- Four supposed RAF settlement agreements were declared invalid as no binding compromise had been reached.
- Judge Fisher ruled that damages cannot be separated informally without court approval as required by Rule 33(4).
- The judgment has been sent to the RAF Chief Executive Officer and the Minister of Transport due to broader concerns identified in these cases.
The High Court in Johannesburg refused to make four alleged settlement agreements between the Road Accident Fund (RAF) and accident claimants orders of court, finding that no valid settlements had been concluded.
The four cases, involving QNM obo NGM, Masina Moses Solomon, Mabusela Shila Sharon, and Sellwane Lydia Malakoane, arose from motor vehicle accidents said to have taken place between 2010 and 2019. Although each case involved different facts, Judge J Fisher found they had common features, such as long delays before legal action was started, vague pleadings, faulty documentary evidence, and identical settlement arrangements presented by the same attorney and counsel.
The plaintiffs asked the court to make the supposed settlements legally binding after the RAF made "without prejudice" offers for lump sum payments based on general damages.
Even though the offers clearly stated they were full and final settlements, the plaintiffs later argued that these only dealt with general damages, leaving claims for loss of earnings and other types of damages to be decided later. Judge Fisher found there had never been an agreement between the parties.
Full and final settlement offers
Judge Fisher found that each RAF offer clearly required acceptance as a whole and stated that accepting only certain parts, such as particular heads of damages, would count as a counteroffer unless the RAF specifically agreed.
Despite signing the settlement documents, the plaintiffs' attorney later tried to argue in correspondence that the agreements settled only general damages.
Judge Fisher said, "The offers were clearly framed as full and final settlements," and noted that the plaintiffs' effort to limit the agreements to one type of damages amounted to a counteroffer, not acceptance.
The judge concluded that, since the parties did not agree on the same terms, no legally binding compromise existed.
Deficiencies in All Four Claims
Judge Fisher pointed out several issues that went beyond the settlement agreements. The claims were brought years after the alleged accidents, with accident reports that were incomplete, hard to read, or showed major inconsistencies. Injuries were described only vaguely, and medical records revealed unexplained differences.
In one case involving a child said to have been injured in 2010, no accident report was made at the time. Instead, a report was compiled only in 2018 and date-stamped in 2019, while the RAF claim was filed about 16 years after the alleged accident.
Judge Fisher also noted that hospital records referred to a 29-year-old patient, even though the claimant was a young child. Another case had conflicting accident dates, and several accident reports were incomplete in important ways.
The judge also observed there was no indication that settlements about liability had been reviewed by a judge before the parties asked the court to decide on the amounts to be paid.
Informal Separation of Damages Not Permitted
A key issue was that the parties tried to settle only general damages and postpone claims for loss of earnings and other types of damages.
Judge Fisher held that this was a separation of issues, which only a court can authorise under Uniform Rule 33(4), after deciding if it would be fair and practical. "The parties cannot, by agreement, create a separation with the legal effect of a Rule 33(4) court order," Judge Fisher said.
The judgment warns that informal separation of damages can lead to fragmented litigation, repeated evidence, higher costs, delays, and possible unfairness to those involved.
Judge Fisher also warned that courts should be alert to cases where attorneys are paid contingency fees while the rest of the litigation drags on for years.
Contingency Fee Requirements Not Met
Judge Fisher found that the RAF's own settlement conditions were not met. The offers required proof that any contingency fee agreement followed the Contingency Fees Act, including affidavits from both the attorney and the claimant if such agreements existed. Only the attorney's affidavit was filed.
Judge Fisher found that the conditions attached to the RAF's settlement offers had not been fulfilled.
Constitutional Court Principles Applied
Judge Fisher applied the Constitutional Court judgment in Eke v Parsons, which requires courts to make sure settlement agreements relate to the actual dispute, follow the law and public policy, and offer a real benefit before being made an order of court.
Judge Fisher found that the supposed RAF agreements failed these requirements because they did not end the disputes, tried to get around Rule 33(4), and provided no real procedural benefit.
Judge Fisher said, "The agreements are not true compromises as they do not bring an end to the dispute between the parties."
Judge Calls for Further Scrutiny
Judge Fisher also questioned why RAF officials agreed to court orders that were very different from the original settlement offers. The judge said it would be wise for the RAF Board to investigate whether similar orders had been sought in other cases.
Judge Fisher said, "These issues raise systemic concerns that need further investigation by the RAF."
Judgment Sent to RAF Leadership
Judge Fisher refused all four applications to make the supposed settlement agreements orders of court.
The Registrar was also told to send a copy of the judgment to the Chief Executive Officer of the RAF and the Minister of Transport, to highlight the broader significance of the issues found in these proceedings.
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