Category Archives: Road Accident Fund

WHO IS LIABLE FOR THE DAMAGES IN A CAR ACCIDENT?

a4_bWhat will happen to my vehicle after I have been involved in a motor vehicle accident and who will be responsible for the damages? Over and above the emotional and economical tension it causes a person and his/her family, there will always be legal principles that apply.

What does the law say?

The most prominent legal field that will apply when a person is involved in a motor vehicle accident is the law of delict. The law of delict will play an important role in determining who will be liable for the damages, if any. If the damages were caused due to the intentional or negligent conduct or omission of somebody else (the third party), the third party would be liable for the damages the car owner suffered. The third party is, however, not without a few defences, but that falls outside the scope of this article.

Litigation

An important legal doctrine to be observed in litigation is the doctrine of subrogation as it applies in the law of indemnity insurance. It is an accepted principle of indemnity insurance law that when an insurer fully indemnifies an insured party in the case of loss caused by a third party, the insurer has a claim against the third party in the name of the insured. The policy behind this doctrine is to prevent the insured party from receiving double compensation from both the insurer and the third party.

Insurance claims

From a procedural point of view, the insurer obtains the right to institute legal proceedings against the third party in the name of the insured party if the insured party still has an unsatisfied claim against the third party. This principle allows the insurer to become dominus litis (master in the proceeding), but only in name and on behalf of the insured party. The insurer becomes entitled to conduct the proceedings in the name of the insured party, provided that the insurer has fully indemnified the insured party and has also indemnified the insured party against the risk of legal costs which may arise from the proceedings. The insurer has no independent claim against the third party, but simply enforces the claim of the insured party for the insurer’s own benefit.

Conclusion

In summary, the car owner will be able to hold the third party liable irrespective if he/she has insurance or not. If the car owner has insurance they will be able to claim the damages from the insurance. If he/she does, the insurance will be able to recover the loss in the name of the insurer from the third party. The relationship between the insured and the insurance is a contractual relationship and if any party fails to perform in accordance with the agreement, that party will be liable for breach of contract.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

CONSIDER YOUR CLAIM CAREFULLY: SOME OF THE NEED TO KNOW FACTS IN THE EVENT OF A THIRD PARTY CLAIM AGAINST THE RAF (ROAD ACCIDENT FUND)

A2_bThe Road Accident Fund (hereinafter referred to as the RAF) has over the years created the assurance that public road users will be covered in the event of any motor vehicle accident which caused either injuries or death, and for the losses suffered thereby, such as medical expenses, loss of earnings and even general damages (damages for pain and suffering).

Before the Road Accident Fund Amendment Act 19 of 2005, which came into operation on 1 August 2008, this had the effect of any person simply being able to institute a claim against the RAF in any event of an accident which amounted to damages suffered as a result of injury or death, or even a claim based on pain and suffering. This sounded simple enough, that is until the Road Accident Fund Amendment Act 19 of 2005 came into operation, placing two very important limitations on claims from the RAF.

The first limitation relates to claiming from the RAF and/or the wrongdoer. In respect of the old Road Accident Fund Act 56 of 1996, the victim who had a limited claim against the RAF, still had a common law claim against the wrongdoer in respect of the excess amount not compensated for by the RAF. This meant that should the road accident victim only be compensated by the RAF for a portion of the damages suffered during the accident, the remaining portion could still be claimed from the wrongdoer in his personal capacity. For example, if victim X suffered damages in the amount of R200 000 and the RAF only compensated the victim in the amount of R150 000, the remaining R50 000 could still be recovered from the wrongdoer in person. This would have the effect of two separate claims. However, should the victim have received full compensation in terms of Section 17 of Act 56 of 1996 for the amount of R200 000, such victim would not have another claim against the wrongdoer.

In terms of the new Road Accident Fund Amendment Act this common law right has been abolished by the institution of Section 21 of the Road Accident Fund Amendment Act. The victim will currently only be able to claim/recover losses or damages suffered as a result of a motor vehicle accident from the RAF. There can be no more separate claims in respect of one cause of action.

The second important amendment is a part of Section 21 which places a cap on the amount of loss of earnings claimed and the amount of general damages claimed, i.e. damages claimed for pain and suffering.

With regard to the capped amount allowed to claim for loss of earnings, a victim is only allowed to claim damages up to the amount of R160 000, but this amount changes quarterly according to the fluctuation in interest rates and currently it stands at R201 337 per annum as from October 2012. Should the victim earn a salary of more than the said amount per annum, he or she will be unable to institute such a claim against the RAF. / Should the victim earn a salary of more than the said amount per annum, his or her claim will be limited to the amount dictated by the Law.

Furthermore, with regard to a claim for damages based on injuries suffered, the claim will only succeed if the victim can prove that he/she has suffered “serious injuries” as defined in the Act. This would amount to injuries sustained which has ultimately rendered such victim at least 30% disabled in his or her everyday life. This limitation does not take into consideration any personal circumstances. Similarly, no common law right exists to institute a second claim against the wrongdoer in the event of failure against the RAF.

Also important to remember is the fact that when consideration is given to medical expenses suffered, the amount is calculated according to the rate charged at a public level (public hospital rates) and not at a private level (private hospital rates).

In conclusion, it is important to remember that the RAF takes over the liability of the wrongdoer in such accidents, meaning that actions must be instituted against the RAF and not the wrongdoer in the first instance. The exception is where the RAF is unable to pay compensation or where emotional shock is suffered. In such a case, the action may be instituted against the wrongdoer in person. Any action instituted against the RAF is a time-consuming process and requires due consideration before proceeding. Section 21 of the Road Accident Fund Amendment Act has definitely placed limitations on claims that need to be borne in mind.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)