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A judge at the Johannesburg High Court has uncovered dubious settlements from the Road Accident Fund and issued a scathing ruling. (File photo: Ashraf Hendricks)
A judge at the Johannesburg High Court has denounced what she says are dubious developments between the Road Accident Fund (RAF) and some personal injury lawyers.
First Posted by GroundUp
Judge Denise Fisher had two RAF matters on her list, but she was told they had been resolved and she did not need to worry about them.
But he smelled a rat when he saw that both claims had apparently been grossly inflated during the deal negotiations and he refused to remove the items from his list.
After conducting his own investigations, he has drawn up a 37-page judgment, condemning the lawyers and some of the medical and financial experts used to quantify the claims, and the RAF officials.
Read the judgment
His conclusion reads: “In my opinion, the fund should be liquidated or managed as a matter of urgency. This is the only way that this hemorrhage of billions of rands of public funds can be stopped and a proper and valid settlement of the plaintiffs’ claims can be made in the public interest. “
He requested that the sentence be made known to the Minister of Transportation, the head of the Traffic Accident Fund and the National Director of the Public Ministry.
It has also referred the conduct of the experts to its professional bodies and the conduct of De Broglio’s lawyers, who dealt with both matters, to the Council of Legal Practice.
The two subjects on his list were Marilyn Doris Taylor and Hlengani Victor Mathonsi.
Judge Fisher said they represented a warning to the RAF and those who trust it, as both the lawyers and the RAF had “vigorously sought to avoid court oversight of the agreements.”
“These are not isolated incidents … these cases expose defiant attempts by legal representatives to avoid judicial scrutiny of agreements entered into in circumstances that strongly suggest dishonesty and / or gross incompetence of those involved.”
He said that since May, the RAF had been trying to settle the cases rather than run trials to save costs. They also did not use any more external legal representation and, without judicial oversight, this had left the RAF system, already on the brink of collapse, even more exposed and vulnerable to misconduct and incompetence.
The Taylor case, in short, was a claim by an office manager who generally brewed tea and coffee. He earned R5,500 a month. His injuries as a result of the accident were “artificial”; there was no evidence that he had lost his job and yet a liquidation offer of more than R3 million was made.
It was only after the judge questioned this that it was lowered to R1.3 million, still “significantly inflated,” the judge said.
In the Mathansi case, the judge was also told that the matter had been settled for a total of just over R1.7 million. Again, he said, there were last-minute amendments to the claims.
Judge Fisher said that Mathansi had not lost his job due to his injury, a fractured collarbone, and yet the RAF had settled the claim for future loss of earnings in excess of R1.3 million.
The modus operandi, he said, was that relatively modest and then inflated claims were being made in the actuarial calculation where revenues were exaggerated or even fabricated. The actuarial report was being used as the basis for an unsupervised claim amendment.
“The RAF is not represented and is overwhelmed by the high volume of cases and the officials are docile. Therefore, they place undue reliance on the statements of the plaintiff’s attorneys regarding the loss.
“When it comes to general damages, low-skilled and sometimes flexible doctors are used to suggest that the injuries are more serious than they actually are.”
Judge Fisher said that while the court’s jurisdiction ended once the parties reached an agreement, the agreement had to be legal and consistent with the Constitution.
“The RAF has chosen to ignore the specific concerns of this court and instead of insisting on a court order as a precondition to the agreement, which would be the rational approach, it has chosen to accept the tactic adopted by de Broglio.
“That the RAF is conducting its business in this reckless manner under insolvency conditions is of great concern to this court.”
He said that the two cases in question had not been legally concluded and the agreements were void, but that he had no authority to interfere with them and that would have to be done under review.
While he singled out de Broglio, he said lawyers in general used similar tactics and “learned them from each other.”
“While de Broglio might believe that he has served the interests of his clients and himself by achieving settlement of excessively inflated amounts, he has in fact jeopardized them to the extent that they are unconstitutional and unenforceable. They are, in effect, useless.
“And if the payment is made, it would constitute irregular spending by the RAF and potentially make those who approve such payments vulnerable to personal scrutiny from the courts.” DM
