Archive | February 2010

The appropriate scale of costs to be awarded to counsel in the Magistrate’s court

Dear Reader,

Welcome to the seventh edition of Independent Actuarial Consultant’s (IAC) monthly newsletter. Via
this newsletter we will keep you updated of all the latest case law relating to motor vehicle accidents
and the quantification of damages relating to personal injury claims.

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day with a joke or inspirational quote.

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BRAND v THE ROAD ACCIDENT FUND (CA 170/09) [2009] ZAECGHC 85 – UNREPORTED

This is an appeal against a cost order granted by a Magistrate in a trial action.  On 4 February 2005 the appellant – plaintiff in the court a quo – sustained bodily injuries in a motor collision.  The appellant had abandoned a portion thereof to bring it within the jurisdiction of the magistrate’s court.
The matter was set down for trial on 8 August 2008 on both merits and quantum.  The appellant’s attorney, however, pursued an application for a separation of the issues and the application was granted.  The magistrate’s judgment did not, however, deal with the question of costs.  Immediately thereafter an 80/20 settlement in favor of the plaintiff was reached and the costs of the day would be
reserved for determination by the trial court adjudicating the issue of quantum.
The matter was set down again for hearing on 6 February 2009. On that day, and prior to evidence being led, the issue of quantum was settled.  General damages would be fixed at R50 000,00, an undertaking would be furnished for future medical expenses and the respondent would pay the appellant’s taxed party and party costs.

Two issues of costs were then argued by the parties before the magistrate:

(a) the liability for the costs which had been reserved on 8 August 2008;
(b) whether the fees of counsel who represented the appellant should be limited to the tariff set out in Part IV of Annexure 2 to the magistrate’s court Rules1 or whether the magistrate should allow higher fees.

After hearing argument the magistrate gave judgment granting the appellant her taxed party and party costs, but limited counsel’s fees to those stipulated in the tariff. He omitted to deal with the costs which were reserved on 8 August 2008. In his further reasons for judgment, however, the magistrate recorded an order that the “wasted costs” of 8 August 2008 be paid by the appellant.

The appellant, sought orders from this court:
(a) setting aside the magistrate’s order and substituting therefor an order allowing counsel’s fees in an amount three times the amount set out in the tariff;
(b) an order that the costs of the hearing on 8 August 2008 be paid by the respondent.

Counsel were agreed, and correctly so, that the following principles were applicable. An order for costs falls within the discretion of the trial court. An appellate tribunal will not readily interfere with the exercise by a trial court of such discretion. It will only do so where the trial court exercised its discretion, not judicially, but capriciously or upon a wrong principle or where the order is incompetent.
See eg. Cronje v Pelser 1967 (2) SA 589 (A) at 592H-593A; Merber v Merber 1948 (1) SA 446 (A) at
452-3.

In his judgment the magistrate recorded that he had been referred to two unreported decisions in this Division: Road Accident Fund v Forbes (Case No CA 197/05, 28 September 2006) and van Zyl v Road Accident Fund (Case No CA 243/07, 19 October 2008). Both decisions were given in appeals against costs orders made by a magistrate in matters of the same nature as the present.

In the first matter Jones J inter alia upheld the magistrate’s order allowing counsel’s fees at three times the amount set out on
the tariff. In the second matter Jones J set aside a magistrate’s refusal to allow counsel’s fees at a rate and ordered that the defendant pay the costs of counsel’s fees in an amount not exceeding three times the amount set out in the tariff. The magistrate, however, sought to distinguish these two decisions.

The first basis on which a distinction was drawn was that in the two earlier cases expert evidence was led on the issue of the quantum to be awarded, whereas in the present matter the quantum was settled without any evidence being led. The distinction is without merit. As recorded earlier, the settlement of the quantum was reached only on the day the matter was set down for hearing. The appellant, and her legal team, had therefore perforce to prepare themselves on the issue of quantum in order to be in a position to lead the necessary evidence.
The second basis of distinction was that in van Zyl the defendant had conceded that there was no contributory negligence on the part of the plaintiff, whereas in the instant matter the appellant had accepted that her contributory negligence be fixed at 20%. Again, the magistrate proceeded on a wrong principle: the appellant had achieved success in the action and to base the refusal to make an order in terms of Note (b) referred to above on the fact of the apportionment of liability was not a judicial exercise of the discretion.
Referring to the fact that the parties had reached agreement on the issues the magistrate again stated that no expert witnesses had been called; hence, there was nothing justifying the court finding that “this is a matter which warrants an advocate as such” in that it was a case which the court dealt with on a daily basis.
Suffice it is to say that the magistrate’s approach can clearly not be endorsed. The restriction of the engagement of counsel to “special cases” enjoys no foundation in the rules of the magistrate’s court nor in the practice followed in that court, and is clearly unacceptable.
With reference to the circumstance that the appellant abandoned a portion of her claim to bring it within the jurisdiction of the magistrate’s court the magistrate’s further reasons contain the following paragraphs:
“Though someone may argue that the matter has been brought to district court because of expenses I strongly feel that a irregardless (sic) of that argument a High Court matter deserve to be taken to High Court otherwise we will find ourselves in a situation where a Mini High Court is created by practice in the District Court.  I do not think this is the intention of our legislature.”
Suffice it to say that this reasoning is difficult to follow and that to the extent that this approach contributed to the magistrate’s coming to the conclusion reached by him, it is clear that a wrong principle was adopted. The court held that where a plaintiff is awarded an amount that falls within the jurisdiction of the magistrate’s court it does not lie within the mouth of that plaintiff, in an attempt to secure an order for costs on a higher scale, to point to the fact that it was alleged that the claim was in an amount in excess of that jurisdiction, but that the claim was reduced to the limit of that jurisdiction.
The issue of the costs of the hearing on 8 August 2008 remains. The magistrate was not entitled in his further reasons to supplement the orders made in his judgment by the addition of a further order. In any event he did not motivate his finding that the costs in question were “wasted costs” nor his ruling that same should be paid by the appellant. Neither can be supported.
The appeal succeeds. The costs order issued by the magistrate is set aside and for it is substituted with the following:
“The defendant will pay the plaintiff’s taxed party and party costs, such costs to include:
1. the costs of the hearing on 6 August 2008;
2. counsel’s fees in amounts not exceeding double the amounts set out in the relevant tariff contained in Part IV of Annexure 2 to
the Rules.”

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And to lighten up your day here’s your joke –
NASA was interviewing professionals to be sent to Mars. Only one could go — and couldn’t return to Earth.  The first applicant, an engineer, was asked how much he wanted to be paid for going. “A million dollars,” he answered, “because I want to donate it to M.I.T.”

The next applicant, a doctor, was asked the same question. He asked for $2 million. “I want to give a million to my family,” he explained, “and leave the other million for the advancement of medical research.”
The last applicant was a lawyer. When asked how much money he wanted, he whispered in the interviewer’s ear, “Three million dollars.” “Why so much more than the others?” asked the interviewer.
The lawyer replied, “If you give me $3 million, I’ll give you $1 million, I’ll keep $1 million, and we’ll send the engineer to Mars.”

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