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IN THE HIGH COURT OF SOUTH AFRICA

(GAUTENG DIVISION, PRETORIA)

DATE: 28 NOVEMBER 2014

CASE NO: 16295/2013

In the matter between:

V W VAN VUREN......................................................................................................PLAINTIFF

And

ROAD ACCIDENT FUND.....................................................................................DEFENDANT

JUDGMENT

LEGODI,J

[1] This is a claim against the Road Accident Fund. The plaintiff is Werner van Vuren, a young man bom in Nelspruit on [...] 1987. When this matter was laid before me, I was informed that merits have been settled 100% in favour of the plaintiff.

[2] The only issue before me concerns past and future loss of earning and earning capacity. Other heads of damages were settled before and others during the course of trial in this matter. For example, the past hospital, medical and related costs were settled at R282 352.14, general damages at R900 000.00 and 100% undertaking in terms of section 17(4)(a). All of these are contained in a draft order submitted by agreement for the convenience of the court.

[3] On 17 September 2009 at approximately 07:00 the plaintiff was a driver of a motorcycle with registration number [...]. A collision occurred at an intersection of Suikeniet and Bulpin Streets in Nelspruit. A motor vehicle driven by one H D Vorster and coming from the opposite direction made a turn to the right in front of the plaintiffs motorcycle and as a result a collision occurred.

[4] The plaintiff suffered injuries as a result of the collision which injuries are set out in paragraph 6 of the particulars of claim as head injury, a fracture of the terminal phalanx of the right finger, an open fracture of the right femur, an open fracture of the right tibia with associated compartment syndrome, dislocation of the left shoulder, dislocation of the right ankle, a fracture of the right knee, swelling and bruising across the face, burst foot soles and a left shoulder fracture.

[5] The Road Accident Fund (the defendant), does not dispute the fact that the plaintiff has suffered loss of earning capacity due to the injuries sustained during the collision. What the parties cannot agree on is the contingency deduction percentage for future loss of earnings or earning capacity. On behalf of the plaintiff, it was contended that he will lose 70% of his earning capacity. On the other hand, I understood counsel for the defendant to contend that loss of earning capacity due to the accident should be between 40% and 45%.

[6] The defendant’s counsel for his contention relied on Dr Birrell’s report of the 27 May 2014. Dr Birrel is orthopaedic surgeon. In his report, he estimates the plaintiffs loss of earning capacity to be still around 40% and that he still estimates ‘early retirement, assuming a retirement age of 65 years, to be at 55 years in the type of work the plaintiff is performing at present’.

[7] It is not in dispute that as a result of the accident and the injuries sustained thereof, the plaintiff will have to retire ten years earlier, that is, at the age of 55. The 40% contingency deduction referred to by Dr Birrell meant that the plaintiff can still be able to do his work at the rate of 60%, so was the argument on behalf of the defendant.

[8]The 40% contingency deduction, should be seen in context, so was the contention by the plaintiffs counsel. That is, Dr Birrell based his estimation only on the nature of the injuries sustained. He did not hear evidence. He did not have the opportunity to interrogate other reports, for example, reports by psychiatrist and psychologists.

[9] A background to the nature of the work by the plaintiff is necessary. The plaintiffs highest qualification is matric which was completed in 2006. Towards the end of 2006, he was employed at a Crocodile Farm in Barberton. His main function was to take care of crocodiles like feeding them and removing their eggs to a safe place. In 2007 he worked at H1- F1 Corporation in Nelspruit. He left for better opportunities. On 29 September 2008 he started to work for Jacks Snacks. He is still employed at Jacks Snacks.

[10] On 17 September 2009 he was involved in a collision as indicated in paragraph 3 of this judgment. Before the collision, he was earning R7 600.00 per month. His position was that of a supervisor at Nick Nacks division of Jacks Snacks. He was overseeing about 40 employees. They were manufacturing Nick Nacks products. He stood most of the time. He used to move between the machines and workers. He had to go up and down using the stairs to reach the machines. He walked Mondays to Fridays between 07:00 and 17:00 with no breaks or lunches in between. They also worked and still work on Saturdays between 07:00 and 12:00. He also stood very good prospects of promotion before the accident.

[11] All changed after the accident. He was moved to the plastic department. He could no longer carry heavy bags and move from one place to the other as he used to. He could no longer move around in between the machines and workers. He could no longer stand for a long period of time. As a result, he was moved to the plastic department. He is presently working there and this time overseeing only five general workers.

[12] The plaintiff had missed out on three promotions. Two positions came out after the accident. That is, a position for assistant production manager and production manager. Although he applied, he did not get the job. He did not, due to his injuries. There was another position which came out.

That was a sales representative position. He did not apply, as it would have meant travelling a lot.

[13] Due to the nature of the injuries sustained by the plaintiff, he had to take long sick leaves. That resulted in exceeding his leave days. He was on occasions forced to take leave without pay and thus resulting in financial difficulties. He is presently under debt review. His employer is not impressed with him and he fears that he would not last for long in his employment, particularly that he still have to go for medical treatment with further many procedures still to be performed.

[14] Two industrial psychologists, Mr W J Wessels and Ms C Du Toit, in their joint minutes dated 13 November 2014, paragraph 6.2.1 state:

‘It is evident that the plaintiff has been rendered a substantially curtailed person. It is anticipated that he will remain a substantially vulnerable person and uncompetitive in the open labour market. It is evident that all positions previously to his disposal are no longer and should he lose his current position will experience substantial difficulties to impress prospective employers. It is also expected that he will in all probability not reach his pre-accident level of competence and earning capacity. It is expected that his physical disposition will remain a burden compromising his residual work and earning capacity. It is thus expected that he will continue to sustain a loss in earnings as has already been evident and indicated.’

[15] Dealing with retirement, the two psychologists record:

‘...early retirement assuming a retirement age of 65 years, to be at 55 years on the type of work that he is performing at present’.

Referring to Dr D A Shevel, psychiatrist, Mr Wessels and Ms Du Toit conclude that the plaintiff is suffering from a significant chronic depressive illness and may well be functionally unemployable in the open labour market.

[16] In his evidence, the plaintiff indicated that he is no longer as lively as he used to be. He gets easily impatient with people. He is easily irritated and in the process he easily loses his tempter. That led, amongst others, being given a written warning about his behaviour. This did not appear to be in dispute. He fears that is just only a matter of time before he is fired.

[17] Based on all of the above, it is contended that it would be wrong to rely on Dr Birreirs estimation of 40% contingency deduction when other factors should be considered. For all of this, is contended on behalf of the plaintiff that for past and future loss of earning capacity a higher contingency deduction must be made. Counsel for the plaintiff calculates the contingency deduction as follows:

70% Spread

Past loss

Value of income uninjured:.........................................R 687, 079

Less contingency deduction: 5.00% ….........................R 34, 354

652,725

Value of income injured: …........................................R 626, 834

Less contingency deduction: 5.00% …...........................R 31,342

R 595,492

R 57,233

Net past loss:

Future loss

Value of income uninjured: ….......................................R 4, 308, 502

Less contingency deduction: 15.00% …............................R_646, 275

R 3. 662. 227

Value of income injured: ….............................................R 2, 764, 085

Less contingency deduction: 85.00% ….........................R 2, 349, 472

R 414,612

Net future loss:

R 3.247.614

Total net loss: …..............................................................R 3,304, 847

[18] This calculation is said to be in line with the joint minutes of the two industrial psychologists in which they state: ‘it is recommended that a substantial higher post-accident contingency deduction be applied’.

[19]Counsel for the defendant refutes the recommendation. In so doing, he argued, inter alia, that the plaintiff had a promotion after the accident and secondly that an Actuary recommended for smaller post- accident contingency deduction to be applied. For example, in their actuarial report dated 27 October 2014, Van De Linde Actuaries regarding two scenarios state:

‘However to allow for the general uncertainty on the pre- and- post morbid income of the injured, we were instructed to illustrate the possible financial effect by using the following alternative contingency deductions for both scenarios’:

Scenario A:

Table of Contingency
	Before Calculation Date	After the Calculation Date
Contingency as if no incident	10 %	10%
Contingency Regarding the Incident	40%	40%

Scenario B

Table of Deductions
	Before Calculation Date	After the Calculation Date
Contingency as if no incident	10%	10%
Contingency Regarding the Incident	50%	50%

[20] Having set out the scenarios, they concluded by stating:

‘From the information, assumptions and basis of calculations described in this report, we have calculated the capitalized value of losses expected to be experienced by the injured as a result of the Incident, to be Rl, 600,542 (Scenario A) and R2,619,735 (scenario B).’

[21] It is also important to allude to other calculations of contingency deduction by Algorithm Consultants and Actuaries cc. In their report dated 13 November 2014, they too set out two scenarios as follows:

Past loss

RESULTS

Scenario 1

Past loss

Value of income uninjured: …..................................R    687,079

Less contingency deduction: 5.00% ….......................R    34,354

R    652,725

Value of income injured: …..........................................R 626,834

Less contingency deduction: 5.00% …...........................R 31.342

595,492

R 57.233

Net past loss:

Future loss

Value of income uninjured: …................................................R 4, 308, 502

Less contingency deduction: 15.00% ….....................................R_646. 275

R 3, 662, 227

Value of income injured: ….......................................................R 2, 764, 085

Less contingency deduction: 45.00% …......................................R 1.243.838

R 1,520,247

Net future loss:

…...................................................................................................R 2.141.981

Total net loss:..............................................................................R 2,199,214

Scenario 2

Past loss

Value of income uninjured: …......................................................R 687, 079

Less contingency deduction: 5.00% …...........................................R 34. 354

R 652,725

Value of income injured: …..........................................................R 626, 834

Less contingency deduction: 5.00% …............................................R 31.342

595, 492

R 57.233

Net past loss:

Future loss

Value of income uninjured: …...................................................R 4, 308, 502

Less contingency deduction: 15.00% ….......................................R_646. 275

R 3, 662, 227

Value of income injured: ….......................................................R 2, 764, 085

Less contingency deduction: 55.00% …......................................R 1.520.247

R 1,243,838

Net future loss:

R 2.418.390

Total net loss: …..........................................................................R 2,475, 623

[22] I must immediately mention that promotion mentioned by the defendant’ counsel was actually not a promotion. He was moved to another section to accommodate him in his present condition. His salary never changed. Instead, he received annual increase like any other employee.

[23] It is not an easy exercise to determine the extent of the contingency exercise. Although one is guided by the facts of each case, such facts are often if not always based on uncertainty. It is of no surprise that divergent views are expressed. For example, in the joint minutes by the two psychologists the issue relating to the extent of contingency deductions was deferred to this court. The actuarial report of Algorithm Consultants and Actuaries cc was based on the joint minutes by Mr Wessel and Ms Du Toit. Algorithm concluded in their report as follows:

‘The calculation has been based on information supplied and assumptions made which appear to be reasonable on the basis of such information. If it is considered that any information is incorrect or allegations inappropriately, then a recalculation should be made.’

[24] Algorithm based their calculations on the information provided to it. The information included an employment certificate dated 8 April 2010, an IRP5 for the tax year ending 28 February 2011, a report of industrial psychologist Mr Wessels dated 28 October 2014 and a payslip dated 31 August 2014. In addition, they were provided with a report of Industrial Psychologist Ms Du Toit dated 3 November 2014. They were not provided apparently with joint minutes wherein a recommendation for a higher contingency deduction was suggested.

[25] Of importance is that the court heard the plaintiffs evidence and that of Mr Wessels. Parties also agreed about the use of other reports in these proceedings, the contents of which are not in dispute. According to psychiatric reports, the plaintiff has a chronic depression. Such depression will aggravate the overall level of occupational dysfunction. He will probably need to be employed in a structured sympathetic environment where very little new learning or initiative is required and where exposure to external stressors is kept to a minimum. The plaintiff is said to be suffering from an organ brain syndrome attributed directly to the injuries sustained in the collision. He is at risk to develop a variety of underlining originicaly based psychiatric conditions.

[26] Similarly, according to the clinical psychologist’s report, psychologist functioning of the plaintiff is compromised by his poor psychological functioning and the efficacy of psychotherapy is directly linked to his physical prognosis. His psychological prognosis is thus best described as guarded. Several psychological and physical factors compromise not only his efforts to regain his power level of proficiency, but also his capacity to be employed in the open labour market. His chronic pain paired with his mood disorder of depression and symptoms of anxiety could also impact his cognitive abilities negatively possibly explaining his forgetfulness. His young life has been reduced to one of more monotony. His poor performance on some of the sub-tests, do not support successful retraining in administrative fields or positions.

[27] Now, his physical prognosis is his greatest impediment to any future work advancement. Since engaged in Jack Snack, his work pattern was physical in nature, long hours, driven by desire to meet production targets. That poses a huge challenge to the plaintiff in his present condition. It is on the basis of all this that counsel for the plaintiff argued for a higher percentage of contingency deduction.

[28] It did not appear to be in dispute that the plaintiffs future loss value of income uninjured is R4 308 502.00. Contingency deduction at 15% for such loss also did not appear to be in dispute. What is really in dispute is future loss value of income injured, in particular, the contingency deduction to be applied thereto. As indicated in paragraph 17 of this judgment, the plaintiffs counsel suggested 70% contingency deduction. That is 15% contingency deduction uninjured and 70% injured contingency deduction and thus 85% appearing on the scenario referred to in paragraph [17] above.

[29] True, in the circumstances of the case a higher contingency deduction more than what is suggested by the actuary as indicated in paragraphs [19] and [21] of this judgment is necessary. However, such contingency deduction cannot be as suggested on behalf of the plaintiff. I referred to the suggestion in paragraph [17] of this judgment. The 70% is too high. In my view, it does not reconcile with the facts of the case and the uncertainty involved in the exercise of determining contingencies. Taking everything into consideration 55% contingency deduction in favour of the plaintiff would be appropriate. The total net loss is therefore R2 890 235.00. Such a calculation was prepared for the convenience of the court. In addition, a draft order was prepared for the court to consider. The draft also envisaged the establishment of a trust to ensure that funds payable to the plaintiff are taken care of. I have considered the terms of the trust and I am satisfied that it would be in the best interest of the plaintiff to incorporate the trust in the order.

[30] Consequently a draft order as amended and marked “X” is hereby made an order of this court.

M F LEGODI

JUDGE OF THE GAUTENG DIVISION. PRETORIA

Heard on: 13 November 2014

For the : Adv. R Ferguson

Instructed by: ADAMS & ADAMS

Plaintiffs Attorneys

Lynnwood Bridge Office Park

4 Daventry Street

LYNNWOOD MANOR

PRETORIA,

REF: DBS/HS/CF/LT275

For the : Adv. D. Dube

Instructed by: DYASON Incorporated

134 Muckleneuk Street West

NIEUW MUCKLENEUK

PRETORIA

REF: COETZE/MM/DD1630

Date of Judgment: 28 November 2014

THE HIGH COURT OR SOUTH AFRICA

(GAUTENG DIVISION, PRETORIA)

HELD AT PRETORIA ON THIS THE 14^th DAY OF NOVEMBER 2014 AT COURT 6F BEFORE THE HONOURABLE JUSTICE LEGODI (J)

CASE NO: 16295/2013

DATE: 28 NOVEMBER 2014

In the matter between:

VAN VUREN, W........................................................................................................Plaintiff

and

THE ROAD ACCIDENT FUND..........................................................................Defendant

DRAFT ORDER

HAVING HEARD COUNSEL for the parties;

THE COURT GRANTS JUDGMENT in favour of the Plaintiff against the Defendant in the following terms:-

1. The Defendant shall pay the following amounts to the Plaintiffs attorneys, Adams & Adams, in settlement of the claim of WERNER VAN VUREN:

Past hospital, medical and related costs: R 282 352.14;

General damages: R 900 000.00;

Loss of earnings/Earning capacity: R 2890 235.00

The aforementioned amounts shall be payable by direct transfer into the trust account of Adams & Adams , details of which are as follows:

Account holder : Adams & Adams Trust Account

Bank : Nedbank

Branch : Pretoria

Branch code : 198765

Account number : 1[...]

Reference : DBS/KW/LT275

2. The Defendant shall furnish the Plaintiff with an undertaking in terms of Section 17(4)(a) in respect of 100% of the costs of the future accommodation of the Plaintiff in a hospital or nursing home or treatment of or rendering of a service or supplying of goods to him, after the costs have been incurred and on proof thereof, resulting from the accident that occurred on 17 September 2009.

3. The Defendant is liable for payment of 100% of the reasonable costs of the Trustee appointed in terms of paragraph 4 hereof, in respect of establishing a Trust and any other reasonable costs that the Trustee may incur in the administration thereof including his fees in this regard, which shall be recoverable in terms of the Undertaking issued in terms of Section 17(4)(a), and which costs shall also include and be subject to the following:-

3.1 The fees and administration costs shall be determined on the basis of the directives pertaining to curator’s remuneration and the furnishing of security in accordance with the provisions of the Administration of Deceased Estates Act, Act 66 of 1965, as amended from time to time, and shall include but not be limited to disbursements incurred and collection commission calculated at 6% on all amounts recovered from the Defendant in terms of the Section 17(4)(a) undertaking;

3.2 The monthly premium that is payable in respect of the insurance cover which is to be taken out by the Trustee to serve as security in terms of the Trust Deed;

3.3 All the abovementioned costs shall be limited to payment of the reasonable costs which the Defendant would have had to pay regarding appointment, remuneration and disbursements had the Trustee been appointed as a curator bonis;

3.4 The costs associated with the yearly audit of the Trust by a chartered accountant as determined in the Trust Deed;

3.5 The appointment and reasonable costs of a case manager.

4. That the nett proceeds of the payments referred to above less a sum of R250 000.00 that shall be paid by Plaintiffs attorneys directly to Plaintiff, as well as the Plaintiff’s taxed or agreed party and party costs payable by the Defendant, after deduction of the Plaintiff’s attorney and own client legal costs and interest on unpaid disbursements, (the “capital amount"), shall be payable to a Trust, to be established within six months of the date of this order, which Trust will:-

4.1 contain the provisions as more fully set out in the draft Trust Deed attached hereto marked as annexure “A”;

4.2 have as its main objective to control and administer the capital amount on behalf of the Patient;

4.3 Constant Wilsnach will be the first trustee with powers and abilities as set out in the draft Trust Deed attached hereto marked as annexure "A”.

4.4 The trustee(s) will be obliged to furnish security to the satisfaction of the Master of the High Court of South Africa for the assets of the Trust and for the due compliance of all his obligations towards the Trust.

5. Should the aforementioned Trust be established within the six month period, the Trustee thereof is authorised to pay the Plaintiff’s attorney and own client costs out of the Trust funds in so far as any payments in that regard are still outstanding at that stage.

6. Should the aforementioned Trust not be established within the six month period:-

6.1 The Plaintiff’s attorneys are directed to approach the court within six months thereafter in order to obtain further directives in respect of the manner in which the capital amount is to be utilized in favour of the Patient;

6.2 The Plaintiff’s attorneys are authorised to invest the capital amount in an interest bearing account in terms of Section 78(2A) of the Attorneys Act to the benefit of the Patient with a registered banking institution pending the finalization of the directives referred to in paragraph 6.1 above;

6.3 The Plaintiff’s attorneys are prohibited from dealing with the capital amount in any other manner unless specifically authorised thereto by this court, subject to the provisions contained in paragraphs 4 to 7 hereof.

7. Until such time as the Trustee is able to take control of the balance of the capital amount and to deal with same in terms of the trust deed, the Plaintiff's attorneys are authorised and ordered to pay from the capital amount:

7.1 any reasonable payments to satisfy any of the Plaintiff’s needs that may arise and that are required in order to satisfy any reasonable need for treatment, care, aids or equipment that may arise in the interim;

7.2 the attorney and own client costs of the Plaintiff's attorneys together with interest on unpaid disbursement;

7.3 such other amount(s) as may reasonably be indicated and/or required for the well being of the Plaintiff and/or in his interest which a diligent curator bonis would have paid, had such curator been appointed.

8. The Defendant must make payment of the Plaintiff’s taxed or agreed party and party costs on the High Court scale which costs shall include the following:-

8.1 The fees of Senior - Junior Counsel on the High Court Scale, inclusive of Counsel’s full reasonable day fees for 13 and 14 November 2014 and the reasonable costs of preparation of Heads of Argument;

8.2 The reasonable taxable costs of obtaining all expert, medico-legal, RAF 4 and actuarial reports from the Plaintiff’s experts which were furnished to the Defendant;

8.3 The reasonable taxable preparation, qualification and reservation fees, if any, of the following experts of whom notice has been given, being:-

8.3.1 Dr C W Goosen (Orthopaedic Surgeon);

8.3.2 Dr D A Birrell (Orthopaedic Surgeon);

8.3.3 Dr P B White (Plastic & Reconstructive Surgeon);

8.3.4 Dr Shevel (Psychiatrist);

8.3.5 Dr J J du Plessis (Neurosurgeon);

8.3.6 Mr D Rademeyer (Mobility Consultant);

8.3.7 Dr M Mazabow (Clinical Neuropsychologist);

8.3.8 Mr M du Plooy (Orthotic);

8.3.9 Dr K Truter (Clinical Psychologist);

8.3.10 Ms K Theron (Speech, Language & Cognitive Communication);

8.3.11 Ms C Pretorius (Occupational Therapist);

8.3.12 Mr K Carpenter-Kling (ENT Surgeon);

8.3.13 Mr W Wessels (Industrial Psychologist);

8.3.14 Mr G van der Linde (Actuary);

8.3.15 Mr G Whittaker (Actuary).

8.4 The costs of a consultation between the Plaintiff and his attorney to discuss the terms of this order;

8.5 The reasonable costs of a'consultation between the Plaintiff's counsel, the Plaintiff, and the Plaintiff’s attorney in preparation for the hearing;

8.6 The reasonable taxable accommodation and transportation costs (including Toll and E-Toll charges) incurred on behalf of the Plaintiff in attending medicolegal consultations with the parties’ experts, consultations with the legal representatives and the court proceedings, subject to the discretion of the Taxing Master;

8.7 The costs of Plaintiff’s counsel and attorney for attending a work-site visit on Friday, 24 October 2014.

9. The above costs will also be paid into the aforementioned trust account.

10. It is recorded that the Plaintiff’s attorneys do not act in terms of a contingency fee agreement for services rendered.

11. The following provisions will apply with regards to the determination of the aforementioned taxed or agreed costs:-

11.1 The Plaintiff shall serve the notice of taxation on the Defendant’s attorney of record;

11.2 The Plaintiff shall allow the Defendant 7 (SEVEN) court days to make payment of the taxed costs from date of settlement or taxation thereof;

11.3 Should payment not be effected timeously, Plaintiff will be entitled to recover interest at the rate of 9.0% on the taxed or agreed costs from date of allocatur to date of final payment.

BY ORDER OF THE COURT

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