Road Accident fund Judgement- Kontos v General Accident Insurance Co SA Ltd1989 (Part 4)

Road Accident Fund Judgement part 4

The parties were ad idem that in view of the facts of this case and in view of the short period over which the past and future loss of income are to be calculated the same percentage deduction should be made in respect of both types of loss of income. I agree with that approach.

The certificate in terms of s 21(1C)(a) and (b) of Act 56 of 1972, referred to above, states that it covers inter alia the cost of future accommodation of the plaintiff in a hospital or a nursing home, or treatment of, or the rendering of a service or supplying goods to him. Both parties were ad idem that, in view of the plaintiff’s particular circumstances (ie that he need not and cannot keep a place of abode separate from the hospital; that he need not provide entirely for his own food; that he need not pay certain other expenses in respect of a house or flat, etcetera), a contingency deduction somewhat higher than what would have been deducted under normal circumstances should be deducted in this case. On behalf of the plaintiff it was submitted that a deduction of 33? per cent should be made, whilst on behalf of the defendant a deduction even as high as 60 per cent was suggested.

A deduction (or even an increase) for contingencies is made to a figure arrived at by way of an annuity calculation to bring it in line with the general equities of the case.

As it was stated in Hulley v Cox1923 AD 234 at 245:

The amount of it should be estimated on an equitable basis on a consideration of all the circumstances.The factors and contingencies for which normal adjustments are made are inter alia —

(a) the possibility of errors in the estimation of the plaintiff’s life expectation and his retiring age;

(b) the likelihood of illness and unemployment which would have occurred in any event or which may in fact occur;

(c) inflation or deflation of the value of money in the future;

(d) alterations in cost of living allowances;

(e) the cost of transport to and from work and pension contributions;

(f) accidents or other contingencies which would have affected his earning capacity in anyevent, etc.

See Corbett and Buchanan, The Quantum of Damages in Bodily and Fatal Injury Cases (Part I), third edition, p 66 et seq.

The present matter is not one in which adjustments should be made only for the “normal” factors and contingencies. If only “normal” factors and contingencies were to be taken into account I would have made but only a small adjustment, particularly in view of the fact that a relatively short period of time is involved. In the words of Corbett and Buchanan, op cit p 72, this is the type of case which calls for an orthodox treatment. The same line of approach was followed in Roberts NO v Northern  Assurance Ltd1964 (4) SA 531 (D) at 537B-H (1964 (1A4) QOD 573 (D) at p 579) where BURNS J said the following:

The conclusion to which I have come is that I should award one lump sum to cover all aspects of the claim for general damages. I consider it wholly inappropriate, in the circumstances of the present case, to endeavour to put a separate money value on the claim for loss of future earnings along the lines suggested my Mr Broome. In the main, I have two reasons for this view. The first is that I consider it fallacious to say, on the facts of this case, that David’s patrimonial loss, in respect of the money which he would have earned, is the gross present-day value of such money. Nor do I think the fallacy is removed by the notion that deductions for contingencies should be made. In the case of the ordinary working man, who has settled employment and who is faced with the normal expenditure that goes with life, it is, I think, logical to say, that if he is prevented by injuries which he has received from earning money which he would otherwise have earned, he has suffered patrimonial loss in the sum total of his lost earnings. And, even if the injuries are such that he will be prevented for a long time, even perhaps for years, from earning money, the court does not, as a rule, have any difficulty in regarding his loss of earnings, subject to suitable deductions, as a direct patrimonial loss. But, in such cases, the man’s normal expenditure continues during the time he is prevented from earning money, and it is only just that the person who has caused the injuries should (subject to appropriate deductions for contingencies) be responsible for the loss of earnings. The present case, however, is totally different from the normal case. Indeed, there seems to be no comparable case to be found in the law reports of this country.

For the present, I leave out of account the fact that, at the time of the accident, David had no settled employment and was still at school. But, apart from that, the case is unique in the respect that the very injuries which have prevented David from earning money, have also had the result that it will never be necessary for him to attempt to earn any. His life will continue without any need for the expenditure of money on any of the normal items which fact the ordinary man, except the few items mentioned by Dr Patterson.

Continue to part 5—>

Comments are closed.