Road Accident Fund Amendments – Constitutional challenge of the ACT

The widely anticipated constitutional challenge to the Road Accident Fund Amendment Act was launched recently in the Pretoria High Court. The Law Society of South Africa, The South African Association of Personal Injury Lawyers, The Quad Para Association of South Africa and the National Council for Persons with Physical Disabilities have applied for various sections of the Road Accident Fund Amendment Act to be declared invalid because they are inconsistent with the Constitution. The Applicants also seek to set aside a number of the new regulations because they are either inconsistent with the Constitution or not authorised by the Act.

The material changes to the Act which are being challenged are:

· the abolition of a claimant’s common law right to claim any damages not recoverable from the RAF from the negligent owner or driver of the vehicle that caused the accident, or the employer of such negligent driver (Section 21 of the Act). The basis of the challenge is that this constitutes a breach of the right of road accident victims to security of the person, the right to an appropriate and effective remedy for the breaches of that right and the obligations of the State to protect, promote and fulfil those rights;

· the capping of loss of income or loss of support claims (Section 17(4)(c)) which is also alleged to be a breach of the right to security of the person.

The Regulations being challenged are:

· the right of road accident victims who have suffered serious injuries to claim compensation for general damages (regulations 3(1)(b)(ii) and (iii));

· the definition in the regulations of “serious injury” on the basis that the minister is not authorised by the Act to define a serious injury (regulation 3(1)(b));

· the prescribed method of assessment of serious injuries which, with the other regulations relating to health care, are alleged to be a breach of the right to health care in terms of Section 27 of the Constitution (regulation 3(1)(b));

· the reasonableness of the tariff for emergency and other medical care (regulation 5(2)) read with the tariff set out in Notice R.771 published by Gazette on 21 July 2008);

· the establishment of an administrative appeal tribunal whose decisions are final and binding on the basis that it deprives victims of access to court in contravention of Section 34 of the Constitution (regulations 3(4) to 3(13) inclusive).

The application, to the extent it is successful, will be referred to the Constitutional Court for confirmation.

Whilst it seems certain that the application will be opposed by the Minister of Transport, the Applicants make some telling points. For instance, they allege that the victims of road accidents in South Africa are, as a result of the amendments to the Act, in a unique position, because they are deprived of the redress which victims of crime, medical or hospital negligence, sporting injury and other accidents would have against the wrongdoer.

The Applicants draw a distinction between the rights that workers have under the Compensation for Occupational Injuries and Diseases Act, 1993 (“COIDA”) and those which the victims of road accidents have, pointing out that workers have a right to compensation on a no fault basis. Workers are also entitled to additional compensation if their employer was negligent and have the right to assert their common law right to claim damages against anyone whose negligence caused their injury except their employers with whom they stand in a “heavily regulated voluntary relationship”.

In addition, compensation for hospital and medical care under COIDA is substantially higher than the rate prescribed under the RAF Act. Injured workers are entitled to access private health care while road accident victims may only obtain hospital and medical care at a rate to be determined by the Minister and based on tariffs for health services provided by public health establishments.

The Applicants also make the point that although private “top up” cover is available there are a number of groups of victims who are unable to insure themselves such as the indigent, children and students, and those excluded from obtaining coverage because of insurance companies’ underwriting requirements. In this regard, the Applicants refer to persons with HIV, persons in high risk professions, persons who are obese and those who suffer from conditions such as diabetes and heart conditions.

The need for insurance

The application is silent about whether the order sought is retrospective or not. The retrospective declaration of the invalidity of certain sections will have important consequences for drivers and owners of vehicles as well as insurers. For example, a driver who causes an accident which results in injury is currently not at risk of a claim being brought against him. However should the application succeed with retrospective effect then the driver may be sued for damages notwithstanding that at the time of the negligence the law did not recognise a claim.

It would therefore be prudent to retain generous levels of liability insurance cover for personal injury to others until such time as the validity of the amendments is resolved.