Tag Archive | Collision

Understanding the RAF Amendment Act Part 2

Is the cap applicable only to a deceased breadwinner’s income or to the income of the household?

In explaining the above we will make use of the following example: A man dies in a motor vehicle collision, at the time of his death he was earning R 200 000.00 per annum, he leaves behind a wife and two children. The wife also earns R 200 000.00 per annum at all relevant times.

The immediate question that comes to mind is do I cap their respective earnings separately or combined?

However the above reasoning is not in keeping with the aim of the amendment act cap. The important thing to remember is that the cap applies to the loss in future years and not to income as implied by the above reasoning. Therefore, one will do the calculation as normal by determining the combined household income and distributing shares to the deceased and claimants/dependents in line with Santam v Fourie.

Using our example the combined income of R 400 000.00 per annum will be divided into six shares with two shares each allocated to the deceased and surviving spouse and one share each to the dependent children. The value that is then subject to the cap would be the combined sum of the 4 shares of the surviving spouse and two dependent children. Again allowance has to be made for tax, mortality and discount rate.

Next month I will continue with this new series on understanding the application of the RAF amendment Act.

Sending us an Instruction

Our dedicated full time professional team receive instructions by any of the following means:

• Email : damagesclaims@iac.co.za, or
• Post : PO Box 1172, Cape Town, 8000
• Fax : 086 616 8308

Depression as Sequlae of – Quantum of damages to be awarded


I am excited to announce that IAC will again be presenting training on the calculation of simple loss of income and loss of support
calculations. The training is aimed at attorneys in order to equip them to give better instructions, have a better understanding of the actuarial calculation process and to aid in settlement of matters.

Same will be taking place on the following dates:

Durban 13 July 2010
Johannesburg 15 July 2010
Pretoria 15 July 2010
Cape Town 28 July 2010
Port Elizabeth 29 July 2010

Further details will follow.


Bicycle Share the road sign

The plaintiff claimed damages from the defendant arising from bodily injuries she sustained in a motor vehicle collision on 8 January 2005. The plaintiff was a cyclist on the Kliprivier Road when the insured vehicle, travelling in the same direction, collided with her from the rear. The collision caused her to fall from the bicycle and she sustained a head injury as well as orthopaedic injuries.

Both the merits and certain heads of quantum were in dispute. The Court found in favor of the plaintiff in regards to the merits.

The plaintiff’s past hospital and medical expenses as well as future medical expenses was settled. The court had to assess the plaintiff’s loss of earning capacity and general damages. It was common cause that the plaintiff suffered a head injury. What remained to be considered were the psychological sequelae of the brain injury. The plaintiff’s psychiatrist testified that the head injury had resulted in a post-traumatic neuropsychological disorder, as well as depression.

The crucial issue in quantifying the plaintiff’s damages for loss of income was to consider the effects of the psychological deficits on her employability and therefore earning capacity. Pre-morbid she excelled in the workplace and moreover fostered excellent relationships. Outside the workplace she proved her organisational capabilities in organising her own cycling events attracting some 2500 participants.

Post-collision the plaintiff remained in the employ of her employer but her capabilities dwindled resulting from her neuropsychological profile. Briefly stated, she lacked motivation and drive and often became emotional and irritable, resulting in a decline in performance and resultant loss of income to her employer.

It was common cause that depression manifested itself once prior to the collision. In addition a family history of depression had been identified. However, since the collision she often suffered from bouts of depression. In this regard the plaintiff’s psychiatrist testified that the plaintiff, prior to the collision, was pre-disposed to developing depression which could be treated and, in any event, did not cause any level of dysfunction. In contradistinction hereto, the depression the plaintiff now suffers is as a result of organic injury to the brain cells.

The depression the plaintiff now has to endure affects her coping and adaptation skills. The depression can be treated but not cured and she will therefore function at a lower level. In addition the plaintiff also suffers from cognitive deficits post-morbid.

A comparison by the plaintiff’s Industrial Psychologist between the plaintiff’s performance and that of her rival co-employee revealed that Pre-collision, the plaintiff out-performed her rival but postcollision the plaintiff brought in less than half the business her rival did.

As a result two possibilities was advanced by the plaintiff’s Industrial Psychologists: either that she remains employed at her present place of employment earning substantially less or employment in a less stressful and demanding work environment in a secretarial environment.

The defendant’s Industrial Psychologist’s opposing view was disregarded by the court. Plaintiff suggested a contingency allowance of 10% pre-morbid, and 20% post-morbid. The defendant contended for a contingency allowance of 50%.

The Honourable Judge held that a contingency deduction of 15% on the pre-morbid scenario is appropriate taking into account plaintiff’s age of 46 years, her consistent and stable employment history in public relations/marketing, the absence of any indications that she would not have further excelled in her work environment and the positive attitude she had displayed towards her work prior to the accident.

The Honourable Judge further held that a contingency deduction of 10% on the post-morbid scenario is appropriate taking into account the plaintiff’s current employer although aware of her condition since 2005, has kept her on and increased her salary from time to time; the plaintiff has no formal qualification; the plaintiff’s husband’s evidence that she was steadily improving and the negative effects a lower category employment is likely to have on her mood and therefore functioning.

Referring to the judgment of the Supreme Court of Appeal in De Jongh v Du Pisani NO [2004] All SA 565 (SCA) the Honourable Judge further held that the sum of R400 000 would constitute fair and adequate compensation in respect of the plaintiff’s general damages.

The plaintiff was awarded R3 333 068.00 for future loss of income and general damages of R 400 000.00 as well as Costs.

Sending us an Instruction

Our dedicated full time professional team receive instructions by any of the following means:

• Email : damagesclaims@iac.co.za, or
• Post : PO Box 1172, Cape Town, 8000
• Fax : 086 616 8308

With the trial season heating up here are a few wise words to keep you humble and your anger in check –
“A man wrapped up in him self makes a very small package.” – unknown
“Be not angry that you cannot make others as you wish them to be, since you cannot make
yourself as you wish to be.” – Thomas A` Kempis

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.

We will also keep you updated of IAC developments, events and training seminars and lighten up your
day with a joke or inspirational quote.

Please take note of our new fax to e-mail number 086 616 8308.


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

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.”

Sending us an Instruction

Our dedicated full time professional team receive instructions by any of the following means:
• Fax : (021) 422 4378,
• Email : damagesclaims@iac.co.za, or
• Post : PO Box 1172, Cape Town, 8000
• Fax 2 e-mail : 086 616 8308

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.”

Application of the Maxim “RES IPSA LOQUITOR” in MVA claims

Dear Reader,

Welcome to the fifth 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. We will also keep you updated of IAC developments, events and training seminars and lighten up your day with a joke or inspirational quote.

Thanks to you, our valued clients, IAC’s MVA department has experienced it most successful month ever. In acknowledging your great support and in an effort to improve our service to you even further we have appointed three new members off staff who will be dealing with the loss of income and loss of support calculations, they are:

  1. Danai Ru’nanga- BComm. (Hons) Actuarial Science
  2. Maureen Kumwenda- BSc. (Mathematics and Statistics) currently doing honours in BSc. (Computational Finance)
  3. Siyanda Ngquba- BSc. (Mathematics and Statistics) currently doing honours in BSc. (Computational Finance).

We also wish to inform you that Mr Johan Olivier, the head of our MVA department, has decided to bid IAC farewell after seven years of dedicated service. We wish Johan well with his future endeavors. We are proud to announce that due to the depth of actuarial professionals at IAC we were able to fill the position from within our own ranks. Mr Wim Loots will be taking over as head of the MVA department from 2 November 2009.
Wim has been with IAC since 2005. He has intimate knowledge of IAC’s clients, processes and people and brings with him a wealth of experience. Wim obtained his B.Sc. in Actuarial science cum laude in 1993 from the then Rand Afrikaans
University (RAU). He is a fellow of the institute of actuaries in England and a fellow of the actuarial society of South-Africa. Wim we wish you Danai, Maureen and Siyanda well and look forward to working with you. These are exciting times full of promise and we are proud to share them with you our valued clients.


This is an appeal against a declaratory order that the RAF (the fund) is liable to compensate the respondent (plaintiff a quo) for serious bodily injuries sustained in a collision on 26 April 2003. I will refer to the appellant as the fund and the respondents as the plaintiff. The facts were that two insured vehicles collided with each other on a curve on the national road at night time without lights (first collision) and, as the plaintiff’s vehicle entered the curve, it collided with the stationary insured vehicles (second collision). The drivers of the insured vehicles died on the scene. The particulars alleged that the drivers of the insured vehicles were negligent in: (1) causing the
first collision, and the second collision was a direct consequence of the first collision; alternatively, (2) causing their vehicles to be and remain, a hazardous and unlighted obstruction on the roadway. The court a quo invoked the res ipsa loquitor maxim and found the drivers of the insured vehicles had been negligent in causing the first collision.

For the sake of clarity the learned Jones J included the following extracts from W E Cooper’s Motor Law vol 2 “Principles of Liability” (Juta, 1987) which I repeat: ‘It is said res ipsa loquitor when: “… human experience shows us that in certain circumstances it is most improbable that the occurrence under investigation would have taken place without negligence.” ’ Mr Cole who appeared for the plaintiff in the trial and subsequent appeal based his argument on the fact that two vehicles collided on a wide, tarred national road in circumstances where the road surface was good and the weather fair, which gives rise to the inference that one of them must have deviated from its path of travel into that of the other. He also submitted that generally a roadworthy vehicle under the control of a skillful driver will behave in a manner consonant with the basic traffic rules (Macleod v Rens 1997 (3) SA 1039 (E) ). His suggested conclusion was that the occurrence of the first collision was such that res ipsa loquitor.

The court held that Mr Cole makes the mistake of seeking to infer negligence by reason of the maxim from an occurrence which’s nature does not make a conclusion of negligence inevitable. Following Mr Cole’s reasoning a claimant in a damages claim following any road accident would be able to rely on evidence of a collision without more for an inference of negligence in his favour, making the maxim of general application to road accident cases, and a nonsense of the rule that the onus is on the claimant to prove his case. The court rejected the conclusion. As to the second averment, namely that they caused their vehicles to be and remain, a hazardous and unlighted obstruction on the roadway, these averments makes out a case based squarely on the presence of a dangerous hazard in the road. The plaintiff proved that case. His evidence established that as he drove round the bend he was suddenly confronted with an unlighted vehicle in his path making it impossible to avoid a collision. In the court’s opinion this was clearly an occurrence of which can be said res ipsa loquitor. The evidence of the occurrence raises a prima facie inference of negligence on the part of the person in control of the stationary vehicle with which he collided.

According to the court it is then up to the fund to explain how the obstruction got there, what was it doing there and why it was still there when he arrived. If no explanation is given then it compels an inference of negligence. The court held, on the alternative, that a prima facie inference of negligence arose res ipsa loquitor, (a) from causing such an obstacle to be in the middle of the road at night, and (b) from allowing it to remain there. There was nothing at all before the court to displace the inference of negligence from (a), and insufficient information to displace the inference from (b).
Appeal dismissed.

Sending us an Instruction
Our dedicated full time professional team receive instructions by any of the following means:

• Fax : (021) 422 4378,
• Email : damagesclaims@iac.co.za, or
• Post : PO Box 1172, Cape Town, 8000

And I leave you with a bit of inspiration for this, the last push towards the end of the year –
“Always bear in mind that your own resolution to succeed is more important than any
one thing” – Abraham Lincoln