MEC: Health and Social Development, Gauteng v DZ obo WZ

The majority in the constitutional court considered common law development and differed from Jafta J’s view that the common law already provides for the payment of damages in instalments. “Apart from the case of Wade, which has not been followed, the only instances of periodic payments as part of the damages award have been where the parties agreed to it, or where execution followed upon an award already made. If an order for periodic payments were to be made under section 173 of the Constitution – or even section 172(1)(b), on which counsel for the applicant did not seek to rely at the hearing – that would constitute incremental development of the common law insofar as the court would need to determine whether a new set of facts falls within or beyond the scope of an existing rule, as explained by O’Regan J in K”. [para 59]

Essence

Common law development considered and not ruled out but factual evidence to substantiate a carefully pleaded argument for the development of the common law must be properly adduced for assessment.

Decision

(CCT20/17) [2017] ZACC 37; 2017 (12) BCLR 1528 (CC); 2018 (1) SA 335 (CC) (31 October 2017).  Although leave to appeal was granted the appeal itself was disallowed.

Judges

Coram: Zondo DCJ, Cameron J, Froneman J, Jafta J, Kathree Setiloane AJ, Kollapen AJ, Madlanga J, Mhlantla J, Theron J and Zondi AJ

Judgments: Froneman J (majority): [1] to [60] and Jafta J (concurring): [61] to [98]

Related books

Darcy du Toit et al

 

Reasons

Although leave was granted the appeal was disallowed unanimously with a concurring judgment by Jafta J.

Court summary

Delictual damages — “once and for all” rule — future medical expenses — lump sum award
Section 39(2) of the Constitution — Section 173 of the Constitution — factual basis for development of the common law

Quotations from judgment

Note: Footnotes omitted and emphasis added

Introduction

[1] On 19 November 2009 the respondent, DZ, gave birth to WZ at the Chris Hani Baragwanath Hospital, Johannesburg. WZ was born by vaginal delivery, following prolonged labour, and was subsequently diagnosed with cerebral palsy due to asphyxia during delivery. DZ instituted action in the High Court of South Africa, Gauteng Local Division, Johannesburg (High Court) on behalf of WZ for damages arising from the allegedly negligent conduct of the employees of the applicant, the Member of the Executive Council for Health and Social Development in the Gauteng Province (Gauteng MEC), during his birth. The Gauteng MEC conceded negligence on the part of hospital staff and thus accepted vicarious liability on the merits of the claim. All that remained for determination by the High Court was the extent of the compensation to which WZ was entitled.

[2] That too was agreed, in the total sum of R23 272 303, of which R19 970 631 was in respect of future medical expenses. But it was an agreement with a wrinkle. The wrinkle was contained in the Gauteng MEC’s amended plea, in which she contended that she did not have to pay future medical expenses in a lump sum. Her alternative was an undertaking to pay service providers directly, within 30 days of presentation of a written quotation, for future medical expenses as and when they might arise. She contended that the common law allowed her to do this, and that, if it did not, the Court should develop it.

[3] The High Court dismissed the amended plea, as did the Supreme Court of Appeal. The Supreme Court of Appeal held that the “once and for all” rule at common law precludes payment of future medical expenses in the form sought by the Gauteng MEC and that, if intervention is necessary to correct this alleged defect, it would best be left to the legislature. In addition, it held that the Gauteng MEC failed to present any evidence why her preferred method would enhance access to healthcare.

[4] In this Court, the Gauteng MEC seeks leave to appeal against the order of the Supreme Court of Appeal.

[5] The MEC for the Department of Health in the Eastern Cape Province (Eastern Cape MEC) and the MEC for the Department of Health in the Western Cape Province (Western Cape MEC) sought, and were granted, admission as amici curiae (friends of the court).

[6] The Eastern Cape MEC sought to ensure that the decision in this matter does not prevent her from raising two defences in pending trials in the High Court of South Africa, Eastern Cape Local Division, Mthatha. The first is a “public healthcare defence”, according to which claims for future medical expenses against public healthcare authorities may be satisfied through the provision of medical services in the public healthcare sector. The second is an “undertaking to pay defence”, according to which medical services or supplies that cannot be provided in the public healthcare sector are paid for when they arise in the future. She contends that the first defence requires, at most, a limited development of the common law, while the second requires a more extensive development of the common law.

[7] The Western Cape MEC similarly seeks to ensure that our decision in this matter does not pre-empt consideration of the ambit of the “once and for all” rule in relation to certain mechanisms that she is devising to deal with claims against public healthcare providers for alleged negligence. She presented statistical evidence indicating pressure on public healthcare resources arising from claims in cerebral palsy-related cases.

Her proposal is to make each damages award conditional on the establishment of a ring fenced trust administered by a case manager and a trustee who can ensure that the award is used only for its intended purpose: meeting the child’s future medical expenses. The deed constituting each trust would include provisions providing for the “topping-up” of the fund if it becomes depleted as well as the reversion of the balance in the fund to the state upon the child’s death.

The High Court of South Africa, Western Cape Division, Cape Town, recently sanctioned the adoption of this model by settlement, but expressed the view that it was unnecessary to decide on the development of the common law in view of the agreement of the parties. The Western Cape MEC contends that, in a future case where there is no agreement, it may well be that the imposition of these mechanisms will require a development of the “once and for all” rule.

Leave to appeal

[8] The development of the common law, and the potential impact of damages awards in medical negligence claims against public healthcare authorities on their ability to discharge their constitutional obligation to provide access to healthcare to everyone, raise constitutional issues that attract this Court’s jurisdiction.

As will be seen, there are some factual difficulties for the Gauteng MEC on the merits of the appeal, but the legal issues are important at a wider level. It is thus in the interests of justice to grant leave to appeal.

The appeal

Factual background

[9] The factual background is brief and needs no repetition.

[10] In the High Court, the Gauteng MEC elected not to lead any evidence on the damages issue. The High Court granted judgment in the agreed sum and the Supreme Court of Appeal subsequently confirmed this.

Various defences

[11] The bare bones of the Gauteng MEC’s amended plea were used in argument to advance a number of different legal propositions, veering off in different directions and sometimes only tenuously connected, if at all, with the wording of the amended plea. It is necessary to attempt to distil the essence of these propositions, and those advanced as future defences by the amici, in order to assess the present state of the common law and whether it needs further development.

[12] Two of the propositions advanced by the Gauteng MEC and the amici concern first principles of our law of delict.

  • The first is that delictual compensation need not necessarily sound in money, but may also be paid in kind.
  • The second is that the “once and for all” rule applies only to the determination of liability on the merits of a delictual claim, and not to the quantification of damages, which (it is said) lies within the trial judge’s discretion.
  • The third proposition, which is perhaps based on these general assertions, is less ambitiously formulated. This is that it is open to a defendant to challenge an amount claimed as damages on the basis that the sum is not reasonable because the plaintiff is likely to use public healthcare rather than private healthcare, the former being as good as, and cheaper than, the latter.
  • Allied to this is the argument that claims for future medical loss may sometimes best be satisfied by the provision of actual medical services, rather than the payment of money.

[13] The Eastern Cape MEC’s “public healthcare” defence may fall within the third proposition since it is based on an assertion that public healthcare provides as good, and cheaper, medical services as private healthcare. But it may also go outside this proposition if it is based on the contention that damages awards in medical negligence claims against public healthcare authorities must also be assessed against the impact they may have on healthcare budgets and the adverse effect they may have on the provision of access to public healthcare for everyone. Her alternative “undertaking to pay” defence and the “top-up/claw-back” mechanism of the Western Cape MEC may also be difficult to fit into the third category.

The current common law

[14] In Standard Chartered Bank Harms JA, “conscious of stating the obvious”, pointed out that—

“The purpose of an Aquilian claim is to compensate the victim in money terms for his loss. Bell J pointed out as long ago as 1863 that when damages are due by law they are to be awarded in money because money is the measure of all things[ ] . . . . This rule still stands.”

There is little reason to doubt that the rule still stands today.

[15] Another rule that still forms part of our law is the “once and for all” rule. In Evins Corbett JA explained its import:

“Expressed in relation to delictual claims, the rule is to the effect that in general a plaintiff must claim in one action all damages, both already sustained and prospective, flowing from one cause of action. This rule appears to have been introduced into our practice from English law. . . . Its introduction and the manner of its application by our Courts have been subjected to criticism . . . but it is a well-entrenched rule. Its purpose is to prevent a multiplicity of actions based upon a single cause of action and to ensure that there is an end to litigation.

Closely allied to the ‘once and for all’ rule is the principle of res judicata which establishes that, where a final judgment has been given in a matter by a competent court, then subsequent litigation between the same parties, or their privies, in regard to the same subject-matter and based upon the same cause of action is not permissible and, if attempted by one of them, can be met by the exceptio rei judicatae vel litis finitae. The object of this principle is to prevent the repetition of lawsuits, the harassment of a defendant by a multiplicity of actions and the possibility of conflicting decisions . . . . The claimant must sue for all his damages, accrued and prospective, arising from one cause of action, in one action and, once that action has been pursued to final judgment, that is the end of the matter.”

[16] What can be drawn from these authorities is that, in relation to delictual claims, the “once and for all” rule is to the effect that a plaintiff must generally claim in one action all past and prospective damages flowing from one cause of action. The corollary is that the court is obliged to award these damages in a lump sum, the object of which is to prevent the repetition of lawsuits, the harassment of a defendant by a multiplicity of actions and the possibility of conflicting decisions. It is buttressed by the res judicata principle, the purpose of which is to prevent a multiplicity of actions based upon a single cause of action and to ensure that there is an end to litigation.

[17] The Gauteng MEC’s first two general and bold propositions – that delictual compensation need not sound in money and that the “once and for all” rule does not relate to the quantification of damages, but only to the determination of liability on the merits – are thus not borne out by an analysis of our current law.

[18] The third proposition – that it is open to counter the method and measure of the claim for damages on the basis that the amount claimed is not reasonable because a plaintiff is more likely to use public healthcare, which is as good as, and cheaper than, private healthcare – appears to be on a surer footing.

[19] In Ngubane the appellant claimed future medical expenses on the premise that he would be treated by private medical practitioners and, when necessary, in a private hospital. The respondent contended, however, that these medical services could be provided at state or provincial hospitals, free of charge, or at no more than a nominal fee, and that it was therefore reasonable to expect the appellant to make use of these facilities. It was argued that there was no general authority that entitled the plaintiff to the costs of private medical treatment, and that, whenever the possibility of cheaper treatment arose, a claimant had a general onus to deal with these possibilities.

[20] Kumleben JA rejected this:

“Though the onus of proving damages is correctly placed upon the plaintiff, this submission, which is really concerned with the duty to adduce evidence, is to my mind unsound. By making use of private medical services and hospital facilities, a plaintiff, who has suffered personal injuries, will in the normal course (as a result of enquiries and exercising a right of selection) receive skilled medical attention and, where the need arises, be admitted to a well-run and properly equipped hospital. To accord him such benefits, all would agree, is both reasonable and deserving. For this reason it is a legitimate – and as far as I am aware the customary – basis on which a claim for future medical expenses is determined.”

But he then continued:

“Such evidence will thus discharge the onus of proving the cost of such expenses unless, having regard to all the evidence, including that adduced in support of an alternative and cheaper source of medical services, it can be said that the plaintiff has failed to prove on a preponderance of probabilities that the medical services envisaged are reasonable and hence that the amounts claimed are not excessive.”

On the facts on record it was held that the respondent had led insufficient evidence to substantiate the assertion that medical services of the same or higher standard would have been available to the appellant.

[21] Ngubane is authority for allowing a defendant to produce evidence that medical services of the same or higher standard, at no or lesser cost than private medical care, will be available to a plaintiff in future. If that evidence is of a sufficiently cogent nature to disturb the presumption that private future healthcare is reasonable, the plaintiff will not succeed in the claim for the higher future medical expenses. This approach is in accordance with general principles in relation to the proving of damages.

[22] This approach does not offend the “once and for all” rule. It is a “once and for all” factual assessment on the evidence adduced that, although the claimant will need medical care in future, it has not been proved on a balance of probabilities that this entails a loss in the sense that the claimant’s patrimony after the delict is less than it would have been had the delict never occurred. It is not the mere injury and its future consequences that justify an award of damages, but the actual diminution in the claimant’s patrimony.

[23] In the recent case of Kiewitz, the Supreme Court of Appeal rejected a “mitigation of damages” defence similar to the one raised in Ngubane because it “offends against both the ‘once and for all’ rule and the rule that compensation, in personal injury matters, must comprise a monetary award”. On the basis of that holding, the Court found it “unnecessary to deal with the evidence relating to the adequacy of medical care offered at provincial hospitals”. It appears that the Court was not referred to Ngubane. For the reasons given, its conclusion – that a mitigation defence of the kind raised in Ngubane offends both the “once and for all” rule and the rule that delictual compensation must sound in money – cannot be sustained. Only after assessing the evidence proffered on the adequacy of alternative future medical care can a court assess, “once and for all”, whether the damages claimed have been proven reasonable. If so, a lump sum assessment must be made of the future loss.

[24] If not, it appears that at least four possibilities exist.

  • The first is that no damages for future medical expenses should be awarded if the evidence shows that the claimant is likely not to suffer any loss in the future.
  • The second is that, if the evidence establishes only a lesser loss, then that sum must be awarded as the monetary damages.
  • The third is that the assessed loss may be ordered to be paid in instalments.
  • The fourth is that the defendant be ordered to ensure the actual rendering of the medical services that it claims obviates or reduces the claimant’s monetary loss.

The first two possibilities fall comfortably within the current law of monetary compensation that must be paid “once and for all”. The latter two may not.

[25] I am only aware of a single instance in our law where the assessed loss was ordered to be paid in instalments. In Wade, the defendant was ordered to pay the claimant’s lost earnings by way of indexed instalments until the latter’s death or remarriage. That case has apparently not been followed, and doubt has been expressed as to whether the Court had the inherent jurisdiction to make the order. In Roxa, the Appellate Division considered it advisable to make provision for the proper care and administration of a minor’s assessed damages. With the consent of the parties, it therefore ordered that its award be paid to a building society and made provision for both periodic payments and recourse to the Court in the event of disputes. It is said that courts have no power to order periodic payments, but this issue may not yet have been squarely addressed. And, in any case, Wade may now be more persuasive in view of section 173 of the Constitution. Although my brother Jafta J considers that the existing law already allows damages to be ordered by way of periodic payments, I adopt the somewhat more cautious approach that this has not yet been definitively decided for the reasons set out at the end of this judgment.

[26] Our law currently requires evidence to substantiate a defence that a claimant has suffered no damages, or less than is claimed, for reasonable future medical expenses. The Gauteng MEC chose not to present any evidence to show that DZ’s claim for future medical expenses was unreasonable. The plea therefore has to fail on the state of our existing law. Can development of the law save the day for her?

Development of the common law

[27] To start the enquiry one must be clear on

  • (1) what development of the common law means;
  • (2) what the general approach to such development is;
  • (3) what material must be available to a court to enable the development; and
  • (4) the limits of curial, rather than legislative, development of the common law.

[28] As O’Regan J explained in K, the common law develops incrementally through the rules of precedent, which ensure that like cases are treated alike. Development occurs not only when a common law rule is changed altogether or a new rule is introduced, but also when a court needs to determine whether a new set of facts falls within or beyond the scope of an existing rule. Thus development of the common law cannot take place in a factual vacuum.

[29] Whether a new set of facts falls within or beyond the scope of an existing rule may, in appropriate circumstances, be decided on exception, a procedure whereby the facts are assumed to be those pleaded for the purpose of determining whether they legally sustain a cause of action or a plea. But where a common law rule is to be changed altogether, or a new rule is to be introduced, it will usually be better to make a decision only “after hearing all the evidence” so that “the decision can be given in the light of all the circumstances of the case, with due regard to all relevant factors”.

[30] Section 39(2) of the Constitution requires the courts to promote the spirit, purport and objects of the Bill of Rights when developing the common law. This requires the courts to be alert to the normative framework of the Constitution, “not only when some startling new development of the common law is in issue, but in all cases where the incremental development of the rule is in issue”.

[31] The general approach to development of the common law under section 39(2) is that a court must:

  • (1) determine what the existing common law position is;
  • (2) consider its underlying rationale;
  • (3) enquire whether the rule offends section 39(2) of the Constitution;
  • (4) if it does so offend, consider how development in accordance with section 39(2) ought to take place; and
  • (5) consider the wider consequences of the proposed change on the relevant area of the law.

[32] In Mokone, this Court held that there are instances in which the common law may suffer from a deficiency that is not at odds with the Bill of Rights. If this deficiency necessitates the development of the common law, this cannot be done in terms of section 39(2). However, development may be possible in terms of section 173 of the Constitution, which stipulates that the Constitutional Court, the Supreme Court of Appeal and the High Court have the inherent power to develop the common law, taking into account the interests of justice. In these cases, the general approach to the development of the law will be similar, except that the enquiry into the common law will not be restricted to whether it offends the normative framework of the Constitution. The enquiry will be whether, even if the common law is constitutionally compliant, there are wider interests of justice considerations that necessitate its development.

[33] The common law may also be developed when applying a provision of the Bill of Rights to a natural or juristic person, in order to give effect to the right to the extent that legislation does not do so, and to limit a right, provided that the limitation is in accordance with section 36(1) of the Constitution.

[34] When exercising their authority to develop the common law, courts should be mindful that, in accordance with the principle of the separation of powers, the major engine for law reform should be the legislature. Relevant factors here include whether the common law rule is a judge-made rule, the extent of the development required and the legislature’s ability to amend or abolish the common law.

[35] To return, then, to the sequential steps in the general approach to the development of the common law under section 39(2): the first two – identification of the existing common law and its rationale – have been dealt with. In relation to compensation in money, a defendant in a delictual claim is allowed to adduce evidence that medical services of the same or higher standard, at no or lesser cost than private medical care expenses claimed, will be available to the plaintiff in future. If that evidence is of a sufficiently cogent nature to disturb the presumption that private healthcare is reasonable, the plaintiff will not succeed in the claim for the higher future medical expenses.

[36] The third step is to enquire whether these common law rules offend the normative structure of the Constitution and, if not, whether there are wider interests of justice considerations that require their further development. Context is important here. We are dealing with a child suffering from, inter alia, cerebral palsy occasioned by medical negligence in a public healthcare institution. It is within that context that it is argued that the law should allow either an order to ensure the actual rendering of the necessary medical care or periodic payments of the assessed loss.

[37] The common law rule that damages must sound in money has, as we have seen, an ancient ancestry. But that ancestry has its own quirks. The law of delict originated in private vengeance: a victim originally had the right to kill a wrongdoer, although this eventually became a right to merely exact the same kind of harm that he or she had suffered and then to demand the payment of money to cover any patrimonial loss caused by the wrong. This development of the Aquilian action to cover purely patrimonial loss happened “rather surreptitiously” and with “[n]o specific precedent for this development . . . available in the Roman sources”. It found its theoretical foundation in the natural law expounded by (among others) Hugo Grotius.

[38] Even in its origin in this jurisdiction – the Wynberg Valley Railway Company case to which Harms JA referred in Standard Chartered Bank – the proposition that when damages are due by law they are to be awarded in money because “money is the measure of all things” was said to be an abstract one “that . . . may fail in its application according to the particular circumstances of the case to which its application is directed”. And it appears that the three judges in that case would have easily accepted the fairness of a partial award of compensation in kind had it not been for the specific wording of the applicable legislation.

[39] There is a further reason for caution in letting the past bind us. Whose past? Professor Zimmermann’s magisterial work on the law of obligations was, in his own words, an attempted “comparison of legal solutions against the background of a common ‘Western’ civilisation”. In a later work he wrote:

“The three Graces of the South African legal system are civil law, common law and customary law. The free spirit of the third Grace makes it difficult for her to join in the circle. To enable her to do so may be one of the great challenges of the new South African legal order. Someone may then, perhaps, be able to tell the story of the Africanisation of Roman-Dutch law in twenty-first century South Africa.”

As a great friend of this country, Professor Zimmermann undoubtedly understands that Western legal systems form only part of our heritage, and that one of the great challenges of our new legal order is indeed to bring about the Africanisation of the common law.

[40] In Mhlongo, an argument that, because a contract of loan was made in cash, and cash was earlier unknown in Africa, the common law and not customary law applied was rejected as “illogical since money is in itself only a token and . . . other articles served as tokens before contact was made with Europeans”.

Although the decision is couched in the unacceptable language of the past, and was in any case made in the context of determining whether customary or common law should apply to the transaction, it represents a glimmer of recognition that different cultural and legal traditions may offer valuable insights on the kind of compensation that may be sufficient to redress wrongs.

[41] The free spirit of our third Grace has an important role to play in giving content to the normative value system of our Constitution and thereby shaping the development of our common law. Of course, customary law will also continue to play its independent role under the Constitution as a pluralist choice of law to govern aspects of legal life. It is, however, also necessary to start giving serious attention to how African conceptions of our constitutional values should be used in the development of the common law in accordance with those values.

[42] In order to determine the appropriateness of monetary compensation for delictual wrongs, one must look at whether that form of compensation is the only one that properly redresses damage to a victim’s patrimony. In Sechaba Photoscan, Howie P stated:

“It is now beyond question that damages in delict (and contract) are assessed according to the comparative method. . . . The award of delictual damages seeks to compensate for the difference between the actual position that obtains as a result of the delict and the hypothetical position that would have obtained had there been no delict. That surely says enough to define the measure.”

[43] Future medical expenses are awarded in respect of medical services that the victim may need in the future, which would have been unnecessary had there been no delict. In principle, the actual rendering of these services would fulfil the two-fold purpose of redressing damage and compensating the victim. This method may be even more appropriate where the victim does not intend to put any money that he or she might receive towards medical treatment. Comparativists have pointed out that “[i]n German law medical expenses cannot be claimed if they have not actually been incurred or, at the very least, it can be shown that the plaintiff does not intend to use the money for medical treatment”.

[44] In logic and principle compensation in a form other than money does not appear to be incompatible with the aim of making good “the difference between the actual position that obtains as a result of the delict, and the hypothetical position that would have obtained had there been no delict”. To require compensation in money as the “measure of all things” therefore appears to be an evaluative normative choice. Does the common law’s choice in this regard offend the normative underpinnings of our legal order?

[45] In general terms, this seems doubtful. Neither the Constitution nor the realities of modern life oblige us to find that money cannot be the measure of things. But it is arguable that the fundamental right of everyone to have access to healthcare services and the state’s obligation to realise this right by undertaking reasonable measures introduce factors for consideration that did not exist in the pre constitutional era. Aligned to this is “the ever-increasing shift from the classical model of individual loss bearing towards a collectivisation of losses” that is reflected in the “gradual absorption of [delict] law, or at least large parts of it, into the modern social-security system”.

[46] The “once and for all” rule is derived from English law and is said to be so entrenched in our law that it is not possible to oppose it on historical grounds. But, as in the case of the entrenched rule that compensation must always be paid in money, the Constitution does not absolve us from interrogating our history and whether the legal norms of the past still fit in with those of the Constitution.

[47] In the rule’s place of origin, the legislature has intervened in order to provide for what was first called “structured settlements” and is now called reviewable periodic payments. On the recommendation of the Law Commission of England and Wales, section 2(1) of the Damages Act 1996 was enacted to allow the courts to make an order for the whole or part of a damages award to take the form of periodic payments, provided the parties agree. The Law Commission recommended that in the absence of agreement there should be no judicial power to impose a structured settlement. This incurred the displeasure of Lord Steyn in the Wells case:

“[T]he lump sum system causes acute problems in cases of serious injuries with consequences enduring after the assessment of damages. In such cases, the judge must often resort to guesswork about the future. Inevitably, judges will strain to ensure that a seriously injured plaintiff is properly cared for whatever the future may have in store for him. It is a wasteful system since the courts are sometimes compelled to award large sums that turn out not to be needed. It is true, of course, that there is statutory provision for periodic payments: see section 2 of the Damages Act 1996.

But the Court only has this power if both parties agree. Such agreement is never, or virtually never, forthcoming. The present power to order periodic payments is a dead letter. The solution is relatively straightforward. The Court ought to be given the power of its own motion to make an award for periodic payments rather than a lump sum in appropriate cases. Such a power is perfectly consistent with the principle of full compensation for pecuniary loss. Except perhaps for the distaste of personal injury lawyers for change to a familiar system, I can think of no substantial argument to the contrary. But the judges cannot make the change. Only Parliament can solve the problem.” (Emphasis added.)

[48] It is not clear if Lord Steyn’s deference to the legislature was occasioned merely by the fact that the existing legislation forbade court approval in the absence of agreement between the parties. He may well have considered that the courts could have developed the law had it not been for this fact. But in other common law jurisdictions the prevailing view appears to be that it is not within the courts’ remit to order periodic payments because of the “once and for all” rule. For example, the Supreme Court of Canada declined to make an order for periodic payments in the absence of enabling legislation or the consent of all parties in Watkins. The Court acknowledged the argument for law reform in order for the common law to evolve to meet the realities of contemporary society, but considered that to accede to it would be to go beyond the “limits on the power of the judiciary to change the law”:

“There are sound reasons supporting this judicial reluctance to dramatically recast established rules of law. The court may not be in the best position to assess the deficiencies of the existing law, much less problems which may be associated with the changes it might make. The court has before it a single case; major changes in the law should be predicated on a wider view of how the rule will operate in the broad generality of cases. Moreover, the court may not be in a position to appreciate fully the economic and policy issues underlying the choice it is asked to make. Major changes to the law often involve devising subsidiary rules and procedures relevant to their implementation, a task which is better accomplished through consultation between courts and practitioners than by judicial decree. Finally, and perhaps most importantly, there is the long-established principle that in a constitutional democracy it is the legislature, as the elected branch of government, which should assume the major responsibility for law reform.
Considerations such as these suggest that major revisions of the law are best left to the legislature. Where the matter is one of a small extension of existing rules to meet the exigencies of a new case and the consequences of the change are readily assessable, judges can and should vary existing principles. But where the revision is major and its ramifications complex, the courts must proceed with great caution.
The change in the law which we are asked to endorse in this case would constitute a major revision of the long-standing principles governing the assessment of damages for personal injury in particular, the principle that judgment is to be rendered once and for-all at the conclusion of a trial, and the correlative entitlement of the plaintiff to immediate execution on the entire award. Permitting courts to award periodic damages for personal injuries does not involve the extension of an existing rule, but the adoption of a new principle.”

[49] For those schooled in the common law tradition it might come as a surprise that “[t]he comparative law of personal injuries offers few divergences as striking as that between systems which award [delictual] compensation in the form of a capital sum or periodic payments”.

There are four legal possibilities of what form payments for future expenses may take. On the outer limits lie, on the one side, the common law systems with lump sum awards not payable periodically and, on the other, some socialist systems, which allowed only periodic payments or annuities; in between these extremes are those systems that neutrally accept either lump sums or periodic payments (such as those of France and Switzerland) and systems like Germany’s, which accepts that awards can take either form but prefers periodic payments.

[50] Professor Fleming considers that the “doctrinal rationale of the two basic systems offers rather little for informed choice” in that the usual argument for the periodic payment (or rent) system is based on the natural law theory of restitution while the arguments in favour of capital awards “ten[d] to be wholly pragmatic”. At the highest level of legal policy, however, “capital and rent confront each other, the one as a manifestation of free enterprise and individualism, the other as representing a social philosophy of paternalism”.

[51] The “once and for all” rule has been cogently criticised. As Nicholas JA pointed out in Southern Insurance Association, the enquiry into damages for future loss is “of its nature speculative, because it involves a prediction as to the future, without the benefit of crystal balls, soothsayers, augurs or oracles. All that the Court can do is to make an estimate, which is often a very rough estimate, of the present value of the loss”.

Professor Fleming calls these shortcomings “lamentable beyond imagination”:

“It would be bad enough if the choice were between guessing either right or wrong: but our methods virtually assure that the choice must turn out wrong. For the accredited approach is to compromise, that is, neither to award the whole amount nor yet to refuse all, but instead to assess and award the value of the chance.”

[52] Similarly, however, the periodic payment or rent system is open to criticism. It may involve piecemeal consideration of the effect of injuries, administrative difficulties of enforcement, variations up and down, problems with adjustment for inflation and taxation, and the like.

[53] What to make of all of this?

[54] Although the “once and for all” rule, with its bias towards individualism and the free market, cannot be said to be in conflict with our constitutional value system, it can also not be said that the periodic payment or rent system is out of sync with the high value the Constitution ascribes to socio-economic rights. There is no obvious choice at this highest level of justification. What appears to be called for is an accommodation between the two. Is that possible? At an abstract level it might be more difficult, as Professor Fleming observes:

“André Tunc recently described both capital and rent solutions as frankly ‘catastrophic’. This is especially true if a categorical choice between them, one way or the other, is demanded in the abstract as one of overriding general policy. What makes it so invidious is that comparison falters really at two levels. At one level there is the uncertainty about goals: we are torn between the paternalistic and the individualistic social philosophy, and yet cannot have both; one or the other must be sacrificed. On a second level, the difficulty is that each system has a different advantage over the other in meeting policy objectives which themselves are incontrovertible: for example, rent is better able to cope with the problem of death or other aggravation in the victim’s physical condition, while capital conceivably provides a better hedge against inflation.”

[55] If the only choice open to us was at this level then it would probably be better to leave reform to the legislature. But this may not be so. Resolution of the dilemma may lie in leaving the choice at the level of each individual case, depending on which form of payment will best meet its particular circumstances:

“Reducing the decision from the abstract or general to the concrete or particular will frequently allow us to minimize the dilemma of subordinating one advantage to another. For example, in cases of greatly reduced life-expectancy, the spectre of inflation becomes negligible compared with the advantages of a periodical award in coping with the problems associated with the uncertain date of death and the desirability of making provisions for the victim’s family thereafter. Even on what I called the first-level problem, the pressure may well be greatly reduced when there is concrete evidence that the particular plaintiff is either incapable of being entrusted with a large sum of money or has, to the contrary, an attractive plan for employing it in founding a new career.”

[56] We must remind ourselves again of the context in which the argument for development of the common law is made here. We are not called upon to decide the fate of the “once and for all” rule in all personal injury cases arising from medical negligence. The most important future imponderable is the ultimate one: death. Periodic payments subject to a “top-up/claw-back” will give less speculative expression to the general principle of compensation for loss. And the likelihood of a dependant’s claim, which might present problems in other cases, is less, if not entirely absent, here.

[57] We have seen, in this regard, that any development of the common law requires factual material upon which the assessment whether to develop the law must be made. Here that factual material is absent. The only possible factual foundation for an argument that the common law must be developed is the mere fact that WZ was born in a public healthcare institution and that is where the medical negligence occurred. This is woefully inadequate to ground development of the common law in the manner sought by the Gauteng MEC. The appeal must fail, for that reason.

[58] But the failure of the appeal does not mean that the door to further development of the common law is shut. We have seen that possibilities for further development are arguable. Factual evidence to substantiate a carefully pleaded argument for the development of the common law must be properly adduced for assessment. If it is sufficiently cogent, it might well carry the day.

[59] As indicated earlier, I differ from Jafta J’s view that the common law already provides for the payment of damages in instalments. Apart from the case of Wade, which has not been followed, the only instances of periodic payments as part of the damages award have been where the parties agreed to it, or where execution followed upon an award already made.

If an order for periodic payments were to be made under section 173 of the Constitution – or even section 172(1)(b), on which counsel for the applicant did not seek to rely at the hearing – that would constitute incremental development of the common law insofar as the court would need to determine whether a new set of facts falls within or beyond the scope of an existing rule, as explained by O’Regan J in K.

Order

[60] The following order is made:

1. No person shall publish a report of the proceedings in this Court in this matter which reveals, or may reveal, the identity of the respondent or the respondent’s child.
2. Leave to appeal is granted.
3. The appeal is dismissed with costs, including the costs of two counsel.