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Road Accident Fund v Reynolds (A5023/04) [2005] ZAGPHC 19 (18 February 2005)

IN THE HIGH COURT OF SOUTH AFRICA
WITWATERSRAND LOCAL DIVISION

CASE NO A5023/2004

In the matter between

ROAD ACCIDENT FUND APPELLANT

and

WILLIAM TRAVERS
REYNOLDS                           RESPONDENT


J U D G M E N T


MALAN J:

[1] This is an appeal with leave from the Supreme Court of Appeal against that part of the judgment of Claassen J in the Court
a quo awarding the respondent damages in respect of estimated future loss of earnings and employability. This appeal is confined, in terms of the notice of appeal filed pursuant to Rule 49(2), to “such parts of the judgment of Claassen J where he did not allow for any contingency deductions in respect of future loss of earnings or loss of earning capacity or interference with earning capacity”. The grounds of appeal are set out in the said notice as follows:

“1        The Judge a quo erred in not applying any contingencies to loss of earnings or earning capacity.
2       
The Learned Judge erred in not applying his mind at all in respect of the issue whether contingencies should be deducted and/or what the percentage of the deductions should be.
3        The Learned Judge further erred in his finding when refusing leave to appeal that there was not a duty on the Court to take into consideration a contingency factor if none is asked for by the defendant.”

Claassen J awarded a sum of R 962 260-00 in respect of the respondent’s estimated future loss of earnings and employability.

[2] The facts germane to this appeal are these: The respondent was an apprentice electrician when involved in a collision on
8 May 2000. The appellant conceded liability to compensate the respondent for damages suffered and the only question at the trial related to the quantum of the damages suffered. On appeal the only question is whether the learned judge a quo should have reduced the amount awarded for future loss of earnings and earning capacity by taking into account the contingencies affecting the respondent’s loss of such capacity.

[3] In his judgment Claassen J accepted the evidence of Dr Read that the plaintiff had, in addition to other injuries, also sustained an injury to his right shoulder and sterno clavicular joint. It is common cause that there has not been a joinder of the fractured right collar bone. A dispute arose between Read and Dr Pienaar as to the the nature of the respondent’s future treatment: Dr Read suggested a fixation of the collar bone but Dr Pienaar recommended excision of the end parts of the fractured collar bone. Dr Pienaar opined that after his recommended surgery the respondent would be able to return to work at full or nearly full capacity while Dr Read took the view that excision would not be the appropriate procedure to follow and that the fractured collar bone should be united by way of reduction and fixation. Dr Read’s view was that excision would render the shoulder weakened but he opined that his treatment, ie fixation, could well be unsuccessful since the respondent’s complaints resulted from various causes.

The respondent experienced pins and needles in his right arm when lifting it above his head in order to work. This could be ascribed to either an impinged sub-clavian artery (first diagnosed by Dr Pienaar and confirmed by Dr Abramowitz) or impinged nerves on the neck or shoulder. Dr Abramowitz supported Dr Read in his conclusion that neither of the two suggested procedures would necessarily result in the removal of all of the respondent’s symptoms. Their view was that the sub-clavian artery as well as the nerves passing through the shoulder and fractured vertebrae may have been permanently damaged and that this would result in a continuation of the sympto
ms even after surgery. Dr Read’s contention was that even if pressure on the sub-clavian artery is relieved the shoulder would not return to full strength and that the respondent would need a full-time assistant to help him perform his duties as an electrician. Movement above the head is the “Achilles heel of a working shoulder”, said Dr Read, as it is a complex of muscles and tendon structures.

Claassen J rejected Dr Pienaar’s contention that the respondent would be able to return to working life fully after surgery. He did so because Dr Pienaar saw the respondent only once and could not follow up his progress as Dr Read had; and because he did not have any detailed knowledge of the respondent’s working conditions. The learned
Judge found that neither of the surgical procedures suggested would render the plaintiff free from his problems. They may relieve some of the pain but would not restore the respondent to full working capacity. He found that the respondent has succeeded in proving that he may require an assistant to perform his duties as an electrician. Basing his judgment on the uncontroverted evidence of Ms Donaldson he found that the respondent would complete his training as an electrician but that, because of his disabilities, he would not be employable and would have to start his own electrician’s business. He would have become self-employed by no later than 1 January 2005. To be able to do so, however, he would need the services of a skilled operator and not of a mere labourer. Since he would have been able to work without that help had the accident not occurred his loss of earnings is made up of the difference between the cost of employing a skilled operator and the cost of employing a mere labourer for the rest of his working life. On this basis Claassen J accepted the calculations made by the actuary that the loss suffered by the respondent amounted to R 914 860-00. It is against this award that the present appeal is directed.

[4] The award in respect of future loss of earnings and earning capacity was made by the learned Judge against the following background. During the course of the trial the respondent amended his particulars of claim so as to bring them in accordance with the evidence tendered by Dr Read, Dr Abramowitz and
Ms Donaldson. The amendment had the effect of changing the respondent’s claim from one based on loss of his own earning capacity to one based on the respondent as a self-employed artisan, using a skilled operator to assist him as opposed to a general labourer he would be required to use in his trade, but for his injuries. Based hereon the additional expenses to be incurred by the respondent in employing a skilled operator were calculated by the actuary to amount to R 914 860.00, which was accepted by the Court a quo. The revised figures were based on an earlier report by the actuary, in which the components of mortality, interest, inflation and taxation were taken into account. In regard to contingencies however it is stated “no allowance is made for contingencies and an appropriate adjustment should be made”. The report of the actuary therefore clearly envisaged and alerted the parties that contingencies should be taken into account, an issue that was left for determination by the Court.

[5] The approach to be adopted by the Court on appeal where an award of damages is appealed against has been dealt with in a number of reported cases. In
Minister of Defence and Another v Jackson 1991 (4) 23 (ZSC) at 26 H-J the following was stated:

“The circumstances in which an appeal Court will interfere with an award of general damages made by a trial Court are well known. Such assessment is notoriously beset with difficulty, but it is established law that the trial Court has a large discretion to award what it considers to be a fair and adequate compensation to the injured party. Thus an appeal Court will only interfere with the exercise of the discretion if satisfied that there was a material misdirection, or that no sound basis exists for the award, or that the award is manifestly too great or too small – where there is a striking disparity between what the trail Court awarded and what the appeal Court considers ought to have been awarded” (my underlining).

See also Southern Insurance Association Ltd v Bailey NO 1984 (1) SA 98 (A) 109 H).

In
Van der Plaats v South African Mutual Fire and General Insurance Co Ltd 1980 (3) SA 105 (A) at 114F-115 CD the Court emphasised that provision for contingencies is a matter falling within the discretion of the trial Court and that the amount allowed for contingencies is variable and closely related to the facts and circumstances of each case. At page 114 G-H the following is stated:

“Daar moet egter nie uit die oog verloor word nie dat die besluit of voorsiening gemaak moet word vir die aftrek van die toegekende skadevergoedingsbedrag van ‘n sekere persentasie tov gebeurlikheidsfaktore binne die diskresion?re mag van die Verhoorregter val en daar word op app l met die uitoefening van sodanige diskresie slegs ingemeng waar die uitoefening daarvan nie behoorlik geskied het nie. Dit is vanselfsprekend dat die korting onder hierdie hoof nie vir akkurate beraming vatbaar is nie.”

Thus, allowing for contingencies is one of the elements in exercising the discretion to award damages (
Cf Southern Insurance Association Ltd v Bailey NO 1984 (1) SA 98 (A) 116 H).

[6] Contingencies may consist of a wide variety of factors. They include matters such as the possibility of error in the estimation of a person’s life expectancy, the likelihood of illness, accident or employment which in any event would have occurred and therefore affects a person’s earning capacity (
Minister of Defence and Another v Jackson supra at 34 FH; Boberg “Deductions from Gross Damages in Actions for Wrongful Death” (1964) 81 SALJ 194 at 198). Contingencies may be positive or negative. Not all contingencies are negative involving a reduction of the award. In Bresatz v Przibilla [1962] HCA 54; (1962) 36 ALJR 212 (HCA) at 213 (cited with approval in Minister of Defence and Another v Jackson supra at 34 H-J and Southern Insurance Association Ltd v Bailey NO 1984 (1) SA 98 (A) at 117 B-D) the following was said:

“It is a mistake to suppose that it necessarily involves a ‘scaling down’. What it involves depends, not on considering what the future might have held for the particular concerned. He might have fallen sick from time to time, been away from work and unpaid. He might have become unemployed and unable to get work. He might have been injured in circumstances in which he would receive no compensation from any source. He might have met an untimely death. Allowance must be made for these ‘contingencies’ or ‘vicissitudes of life’ as they are glibly called. But this ought not to be done by ignoring the individual case and making some arbitrary subtraction … Moreover, the generalisation, that there must be a ‘scaling down’ for contingencies seems mistaken. All ‘contingencies’ are not adverse, all ‘vicissitudes’ are not harmful. A particular plaintiff might have had prospects or chances of advancement and increasingly remunerative employment. Why count the possible buffets, and ignore the rewards of fortune. Each case depends on its own facts.”

[7] Although contingencies are generally taken into account when awards of damages are quantified (
See Nochomowitz v Santam Insurance Co Ltd 1972 (1) SA 718 (T) 723; Gillbanks v Sigournay 1959 (2) SA 11 (N) 17-8) this is not always done. In Wessels v AA Onderlinge Assuransie Assosiasie (TPD) referred to in Corbett & Honey The Quantum of Damages Vol 4 A3-19 at A3-33, the Court refused to take contingencies in respect of future medical costs into account where although the amount of damages, excluding loss of income, had been agreed upon, contingencies were neither mentioned nor in issue.

[8] In the present case the issue of contingencies was referred to very briefly in evidence by Ms Donaldson. No submissions were made to the Court a quo on the issue at all. It was mentioned for the first time during argument in the application for leave to appeal. It is obviously undesirable for a Court to deliver a judgment on matters not canvassed at the trial or not relied upon by counsel (Kauesa v Minister of Home Affairs and Others 1996 (4) 965 (Nm SC) at 974 A). This is particularly so in an adversarial system where in civil litigation the presiding officer plays an objective role: there is generally no duty on him or her to explore facts where counsel does not invite him or her to do so. As I have said, determining the quantum of damage is a discretionary matter falling within the competence of the trial Court. On appeal the trial Court’s assessment of the damages will be interfered with only where there was a material misdirection or a striking disparity between the trial Court’s award and the amount that should have been awarded (paragraph 5 above). In view of the circumstances of this case, I am unable to hold that Claassen J misdirected himself in not considering the contingencies inherent in this matter: he was not asked to; neither was there a duty to do so.

However, in view of the conclusion to which I have come I do not consider it necessary to express any firm view on the trial Court’s
omission to take contingencies into account. If I am wrong on this issue and assuming that contingencies should have been provided for, I am nevertheless, having weighed all the factors relied upon by both parties, not persuaded that the award made by the Court a quo warrants interference. Those factors are the following. The appellant’s list of contingencies includes the general vicissitudes of life, such as early death, sickness etc; the age of the respondent who was relatively young when the collision occurred and the fact that that he had by then not yet qualified as an artisan; the difference in medical opinion as to the success of a future operation, including a measure of uncertainty as to the question whether the respondent will suffer some residual incapacity; the further uncertainties relating to his future earnings working on his own against the background of him having worked for another person where he possibly could have continued in this employment.

[9] As against these considerations, the factors relied upon by the respondent include that the respondent was shown to be an intelligent and determined person who had underachieved as a youngster but
eventually got his life under control; who might have done better than the average electrician: the option that would have been open to him prior to the accident of staying in corporate employment promising a stable income with associated fringe benefits, whereas he was now without the necessary administrative experience or inclination required to work on his own venturing into an entrepreneurial career with the accompanying uncertainties that it entails; his uncertain physical prognosis and, finally, the various uncertainties whether he would be successful in the new enterprise.

[10] I am aware of the dangers in foretelling the future. As was said in
Goodall v President Insurance Co Ltd 1978 1 SA 389 (W) 392-3:

“In the assessment of a proper allowance for contingencies, arbitrary considerations must inevitably play a part, for the art or science of foretelling the future, so confidently practiced by ancient prophets and soothsayers, and modern authors of a certain type of almanack, is not numbered among the qualifications for judicial office” (and see Boberg The Law of Delict Volume One (1984) at 541).

The Court must, of course, do the best it can in the particular circumstances of each case. Having done that I am of the view that the contingencies in this matter are fairly evenly balanced. I have little doubt that fairness requires me in the exercise of my discretion to leave the award made by the Court a quo unaltered. It follows that I am unable to find that, if the learned Judge was required to consider the contingencies inherent in this case, he would have come to a different conclusion. It follows that the appeal must fail.

[11] The appeal is dismissed with costs.




________________
FR MALAN
JUDGE OF THE HIGH COURT OF SOUTH AFRICA


I agree and it is so ordered.


___________________
I SCHWARTZMAN
JUDGE OF THE HIGH COURT OF SOUTH AFRICA


I agree.


___________________
FHD VAN OOSTEN
JUDGE OF THE HIGH COURT OF
SOUTH AFRICA





COUNSEL FOR THE APPELLANT                          ADV VAN VUUREN
(The Appellant’s heads of argument
were drawn by Adv N van der Walt SC)
APPELLANT’S ATTORNEYS                      LINDSAY KELLER

COUNSEL FOR THE RESPONDENT                ADV JJ WESSELS SC
RESPONDENT’S ATTORNEYS   MUNRO FLOWERS VERMAAK

DATE OF HEARING                                     
14 FEBRUARY 2005
DATE OF JUDGMENT                                    18 FEBRUARY 2005