Road Accident Fund v Ehlers Attorneys and Others (32968/21) [2021] ZAGPPHC 562 (1 September 2021)

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

CASE NUMBER: 32968/21

DATE: 1 September 2021

THE ROAD ACCIDENT FUND

Applicant

V

EHLERS ATTORNEYS

First Respondent

THE LEGAL PRACTICE COUNCIL

Second Respondent

THE SHERIFF PRETORIA EAST

Third Respondent

ABSA BANK LIMITED

Fourth Respondent

JUDGMENT

MABUSE J

[1] The Applicant applies for leave to appeal to either the full court of this Division or the Supreme Court of Appeal (“the SCA”) against the whole judgment and orders granted on 28 July 2021. On the said date, the Court dismissed with costs the Applicant’s application and ordered it to pay the costs of two counsel.

[2] The Applicant had approached the Court on an urgent basis for the relief that it sought.

[3] The application was predicated on the unsubstantiated allegations made by a certain Mr Collins Phutjane Letsoalo (“Mr Letsoalo”), the Applicant’s Chief Executive Officer.

[4] The Applicant, being disgruntled by the order the Court made in the written judgment on 28 July 2021, wants, on grounds fully set out in its application for leave to appeal, to appeal against the said order. I do not intend repeating those grounds of appeal in this judgment by reason of the fact that the application for leave to appeal constitutes part of these appeal papers.

[5] The first question that falls to be considered is that of the criterion or test to be adopted in an application such as the present. For the purposes of this application, the test is as set out in s 17(1)(a)(i) and (ii) of the Superior Court Act 10 of 2013 (“the Superior Court Act”). This section prescribes that:

“17(1) Leave to appeal may only be given where the judge or judges concerned are of the opinion that –

(a) (i) the appeal would have reasonable prospects of success; or

(ii) there is some other compelling reason why the appeal should be heard, including conflicting judgments on the matter under consideration.”

[6] The enquiry as to whether leave should be granted is twofold. A Court that adjudicates an application for leave to appeal under section 17(1)(a)(i) and (ii) will investigate firstly, whether there are any reasonable prospects that another Court seized with the same set of facts will reach a different conclusion. Should the answer be in the positive, the Court should grant the application for leave to appeal, but should the answer be in the negative, the next step in the enquiry is to determine whether there are any compelling reasons why the appeal should also be heard.

[7] Section 17(1) sets out a fixed threshold to grant leave to appeal. Accordingly, the Applicant must of necessity meet these stringent thresholds set out in s 17 of the Superior Court’s Act in order to be successful with this application for leave to appeal. This threshold is, under the Superior Courts Act, even more stringent than it was under the old Supreme Court Act 59 of 1959. A demonstration of the stringent threshold can be seen in S v Notshokove & Another [2016] ZA SCA 112 par 2 [7 September 2016], where Shongwe JA, as he then was, writing for the Courts, stated as follows:

“An applicant, on the other hand, faces a higher and stringent threshold in terms of the Act, compared to the provisions of the repealed

Supreme Court Act 59 of 1959.”

Section 17(1) uses the words “may only be given” and thereafter sets out the circumstances under which a Judge or Judges seized with an application for leave to appeal may grant the application. In South African Breweries (Pty) Ltd v the Commissioner of the South African Revenue Services (SARS) 2017 (2) GPPHC 340 (28 March 2017), par 5, Hughes J, had the following to say about the applicable test:

“The test which was applied previously in applications of this nature was whether there were reasonable prospects that another Court may come to a different conclusion. See Commissioner of Inland Revenue v Tuck 1989 (4) SA 888 (T) at 899. What emerges from section 17(1) is that the threshold to grant a party leave to appeal has been raised. It is now only granted in the circumstances set out and decided from the word “only” in the said section.”

See The Mont Chevaux Trust v Tina Goosen & 18 Others 2014 JDR 2335 (LCC) at par [6]. Bertelsmann J held as follows:

“It is clear that the threshold for granting leave to appeal against a judgment of a High Court has been raised in the new act. The former test whether leave to appeal should be granted was a reasonable prospect that another Court might come to a different

conclusion. See Van Heerden v Cronwright & Others 1985 (2) SA 342 (T) at 342H. The use of the word “would” in the new statutes indicates a measure of certainty that another Court

will differ from the Court whose judgment is sought to be appealed against.”

[8] Apropos the rigidity of the threshold, Plasket AJA, as he then was, wrote in the judgment in which Cloete JA and Maya JA, as she then was, concurred in S v Smith 2012 (1) SACR 567, 570 par 7:

“What the test of reasonable prospects of success postulates is a dispassionate decision, based on facts and the law that the Court of Appeal could reasonably arrive at the conclusion different to that of the Trial Court. In order to succeed, therefore, the appellant must convince this Court on proper grounds that he has prospects of success on appeal and that those prospects are not remote, but have a realistic chance of succeeding. More is required to be established than that there is a mere possibility of success; that the case is arguable on appeal or that the case cannot be categorised as hopeless. There must, in other words, be a sound, rational basis for the conclusion that there are prospects of success on appeal.”

[9] I deal with the applicant’s grounds of appeal singly.

9.1 Ground 2.1

The Applicant refuses to pay or deposit funds into the trust account of the Respondents simply because of some alleged impropriety. It is correct that this allegation that the trust account of the Respondent has some impropriety is baseless for the following

reasons:

9.1.1 there are no objective facts based on which such an allegation is made;

9.1.2 there is no evidence by Mr Letsoalo and through the bank statements of the Respondent or the books of accounts of the First Respondent from which he has been able to establish the impropriety of the First Respondent’s trust account;

9.1.3 he makes a bear allegation, based on hearsay, that there is impropriety in the trust account of the First Respondent. What that impropriety is, is not explained. There was no verifying affidavit by any other person to support his allegation;

9.1.4

this allegation only arose after the Respondents had given instructions to the Sheriff of the Court to execute the writs of execution. Even the instructions by the First Respondent to the Sheriff to execute the First Respondent’s writs of execution were given only after the Applicant had failed to comply with the Court order 45(b) and (c) of the Full Court, in which the Applicant had been given an opportunity by the Court until 30 April 2021 to pay all the claims that were older than 180 days;

9.1.5

there is no report from the Fourth Respondent about the impropriety of the trust account of the First Respondent as made by Mr Letsoalo. Mr Letsoalo did not rely on such a report;

9.1.6

there is no adverse or any report for that matter from the Second Respondent that there was impropriety with the trust account of the Second Respondent. Mr Letsoalo did not seem to rely on such a report;

9.1.7

there is no evidence by Mr Letsoalo that he received a report from any of the clients of the First Respondent that there was any impropriety with the trust account of the First Respondent;

9.1.8

there is no evidence by Mr Letsoalo that, because of the impropriety in the trust account of the First Respondent, the Applicant has approached the Second Respondent or this Court for an order interdicting the First Respondent from operating its trust account. Based on the aforegoing observations, in my view, no other Court will arrive at the conclusion that Mr Letsoalo’s evidence was based on any objective facts.

9.2 Ground 2.2

It is correct that the decision to suspend payments to the First Respondent’s trust account was taken irrationally, unlawfully

and unfairly and without merit. That observation is anchored on the following observations:

9.2.1 Mr Letsoalo has made general allegations without in any way implicating the First Respondent in the commission of any offence, whether in its practice or regarding its trust account;

9.2.2

these allegations are based on unsubstantiated hearsay evidence;

9.2.3

there is no corroboration for any of the allegations he has made in the founding affidavit;

9.2.4

the First Respondent was never informed that they were under any investigations nor were they told that their trust account was suspected of any impropriety;

9.2.5

the First Respondent was never furnished with the details of any such impropriety and requested to comment. This is against the principle of audi alteram partem;

9.2.6

the First Respondent was never informed that the Applicant contemplated withholding depositing funds into their trust account and were never requested to give reasons why the Applicant should not stop depositing funds into their trust account;

9.2.7

the First Respondent was never requested to withhold any further fire as the Applicant wanted to preserve its funds or assets or that it needed time to make payments in terms of the court order;

9.2.8

there is an obligation imposed by the Road Accident Fund Act 56 of 1996 (“RAFA”), s 17 thereof, on the Applicant to compensate any person for any loss or damage which a third party has suffered as a result of any bodily injury to himself or herself or the death of or any bodily injury to any person caused by or arising from the driving of motor vehicles by any persons at any place within the Republic if the injury or death is due to the negligence or other wrongful act of the driver or the owner of the motor vehicle or his or her employee in the execution of the employee’s duties. The people whose claims the Applicant refuses to pay are such people. They sustained the injuries as a result of the driving of the motor vehicles in the public roads of the Republic of South Africa. The Applicant withholds the funds that are meant to compensate these people. The Applicant refuses to pay them. Failure to comply with this duty is unlawful. It is also a violation of s 34 of the Constitution of the Republic of South Africa Act 108 of 1996 (“the Constitution”), which states that:

“Everyone has the right to have any dispute that can be resolved by the application of the law decided in a fair public hearing before a Court of law or where appropriate, another independent and impartial tribunal or forum.”

In this case the Applicant adopted a self-help method by unilaterally taking a decision not to pay the First Respondent without an order of Court or independent or impartial tribunal or forum.

[10] Ground 3.3

This point was never raised in the original application nor was it raised in counsel’s heads of argument. It was therefore never argued. It was further argued by Adv Grobler SC that the Oudekraal case is not applicable in this matter.

[11] Ground 2.4

There is no merit in this ground, unless it is the Applicant’s case, which is not, that executing a court order by way of a writ of execution is unlawful. Again the First Respondent were never informed about the investigations of the SAPS until the letter from the Applicant’s attorneys dated 29 June 2021. There was no explanation why it was not sent before 29 June 2021.

[12] Ground 2.5

It was never the Applicant’s case that before the First Respondent gave orders to the sheriff to execute its writs of execution, it was informed that:

12.1 a decision had been taken not to pay its claims;

12.2 that the First Respondent’s trust account was suspended for impropriety;

12.3 but one thing is certain, the Applicant had failed to comply with the order of the Full Court and had failed to give any reasons why the First Respondent’s claims that were older than 180 days were not paid in accordance with the court order, while there were no allegations of fraud against the First Respondent.

[13] Ground 2.6

Again allegations of inflated bills of costs are baseless. It is not Mr Letsoalo’s evidence that he went through these bills of costs and found that they were indeed inflated as he alleges. There is no evidence that he relied on a report by any person. There is also no evidence that he approached any of the taxing masters in those bills of cost and received a report of inflation in the bills of costs. He has placed no evidence before this Court that any of the taxing masters had observed that the costs consultants who taxed the bills of costs had inflated such bills of costs. He also relies on no report by any of the cost consultants. For that reason, these allegations are based on unsubstantiated hearsay evidence. They have not been proved.

[14] Ground 2.7

There is no denying the fact that the Applicant’s preparedness and submission to pay the First Respondent’s clients directly amounts to the Direct Pay System (“DPS”). It is not correct that the DPS is manifestly distinguishable. The Applicant has failed to show the distinctions in the two systems he alleges.

[15] Ground 2.8

Payment of the claim that have been awarded by the Courts will never amount to unlawful payments.

Paragraph 3

[16] Grounds 3.1; 3.2; 3.3 and 3.5

16.1 It was never the First Respondent’s case that the Applicant has no right to stipulate the terms and conditions upon which claims for compensation shall be administered as set out in the Road Accident Fund Act. This is not the point. The point is whether the First Respondent is not entitled to give effect to the Court orders. What precisely prevented the First Respondent from executing upon unpaid and outstanding claims or awards which were outstanding for

over 180 days?

16.2 In many respects the Applicant had not complied with the order of the Full Court in respect of the First Respondent.

[17] Ground 3.4

17.1 The Applicant contends that I failed to give regard to her ladyship Madam Fisher, Collis J, and the honourable Justice Basson’s judgments.

17.2 The Applicant has not direct my attention to any specific aspects in those three judgments. They have not pointed out to me how those judgments could have influenced me. Having read all the three judgments, it is my respectful view, that they are not relevant to the current matter.

[18] On the aforegoing grounds, I was urged by Adv R Schoeman to grant leave to appeal. He argued that the appeal would have reasonable prospects of success and that there are compelling reasons why leave to appeal should be granted. I disagree with him. The Applicant has not satisfied the stringent threshold that is in s 17(1)(a)(i) and (ii) of the Superior Courts Act nor has he satisfied the requirements of S v Smith and Another supra. The contention of Mr Schoeman that the appeal would have a reasonable prospect of success is not based on the facts and the law. There is therefore no basis upon which the Full Court of this Division or the Supreme Court of Appeal could reasonably arrive at a conclusion different to what I arrived at. The Applicant had failed, in my view, to convince this Court that on the grounds it has raised against the judgment in the main application, the appeal would have reasonable prospects of success.

[19] I agree with Adv Grobler SC that the Applicant has fallen short of satisfying the requirements of the tests set out in s 17(1) of the Superior Courts Act.

[20] For record purposes “Full Court” in this judgment refers to the judgment in matter 58145/2020. This was a matter heard by my brothers Meyer, Adams and Van der Westhuizen JJ. It was a matter between the Road Accident Fund, as the Applicant on one side and Legal Practice Council and 22 Others on the other side.

[21] The order that the Court made at the end read as follows:

“[45] In the result the following order is made:

(a) The temporary order made by the full court of this Division on 9 December 2020, and extended by this court on 16 March 2021, is discharged.

(b) All writs of execution and attachments against the applicant based on court orders already granted or settlements already reached in terms of the Road Accident Fund Act 56 of 1996 (the RAF Act) are suspended until 30 April 2021.

(c) The applicant is to pay all claims based on court orders already granted or settlements already reached in terms of the RAF Act, which are older than 180 days as from the date of the court order or date of the settlement reached, on or before 30 April 2021, provided that the applicant has been notified by any attorneys who represent claimants that have such claims that are older than 180 days of the existence of such claims in accordance with paragraph 3 of this court’s order made on 16 March 2021.

(d) All writs of execution and warrants of attachment against the applicant based on court orders already granted or settlements already reached in terms of the RAF Act, which are not older than 180 days as from the date of the court order or date of the settlement reached, are suspended from 1 May 2021 until 12 September 2021.

(e) The applicant is to take all reasonable steps to:

(i) register court orders or settlement agreements for claims instituted in terms of the RAF Act against the applicant, on its list of payments in order of date that the court order was granted or the date of the settlement agreement;

(ii) ensure that court orders or written settlement agreements for claims in terms of the RAF Act for payment are registered on the applicant’s payment list within 30 business days of receipt of the court order or settlement agreement;

(iii) ensure that court orders or settlement agreements for claims as set out above that have not been captured on its payment list will be captured in historical chronological order from the date that the court order was granted by the court or the written settlement agreement was entered into;

(iv) provide all attorneys on its database of email addresses of attorneys involved in third-party matters against the Road Accident Fund with updated payment lists on a bi-monthly basis from April 2021 onwards.

(f) The Applicant is to continue with its process of making payment of the oldest claims first by date of court order or date of written settlement agreement a priore tempore.

(g) Any party may approach the court during September 2021 to vary, extend or amend this order.

(h) This order and the order made by this court on 16 March 2021 shall forthwith be published by the applicant:

(i) to all practicing attorneys through the Legal Practice Council;

(ii) by email to all the applicant’s list of attorneys on its database;

(iii) to the Minister of Transport and the Minister of Finance by service on the State Attorney;

(iv) by publication in two national newspapers.

(i) No order is made in respect of each counter application, except that the applicant is to pay the costs of each counter application.

(j) The applicant is to pay the costs of each opposing respondent’s opposition of the application, including all reserved costs and the costs of two counsel, one of whom a senior counsel, whenever so employed.”

[22] I have considered all the contentions urged in support of the contention that another Court might take a different view. I considered that there is no sufficient prospect on appeal nor is there any reason why the appeal should be heard. The application for leave to appeal against the judgment should accordingly fail. I therefore make the following order:

The application for leave to appeal is hereby refused, with costs, which costs shall include the costs of two counsel.

PM MABUSE

JUDGE OF THE HIGH COURT

Appearances:

Counsel for the Applicant: Adv R Schoeman

Adv P Motsie

Instructed by:

Malatji & Co Attorneys

Counsel for the First Respondent: Adv F Grobler (SC)

Adv J Bam

Instructed by:

VZLR Attorneys

Dates heard:

26 August 2021

Date of Judgment:

1 September 2021