of cognitive
efficiency he has lost that is due to the
sequela
of the
injuries he sustained.
[10] Adv. Ferreira for
the plaintiff argues that the plaintiff, but for the collision, would
have obtained his MBA in 2009 when
he was 30 years old. He would have
commenced on lower quartile of level D5 of the Paterson Grade by 2010
with his income evenly
rising in real terms until he reached his
career ceiling at age 45, earning at the lower level of E1.
[11] On the other hand
Adv. Coetzee argued for the defendant that at best the plaintiff
would have commenced in 2010 on the median
of D1 Paterson Grade level
and progressed with uniform real term increases to the lower D2 level
by the time he reached age 45
with inflationary increases thereafter
till retirement age 65. This scenario excludes the possibility of the
plaintiff attaining
a MBA.
[12] Behrmann and Motau
agreed that the age of retirement would be 65 years in both the 'but
for' the collision and 'having regard'
to the collision scenarios.
[13] A further factor to
take into consideration is the fact that this collision took place
after the 1 August 2008 and in terms
of the Act a maximum loss
allowance per annum is R160 000.00 which value is applied to the net
loss. This is in respect to general
contingencies being applied to
the calculation of the accrued and prospective loss amounts.
[14] The two hypotheses
above differ on one aspect only and this is whether the plaintiff
would have attained his MBA.
[15] The evidence of the
plaintiff was that he wished to first attain sufficient work
experience to 'maximise' his MBA studies.
This was why he had planned
to register a year or two after 2008. This would give him at least 4
to 5 years work experience towards
his MBA on my calculations.
[16] Behrmann testified
that the issue of the plaintiff wanting to pursue a MBA came to the
fore when the he was interviewed on
19 August 2014. She conceded, in
cross-examination, that she did not have the plaintiff's degree
certificate when she interviewed
him to verify that he had indeed
been conferred with the degree he said he had. She further conceded
that she did not even verify
with the institution that plaintiff was
in fact conferred with a degree. What she did confirm that for the
plaintiff's attain his
aspirations in obtaining a MBA, regard had to
be had of his result of his BCom. These results she never had sight
of and she conceded
that this would play a vital role in him being
admitted to do the MBA. She emphasised that it was on the plaintiff's
submissions
to her that she came up with the notion that he would
have attained a MBA. Lastly on this aspect she conceded that she did
not
do any investigations on whether the plaintiff would have
qualified to be admitted for the MBA program with just a BCom degree,
the results of which she was not aware of, and the requirement for
such a degree she had not research.
[17] Motau interviewed
the plaintiff on 1 September 2014 and her evidence is that she was
not told by the plaintiff of his aspiration
to do a MBA.
[18] In her evidence in
chief she testified that she did do follow up interviews with his
past employer that the plaintiff had advised
her of and she verified
that he had obtained a matric with exemption certificate and B Com
Acc. degree.
[19] When she enquired
from the plaintiff of what his future aspiration were he responded
that he wanted to be on a board or start
his own business. As regards
his aspiration before he pursued his BCom degree he told her that he
wanted to complete his degree,
do his article and qualify as a CA,
maybe his Masters and at some point he wanted to be a Doctor.
[20] In cross-examination
she made the concession that the plaintiff could have attained a
post- graduate diploma and that the knowledge
of the plaintiff
aspiring to do a MBA prior to the collision should be taken into
account with the application of a higher contingency
to cater for the
uncertainty element.
[21] What ultimately
comes to the fore, in my mind, from the testimony of both Behrmann
and Motau, is that they agree that the plaintiff's
aspiration to do
his MBA should be taken into account. Motau qualifies this by stating
that a higher than normal contingency be
applied to cater for
uncertainties.
[22] I find difficulty in
accepting both experts notion that I should take into account the
aspirations of the plaintiff to do his
MBA as he stated for the
reasons that follow. Firstly, Behrmann conceded that she did not
investigate whether the plaintiff, by
way of the marks that he
attained in his BCom, would have qualified to be admitted to do his
MBA. Secondly, she also did not investigate
what the requirements
were in the plaintiff's circumstances to be admitted to do a MBA. She
conceded that she relied solely on
the plaintiff's say so to conclude
that he would have registered for his MBA when he said he would.
Motau's evidence is that he
could have done a post graduate degree.
She also stated that in addition to the BCom a post graduate
qualification was required
together with three to four years work
experience.
[23] Now in light of the
above evidence I concur with Adv. Coetzee argument that the
plaintiff, by way of expert evidence, has failed
to discharge the
onus to demonstrate that the plaintiff would have registered for his
MBA as he said he would and attained the
said qualification.
[24] I am guided by that
said in
S v The State (423/11
[2011] ZASCA 214
(29 November 2011)
at [19]
where
Harms AP
makes reference to the principles
that guide a court in admitting the opinions of experts:
"[19] This approach
is fatally flawed. Courts have to decide whether or not they believe
witnesses. They cannot be led by opinion
evidence on this point. The
glib evidence was simply inadmissible opinion. It should suffice to
refer again to
Holtzhauzen v Roodt
and to quote from another
judgment by Satchwell J, namely
S v Engelbrecht
2005 (2) SACR
41(W)
at para 26, where the learned judge said this:
'Courts frequently turn
to persons with expertise and skill for assistance. The relevant
principles applicable to the admissibility
of opinion evidence by
experts, including psychologists and social workers, have been set
out in numerous authorities. Firstly,
the matter in respect of which
the witness is called to give evidence should call for specialised
skill and knowledge. Secondly,
the witness must be a person with
experience or skill to render him or her an expert in a particular
subject. Thirdly, the guidance
offered by the expert should be
sufficiently relevant to the matter in issue to be determined by the
Court. Fourth, the expertise
of any witness should not be elevated to
such heights that the Court's own capabilities and responsibilities
are abrogated. Fifth,
the opinion offered to the Court must be proved
by admissible evidence, either facts within the personal knowledge of
the expert
or on the basis of facts proven by others. Sixth, the
opinion of such a witness must not usurp the function of the Court.'
The evidence of Mrs
Haycock did not satisfy requirements four, five or six."
[25] I conclude that the
experts on this MBA aspect did not provide this court with assistance
as their conclusion was not based
on proven facts as they had not
investigated and/or researched whether the plaintiff, aside from his
say so, would have firstly
qualified to register and complete the MBA
program.
[26] I am aware that
sight must not be lost of my responsibilities in drawing inferences
from the proven facts before me, and in
this instances both experts
have not furnished evidence in order for me to test the accuracy and
the objectivity of their conclusion
with regard to the issue of the
plaintiff having attained a MBA. I therefore find that the evidence
of both experts did not satisfy
requirements five and six mentioned
in
S v The State
supra.
[27] In the result I am
of the view that basis of the calculation without attaining an MBA,
as submitted by Adv. Coetzee, is applicable
in these circumstances.
[28] From the joint
minutes of Behrmann and Motau they agree on the calculation of the
plaintiff's future earnings having regard
to the collision as
totalling an amount of R8 510 534.00, as calculated in the actual
report of Ivan Kramer cc. I see no need to
venture into this terrain
as it falls into that which common cause with the parties.
[29] Turning to the issue
of contingencies I take heed of what was stated in
Southern
Insurance Association v Bailey NO 1984(1) 98 AD
about the two
approaches that can be used to ascertain future loss of earnings are
discussed on
page 113
where the following is said by
Nicholas
JA:
"One is for the
Judge to make a round estimate of an amount which seems to him to be
fair and reasonable. That is entirely
a matter of guess work, a blind
plunge into the unknown. The other is to try to make an assessment by
way of mathematical calculations,
on the assumptions resting on the
evidence. The validity of this approach depends of course upon the
soundness of the assumptions,
and these may vary from the strongly
probable to the speculative. It is manifest that either approach
involves guesswork to a greater
or lesser extent."
Continues on page
114C-D
to state:
''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 "informal guess"
it has the advantage of a logical basis". In addition refer to
Smit NO v The Road Accident Fund, The Quantum of Damages, Corbett
and Honey, Volume 5,
B4-251.
Robert J Kock
in
his book
"The Quantum Year book"
states that there
are no fixed rules as regards general contingencies and one of his
helpful guidelines is that of the sliding scale
contingency theory:
"Sliding scale:
%
%
per year to retirement age, i.e. 25% for a child, 20% for
a
youth and 10% in middle age".
[30] In the circumstances
of I am of the view that normal contingencies of 5% on accrued and
10% on prospective values of income
be applied, as is set out in the
actuarial calculation of Ivan Kramer cc dated 13 October 2015 handed
up as exhibit 'D'. These
contingencies will be applied to the 'but
for the collision' scenario taking into account the facts of this
case mentioned in relation
to the plaintiff's progress in his career
prior to the collision.
[31] As there is
consensus with regards to the 'having regard to the collision'
scenario I will apply the mathematical contingency
as suggested in
Ivan Kramer cc dated 13 October 2015 of 30%. It was correctly in my
view pointed out by the two industrial psychologist,
that the
plaintiff is a more vulnerable employee, has suffered from a decree
in productivity, is on an unequal footing as a competitor
on the open
labour market and as a result his career progress opportunities are
thus restricted.
[32] In the result, as
illustrated by way of the actuarial calculation mentioned supra, I am
of the view that the amount due to
the plaintiff is that which set
out under the header 'LIMIT APPLIED Basis 02 level' totalling an
amount of R2 563 781.00 which
takes into account the contingency
deduction mentioned above.
[33] The net loss of
earnings due to the plaintiff totals R2 563 781.00.
[34] The order granted is
in terms of the order attached marked X, duly incorporated into the
judgment, with the insertion of the
amount of R2 563 781.00.
____________________________
W. Hughes
Judge High Court Gauteng,
Pretoria
Delivered: 3 May 2016
For plaintiff: Adv E J
Ferreira Instructed by: Ian Levitt Attorneys For Defendant: Adv L
Coetzee
Instructed by: Maponya
Incorporated
IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
CASE NO: 5146/2012
In the matter between:
CHARL F
HUGO
Plaintiff
and
ROAD ACCIDENT
FUND
Defendant
DRAFT
ORDER
HAVING HEARD COUNSEL FOR
THE PARTIES IT IS ORDERED THAT:
1. The Defendant shall
pay the capital amount of R2 563 871.00 in settlement of
Plaintiff's claim for loss of earnings:
NAME OF ACCOUNT:
Ian
Levitt Attorneys
BANK:
ABSA
BRANCH: […]
ACCOUNT NO: […]
BRANCH CODE: 630 805
2. Interest on the
capital amount of R 2 563 781.00 at the rate of 9% per
annum calculated from fourteen (14) days from
date hereof to date of
final payment, both days inclusive.
3. The Defendant shall
pay the Plaintiff's taxed or agreed costs on the High Court party and
party scale to date, the costs on trial
of counsel on 12, 13 and 20
October 2015, including Counsel's consultations with experts,
drafting of written heads of argument
and the preparation,
reservation and qualifying fees of the following experts together
with their consultations with Counsel, if
any, and as determined by
the taxing master, namely:
3.1. Dr G Read,
orhtopaedic surgeon;
3.2. Dr Basil Braude,
psychiatrist;
3.3. Dr P Miller,
neurosurgeon;
3.4. E Bloye, clinical
psychologist;
3.5. Catherine Rice,
occupational therapist;
3.6. S Behrmann,
industrial psychologist;
3.7. Ivan Kramer,
Actuary.
4. In the event that
costs are not agreed, the parties agree as follows:
4.1. The Plaintiffs shall
serve a notice of taxation on the Defendant's attorneys of record;
and
4.2. The Plaintiffs shall
allow the Defendant 14 (fourteen) court days to make payment of the
taxed costs.
BY THE COURT
REGISTRAR