The plaintiff was a pillion passenger on a motorcycle involved in an accident on or about 21 October 2021. The plaintiff sustained a right distal femur fracture, deep lacerations to the right lower leg, disfigurement and psychological sequelae. At the time of the accident, the plaintiff was from another country and had come to South Africa under a contract that would have enabled him to earn approximately R215,000 per annum. However, after the accident, the plaintiff started a business in South Africa which by 2024 resulted in an annualized income of R691,200. At the time of the hearing, the plaintiff did not possess the required documentation to legalize his stay in South Africa. The plaintiff claimed past hospital and medical expenses (R50,000), future hospital and medical expenses (R136,244.63), past loss of income (R51,562), future loss of income (R1,077,964), and general damages (R650,000).
1. The plaintiff's rule 38(2) application was granted. 2. The plaintiff's claim for general damages was separated and postponed sine die in terms of rule 33(4). 3. The defendant was found liable for 100% of such damages as the plaintiff may substantiate. 4. The defendant was ordered to provide an unlimited undertaking in terms of section 17(4)(a) of the RAF Act for future hospital, medical or ancillary expenses. 5. The defendant was ordered to pay R51,562 for past loss of income. 6. The defendant was ordered to pay R600,000 for impairment of earning capacity. 7. The plaintiff was awarded party and party costs with counsel's fees on scale B.
The binding legal principle established is that the earning capacity of an individual is unaffected by the legality of his or her immigration status when considering past or accrued loss of income in Road Accident Fund claims. Further, a claim for impairment of earning capacity can be awarded even where a specific claim for future loss of income cannot be substantiated due to uncertainty about the claimant's legal status, because impairment of capacity is unaffected by the country in which the loss is suffered and reflects the impact of injuries on the ability to conduct business affairs regardless of location.
The court observed that the plaintiff had successfully started a business in South Africa which, three years after the accident, resulted in an annualized income approximately triple what he would have earned under his original contract. The court also noted that there was no reason to doubt counsel's submissions regarding the steps taken by the plaintiff to legalize his stay in South Africa, though the required documentation was not available at the time of the hearing. The court commented that factually, the injuries and their sequelae would have an impact on the plaintiff's ability to conduct future business affairs in either South Africa or his country of origin.
This case is significant for establishing that in Road Accident Fund claims, the legality of a claimant's immigration status does not affect their entitlement to claim for past loss of income based on earning capacity. It also demonstrates the court's willingness to distinguish between future loss of income (which may require proof of legal status to substantiate) and impairment of earning capacity (which is unaffected by the country in which the loss is suffered and does not depend on immigration status). The case illustrates the application of the principle that earning capacity is a compensable asset regardless of whether the claimant's work or presence in South Africa was legally authorized.