Judge says the inference of mala fides by the fund and former CEO Collins Letsoalo in bringing the counter application is ‘inescapable’.
A Road Accident Fund (RAF) counter application for a high court order that would have reduced the amount the fund would have to pay road accident victims for treatment of injuries and/or illnesses and to stop it issuing claimants “a blank cheque” has been dismissed with punitive costs.
Judge Petrus van Niekerk, in a judgment handed down in the High Court in Pretoria last week, said the applicants – five RAF claimants – sought a punitive order for costs against the RAF and its former CEO Collins Letsoalo.
Judge van Niekerk said he is of the view the applicants are entitled to costs on a punitive scale for a number of reasons.
He said the authorities referred to the RAF’s ‘undertakings’ as being “clearly disposed of the legal principles” that inform the issue in the application, and most were readily available at the time when the counter application was launched”.
“It thus raises questions about the underlying motive for this application.
“From the history of the litigation in this matter, it is in my view clear that this counter application was launched as a proverbial knee-jerk reaction after an application was launched for the committal of the second respondent [Letsoalo] for contempt of the various orders of court,” he said.
“In view, the inference of mala fides [being intentionally dishonest] is inescapable.”
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Background of the dispute
The RAF lodged the counter application after an application by five claimants for a contempt of court order against the fund and Letsoalo, because of the failure to comply with high court orders to provide undertakings in terms of the RAF Act to the claimants for injuries they sustained in motor vehicle accidents.
The applicants are Emm Muller, Samuel Sithole, Hermanus Krause, Ramoletsi Makgopa and Leon Bezuidenhout.
Judge van Niekerk said the counter application by the RAF follows “a chequered history of litigation” between Muller, which eventually culminated in the other four applicants being joined as interested parties in the litigation after the fund instituted the counter application.
Muller instituted an action against the RAF during March 2016, claiming damages for injuries sustained in a motor vehicle accident and for which the fund was held liable for 100% of her proven and agreed damages in terms of an order issued by the High Court in Pretoria on 30 November 2017.
Her claim for general damages was finalised on 16 October 2020, and the court made a further order on that date regarding the RAF undertakings in terms of the RAF Act for injuries she sustained in a motor vehicle collision on 27 September 2015.
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RAF’s failure to comply
The RAF failed to comply with the order to provide the undertaking and after attempts were made by Muller’s attorney to obtain such an undertaking from the fund, an application was launched in the High Court in Pretoria to compel the RAF and Letsoalo to furnish the undertaking.
The RAF and Letsoalo remained in default.
Muller then launched an application for contempt of court.
The RAF and Letsoalo gave notice of their intention to oppose the contempt of court application on 23 November 2023 but failed to take further steps, resulting in the matter being set down on the unopposed court roll.
The RAF and Letsoalo eventually filed an answering affidavit and counter application, plus an application for condonation for the late filing of the opposing affidavit.
Judge van Niekerk said the matter was initially enrolled on the unopposed motion court roll, then removed, then placed on the opposed motion court roll without the RAF and Letsoalo’s opposing affidavits, then removed again, and finally enrolled as an opposed motion “all caused by the respondents [RAF and Letsoalo’s] repeated failures to comply with the relevant court rules and directives”.
Between March and April 2025, the four other applicants were granted leave to intervene as a result of the relief sought by the RAF and Letsoalo in the counter application.
They all had similarly obtained orders against the RAF to provide an undertaking, which the fund failed to provide or, alternatively, provided with certain caveats that were unacceptable to them.
All the applicants subsequently agreed that only the RAF and Letsoalo’s counter application be enrolled for adjudication, with the contempt of court application to be enrolled at a later date.
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Counter application
In the counter application, the RAF and Letsoalo were seeking an order that:
- A declarator be granted confirming the RAF is entitled to issue undertakings in compliance with its statutory obligations provided for in the RAF Act that “specify the injuries and envisaged treatment covered by the relevant undertakings”.
- The RAF is not obliged, in terms of the RAF Act, to issue open-ended certificates to claimants to receive treatment for injuries and/or illnesses that are not causally linked to the injuries suffered in the relevant motor vehicle collision and/or are not caused by the relevant motor vehicle collision that formed the basis of the liability of the RAF in the first place.
Van Niekerk said it appears the RAF provided undertakings described as a “contractual undertaking”.
Such an undertaking has one or more of the following features:
- It limits treatment to within the borders of the Republic of South Africa;
- The compensation for future medical expenses is limited by the contractual undertaking to the Managed Healthcare Guidelines and Principles;
- It excludes social and inter-facility transfers and excludes minor post-operative care;
- The RAF reserves for itself the right to “pre-authorise” treatment; and
- It lists a number of items the RAF will not pay as well as implementing validations.
Judge van Niekerk said these undertakings, as provided by the RAF and which the applicants refused to accept, do not follow the wording of the court orders, and do not follow the wording of the RAF Act.
In an affidavit by the RAF in support of the necessity for an order declaring the fund to be entitled to issue an undertaking that specifies the injuries and envisaged treatment cover, the RAF said historically it used to provide claimants with “non-specific undertakings which were akin to … ‘a blank cheque’”.
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Ruling
Judge van Niekerk said the permissible content of an undertaking in terms of the RAF Act has been the subject of various judgments and “is settled in law”.
He said from any reasonable reading of the various judgments, it is clear the subject matter of the order sought by the RAF and Letsoalo “has been definitively determined, not only by this court … but by other courts in other divisions”.
Judge van Niekerk said the declarator sought by the RAF in Paragraph 1 of the notice of motion in the counter application “is therefore legally untenable”.
He said the declarator sought by the RAF in Paragraph 2 will not provide further clarity or advantage to any party.
This article was republished from Moneyweb. Read the original here.