THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Reportable
Case No: 724/2023
and 724B/2023

In the matter between:

THE ROAD ACCIDENT FUND FIRST APPELLANT
C P LETSOALO (THE CHIEF EXECUTICE OFFICER
OF THE ROAD ACCIDENT FUND ) SECOND APPELLANT
THE BOARD OF THE ROAD ACCIDENT FUND THIRD APPELLANT

and

DUMISANI ELVIS HLATSWAYO FIRST RESPONDENT
MZWANDILE MODCAY MASILELA SECOND RESPONDENT
THE SOUTH AFRICAN LEGAL PRACTICE COUNCIL THIRD RESPONDENT
THE GENERAL BAR COUNCIL OF SOUTH AFRICA FOURTH RESPONDENT
PRETORIA SOCIETY OF ADVOCATES FIFTH RESPONDENT

Neutral Citation: The Road Accident Fund and Others v Hlatshwayo and Others
(724/2023 and 724B/2023 ) [202 5] ZASCA 17 (5 MARCH 2025 )
Coram: MOCUMI E, HUGHES and SMITH JJA and DOLAMO and
MOLITSOANE AJ JA
Heard: 11 November 2024
Delivered : 5 March 2025
Summary: Civil procedure -whether it was competent for the full court to inquire into the
issue of costs occasioned by the late settlement of two Road Accident Fund matters –

2
whether the full court erred in ordering costs de boniis propriis against the Chief Executive
Officer of the Road Accident Fund (the CEO) and the R oad Accident Fund Board (the
Board) pursuant to the findings of the inquiry – whether it was proper for the full court to
order costs de boniis propriis against the RAF Board where the Board was not joined to
the proceedings – whether costs were properly granted against the CEO and the Board
in light of the indemnity provi sion in s 15(3) of the Road Accident Fund Act 56 of 1996 –
whether malice on the part of the CEO and the RAF board has been established as
required in terms of s 15(3)


























3

______________________________________________________________ _____

ORDER
______________________________________________________________ _____
On appeal from : Mpumalanga Division of the High Court, Mbombela ( Legodi JP and
Mphahlele DJP and Mashile J, sitting as court of first instance ):
1 The appeal against the first appellant is dismissed.
2 The appeal is upheld in respect of the second and third appellants.
3 The first appellant shall pay the first and second respondents’ costs of the
appeal, including the costs of two counsel, where so employed.
4 The order of the high court is set aside and replaced by the following order:
‘The defendant is ordered to pay the plaintiff s’ costs of suit, including the costs
of the inquiry and of two counsel in the inquiry, where so employed. ’

______________________________________________________________ _____

JUDGMENT
______________________________________________________________ _____
Molitsoane AJA (Mocumie, Hughes, Smith JJA and Dolamo AJA concurring)

Introduction
[1] At the heart of this appeal is an order against the appellants to pay the costs
occasioned by the late settlement of the third-party claims of Mr Dumisani Elvis
Hlatshwayo (the first respondent) and Mr Mzwandile Modcay Masilela (the second
respondent ), as well as the cost s of the inquiry that the Mpumalanga Division of the
High Court held on the strength of rule 37A of the Uniform Rules of Court .1 The
appellants unsuccessfully sought leave to appeal the order of the full court which was
specially constituted by the Judge President of the high court for the inquiry. The
appeal is with special leave of this Court.


1 Supreme Court Act 59 of 1959 - Rule 37A of the Uniform Rules of Court provides for judicial case
management which includes settlement of all or some of the issues .
4
[2] The two cases of the first and second respondents , case numbers 3242/2019
and 7141/2019 , were consolidated by the high court2 for the purposes of holding an
inquiry into the costs which were incurred as a result of the last-minute settlement of
the two claims . The second appellant , the Chief Executive Officer of the Road Accident
Fund ( the CEO ), and the third appellant , the Board of the Road Accident Fund ( the
Board ), were ordered to pay the costs in their personal capacities . The CEO was also
ordered to bring the judgment of the full court to the attention of the Minister of
Transport , as well as the Board , within the period stipulated in the order .

[3] The first and second respondents oppose d the appeal on the limited basis that
the Road Accident Fund (the RAF) should be order ed to pay the costs of the inquiry ,
which took place at the instance of the full court. They, however, d id not support an
order of costs de boniis propriis against the second and third appellant s. The
remaining cited respondents did not participate in this appeal . The mere fact that th e
appeal centres solely on the issue of costs does not preclude this Court from dealing
with it.3 In any event , none of the respondents seek to impugn the jurisdiction of this
Court in this regard.

[4] The R AF is a juristic person established in terms of s 2 of the Road Accident
Fund Act 56 of 1996 ( the RAF Act). The CEO of the RAF was appointed by the Minister
of Transport on the recommendation of the Board in terms of s 12(1) (a) of the RAF
Act. The Board has been duly constituted in terms of s 10 of the RAF Act. Section
4(1)(b) of the RAF Act provides that :
‘[t]he powers and functions of the Fund shall include the investigation and settling, subject to
this Act, of claims arising from loss or damage caused by the driving of a motor vehicle whether
or not the identity of the owner or the driver ther eof, or the identity o f both the owner and the
driver thereof, has been established.’
The first and second respondents are claimants as envisaged in s 17(1) (a) of the RAF
Act.


2 For ease of reference , ‘the high court’ in these proceedings refers to proceedings before a single
judge, while ‘the full court’ refers to the proceedings before a specially constituted court of three
judges.
3 Public Protector v South African Reserve Bank [2019] ZACC 29 ; 2019 (9) BCLR 1113 (CC); 2019 (6)
SA 253 (CC) (Public Protector ).
5
Factual background
[5] The following undisputed fac ts triggered these proceedings. The first and
second respondent instituted separate delictual claims against the RAF arising out of
the alleged negligent driving of motor vehicl es in separate incidents. A few days before
the dates of the hearing of both claims, the respondents and the RAF settled the
claims.

The claim of the first respondent
[6] On 28 March 2018 , the RAF acknowledged receipt of a third-party claim of the
first respondent . The RAF has no proof of any formal rejection of the validity of the
claim of the first respondent . On 10 September 2019, the first respondent instituted an
action against the RAF. It appears that, a fter the close of the pleadings , the RAF was
notified of the rule 37(1) conference and the rule 37A judicial case management
hearing , but it did not appear at these sittings. The trial was set down for hearing on 7
March 2022.

[7] A day before the trial, the RAF made an offer to the first respondent’s a ttorneys,
which offer was accepted on the day of the trial . This settlement of the claim on the
day of the trial prompted the high court to hold an inquiry into the issue of costs , which
is the subject of this appeal.

The claim of the second respondent
[8] The se cond respondent instituted a direct claim against the RAF which was
registered by the RAF on 12 January 2018. Since the RAF did not object to the validity
of the claim as envisaged in s 24(5) of the RAF Act , the claim was deemed to be valid .
On 27 March 2018 , the RAF requested the second respondent to submit his
hospital/clinical records. The second respondent did not furnish the requested
documentation but opted to issue a summons instead . The RAF instructed a firm of
attorneys to defend the matter. The pleadings were duly exchanged but the
hospital/clinical records were only furnished in August 2019.

[9] The second respondent ’s attorneys then delivered the rule 37 conference and
37A judicial case management meeting notices to the RAF ’s previous panel of
attorneys. The RAF’s attorneys failed to respond to the rule 37 notice or appear at the
6
case management hearing. Although the second respondent claimed for loss of
earnings , his rule 37 minute , compiled by his attorneys , indicated that the expert
reports of the occupational therapist, the industrial psychologist and the actuar y were
still outstanding .

[10] The RAF contends that when the second respondent set the matter down for
the case management meeting, the case was not ripe for hearing as there were expert
reports outstanding . Nevertheless , this case was certified trial ready on 25 January
2022 and was enrolled for hearing on 14 March 2022.

[11] The RAF tender ed an offer in respect of the merits, future medical expenses
and general damages on 9 March 2022 .The second respondent accepted the offer on
the same day. Due to the outstanding issue of loss of earnings, the claim was thus
partially settled. The partial settlement, like the settlement in the first respondent’s
claim, was also concluded a day before the hearing .

[12] The high court refused to make the settlement agreements orders of the court.
The late settlement of the claims prompted the Judge President to constitut e a full
court to inquire into the reason s for the delay and late settlement of the claims . In
pursuance of its decision to conduct the inquiry , the full court issued various directives,
which were primarily aimed at the officials of the RAF.

[13] Although the questions raised by the full court in the directives were couched
in general terms and not necessarily fact specific , they essentially sought to explore :
(a) the reasons for the settlement or partial settlement of claims close to the date of
trial;(b) the failure of the RAF to hold meaningful pre -trial conferences and to attend
case management hearings ;(c) the failure of its officers to attend court on the trial
dates; the roles and duties of the claims officers ;(d) the reasons why the officers of
the RAF should not be ordered to pay costs out of their own pockets ;(e) how the RAF
dealt with the claims .

[14] The full court also invited the Legal Practice Council (LPC) and the General
Council of the Bar of South Africa (the GCB) to participate as friends of the court. The
GCB was also invited by the court to collate information from other divisions regarding
7
the issues raised by it. The Pretoria Society of Advocates also intervened in the
proceedings and filed a report.

[15] On 24 January 2023 , the full court handed down judgment and granted the
following order:
‘1. The CEO (Mr . Letsoalo) and the Board are hereby directed to pay out of their own
pockets, jointly and severally the one paying the other to be absolved, the costs connected to
and occasioned by the late settlement in each matter. (Emphasis by the full court .)
2. The costs referred to in paragraph 1 (above) shall include the costs to date connected
to or associated with the enquiry proceedings herein.
3. The costs occasioned by or connected to the late settlements herein shall include
costs of two counsels where applicable.
4. The Chief Executive Officer of the Fund, Mr . Letsoalo, is hereby directed to bring this
judgment to the attention of the Minister of Transport and the Board by not later than Thursday
26 January 2023, and confirm to the Registrar of this court by not later than Friday 27 January
2023 that same has b een done.
. . . .
. . . .’

[16] On 7 February 2023, acting in terms of rule 424, the full court varied its order to
hold the RAF liable for the costs of the first and second respondents, jointly and
severally with the CEO and the Board. The full court ’s judgment is comprehensive
comprising some 97 pages and traverses many issues. In my view , it is unnecessary
to deal with all the issues considered by the full court since the following issues are
dispositive of this appeal :(a) whether it was appropriate for the Judge President to
refer the first and second respondents claims to the full court for an inquiry; if so,
whether a case has been made for the orders granted ;(b) the non -joinder of the Board

4 Rule 42 provides:
Variation and rescission of orders
(1) The court may, in addition to any other powers it may have, mero motu or upon the application of
any party affected, rescind or vary :
(a) An order or judgment erroneously sought or erroneously granted in the absence of any party
affected thereby;
(a) an order or judgment in which there exists an ambiguity, or a patent error or omission, but only to
the extent of such ambiguity, error or omission.
(c) …
2…
3…
8
to the proceedings ;(c) whether costs should have been granted against the CEO and
the Board , in the light of s 15(3) of the RAF Act. I consequently only deal with th ese
issues.

Was it competent or proper for the Judge President to refer the two fee inquiries
to the full court?
[17] The high cou rt has inherent powers to regulate its own processes by virtue of
s 173 of the Constitution .5 In this regard, they , from time to time, promulgate practice
directives applicable to their divisions. In Ex parte National Director of Public
Prosecutions ,6 this Court explained that the practice directives , in essence , deal with
the day -to-day functioning of the court s and are geared to supplement the rules.7 They
are, for this reason , not meant to substitute the rules. In case of any conflict, the rules
would prevail . However, they have the same force and effect as the rules .8

[18] The Chief Justice also published the Norms and Standards for the Performance
of Judicial Functions,9 which , inter alia , seek to ‘ensure the effective, efficient and
expeditious adjudication and resolution of all disputes through the courts ’.10 To this
end, judicial officers are enjoined to take control of the management of cases from an
early stage and actively take responsibility for the speedy finalisation of cases from
initiation until their conclusion.

[19] Rule 37(9) (a) empowers a court to consider , and in certain circumstances , to
make special orders as to costs against any party during the hearing of an action or
their attorney , where the attorney had failed to attend the pre -trial conference or to a
material degree failed to promote the effective disposal of the action. It is not in dispute
that the RAF’s attorneys had failed to attend the rule 37 conferences as well as the
case management hearings having be en duly notified . Rule 37A (1) recognises th e

5 Section 173 provides that ‘[t]he Constitutional Court, the Supreme Court of Appeal and the High Court
of South Africa each has the inherent power to protect and regulate their own process, and to develop
the common law, taking into account the interests of justice ’.
6 Ex parte National Director of Public Prosecutions [2018] ZASCA 86; 2018 (2) SACR (SCA) 176.
7 Ibid para 31.
8 Rossiter v Nedbank Ltd 2015 JDR 2629 (SCA) ; [2015] ZASCA 196 para 15.
9 The Chief Justice issued the Norms and Standards for the Performance of Judicial Functions (Norms
and Standards) in terms of s 8 of the Superior Courts Act 10 of 2013 read with s 165(5) of the
Constitution and published in GN 147 in GG 37390 of 28 February 2014 .
10 See para 2 of the Norms and Standards.
9
power of the Judge President to issue practice notes or directives dealing with judicial
management of cases . In this regard , the Judge President of the high court
promulgated such practice directives to address , inter alia , the issue of the settlement
of disputes on the date of the trial. Clause 14.1 of the Practice Directive11 precludes
any settlement of the matter on the day of the trial. In terms of the practice directives
of the high court, where settlement is concluded on the day of the trial , the court may
inquire into causes for the late settlement to determine which party should be saddled
with costs, thereafter the case would be removed from the roll.12

[20] It is important to note that while the responsibility for the management of the
case lies squarely in the hands of a judge ceased with a matter , rule 37A( 2)(c) imposes
the primary responsibility on the litigants and their legal representatives to prepare
properly and comply with the rules and to ensur e that the case is set down for hearing.
At the case management hearing, the court may make any order as to costs including
costs de boniis propriis against a party’s legal representatives or any person whose
conduct has contributed to frustrate the objectives of the case management
directives .13 If, during the case management hearing , an inquiry into costs had not
been held as contemplated in rule 37A (12)(h), the trial court may at its discretion, as
in this case, hold an inquiry into the issue of costs.14

[21] In the two matters before t he full court, the parties had settled their disputes
and agreed who must pay the costs . In awarding costs, however, the court exercises
a wide discretion which must be judicially exercised. This discretion is retained by the
court even in circumstances where the parties have reached an agreement on the
issue of costs . While the court will recogni se and respect the rights of the parties to

11 Amended Practice Directive of 9 January 2020 for Mpumalanga Division of the High Court issued in
terms of s 8(3) of the Superior Courts Act read with rule 37A(1) and (2) of Uniform Rules of Court.
12 Clause 14.4 provides that ‘[a] ny matter that is settled on the date of the trial in its entirety, shall be
removed from the trial roll . . .’ Clause 14.5 provides that ‘[t] he recording of removal from the roll as
contemplated in 14. 4 above shall be preceded by summary inquiry and an order for costs as
contemplated in paragraphs 4 and 5 of Form A3 . . . and any defaulting party or legal practitioner may
be ordered to pay costs on a party and party scale or punitive scale and or out of own pocket, including
forfeiture of appearance or day fee , all of which shall be guided by the nature of the default and
explanation provided for settlement on the day of the trial ’.
13 See rule 37A (12)(h).
14 Rule 37 A(13) provides that ‘[t]he record of the case management conference, including the minutes
submitted by the parties to the case management judge, any directions issued by the judge and the
judge’s record of the issues to be tried in the action, but excluding any settlement discussions and
others, shall be included in the court file to be placed before the trial judge ’.
10
contract , it may interfere in the agreement on the issue of costs , should good cause
exist.

[22] In Intercontinental Exports (Pty) Ltd v Fowles ,15 this Court explained the
essence of this discretion as follows :
‘The basic rule is that, statutory limitations apart, all costs awards are in the discretion of the
court. (Kruger Bros & Wasserman v Ruskin 1918 AD 63 at 69, a decision which has
consistently been followed). The court’s discretion is a wide, unfettered and [an] equitable one.
It is a facet of the court’s control over the proceedings before it. It is to be exercised judicially
with due regard to all relevant considerations. These would include the nature of the litigation
being conducted before it and the conduct of the parties ( or their representatives). A court may
wish, in certain circumstances, to deprive a p arty of costs, or a portion thereof, or order lesser
costs than it might otherwise have done, as a mark of its displeasure at such party’s conduct
in relation to the litigation. Is it to be precluded by agreement from doings so? A court should
not be obliged to give its imprimatur to an order of costs which, in the circumstances, it
considers entirely inappropriate or undeserved. In my view, as a matter of policy and principle,
a court should not, and must not, permit the ouster of its discretion because of agreement
between the parties with regard to costs.

Because a court exercises its discretion judicially, not capriciously, it would normally be bound
to recognise the parties’ freedom to contract and to give effect to any agreement reached in
relation to costs. But good grounds may exist, depending upon the particular circumstances,
for following a different course. This might result, on a proper exercise of discretion, in a party
being deprived of agreed costs, or being awarded something less in the way of costs than that
agreed upon .’

[23] Over and above this, it was within the prerogative of the Judge President, acting
in terms of s 14(1)( a) of the Superior Courts Act to constitute a full court.16 The high
court was entitled , in terms of its practice directive s, the empowering rule 37A(13) as
well as the wide discretion it has in the award of costs, to hold this inquiry when the
two cases were brought before it for the purpose of making the settlement agreements

15 Intercontinental Exports (Pty) Ltd v Fowles 1999 (2) SA 1045 (SCA); [1999] 2 All SA 304 (A) paras
25-26.
16 Section14(1)(a) of the Superior Courts Act 10 of 2013 provides: ‘Save as provided in this Act or any
other law, a court of a Division must be constituted before a single judge when sitting as a court of first
instance for the hearing of any civil matter, b ut the Judge President and the Deputy Judge President,
the senior available judge, may at any time direct that the matter may be heard by a court of not more
than three judges as he or she may determine.’
11
orders of court. It was thus competent and proper for it, to refer the two cases to the
full court to inquire into the question of wasted costs.

Was it proper for the full court to order costs de boniis propriis against the RAF,
the Board and the CEO ?
[24] The full court dealt extensively with the connection between the conduct of the
CEO, the Board and the late settlement of the two claims . The full court further
considered the contractual relationship between the RAF and its panel of attorneys
which w ould have terminated on 31 May 2020. In response to some of the questions
directed to him, the CEO penned a letter which he claims was written in his personal
capacity. Contrary to established practice of communicating with the court by notifying
and including all part ies involved in litigation , the CEO addressed the letter to the
Judge President without such notification. The relevant parts of that letter read as
follows :
‘1. What is the nature of these proceedings before the full bench? Is it an enquiry and, if it is,
under what provision of the court rules is it held? What is intended to be achieved or
determined in these proceedings?
2. Except for Hlatshwayo , Masilela and the RAF, who are parties to these proceedings? What
is the role of each party and how did they join these proceedings? How were these parties
selected to join these proceedings and invited to these proceedings? Are there any examples
of proc eedings of this nature held in the past, in any high court division, that one can refer to,
where this kind of proceedings were held?
3.What is my role, personally in these proceedings? What is expected of me and how and
how do I participate in these proceedings? I ask this question given what happened, during
these proceedings on 22 June 2022 when the legal representative of the RAF, Advocate
Cedric Puckrin, SC, informed the court of my presence and that I requested to address the
court on matters to my personal knowledge and this was denied. An instruction was then
issued to the effect that I must instruct Advocate Puckrin, who is the l egal representative of
the RAF. This is notwithstanding me being personally invited by the court to attend the
proceedings.
4. What is the procedure in this kind of proceedings? I am asking, this in the context of where
RAF was asked to address the court first and about 17 questions were asked to be addressed,
questions which were mostly generic and did not form part of the papers. I was also asked to
present myself personally at these proceedings, only for RAF legal re presentative , Advocate
12
Puckrin, to be instructed to take instruction from me without him being appointed my legal
representative. I believe that I have a right to a legal representative of my choice. A right I
don’t intend to forgo .
5. Some of questions are in relation to matters that are active various court cases and
proceedings, serving in divisions of the high courts and the Supreme Court of Appeal. This
includes matters in reference to Section 13 of the RAF Act, regarding RAF’s Annual Report.
How am I or any of the parties expected to answer those questions? It is also not clear how I
and any of the parties expected to answer the questions which are the questions which are
subject matters in the province of these courts.
. . . .
7. Lastly, who usually pays for costs associated with these kinds of proceedings .’

[25] The Judge President declined to respond to the letter but dealt with it
extensively in the judgment . The view taken by the Judge President not to respond
directly to the CEO is correct as the CEO as the author of the letter was at the time
acting in his capacity as the CEO of a party, the RAF, which was legally represented
before the pending proceedings in court. The assertion by the CEO that the letter was
written in his personal capacity is perplexing and does not bear scrutiny as he signed
same in his capacity as the CEO of the RAF.

[26] The letter is based on the CEO’s own misunderstanding of the procedure the
full court followed in the cost inquiry . However , the letter did little to avert the imminent
disagreement between the CEO and the full court which found that neither the CEO,
nor its Board or Management had capacity to demand the files from panel attorneys
and deal with them in cases which were still pending in courts. Thus , the deman d was,
according to the full court , unreasonable and unfair .

[27] The full court found that there was a causal connection between the demand
to remove the files from the panel attorneys and the delay in the late settlement of the
claims . It held that “. . . ‘it was manifestly inappropriate ’ of the CEO, the Board and the
Fund to demand the return of all the files from panel attorneys, when the Fund did not
have the capacity to deal with such pending matters in our courts. ” The two cases
were the subject of such demands . The full court then, inter alia , found that the
13
appellants were personally liable for the costs in respect of these two claims and for
the costs of the inquiry.

[28] It is settled law that those who occupy public office and who act in a
representative capacity may be mulct ed with costs out of their own pockets in certain
circumstances.17 These costs order s, de boniis propriis , are not easily granted but
only in exceptional circumstances.18 In Public Protector ,19 the Constitutional C ourt
stated it thus:
‘In Black Sash II , this Court held that the common law rules regarding the granting of personal
costs orders are well grounded and buttressed by the Constitution. The traditional common
law tests of bad faith and gross negli gence must be infused by the Constitution. Froneman J
said that the question whether the conduct of a public official justifies the imposition of liability
for personal costs can be answered by having regard to institutional competence and
constitution al obligations. He went on to explain:
“From an institutional perspective, public officials occupying certain positions would be
expected to act in a certain manner because of their expertise and dedication to that position .
Where specific constitutional and statutory obligations exist the proper foundation for personal
costs orders may lie in the vindication of the Constitution, but in most cases there will an
overlap .”’20 (Foot notes omitted)

Non joinder of the Board
[29] In dealing with the issue of personal costs against the CEO and the Board, it is
perhaps convenient to start with the order against the Board. The order of the full court
was assailed on the basis that there was a material non -joinder of the Board. It is trite
that joinder of a party is required where such a party may have direct and substantial
interest in the subject matter of the action. In Snyders and Others v De Jager and
Others 21 the Constitutional C ourt held as follows:
‘A person has a direct and substantial interest in an order that is sought in proceedings if the
order would directly affect such person’s rights or interest. In that case the person should be
joined in the proceedings. If the person is not joined in circumstances in which his or her rights

17 Black Sash Trust v Minister of Social Development and Others (Freedom Under Law NPC
Intervening) [2018] ZACC 36; 2018 (12) BCLR 1472 (CC) paras 7-14. See also Public Protector para
153.
18 Lushaba v MEC for Health, Gauteng 2015 (3) SA 616 (GJ) paras 68 and 69.
19 See fn 2 .
20 See fn 2 para 154.
21 Snyders and Others v De Jager and Others [2016] ZACC 54; 2017 (5) BCLR 606 (CC).
14
or interests will be prejudicially affected by the ultimate judgment that may result from the
proceedings, then that will mean that a judgment affecting that person’s rights or interests has
been given without affording that person an opportunity to be hea rd. That goes against one
of the most fundamental principles of our legal system. That is that, as a general rule, no court
may make an order against anyone without giving that person the opportunity to be heard. ’22

[30] Neither the Board nor any of its members were before the full court. The fact
that the CEO ‘serves at the pleasure of the . . . Board ,’ as held by the full court , is no
justification to mulct it with costs as it is common cause that the Board was not part of
the proceedings from the time the inquiry commenced until it ended.

[31] The full court issued numerous directives calling on different functionaries of
the RAF to provide explanatory affidavits and in some instances , calling f or relevant
people to appear before it in person during these proceedings, but such an invitation
was never extended to the Board. The full court was fully aware that the Board and/or
any of its members were not before it , hence it also directed the CEO to bring its
judgment and order to the attention of the Board . The full court ordered personal costs
orders against the Board without affording it the opportunity to be heard . There is no
explanation or reasons advanced in the judgment why the Board has been mulcted
with costs. Such an order goes against the notion of procedural fairness and cannot
stand.

[32] The full court found that the system which was implemented by the RAF after
the disposal of the panel attorneys and the challenges thereof appears to be the real
problem for the ‘failure by the Fund to participate effectively in the pre -trial procedures
and failure to attend court on the dates of the trial’. The full court held the following :
‘I understand the claim -officers who had deposed to affidavits in these two matters to say in
terms of the policy or directive issued to them and to which they are obliged to comply
therewith, they are not permitted to ask for information and seek to settle at an earlier stage
of the pre -trial and judicial case management conferences. They are only allowed to resort to
seeking to settle at a very late stage when matters are enrolled for trial. This cannot be in the
best interests of justice to alleviate con gested trial rolls and to address the problems which
cause delays in the finalisation of cases as contemplated in rule 37A(2) (a). In fact, this

22 Ibid para 9 .
15
procedure to which the claim -officers are obliged to comply with, fails to a material degree to
promote the effective disposal of the litigation as contemplated in rule 37(9) (a)(ii). It is also a
procedure that can be categorised as offending against the principles and requirements of
rule 37A, seen in the context of sub -rule 16 referred to earlier in this judgment . The procedure
can only serve to conduce unreasonably to frustrate the objectives of the judicial case
management process as contemplated in sub -rule 12(h) of rule 37A. . .’23

[33] What the full court had to decide, was the issue relating to the costs pertaining
to pre-trial conferences. In Road Accident Fund v Taylor ,24 this Court observed that :
‘. . . [A] court has no general duty or power to exercise oversight over the expenditure of public
funds. This is so for three reasons. The first is the constitutional principle of separation of
powers. The second is that the exercise of such a duty or power would i nfringe the
constitutional rights of ordinary citizens to equality and to a fair public hearing. The third
principle that the law constrains a court to decide only issues that the parties have raised for
decision . . .’25
When the court inquired into the internal workings of the RAF as it did, it encroached
into the domain of the executive . The order is fundamentally flawed and should not be
allowed to stand.

Whether the costs should have been granted against the CEO and the Board in
light of s 15(3) of the RAF Act
[34] The CEO and the Board’s liability for costs must be considered in the light of
the indemnity provided in terms of s 15(3) of the RAF Act. The CEO, the Board and
any of its members enjoy indemnity in terms of s 15(3) of the RAF Act. This section
provides that:
‘No member of the Board or officer or employee of the Fund, or other person performing work
for the Fund, shall be liable for anything done in good faith in the exercise of his or her power s
or the per formance of his or her functions or duties under or in terms of this Act. ’

[35] The contention by the appellants is that the full court did not properly consider
and apply the facts to the issue of whether ‘malice’ can be imputed to them, and
consequently , whether s 15(3) found application. The full court made findings on

23Hlatshwayo and Another v Road Accident Fund [2023] ZAMPMBHC 2 para 56 .
24 Road Acci dent Fund v Taylor [2023] ZASC A 64; 2023(5) SA 147(SCA) .
25 Ibid para 31 .
16
issues that were not properly before it , in finding that the conduct of the CEO, the
Board and/ or management of the Fund put the Fund ‘ under extreme pressure’ and
that the said conduct was taken in bad faith and found no protection under s 15(3) .

[36] Section 15(3) envisages that the functionaries who act in bad faith in the
exercise of their powers or the performance of their functions or duties towards the
RAF should be mulct with costs. In Public Protector , the court had occasion to deal
with the question of ‘bad faith’ . In the minority judgment the court said the following:
‘A proper starting point is in my view to remind ourselves of what the ordinary meaning of bad
faith is. A dictionary meaning is “[i] intent to deceive .” The meaning of bad faith or malicious
intent is generally accepted as extending to fraudulent, dishonest or perverse conduct; it is
also known to extend to gross illegality. Here too the perverse, seriously dishonest or
malicious conduct must link up, not m erely with the seniority of the person or high office
occupied, but also with the seriousness of the actual or reasonably foreseeable consequences
of that conduct.
…
The correct approach to determining the existence of bad faith is therefore one that recognises
that bad faith exists only when the office -bearer acted with the specific intent to deceive, harm
or prejudice another person or by proof of serious or gross recklessness that reveals a
breakdown of the orderly exercise of authority so fundament al that absence of good faith can
be reasonably inferred and bad faith presumed. This is so because the mischief sought to be
rooted out by rendering bad faith so severely punishable, particularly within the public sector
space, is to curb abuse of office which invariably has prejudicial consequences for others.
Abuse of office undermines the efficacy of State machinery and denies justice and fairness to
all people and inst itutions. ’26

[37] In the context of this case, for the full court to make a finding of bad faith, the
issue of the demand for the files from the panel attorneys ought to have been an issue
for adjudication before it. The explanatory affidavits of the claim s handler s would not
have assist ed the full court in this determination. That decision was taken by the
Board. The Board was not a party to these proceedings. The claim s handler s do not
serve on the Board . The CEO , who might have provided insight into the decision of
the Board , declined to be drawn into the issue of the panel attorneys as he held the

26 See fn 2 paras 71-72.
17
view that the said issue was subject to litigation in other forums. There was no
evidence before the full court to arrive at the finding of bad faith by the appellants,
either based on malicious intent or even ‘gross recklessness that reveals a breakdown
of the ordinary exercise of authority .’ This finding is dispositive of the issue relating to
the CEO and the Board’s liability.

[38] This brings us to the issue of whether the RAF should bear the costs of the
inquiry. As stated, the general rule in cases of this nature is that the award of costs
lies within the discretion of the court . An a ppellate court’s interference with a court’s
discretion is permissible on restricted grounds only. In Fine v Society of Advocates of
SA (Witwatersrand Division)27 this Court held:
‘The Appeal Court will only interfere wi th the exercise of his discretion on the grounds of
material misdirection or irregularity, or because the decision is one no reasonable Court could
make. ’28

[39] In this appeal, there is no dispute that the RAF is liable for costs in the litigation
between itself and the respondents . The respondents did not contend for an award of
personal costs against the second and third appellants. However, both respondents
contend that the RAF should be liable for the costs of the inquiry. The only issue thus
remaining is whether the RAF should be mulct ed with costs in respect of the inquiry
as envisaged in paragraph 14.529 read with clause 5 of Form A330 of the court a quo’s
Practice Directives.

[40] The full court imputed blame for the late settlement of the claims on the RAF
on two grounds. First, it found that the system that was implemented by the RAF after
the termination of the panel of attorneys’ mandate resulted in the ‘ failure by the Fund

27 Fine v Society of Advocates of SA (Witwatersrand Division) 1983 (3) SA 488(A)
28 Ibid at 494H -495.
29 The recording of removal from the roll as contemplated in 14.4 above shall be preceded by
summary inquiry and an order for costs as contemplated in paragraphs 4 and 5 of Form A3 or
paragraph 3.6 of Form B or any other similar Form and any defaulting party or attorney may be
ordered to pay costs on a punitive scale and or out of own pocket, including forfeiture of appearance
or day f ee, all of which shall be guided by the nature of the default and explanation provided for
settlement on the date of trial. (Emphasis in the text)
30 Clause 5 of Form A3 provides: It is hereby recorded that should this matter be settled on the date of
trial, parties run the risk of punitive cost order and/or forfeiture of a day fee, against any person
responsible for the late settlement of the matter and any such costs order may include payment out of
pocket by whoever is responsible for the late settlement including claim handlers and or attorneys of
parties. 9 Emphasis in the text).
18
to participate effectively in the pre -trial procedures and failure to attend court on the
dates of the trial’. Second, the high court found that the problems experienced by the
RAF ‘were actually caused by lack of planning at the time when the files were
demanded from the pane l [of] attorneys .’

[41] The full court , in scrutinising the conduct of the RAF after its contracts with its
panel of attorneys had terminated, found that the RAF did little to expedite the
finalisation of the claims before litigation. It is submitted on behalf of the RAF and the
Board that the inquiry by the full court into the issue of the termination of the agreement
of the panel of attorneys was designed to excoriate the decisions which the Board
took in 2020. These decisions culminated in the cancellation of the tender for a new
panel of attorneys and the request to the old panel of attorneys to hand over the files
of the RAF. The decision of the RAF was successfully challenged in the matter of
FourieFismer Inc. and Two Others v Road Accident Fund .31 That was three years
before the two claims were enrolled for hearing in the Mpumalanga High Court.
However, this Court, on appeal in RAF v Mabunda Incorporated and Others: Minister
of Transport v Road Accident Fund and Others (Mabunda)32overturned the judgment
of the court of the first instance and ruled in favour of the RAF.

[42] I agree with the submission by counsel for the RAF that the decisions in respect
of the old panel of attorneys and the evidence which led to their undertaking, were not
before the full court. It is undesirable for courts to decide issues which are not correctly
before them. The nature of the proceedings in our courts is that parties bring particular
issues or disputes before the courts upon which they ask for adjudication. It is thus
generally not permissible for the court to create, raise and decide i ssues which the
parties do not wish to be adjudicated upon. In National Director of Public Prosecutions
v Zuma (NDPP v Zuma ),33 this Court held , inter alia , that in ‘exercising [their] judicial
function judges are themselves constrained by the law ’.34 This Court further held that
the judicial function of a judicial officer is to confine the judgment to the issues before

31 Fourie Fismer Inc. and Two Others v Road Accident Fund [2020] ZAGPPHC 183; [2020] 3 All SA 460
(GP); 2020 (5) SA 465 (GP) .
32 RAF and Others v Mabunda Inc orporated and Others ; Minister of Transport v Road Accident Fund
and Others [2022] ZASCA 169 ; [2023] 1 All SA 595 (SCA) .
33 National Director of Public Prosecutions v Zuma [2009] ZASCA 1; 2009 (2) SA 277 (SCA); 2009 (1)
SACR 361 (SCA); 2009 (4) BCLR 393 (SCA); [2009 ] 2 All 243 (SCA).
34 Ibid para 15.
19
it; by deciding matters that are germane and relevant; by not creating new factual
issues.35

[43] This rule of practice is, however, not cast in stone as the court may, in certain
circumstances , mero motu raise and decide issues, usually legal in nature, even in
circumstances where same have not been raised on the papers before it. These are
issues such as questions of jurisdiction, locus standi , condonation and non -
compliance with the court rules. The override to this trite principle is that the parties
must have been alerted that the issues will be raised, and they must have been
granted the oppo rtunity to address the court on them , which are to be included same
in their heads of argument in preparation of their case. This evidently did not happ en.

[44] The full court found that the problems at the RAF ‘w[ere] actually caused by
lack of planning at the time when the files were demanded from the panel attorneys’.
The full court dismissed any intimation by the counsel of the RAF and the Board on
the issue of budgetary and lack of funding constraints. This issue was correctly
rejected as the CEO did not raise it as a defence for failure by the RAF to attend pre -
trial conferences. It is, however, not in dispute that the RAF has been in financial woes
for the longest of time.

[45] This Court in Mabunda , commenting on the fact that the RAF had been technically
insolvent , said that ‘the repeated deficits have seemingly been exacerbated by the
mounting legal fees which the RAF has been obliged to meet; both those of the
attorneys on the panel and those of attorneys and counsel representing claimants.’36
The CEO painted a picture by the Board, of attempting to re -evaluate existing
processes and impleme ntation of more efficient and effective approaches. In this
regard, the RAF has implemented three departments, namely, the settlement hub
department, the short -term trial department and the long -term trial department. It
appears that a t the core of this reorganisation is the need to encourage efficiency
through teamwork. It is hoped that plans like these will bear fruit shortly and the

35 Ibid para 15.
36 Ibid para 27.
20
settlement of claims will happen in shorter periods , thus reducing costs and benefit
claimants for whom the scheme is meant.

[46] The inquiry into costs was not initiated by any of the parties. While it is trite that
a court is empowered to order such an inquiry mero motu , it must be borne in mind
that the purpo se of judicial case flow management is essentially to curb unnecessary
delays in litigation , by inter alia , narrowing the issues and facilitating the settlement of
disputes. It is also meant to reduce the costs of litigation.

[47] The inquiry at the behest of the full court went against the grain of avoiding
delays and curbing the costs of litigation. The costs , in the uncomplicated claims of
the respondents which had been settled , resulted in extensive and unnecessary costly
investigation into systemic problems caused by the decision taken years before the
claims were instituted. The matters were settled around March 2022. Both matters
were enrolled for hearing during the same month. It was in March 2022 when the high
court sent out directives which were directed to the officials of the RAF about the issue
of costs . The whole exercise lasted for about nine months , with no less than ten
counsel involved. It defeated the very purpose of avoiding delays in litigating and
cutting costs.

[48] In the case of the second respondent the pre -trial minute filed by his attorneys
five days before the trial, states that the reports of three experts were outstanding. An
assertion is made in the minute that ‘plaintiff will request an offer on the issue of [p]ast
[l]oss of [e]arnings and [f]uture [l]oss of [e]arnings upon receipt of outstanding expert’s
reports .’ On this basis , one can safely conclude , as contended by the RAF, that when
the case was certified trial-ready and enrolled , it was not ripe for hearing . The full court
does not refer to the fact that the case was pre -maturely set down for hearing by the
second respondent’s attorneys or even still, on the possible instructions of the second
respondent .

[49] I am acutely aware that the inquiry was not brought about at the request of the
RAF. With this in mind, however, it failed to validate the clai ms as required by s 24(5)
of the RAF Act. It also failed to attend the rule 37 and judicial case management
hearings which ultimately caused the high court to hold the inquiry into costs. It was
21
to blame for the holding of the inquiry. The case management procedures including
hearings relating to costs, necessarily form part and parcel of litigation. It is thus in the
interests of justice that the RAF be held liable for the costs of the inquiry as the first
and second respondents were not responsible in anyway .

[50] I accordingly make the following order:
1 The appeal against the first appellant is dismissed.
2 The appeal is upheld in respect of the second and third appellants.
3 The first appellant shall pay the first and second respondents’ costs of the
appeal, including the costs of two counsel, where so employed.
4 The order of the high court is set aside and replaced by the following order:
‘The defendant is ordered to pay the plaintiffs’ costs of suit, including the costs
of the inquiry and of two counsel in the inquiry, where so employed. ’



________________________
P E MOLITSOANE
ACTING JUDGE OF APPEAL

22
Appearances

For the first and third appellant s: C Puckrin SC with R Schoeman and P Nyapholi
Instructed by: Mpoyana Ledwaba Inc, Pretoria
Modisenyane Attorneys , Bloemfontein

For the second appellant : J G Cilliers SC with M T Shepherd and H A
Mukhavela
Instructed by: Mpoyana Ledwaba , Pretoria
Modisenyana Ledwaba Inc. Pretoria

For the first respondent: B P Geach SC with A Frosch and F H H Kerrhahn
Instructed by: Pieter Nel Attorneys, Pretoria
Honey Attorneys, Bloemfontein
For the second respondent: P J Vermeulen SC with M Pienaar
Instructed by: P Mahlalela Attorneys, Pretoria
Hill McHardy & Herbst Inc.