ACTUARIAL CASE LAW REVIEW

Facts: The Plaintiffs instituted action against the Minister for damages arising out of a shooting incident which occurred in 2005 in Khayelitsha, Cape Town, when Mr Tekete (the deceased) was shot by a member of the police service and later died. The deceased, at the date of his death, was married in community of property to the first plaintiff and was the father of the second and third plaintiffs. Judgment on liability was handed down in 2019 where the court found the Minister to be liable to the plaintiffs for loss of support as a consequence of the shooting.

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The deceased’s earnings: It is undisputed that the deceased was the breadwinner at the time of his demise. It is further undisputed that the plaintiffs’ loss of support commenced at the time of the demise of the deceased. It appeared from the evidence that the deceased was previously employed as a police officer, but lost his job. He managed to secure casual employment as a kitchen hand and was able to assist with various duties and had the ability to cook well. He was taught the skills he acquired and although he did not receive any formal training, he was able to perform a variety of duties from cooking to setting up events. The deceased’s sister said that he earned R250 per day at the time. Counsel for the Minister challenged the industrial psychologist’s prognosis that the deceased would have reached a semi-skill level and requested that the court considers the concession made by the industrial psychologist that unemployment in South Africa is currently running at 40%. Counsel for the Minister argued that the deceased’s meteoric rise in income in the labour market as forecast by the industrial psychologist was a leap of faith.

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Findings: The industrial psychologist places reliance on an assessment on a non-corporate level. The court is satisfied that he considered the necessary factors to support his conclusion that the deceased would have been employed at a semi-skilled level, which was reasonable and properly considered. Based on the balance of probabilities, the deceased’s income and probable career path would have been as follows: The deceased would have earned R41,500 per annum as at 31 December 2005; his income would have progressed to a current amount of R150,000 per annum as per the 2024 values; his income would have progressed to an income of R218,000 per annum as per the 2024 levels at the age of 45 years; increases would have been coupled with earnings inflation; and the deceased would have retired at the age of 65 years.

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Further considerations: The first plaintiff testified that the second and third plaintiffs were still residing with her. According to the first plaintiff, the third plaintiff is currently 20 years old and still financially dependent on her. The second plaintiff (eldest child) is unemployed and did not progress beyond Grade 11. Both children did not finish school. The industrial psychologist confirmed that he made provision in his calculation in respect of the children up until the age of 18 years. The court finds that it would be reasonable that the second and third plaintiffs’ dependency age is to be set at 18 years. The plaintiff is, at the time of writing of the judgment, currently 56 years old. The evidence on record is that she has not remarried. It is unlikely that she will remarry in the future and as such, the court does not deem it necessary to consider a remarriage contingency. The plaintiffs proposed that general contingency deductions of 5% for past loss of support and 10% for future loss of support would be appropriate. The court finds these to be fair and reasonable.

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Calculations: The actuaries were instructed to calculate the loss of support in respect of the first, second and third plaintiffs. An actuarial report was prepared which quantified the present value of the loss of support suffered by the plaintiffs after contingencies in the amount of R1,436,937 calculated as follows: R965,658 for the first plaintiff; R111,867 for the second plaintiff; and R359,412 for the third plaintiff.

These are set out in a second judgment at Tekete v Minister of Safety (quantum) [2024] ZAWCHC 144.

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The Calderbank Offer

See the discussion from para [10] of the second judgment on costs and the Calderbank Offer. The chronology of the litigation paints a stark picture of a family who, after having lost the breadwinner of the family at the hands of a member of the police in 2005, have waited almost 17 years for closure after instituting action in 2007. There were at least 12 court hearings in the action on the merits leading up to judgment and another 7 court hearings in respect of quantum. This type of protracted litigation cannot be in the public interest and neither can it serve the interest of justice. It is precisely for this reason that public policy considerations frowns upon costly litigation. It therefore follows that protracted cases cause an escalation in costs, which may have been curtailed had the Calderbank offer been considered.

ANDREWS AJ

Facts: The accident occurred in 2021 and according to the particulars of claim the plaintiff was stationary at a stop sign when an unknown driver ignored the stop sign and collided with her. This version is recorded in the Accident Report Form, albeit that the sketch plan suggests that both vehicles were in the through road and not at the stop sign. The court notes the careless pleadings and preparation of documents such that the particulars of claim suggests that the plaintiff is “an adult female”, while in the section 19(f) statutory affidavit, the plaintiff swears under oath to be an adult male person. Neither the statutory affidavit nor the particulars of claim indicates where the accident occurred. One gathers from the Accident Report Form that the accident occurred in Berea, Johannesburg.

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Claim: The Fund opted not to defend the matter. To the extent that there is no evidence to gainsay the plaintiff’s version and the version is not inherently improbable, the only possible outcome is an order that the Fund is 100% liable for such damages as the plaintiff may be able to prove.

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Discussion: The orthopaedic surgeon’s medico-legal report listed the plaintiff’s injuries as: “Fracture right ankle. Abrasion right flank.” There is no mention in his report of the pelvic fracture that is listed in the particulars of claim. Prior to the accident the plaintiff allegedly had a business transporting children to school. The plaintiff reported that the vehicle with which the children were transported broke down whilst she was recuperating. This is clearly not the vehicle that she was driving at the time of the accident as she was driving a Mercedes Benz whilst the children were transported with a Mazda. The industrial psychologist recorded that plaintiff reported to her that she worked at a business called Legal Tax from 2010 to 2014 earning approximately R10,000 per month. During 2015 she was unemployed and in 2016 she started a business transporting children to school. She was still engaged with this business when the accident occurred. She reported that she made R3,000 per month profit.

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The report of the industrial psychologist: It is regretful that a report such as this was served and filed. Expressing an opinion based purely on the verbal information conveyed by the plaintiff is not of assistance as it is no more than speculative hearsay. In the current matter the plaintiff allegedly conducted her own business. By implication she should have had a set of accounting books. She should have had bank statements, tax returns, both her own and for the business, if it was a separate legal entity. All of these should have been called for and the industrial psychologist should have remarked on it. There is not a single piece of evidence available to substantiate that she transported children for reward. There is nothing in the report to suggest that it was investigated why she could not return to the higher income earning position that she occupied earlier in her career. Based on the plaintiff’s own evidence that the vehicle used to transport the children broke down while she was recovering and that this was the reason why she did not return to transporting children, one would expect this to be properly interrogated in the industrial psychologist’s report. There is no evidence that could serve as the foundation on which the industrial psychologist’s report is based. None of the conclusions contained in the report can be accepted. The calculations of the actuary are also of no assistance and that report is also rejected. Reference is also made to an automatic vehicle in the industrial psychologist’s report, and it is recorded as an unquantified loss that must be added to the loss of income calculation. This would be the difference in cost between a manual and an automatic vehicle, but there is no evidence before court as to whether there is a difference in cost and, if so, what that might be. This claim is equally unsubstantiated and must fail. No documentation in support of the claim for past hospital and medical expenses has been presented.

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Order: The plaintiff’s claims for past hospital and medical expenses as well as loss of income are dismissed. The plaintiff’s claim in respect of general damages is postponed sine die. The Fund is ordered to provide the plaintiff with an unlimited undertaking for future hospital and medical expenses.

WEIDEMAN AJ

Facts: The plaintiff, an adult female of 22 years of age, was involved in a motor vehicle accident in 2020. According to the neurologist, the hospital records confirm a pelvis fracture (superior inferior rami on the left), L5 transverse process fracture, diastasis of right SI joint, displaced sacral body fracture with S2 level sacral angulation, laceration on her scalp and forehead including concussion, a spinal injury and various soft tissue injuries. She further confirms that plaintiff's main complaints included lower back pain and pelvic pain between her legs. Specific enquiries elicited complaints of headaches two to three times per week, reduced hearing in her left ear and short-term memory deficits. The neurologist opined that the plaintiff probably suffered a mild traumatic brain injury over and above her orthopaedic injuries.

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Claim: The merits-aspect have been settled and the Fund has tendered an undertaking for future medical expenses. The court is called upon to determine the award to be made in respect of future loss of earnings/earning capacity and contingencies to be applied.

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Discussion: The plaintiff was a good and reliable witness. Her evidence made sense and was logical. She was open and candid and her evidence contained no contradictions. The plaintiff testified that she completed her studies at the University of North­West during 2023 and that she was to be awarded her degree in 2024. Her field of studies is in respect of younger children, in particular children in Grade R to Grade 3. In her experience as an assistant teacher she struggled to cope. She experienced intense pain and discomfort in especially her lower back and hip. In the fulfilment of her duties as a teacher, she needs to often bend down to assist the children in their tasks in class. The plaintiff further confirmed that she still experiences daily backpain and cannot stand for periods longer than 30 minutes. The same occurs when she has to sit doing administrative duties. She did find it easier as a swimming coach where she spends the majority of her time in the pool. The buoyancy assists and she manages to cope with her daily duties. The plaintiff further testified that she has not received any treatment in the form of physiotherapy or by a chiropractor. She confirmed that this is due to the lack of funds and that her intention is to pursue a treatment regime once she received funds from her claim. The industrial psychologist noted that due to the lack of a timeframe for early retirement provided by the relevant experts, it was suggested to deal with her case by not allowing for promotions and regular movement between schools (only notch increases) and secondly applying a contingency deduction on her postmorbid earnings.

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Findings: The actuary has for illustrative purposes computed two scenarios: scenario 1 is based on a 15% differential (15% higher post-morbid contingency deduction) and scenario 2 with a 20% deduction. The primary expert reports indicate that the finding and recommendations are based largely on the probabilities and an anticipation of what the plaintiff's future condition might be. The physical demands of a teacher are of light to medium work. According to the occupational therapist, the plaintiff has a physical capacity for sedentary to light work with accommodations. Given that the plaintiff can apply for work within government, she can be accommodated, as government will not discriminate against her injury, thus she can continue working. To date, the plaintiff has not attended treatment but with rehabilitation her condition should improve. Furthermore, in relation to future promotions, it must be noted that the plaintiff will only be promoted if and when a position is available, thus there is no guarantee that she will be promoted. These factors should be taking into consideration when contingencies are applied. Contingencies of 23% should be applied to the pre-accident scenario and 34% to the post-accident scenario.

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Order: The Fund is to pay R700,000 for general damages and R2,032,088 for loss of earnings.

HEFER AJ