RAF Discovers Rough Times Ahead

Published Date: 11/08/2023
Source: By Anika de Kock, Norton Rose Fulbright

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This blog was co-authored by Hannah Howell, Candidate Attorney.

On 12 August 2022, the Road Accident Fund, in a presumed bid to extricate itself from its ever-expanding pothole of debt, issued a directive instructing its staff to reject any claims made for past medical expenses if a medical aid scheme had already paid for them. This meant that where a claimant was a medical aid scheme claiming on behalf of its members, the claim would be rejected by the Fund. The reasoning for this directive was that “the claimant has not sustained any loss or incurred any expense in respect of the past medical expenses claimed and there is therefore no duty on the RAF to reimburse the claimant”.

On 27 October 2022 the Pretoria High Court found this directive to be unlawful, following an urgent application brought by Discovery Health (Pty) Ltd. Pivotal in the court’s ruling, was Section 17 of the Road Accident Fund Act of 1996, the legislation within which the RAF must operate. This section states that the Fund:

 “[S]hall be obliged to compensate any person (the third party) for any loss or damage which the third party has suffered as a result of any bodily injury to himself or herself or the death of or any bodily injury or death is due to the negligence or other wrongful act of the driver or of the owner of the motor vehicle…”

The court emphasised that the purpose of the Act is to provide maximum protection to persons who suffer loss or damage because of the negligent driving or unlawful conduct in the driving of a motor vehicle by the driver. The court found that the RAF was not entitled to unburden itself from its clear statutory obligation to pay full compensation to victims of motor vehicle accidents, despite the fact that a medical aid scheme is claiming on behalf of its members. A medical aid scheme claiming from the RAF through their members via subrogation is therefore an irrelevant consideration for the RAF.

What followed was an unsuccessful spate of appeals by the RAF against the court’s decision, culminating in its application for leave to appeal to the Constitutional Court, which was refused with costs on 18 October 2023. The Constitutional Court found that the RAF’s appeal did not fall within its jurisdiction.

The RAF claims that the Constitutional Court did not engage with the merits of the case, and instead came to their decision on a mere technicality. Further, the RAF has communicated that it amended its directive on 12 April 2023 so as to only reject the payment of prescribed minimum benefits and emergency medical conditions claimed by medical schemes on behalf of its members who are victims of motor vehicle accidents. As such, the RAF does not consider itself bound by the Constitutional Court’s decision, claiming that its amended directive is a departure from the original August 2022 directive. As it stands, this supposedly updated directive continues, in the eyes of the RAF to be applicable as it has yet to be challenged or set aside.

Discovery Health indicated that it may apply to the High Court to hold the fund in contempt of its order, but has not initiated any application at present.

Road Accident Fund v Discovery Health (Pty) Ltd and Minister of Transport (CCT 106/23) [2023]