Mkuyana v Road Accident Fund (4000/2017) [2020] ZAECGHC 73; [2020] 3 All SA 834 (ECG); 2020 (6) SA 405 (ECG) (2 July 2020)

Mkuyana v Road Accident Fund (4000/2017) [2020] ZAECGHC 73; [2020] 3 All SA 834 (ECG); 2020 (6) SA 405 (ECG) (2 July 2020)

The court held that the contingency fee agreement between the plaintiff and her attorney was invalid and unenforceable due to non-compliance with the Contingency Fees Act. The attorney's disclosed 'normal fee' was found to be unreasonable, being significantly higher than both the existing and proposed court tariffs, and not justified by the evidence. The agreement was concluded after litigation had commenced, which undermined statutory requirements such as the client's cooling-off period and proper assessment of the claim's prospects. The court emphasized that strict compliance with the Act is required, and judicial oversight is necessary to prevent abuse and protect access to justice....

Citation
[2020] ZAECGHC 73
Parties
Plaintiff: Nowetu Mkuyana; Defendant: Road Accident Fund
Court
Eastern Cape High Court, Grahamstown
Jurisdiction
South Africa
Judgment Date
2 July 2020
Case Number
4000/2017
Procedural Posture
Civil Trial / Full Bench Judgment Following Referral of Issues Regarding Contingency Fee Agreement Validity
Outcome
Contingency fee agreement declared invalid and set aside. Attorney entitled only to reasonable attorney and own client costs, subject to taxation. Plaintiff not liable for costs occasioned by the invalid agreements or the hearing of these issues.
Judges
D Van Zyl, G H Bloem, A Rawjee
Legal Topics
Contingency Fee Agreements, Attorney and Own Client Costs, Reasonableness of Fees, Judicial Oversight of Fee Agreements, Access to Justice
Civil Procedure Commercial and Corporate Contingency Fee Agreements Attorney and Own Client Costs Reasonableness of Fees Judicial Oversight of Fee Agreements Access to Justice

Case Brief

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Parties

Nowetu Mkuyana

Plaintiff

Road Accident Fund

Defendant

Procedural Posture

Civil Trial / Full Bench Judgment Following Referral of Issues Regarding Contingency Fee Agreement Validity

Legal Issues

  1. 1 Whether the contingency fee agreement between the plaintiff and her attorney complies with the Contingency Fees Act and is valid.
  2. 2 Whether the attorney's disclosed 'normal fee' is reasonable as required by the Act.
  3. 3 Whether a contingency fee agreement concluded after litigation has commenced is compliant with statutory requirements.

Ratio Decidendi

The court held that the contingency fee agreement between the plaintiff and her attorney was invalid and unenforceable due to non-compliance with the Contingency Fees Act. The attorney's disclosed 'normal fee' was found to be unreasonable, being significantly higher than both the existing and proposed court tariffs, and not justified by the evidence. The agreement was concluded after litigation had commenced, which undermined statutory requirements such as the client's cooling-off period and proper assessment of the claim's prospects. The court emphasized that strict compliance with the Act is required, and judicial oversight is necessary to prevent abuse and protect access to justice....

Court Disposition

Contingency fee agreement declared invalid and set aside. Attorney entitled only to reasonable attorney and own client costs, subject to taxation. Plaintiff not liable for costs occasioned by the invalid agreements or the hearing of these issues.

Orders

  • The contingency fee agreement between the plaintiff and Antonio de Sousa of A C de Sousa Attorneys concluded on 30 August 2018 is declared invalid and set aside.
  • The plaintiff's attorney may recover from the plaintiff only taxed attorney and own client costs on the high court scale, excluding any costs occasioned by the entering into of both contingency fee agreements and the hearing of this matter on 9 March 2020.