RAF CEO, board ordered to pay costs from own pockets, for wasting court’s time

Road Accident Fund (RAF) CEO Collins Letsoalo and the board of directors have been ordered to personally pay legal costs by the Mpumalanga High Court, in an unprecedented judgment for the troubled transport entity.

The fund fired its team of attorneys, leaving its work in disarray and without a plan for its court cases.

RAF failed to execute its duties

Judge Francis Legodi’s Tuesday judgment came after the RAF failed to attend trials and pre-conference hearings despite numerous notices over a period of time, and further failed to fully comply with court directives in respect of two claimants.

The cases of claimants Dumisani Hlatswayo and Mzwandile Masilela were consolidated as they both faced the same frustrations with RAF.

Also Read: ‘Stubborn, militant and ill-advised misdirection’ – Judge blasts RAF in R7m rescission attempt

The court had even gone further in April last year requesting the entity to provide it with its own policy documents, including on the attendance of pre-trials and judicial case management conferences.

RAF was also asked to provide information on the number of cases handled by each of their claim handlers and the procedures followed on cases that were previously handled by lawyers.

To ensure RAF had a helping hand, the court requested industry regulators Legal Practice Council (LPC) and the bar council to join the case and assist the entity to comply with its directives.

Following the countless attempts by the court to get the fund to do its work, the entity chose to settle after costly years of litigation with Hlatswayo and Masilela.

The latter’s attorney first lodged his claim in January 2018.

‘Litigation could have been avoided’

In the scathing 97-page judgment, Legodi said such drawn-out litigation should have been avoided.

“As correctly conceded by the CEO in one of his affidavits, litigation ought to have been avoided. Litigating instead of investigating, settling, and paying without unnecessarily protracted litigation ought to be avoided.

ALSO READ: Law firms on warpath against RAF over new payment system

“It is unsustainable to deal with the monies of the Road Accident Fund by defending every matter where summons have been issued and only to settle after huge legal costs shall have been incurred at the door steps of the courts as it has happened in these two matters.”

‘Pay out of your pockets’

Legodi directed Letsoalo to bring the judgment to the attention of Transport Minister Fikile Mbalula by Thursday, 26th January.

“The CEO and the board are hereby ordered to pay out of their pocket, jointly and severally, the one paying the other to be absolved of the costs connected to and occasioned by the late settlement in each matter.”

“The costs shall include the costs to date, connected to, or associated with the inquiry herein and that of two counsels where applicable.”

The RAF, which falls under Mbalula’s department, is also in a legal tussle with the Auditor-General (AGSA) over an accounting method. The AGSA found that the entity had liabilities of over R3 billion.

Dlamini and Mkhwebane’s cost orders

Previously, two of the well-known precedents were handed down by the Constitutional Court in recent years, when ex-minister Bathabile Dlamini was ordered to pay for her handling of the Sassa grant distribution debacle.

Dlamini paid R600,000 to foot the legal bill for social grant litigants Black Sash and Freedom Under Law.

In 2019, the apex court didn’t spare serial litigant – suspended Public Protector Busisiwe Mkhwebane -when it ordered her to cough up more than once.

Her conduct in the Bankcorp-Ciex report matter was labelled as having “fallen short of the high standards required of her office.”

RAF remains mum

When contacted for comment, the entity’s spokesperson Linda Rulashe on Thursday said she hadn’t heard from management regarding the judgment, and requested The Citizen to send an email.

“Send through a formal query and I will escalate it to management for a response. I haven’t received anything regarding that at the moment,” she said.

Follow-up calls and texts on the emailed questions went unanswered.

Letsoalo was previously CEO of the Passenger Rail Agency of South Africa (Prasa).

NOW READ: Road Accident Fund’s accounting blunder ‘of Steinhoff proportions’ slammed by MPs