The Road Accident Fund (RAF) secured an unusual court order preventing successful claimants and their attorneys from laying claim to money in its Absa bank account and other assets to recover what they are owed.
It was ordered by the Gauteng High Court that RAF is to pay all claims based on court orders already granted or settlements reached, which are older than 180 days. This must be done before the end of April, provided that the RAF is notified by the attorneys involved that they have outstanding claims which are older than 180 days.
Judge PA Meyer also ordered that all writs of execution and warrants of attachment against the fund based on court orders already granted or settlements already reached, which are not older than 180 days, be suspended from the 1st of May until the 12th of September.
In the meantime, the RAF, was ordered to take all reasonable steps to register court orders or written settlement agreements for claims on its list of payments, in order of the date on which the court order was granted or the date of the settlement agreement.
Judge Meyer explained that implosion of the fund will trigger a section of the Road Accident Fund Act which bars any claims against it for compensation. In its application, the fund sought an order to suspend all writs of execution and attachments based on court orders already granted or settlements already reached where payment has not been received within 180 days.
This, it argued, would enable it to make payments on its oldest claims first, which it would do before the end of April 2021.
The matter first came before court in December last year. Numerous law firms and sheriffs across the country were cited as respondents in the application, while the General Council of the Bar and the Pretoria Attorneys Association joined the proceedings as a friend of the court. These respondents were ordered to not execute against the fund’s Absa Bank account or any other moveable asset until the end of February this year.
That order was extended until March, when the court heard the application, and then again until judgment was delivered last week Friday. Judge Meyer said the fund’s tardy and wasteful litigation and poor administration was being brought under control by a new management team, appointed by the Minister of Transport in 2019.
According to the judge, about 100 law firms have acted against the fund but this needed to be stopped so that it could get its affairs in order. He said the fund had disclosed in court, papers that it relied on the fuel levy and loans for its funding. It could not apply for loans at present because of its financial plight. The fund’s draft annual statement ending March last year showed a deficit of R322 billion, with liability exceeding assets of more than R400 billion.
Payment delays were expected to increase from an average of 187 days to 331 days. On the upside, new management had already received R600 million back in duplicate payments. “A large number of attorneys are willing to work with the RAF to solve the current crisis, agreeing that the larger public interest must trump any possible infringement caused by delayed payments,” Judge Meyer said.