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Case Number : 151/2000
Reportable
IN THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA
In the matter between
ROAD ACCIDENT FUND
Appellant
and
ALFRED SAMELA
Respondent
COURT : VIVIER ADCJ; MARAIS AND OLIVIER JJA; CLOETE AND BRAND
AJJA
Date of hearing : 4 SEPTEMBER 2001
Date of delivery : 28 SEPTEMBER
2001
SUMMARY
Multilateral Motor Vehicle Accidents
Fund Act, 93 of 1989 – conveyance ‘for reward’ and ‘in
the course of
the business of the owner’ of the motor vehicle in terms of
art 46 of the Schedule interpreted.
J U D G M E N T
CLOETE
AJA
INTRODUCTION
[1] On 7 January 1996 the
respondent was a passenger in a Toyota minibus motor vehicle travelling between
Warden and Villiers in the
Free State. The minibus overturned solely in
consequence of the negligence of the driver and the respondent suffered personal
injuries.
[2] The respondent (as the plaintiff) instituted an action
for compensation in terms of the provisions of chapter XII of the Schedule
to
the Multilateral Motor Vehicle Accidents Fund Act 93 of 1989 (‘the
Schedule’) and cited as the defendant (who is the
appellant on appeal) the
Road Accident Fund, a body established by the Road Accident Fund Act 56 of 1996.
ISSUES
[3] The essential difference between the
parties in this Court, as in the court below, is that the respondent contends
that he was being
conveyed in the minibus for reward as contemplated in
paragraph (a)(i), or in the course of the business of the owner of the minibus
as contemplated in paragraph (a)(ii), of article 46 of the Schedule; whereas the
appellant contends that the respondent was being
conveyed in the motor vehicle
as contemplated in paragraph (b) of article 46.
[4] Article 46, to
the extent relevant for present purposes, provided (at the relevant time)
that:
‘The liability of the MMF or its appointed agent, as the case may be, to compensate a third party for any loss or damage contemplated in Chapter XII which is the result of any bodily injury to or the death of any person who, at the time of the occurrence which caused that injury or death, was being conveyed in or on the motor vehicle concerned, shall, in connection with any one occurrence, be limited exclusive of the cost of recovering the said compensation ...-
(a) to the sum of R25 000 in respect of any bodily injury or death of any one such person who at the time of the occurrence which caused that injury or death was being conveyed in the motor vehicle in question –
(i) for reward; or
(ii) in the course of the business of the
owner of that motor vehicle; or
(iii) ...
(iv) ...
(b) in the case of a person who was being conveyed in the motor vehicle concerned under circumstances other than the circumstances referred to in paragraph (a), to the sum of R25 000 in respect of loss of income or of support and the costs of accommodation in a hospital or nursing home, treatment, the rendering of a service and the supplying of goods resulting from bodily injury to or the death of one such person, excluding the payment of compensation in respect of any other loss or damage’.
[5] On any
basis the respondent’s claim is limited to R25 000-00. But if the
appellant is correct, the respondent’s claim
is further limited in that
the categories under which damages may be claimed are confined to those
mentioned in article 46(b); whereas
if the respondent is correct, his claim is
not so limited and he may claim, in addition, damages for example for pain and
suffering
and loss of amenities of life.
[6] It is common cause that
the respondent is entitled to the greater protection of article 46(a) if he can
bring himself within the
provisions of any one of paragraphs (i) to (iv)
thereof. Those provisions are disjunctive. If, therefore, the respondent was
being
conveyed in the course of the business of the owner of the motor vehicle
in which he was a passenger, it matters not whether he was
also being conveyed
for reward and the converse is also the
case.
FACTS
[7] The merits were separated from the
quantum. The matter came before the court below by way of a stated case.
Apart from the facts mentioned in the first paragraph of this judgment,
and
compliance with the formalities prescribed by the Schedule, the parties were
agreed on the following:
(i) One Mfenga was the owner of the minibus and the holder of a valid and current Public Road Carrier Permit issued pursuant to the provisions of the Road Transportation Act 74 of 1977 in respect of the minibus. Mfenga was aware of the terms of the permit and he conducted road transportation by operating the minibus for the conveyance of persons or goods on public roads for reward, or alternatively in the course of his business.
(ii) At the time of
the accident the passengers in the minibus, including the plaintiff, were being
conveyed as fare paying passengers
(the plaintiff having boarded the minibus in
the Transkei in order to be conveyed to Johannesburg). However, the minibus was
being
operated outside the area specified in the permit (a radius of 50 km from
the Kokstad taxi rank) in contravention of section 31(1)(b)
of the Road
Transportation Act. The passengers, including the plaintiff, were unaware of
the terms of the permit and the contravention.
[8] The court below
found that the respondent was being conveyed ‘for reward’ as
contemplated in article 46(a)(i) and gave
the following order:
‘1. It is declared that the plaintiff was being conveyed in the insured vehicle in terms of Article 46(a) of the Schedule to the Multilateral Motor Vehicle Accidents Fund Act, 93 of 1989.
2. The defendant is
ordered to pay the costs occasioned by the determination set out in paragraph 1
above, which costs shall include
the costs of the hearing on 24 February
2000’.
The respondent appeals with the leave of the court
below.
BUSINESS
[9] I shall first consider whether
the respondent was being conveyed ‘in the course of the business of the
owner’.
[10] Article 1(ii) of the Schedule provides that
‘’business’ does not include any unlawful business’.
The journey
– the particular conveyance – of the respondent, was
illegal. But it does not follow that the business of the owner
was unlawful.
The definitions of ‘ reward’ (quoted below) and
‘business’ in the Schedule distinguish between
an illegal conveyance
and conveyance in the course of an unlawful business. There is a difference
between being conveyed legally/illegally
(in which case one looks to the
conveyance) and being conveyed in the course of a lawful/unlawful business (in
which case one looks
to the business). The distinction was drawn by this Court
in Santam Insurance Co Ltd v Tshiva; Maxanti v Protea Insurance Co Ltd,
1979(3) SA 73(A) at 82C-F where Kotzé JA, writing for the
majority of the Court, said:
‘I conclude therefore that the reference in s 23 (b) (ii) of the Act to conveyance "in the course of the business of the driver or owner" is not restricted to conveyance which is not illegal in terms of any provision of Act 39 of 1930 (now repealed and re-enacted by the Road Transportation Act 74 of 1977). The illegality of conveyance under the road transportation legislation should not without the clearest indication be imported into the Act (which after all reflects an intention to provide comprehensive protection in respect of damages sustained as a result of motor vehicle accidents) to nullify a claim against a registered insurer. Accordingly, on the facts of the present case: Daniso operated a lawful taxi business. In the course of that business, in addition to three duly licensed taxis, he also operated motor vehicle CB 44478 as a taxi in contravention of the provision of Act 39 of 1930. On 6 October 1972 his servant Dindala conveyed the husbands of the respondents, who were innocently unaware of the illegality pertaining to the vehicle in question, in the course of his taxi business. They met their death in the course of such conveyance which, constituting (as I have held) conveyance in the course of Daniso's business within the meaning of s 23 (b) of the Act, renders Santam liable to the respondents in the agreed sums of damages caused by the admitted negligence of Dindala.’
The distinction apparent from the extract of the judgment just quoted was spelled out by Wessels JA (who was a party to that judgment) in Southern Insurance Association Ltd v Khumalo and Another 1981(3) SA 1(A) at 10D and 10F as follows:
‘In Tshiva’s case the Court held that the conveyance was undertaken in the course of the owner’s lawful business as a taxi operator, notwithstanding the fact that the conveyance in the unlicensed vehicle rendered the conveyance illegal in terms of the provisions of Act 39 of 1930 ... In Tshiva’s case, the passengers were being conveyed in the furtherance of a taxi operator’s lawful business, notwithstanding that the conveyance as such was tainted with illegality’.
[11] The definition of business so
as to exclude any unlawful business was introduced after the decision in the
Tshiva and Maxanti case (by section 1(a) of Act 23 of 1980, with
effect from 11 April 1980). But it does not follow, as Klopper suggests in
‘The Law of Third Party Compensation’ (2000) 239, that the
definition was introduced in response to that decision and to reverse its
effect. In the first place, the definition
means that not only business which
is unlawful under the law governing road transportation services, is excluded
– all unlawful
business is excluded (ie the definition goes further than
would be necessary to deal with the effect of the Tshiva and Maxanti
decision). The definition could therefore have been introduced to cover all
unlawful businesses. In the second place, if the definition
was intended to
eliminate the distinction drawn by this Court in the Tshiva and
Maxanti case, it has singularly failed in its purpose: a provision that the
business of the owner of the vehicle must be lawful, does not
exclude the
occasional illegal conveyance in the course of a predominantly lawful business.
[12] If the legislature intended, as the appellant contends and
Klopper suggests (op. cit. 240), that a single illegal conveyance should
be excluded, the words ‘legally and’ (which would qualify the
conveyance)
could have been used to introduce paragraph (ii) of Article 46(a).
The combined effect of such a provision and the definition of
‘business’ which currently appears in the Schedule would be to
require both the conveyance of the passenger and the business
of the owner of
the vehicle to be lawful.
[13] This Court has held that a business
can consist in a single act: AA Mutual Insurance Association Ltd v Biddulph
and Another 1976(1) SA 725(A) at 739 B-C. But it does not follow that where
a business does not consist in a single act, but comprises numerous
transactions, the one which is unlawful is a business in itself distinct from
the rest of the business − any more than it
follows that a business
comprising numerous transactions is unlawful because one transaction is
unlawful. I therefore respectfully
disagree with the reasoning of Levy AJ in
Nhlangwini and Another v National Employers General Insurance Co Ltd and
Another 1989(1) SA 96(W) at 99 B-C.
[14] There is no suggestion in
the pleadings in the present matter that the business of the owner of the
minibus in which the plaintiff
was being conveyed, was in fact unlawful. It is
clear from the stated facts that the owner of the minibus held a valid permit in
respect of the minibus and that he operated the minibus for the conveyance of
persons on public roads in the course of his business
– ie that he
conducted a lawful business. In these circumstances it seems to me (and it was
conceded by the appellant’s
counsel) that it was not incumbent on the
respondent to go further than to show that at the time of the accident he was
being conveyed
in the minibus in the course of the business of the owner of the
vehicle (which is established by the stated facts).
[15] I therefore
conclude that the respondent was being conveyed in the course of the business of
the owner of the minibus as contemplated
in article 46(a)(ii) of the
Schedule.
REWARD
[16] The learned judge in the court
below held, as I have said, that the respondent was being conveyed ‘for
reward’. I respectfully
disagree with that conclusion for the reasons
which follow.
[17] Article 1(xiv) of the Schedule provides that:
‘’reward’, with reference to the conveyance of any person in or upon a motor vehicle, does not include any reward rendering such conveyance illegal in terms of any law relating to the control of road transportation services applicable in the area of jurisdiction of a Member’
(ie a Member of the Multilateral Motor Vehicle
Accidents Fund – originally, in terms of article 4, the Republics of South
Africa,
Transkei, Bophuthatswana, Venda and Ciskei).
[18] The
‘law’ in question is, for present purposes, the Road Transportation
Act and more particularly section 31(1) which
(to the extent relevant for
present purposes) provides:
‘Any person who –
(a) undertakes road transportation
except under the authority of a permit authorizing such road transportation;
or
(b) being the holder of a permit, undertakes road transportation otherwise
than in accordance with the provisions of such permit,
or ... contravenes or
fails to comply with any condition or requirement of a permit
...
...
shall be guilty of an offence’.
‘Road
transportation’ is defined (subject to exceptions not presently relevant)
to include inter alia:
‘(a) the conveyance of persons or goods on a public road by means of a motor vehicle for reward;
(b) the conveyance of persons or goods
on a public road by means of a motor vehicle in the course of any industry or
trade or business’.
Section 31(1) envisages two possibilities:
road transportation, in the case of (a), without a permit; and in the case of
(b), with
a permit but outside the terms of the permit: S v Smith
1986(3) SA 714(A).
[19] In Mutual & Federal Insurance Co
Ltd v Gounder 1995(1) SA 486(D & CLD), in Ncqulunga and Others v
President Insurance Co Ltd 1995(1) SA 594(N) and in the court below it was
reasoned that for the purposes of article 46(a)(i) there is a distinction
between
paragraphs (a) and (b) of section 31(1) in that (to quote the court
below):
‘Where section 31(1)(a) is contravened, the conveyer has no permit. In such a case the mere payment of the reward probably renders the conveyance illegal. (I say probably because that is not what I have to decide.) In the case of a contravention of section 31(1)(b) the permit holder is entitled to receive reward for conveyance. It is not the payment of the reward that makes the conveyance illegal. It is the fact that he contravenes the terms of his permit.’
The fallacy in this reasoning in my respectful
view is that in a case of a contravention of section 31(1)(b) the permit holder
is
not ‘entitled to receive reward’ for that particular
conveyance which is illegal in that it is contrary to the terms of the
permit and accordingly the provisions of the Road Transportation Act.
In
neither situation – (a) or (b) of s 31(1) – is the permit holder
entitled to a reward (in the case of (a), at all;
and in the case of (b), for
the particular conveyance) and if a reward is paid, it has the effect of
‘rendering’ the
‘conveyance illegal’ (the Afrikaans text
is: ‘vergoeding wat sodanige vervoer onwettig
maak’).
[20] Inherent in both ‘render’ and ‘
maak’ is a causative element. But payment of a reward does not by itself
make a conveyance illegal. In both subsections (a) and (b) something more is
required: in the case of (a), conveyance without a
permit; and in the case of
(b), conveyance outside the terms of a permit. I therefore do not consider that
emphasis on the causative
element inherent in the verbs used in both texts can
be a basis for distinguishing between sections 31(1)(a) and (b) of the Road
Transportation Act for the purposes of the definition of ‘reward’ in
the Schedule; and I accordingly disagree, with respect,
with the reasoning in
the Gounder case at 491 F-H.
[21] What must be borne in mind in
interpreting article 46(a)(i) and the definition of ‘reward’ is that
numerous offences
under the Road Transportation Act can be committed – eg
where the permit holder does not carry the permit on the motor vehicle
as
required by section 24(1)(a). It is for that reason in my view that the
legislature provided in the Schedule that in order for
the additional protection
under article 46(a)(i) to be excluded, the reward must have the effect of
rendering the conveyance of that person to whom the reward relates,
illegal. It is the conveyance of the passenger which must be illegal (and
therefore the
appellant’s counsel was incorrect in submitting that any
contravention of the Road Transportation Act not incidental to the
conveyance of
a particular passenger such as the failure to carry the permit in the vehicle,
takes that passenger outside the protection
of article 46(a)(i)); it is the
reward which must make it so (which will be the case where either subsection of
section 31(1) is
contravened, for in neither case can there be a contravention
if a reward is not paid); and because the phrase ‘such conveyance’
in the definition of ‘reward’ refers to the conveyance of the
particular person in respect of whom the reward is paid,
the rights of other
passengers are not affected.
[22] Arguably this interpretation
operates harshly on the respondent, who was ignorant of both the terms of the
permit and the contravention
of the Road Transportation Act. Before the
insertion of the definition of the term ‘reward’ in section 1 of the
Motor
Vehicle Insurance Act, 29 of 1942, this Court held in Ndhlovu v Mathega
1960(2) SA 618(A) that a passenger who was unaware of the illegality of his
conveyance was not barred from recovering damages for
injuries under that Act.
The definition inserted by s(1)(e) of Act 60 of 1964 provided that
‘reward’ did not include
‘any reward rendering such conveyance
illegal in respect of any provision of the Motor Carrier Transportation Act 39
of 1930.’
This Court then held in Martin and Others v Marine &
Trade Insurance Co Ltd 1978(3) SA 640(A) that the effect of the insertion of
the definition was that a passenger for reward who was unaware of the
illegality
of his conveyance was barred from recovering damages for injuries
from the insurer. (See also Parity Insurance Co Ltd v Marescia and Others
1965(3)SA 430(A) at 434 A-B and the Tshiva and Maxanti
case supra at 80F.) The same reasoning must apply to the
Schedule, with the consequence that the respondent’s ignorance that he was
being conveyed
illegally in the minibus, is irrelevant. It is the objective
illegality of the conveyance and not the passenger’s knowledge
thereof,
which takes the passenger out of the ambit of article 46(a)(i).
[23] A
passenger will nevertheless always have the protection of article 46(b). But
the effect of excluding a passenger from the categories
of damages for which
article 46(a) additionally provides when compared to article 46(b), has the
effect that the residual common
law obligation of the owner of the vehicle, the
driver and the latter’s employer – ie those involved in the taxi
business
– is correspondingly increased (in as much as, in terms of
article 52, an injured person is deprived of the right to claim
compensation
only to the extent that such compensation is payable under the Schedule).
Accordingly if a business is lawful in the
sense described above (with the
consequence that a passenger will fall under article 46(a)(ii)) the obligation
to compensate him/her
for the additional categories of damages for which article
46(a) provides, is not imposed on those involved in the taxi business.
Because
the business is lawful, the passenger’s claim lies against the Fund even
although his conveyance may have been illegal.
Conversely, if a business is
unlawful in the sense described above (with the consequence that a passenger
cannot fall under article
46(a)(ii)) the obligation to compensate him/her for
the additional categories of damages contained in article 46(a) will only be
transferred to those involved in the taxi business if they further the unlawful
business vis-a-vis that particular passenger by receiving a reward which
renders his/her conveyance illegal (so taking him/her outside the protection
of
article 46(a)(i)). On the interpretation I have given, this situation occurs
where those involved in an unlawful taxi business
contravene either subsection
of section 31(1) of the Road Transportation Act (by operating without a permit
under (a), or outside
the terms of the permit under (b)). That appears to me to
accord with the intention of the legislature. If, however, the definition
of
‘reward’ is interpreted so as to exclude the situation contemplated
in section 31(1)(b), then the reward paid in such
a case will always qualify as
a ‘reward’ and the passenger will automatically fall under article
46(a)(i), even although
his conveyance was illegal under the Road Transportation
Act and even where it formed part of a business which was exclusively unlawful
under that Act. I cannot accept that the legislature intended this result.
[24] On the stated facts, the respondent paid a fare to be transported
outside the area of the permit held by Mfenga. The consequence
in my view is
that the reward he gave rendered his conveyance illegal in terms of section
31(1)(b) of the Road Transportation Act
and such reward is accordingly not a
‘reward’ as defined for the purposes of article 46(a)(i) of the
Schedule.
CONCLUSION
[25] I therefore conclude that
the respondent was not being conveyed for reward, but was being conveyed in the
course of the business of
the owner of the minibus; and that for this latter
reason, the respondent falls under article 46(a) of the Schedule. Although the
reasoning of the court below was in my respectful view incorrect the order given
requires no alteration. The appeal is accordingly
dismissed with
costs.
......................
TD CLOETE
ACTING JUDGE OF APPEAL
CONCUR
OLIVIER JA
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