Day two in the LSSA’S Constitutional challenge to the RAF Amendment Act (2 March 2010)
 It was put to the court that the RAF Act does not provide for sub-delegation of the powers to amend tariffs, and by the Minister of Transport sub-delegating to the RAF, the power to decide upon such amendments, is in contravention of the Constitution. Adv JJ Gauntlett SC then again addressed the court, and reiterated to the court that if road users are not allowed to use their common law rights, they would suffer great financial prejudice, and held that the implication proposed by the scheme that general damages are not “real needs” is an incorrect view. Counsel closed by putting to the court that the RAF Amendment Act infringes four of a claimant’s rights, namely an abrogation of the common law right, property rights in light of general damages, the right to access to courts, and a procedural attack on Sec 33 of the Constitution. Counsel held that the court needs to view the infringement of the abovementioned rights in light of the three elements of reasonableness, proportionality and the use of less restrictive means. Adv MR Madlanga SC then commenced address on behalf of the Respondents, together with Adv HJ de Waal, Adv S Budlender and Adv K Pillay. Counsel submitted that it was an overriding legislative decision taken, that RAF funding would come directly from fuel levies. Counsel put to the court that it was not for the court to decide how and from where the RAF should derive its income, which if done by the court, will be overstepping the boundaries. Counsel addressed the issue of the abolition of the common law claim on three main points. Firstly, had the RAF Act stayed the same, what benefits would future claimants derive? Secondly, that the abolition of the common law right was a transitional measure and lastly an overriding legislative policy on how the RAF Scheme is to be funded. Adv Madlanga SC held the view that having an institution like the RAF is an advantage to claimants. The risk that such claimants face by using their common law rights, is that they may claim against an individual who may not have sufficient financial means to pay the claims, whereas an institution like the RAF has a deeper pocket. Counsel held that as long as the RAF Amendment Act is objectively rational, the court cannot interfere, as the task of the court is not to second guess the wisdom of policy decisions under the guise of rationality and that the only consideration should be whether or not the Amendment Act fulfills the purpose for which it is intended, and if so then the Amendment Act as it is intended by the legislature should be allowed to stand. Adv S Budlender argued on behalf of the Respondents that the R160 000 cap on loss of income should be allowed to stand. He based his argument on three main points. Firstly, the liquidity crisis of the RAF and that the cap saves the RAF 2% in annual revenue which is approximately R200 million per year. Secondly, counsel held that it achieves greater equity, as there is only a small percentage of claims against the RAF which are over R160 000 and that the cap seeks to abolish the inequity between passenger claims. He added by removing the cap, it would increase the RAF’s liability by 15% and in so doing increase the RAF’s rather precarious financial vulnerability. Counsel also argued against the Applicant’s submission that the court should combine the R160 000 cap and the claimant’s common law rights. The Applicants’ submitted that when a claimant’s claim is above the RAF’s R160 000 cap, the claimant should then be allowed to use his common law right and claim the balance from the wrongdoer. Counsel for the Respondent held the view that the two cannot be combined and that they should stand or fall on their own. Further on the point of the implemented R160 000 cap, Adv Budlender held that 94% of claimants earn under the R160 000 cap, and as such the legislature chose to draw a line at a specific point which protects 94% of claimants, and that it is not up to the court to decide whether or not this line is drawn at the correct point or not. Adv Budlender also addressed the court on the debate of top-up insurance and held the view that every person can obtain top-up insurance cover, even though this cover may not be extensive. Adv HJ de Waal concluded the day’s argument on behalf of the Respondents, addressing the court on certain points raised in the Applicants’ argument. The matter is proceedings on Wednesday 3 March 2010, when the Respondents will conclude their argument, whereafter the Applicants will reply. Nicolette Koch Partner nicolette-k@adamsadams.co.za |
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| 9/06/2012 | ||
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