Hendry v Road Accident Fund
| Jurisdiction | http://justis.com/jurisdiction/166,South Africa |
| Judge | Roelofse AJ |
| Judgment Date | 26 January 2023 |
| Citation | 2023 JDR 0373 (MN) |
| Docket Number | 856/2020 |
| Hearing Date | 23 January 2023 |
| Court | Mpumalanga Division (Main Seat) |
Roelofse AJ:
Introduction
Fortunately, in our country, the doors of court are wide open to everyone for in terms of section 34 of the Constitution of the Republic of South Africa, 1996 'Everyone has the right to have any dispute that can be resolved by the application of law decided in a fair public hearing before a court or, where appropriate, another independent and impartial tribunal or forum'. This, every person should know by now. However, what is sometimes overlooked by litigants and those who are involved in the administration of justice is that the right of access to courts encompasses the entire judicial process – from the time a litigant enters the court's doors by issuing a proceeding up to when a litigant exits the court because the litigation is finalized or resolved.
This judgment concerns the process after entering the courts' doors, what happens in court and the ultimate exit from court.
Due to the insistence in this Division on strict compliance with the Rules and Directives in respect of pre-trial and judicial case management procedures, many actions founded upon compensation for personal injuries become settled in its entirety before they reach their trial date. This is all the more so with actions against
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the Road Accident Fund. As recently as 24 January 2023, Legodi JP (Mphahlele DJP and Mashile J concurring), writing for the Full Court, said the following over pre-trial and judicial case management: [2]
In paragraph [1] and [2] of this judgment I referred to the weapon which the courts have in the form of costs orders when rules of court are not complied with in particular, rules 37(6) and rule 37A(10) read with sub-rules 7(d)(ii), (8) and (9). All these sub-rules deal with what I refer to as a "meaningful pre-trial conferences" between the parties. This must happen before judicial case management conferences are held. As indicated earlier in this judgment, sub-rule(2)(c) of rule 37A places an obligation on the parties or parties' legal representatives to prepare properly, comply with all rules of court and to act professionally in expediting the matter towards trial and adjudication. This should be seen in the context of rule 37A(2)(a) which provides that case management through judicial intervention shall be used in the interest of justice to alleviate congested trial rolls and to address the problems which cause delays in the finalisation of cases. In this Division all matters on any roll are subject to judicial case management process in terms of rule 37A (4) read with sub-rule (1)(a) and (b) thereof. The two cases before us are therefore subject to judicial case management process. A meaningful pre-trial conference has a two-fold purposes. The primary aim is to assist towards the resolution of disputes without recourse to protracted trials. The parties are given the benefit and an opportunity of resolving or curtailing the issues between themselves before trial and without the involvement of the court. The costs of litigation related to such pre-trial conferences between the parties are very minimal. A meaningful pre-trial conference is intended to enable the parties to explore settlement, to identify and limit issues and also to seriously consider settlement through voluntary mediation the latter of which is regrettably not taken seriously despite rules 41A and 37(6)(d) read with rule 37A(11)(a).'
Personal injury litigation is almost always undertaken by legal practitioners on a contingency basis. Under these circumstances, the Contingency Fees Act 66 of 1997 (the Act) applies. Litigation undertaken by legal practitioners on contingency basis has vast advantages as it provides access to the court for persons who wish to vindicate their rights who might otherwise not have been able to do so. In
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Mfengwana v Road Accident Fund [3] Plasket J (as he then was) said over the Act as follows:
The Act was promulgated to facilitate access to court – a fundamental right – for the large number of people in this country who cannot afford the considerable cost of legal services. Typically many of those who are injured in motor vehicle accidents enter into contingency fee agreements with attorneys in damages claims against the RAF.
The basic idea behind a contingency fee agreement is that the attorney takes on the risk of financing his or her client's litigation in the hope – or anticipation – of succeeding. If the litigation is not successful, the attorney will not be paid. If the litigation is successful, the attorney will be entitled to a success fee that is higher than his or her normal fee.
The context and background of the Act was considered in Price Waterhouse Coopers Incorporated and others v National Potato Co-operative Ltd2 in which Southwood AJA stated:
"The Contingency Fees Act 66 of 1997 (which came into operation on 23 April 1999) provides for two forms of contingency fee agreements which attorneys and advocates may enter into with their clients. The first, is a 'no win, no fees' agreement (s 2(1)(a)) and the second is an agreement in terms of which the legal practitioner is entitled to fees higher than the normal fee if the client is successful (s 2(1)(b)). The second type of agreement is subject to limitations. Higher fees may not exceed the normal fees of the legal practitioner by more than 100% and in the case of claims sounding in money this fee may not exceed 25% of the total amount awarded or any amount obtained by the client in consequence of the proceedings, excluding costs (s 2(2)). The Act has detailed requirements for the agreement (s 3), the procedure to be followed when a matter is settled (s 4) and gives the client a right of review (s 5). The professional controlling bodies may make rules which they deem necessary to give effect to the Act (s 6) and the Minister of Justice may make regulations for implementing and monitoring the provisions of the Act (s 7). The clear intention is that contingency fees be carefully controlled. The Act was enacted to legitimise contingency fee agreements between legal practitioners and their clients which would otherwise be prohibited by the common law. Any contingency fee agreement between such parties which is not covered by the Act is therefore illegal. What is of significance, however, is that by permitting 'no win, no fees' agreements the Legislature has made speculative litigation possible. And by
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permitting increased fee agreements the Legislature has made it possible for legal practitioners to receive part of the proceeds of the action."'
Yet, contingency litigation has shown to be open to abuse if same is not regulated and closely monitored. In Mfengwana supra Plasket J was requested to make a settlement agreement between the plaintiff and the Road Accident Fund an order of court. The court discovered that the plaintiff had entered into a contingency fee agreement with the attorney and held that the attorney had to pursue the contingency fee agreement through the Act and file the affidavits required by the Act. [4] The court found that the contingency fees agreement appeared to be in conflict with the Act. Ultimately, the court issued an order safeguarding the interests of the plaintiff.
In Kedibone obo MK and another v Road Accident Fund and another as amicus curiae and a related matter [5] , the importance of proper judicial oversight was emphasized. In the matter, moneys were paid to the attorney by the Road Accident Fund before the settlement agreements were made orders of court. Fisher J set out as follows: [6]
'The entire RAF system is underpinned by the legislative scheme in the CFA [the Act]. The purpose of CF [contingency fees] agreements is to enable litigants to obtain legal representation to prosecute their claims where such litigant is otherwise unable to do so by reason of the prohibitive cost of litigation. CF agreements thus provide the entire substructure for the many thousands of actions instituted against the RAF in our courts annually. Indeed these matters comprise approximately 90% of all legal process in this and
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many other divisions of the High Court and thus the contingency fee process is foundational to our system of justice. Its importance cannot be overemphasised.
CF agreements are strictly controlled in terms of the CFA. Prior to the CFA coming into force, contingency fee agreements were prohibited for being contra bonos mores. The intention of the CFA is thus to encourage speculative litigation in order to allow for access to legal representation. However, due to the high risk of abuse and corruption attendant on contingency fee agreements, the Legislature has placed tight strictures and requirements on such agreements. Thus a CF agreement that is not covered by the CFA, or which does not comply with its requirements, is invalid. (Endnote omitted).
In respect of a claim by minor dependants, which in my view equally apply to all plaintiffs in Road Accident Fund matters, Fisher J said:
'It seems to me that, in each instance, where an order is sought under these circumstances, the judge called upon to approve the settlement must deal with each matter in accordance with its own peculiar facts. In all instances, a court should satisfy itself that the rights of the dependants are properly taken account of by the order which is granted ultimately granted.[sic] This would, to my mind, involve a consideration of the issues set out in this judgment in relation to the contents of the section 4(1) affidavit and thus it would be prudent in each case to insist on the filing of such an affidavit.' (Footnotes omitted)
I have decided to produce this single judgment in respect of all of the matters that were placed before me in terms of Clause 15 of this...
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