LPL4802_EXAM PAPER 2021.

LPL4802_EXAM 2021. LPL4802 - Law Of Damages. Identify and discuss at least five principles that influence the final award of damages. Provide examples to show how they affect the final amount of damages. (10) The five principles that influence the final award of damages are causation, remoteness, mitigation, compensatory principle and punitive damages. Causation is a principle used in the assessment of damages for breach of contract. Losses may have been foreseeable at the time of contracting or at the time of the breach of duty, but they will only be recoverable if those losses were caused by the breach of contract or duty. The claimant must prove on a balance of probabilities that the breach caused the loss. It is not sufficient for the breach merely to provide the opportunity or occasion for the claimant to injure himself. If the loss would have happened in any event, then the breach could not be said to have caused the loss. Causation should be applied in determining whether a breach of contract is the cause of a particular loss, as applied in the law of negligence. Furthermore, remoteness of damage relates to the requirement that the damage must be of a foreseeable type. In negligence claims, once the claimant has established that the defendant owes them a duty of care and is in breach of that duty which has 6 Olgar v The Minister of Safety and Security 2008 (JDR 15821E). caused damage, they must also demonstrate that the damage was not too remote. Added to that, mitigation of damages, prevents an injured party from recovering damages that could have been avoided through reasonable efforts. The duty to mitigate damages is most traditionally employed in the area of contract law. In as far as compensatory principle is concerned, general compensatory damages, meanwhile, include estimates of loss not involving actual monetary expenditure. Some courts use the multiplier method, which calculates general damages by multiplying the sum total of one's actual damages by a number that signifies the seriousness of the injury. In other jurisdictions, courts will use the per diem method, which attaches a rand value to each day a plaintiff suffers and adds the value of all those days together. In some cases, a court will use a hybrid of these two methods to calculate general compensatory damages. In addition, punitive damages are legal recompense that a defendant found guilty of committing a wrong or offense is ordered to pay on top of compensatory damages. They are awarded by a court of law when compensatory damages are deemed to be insufficient. Punitive damages go beyond compensating the aggrieved party and are specifically designed to punish defendants whose conduct is considered grossly negligent or intentional. (2.2) The fact that certain kinds of loss may be described as ‘unlawful’ results in a restriction on their recoverability. Visser and Potgieter Law of Damages (2012) at 322. Evaluate the legal position on the recovery of damages for loss of illegally earned income as opposed to loss of earning capacity. Use relevant case law and legal opinion to support your answer. (10) The evaluation of the legal position on the recovery of damages for loss of illegally earned income as opposed to loss of earning capacity is as follows. In as far as the recovery of the damages for loss of illegally earned income is concerned, the law denies compensation where bodily injuries prevent someone from earning money illegally. Dendy M (1987),7 emphasised that someone who earns money through an unlawful 7 Dendy M 'Damages for loss of support out of illegally earned income: Visiting the sins of the fathers' (1987) 104 SALJ 243. activity is not using his earning capacity as part of his patrimony and therefore the frustration of such activities can not constitute damage. For instance, a thief who wants to claim compensation for damage to the stolen article suffers no damage because he has no legally recognised interest in the stolen property. Furthermore, Visser and Potgieter (2012),8 argued that where a person, who is injured, loses income from unlawful sources, wrongfulness exists because his right to bodily integrity has been infringes, thus the fact that this person, who has been wrongfully and negligently injured may claim compensation for medical expenses and pain and suffering, and does not need to prove that his loss of illegal earnings has also been caused wrongfully. Added to that, this person who earns income unlawfully, is injured, the fact that he can not recover compensation for such loss does not exclude a claim for the possible impairment of his lawful earning capacity. The same act may cause this person not only to lose his illegal earnings but also his capacity to earn money lawfully. This is illustrated by the case of R v Road Accident Fund (2017) ZAGPPHC 422,9 where a 55 year old Plaintiff, Ms G R, instituted an action against the Road Accident Fund as a statutory insurer in terms of section 17 of the Road Accident Fund Act 56 of 1996, (the Defendant) for compensation for damages she allegedly suffered arising from personal injuries she sustained when a motor vehicle driven by one Bheki Khumalo ("the insured driver") in which she was a passenger overturned on the Heidelberg road near Alberton on 8 November 2010. In her particulars of claim Ms R alleges that the sole cause of the accident was the insured driver in that he drove the insured vehicle negligently in one or more respects as set out in her particulars of claim, and to have as a result sustained the following personal injuries: chest injury, head injury, left and right Knee, right eye injury and multiple lacerations and abrasions. However, in the case of loss of earning capacity (the loss of future income because of bodily injuries) and loss of creditworthiness, a new category of subjective rights has evolved, which are personal immaterial property rights. The object of such rights is immaterial property that is closely connected with someone’s personality. Thus, pecuniary loss caused by the plaintiff’s incapacity to earn money as before and which 8 Potgieter JM, Steynberg L and Floyd TB Visser & Potgieter’s, Law of Damages 3rd Ed (Juta 2012). 9 R v Road Accident Fund (2017) ZAGPPHC 422. results from bodily injuries, should not be seen in association with a possible infringement of the right to corpus, but with a newly identified right to earning capacity. This right has as its object certain patrimonial as well as personality interests. In generally, it is impossible to avoid the conclusion that patrimonial interests are involved in all the personality rights that are currently recognized. It may, for practical and theoretical reasons, become necessary in future to classify such interests as belonging to a separate category of rights, similar to the proposed personal immaterial property rights. For instance, if a person injures another person and causes him to lose the sight in one of his eyes. Before the trial he loses the use of his second eye on account of a further accident. In an assessment of the extent of the person`s claim for loss of earning capacity against another person, it is evident that only damage associated with the loss of one eye may be taken into account. In Baker v Willoughby (1970) AC 467,10 the plaintiff had sustained a serious injury to his leg in a motor accident. Before his action came to trial, a robber shot him in this leg and it had to be amputated. The court rejected the defendant’s argument that the plaintiff may claim only for the time before the amputation. (2.3) Explain briefly, how the Road Accident fund Act 56 of 1996 limits certain kinds of compensation. (5) The explanation of how the Road Accident fund Act 56 of 1996 limits certain kinds of compensation is as follows. In terms of section 17(1) of the Road Accident Act 56 of 1996,11 the Road Accident Fund or an agent is obliged to compensate a person (a third party) who has suffered patrimonial or non-patrimonial loss as a result of any bodily injury to him or herself or the death of or any bodily injury to any other person arising out of the negligent driving of a motor vehicle. Damage to property is thus not included in the wording of section 17(1). In terms of section 17(1A), the obligation of the Fund to compensate a third party for non-patrimonial loss is limited to compensation for a serious injury and will be paid as a lump sum. In terms of section 17(4) a claim for loss of income or support shall be proportionately calculated on an amount not exceeding 10 Baker v Willoughby (1970) AC 467. 11 Road Accident Act 56 of 1996. R160 000 per year in the case of a claim for loss of income and R160 000 per year in respect of each deceased breadwinner in the case of a claim for loss of support. This amount is adjusted on a quarterly basis in order to counter the effect of inflation. Section 18 of the Road Accident Act imposes important restrictions on certain plaintiffs regarding both the maximum amount recoverable and the type of damage for which compensation maybe recovered. Section 18(2) contains the following principles: where the loss or damage contemplated in section 17 is suffered as a result of bodily injury to or death of any person who, at the time of the occurrence which caused that injury or death, was being conveyed in or on the motor vehicle concerned and who was an employee of the driver or owner of that motor vehicle and the third party is entitled to compensation under the Compensation for Occupational Injuries and Diseases Act 130 of 1993, in respect of such injury or death. QUESTION 3 (3.1) In the event that Mr and Mrs Jones intend to rely on Ms Xavier’s knowledge and skill (or lack thereof) as a financial advisor, indicate fully the provisions of the legislation that they could rely on to successfully claim their damages. (10) The provisions of the legislation that they could rely on to successfully claim their damages is as follows. They will rely on the provisions which are in Financial Advisory and Intermediary Services Act 37 of 2002 (FAIS Act). Failure to act reasonably when providing financial advice may also constitute a violation of the FAIS Act. The FAIS Act regulates the conduct of Financial service providers who provide financial advisory and intermediary services to consumers. Advice is broadly defined as any recommendation, guidance or proposal of a financial nature to a client or group of clients regarding the purchase of financial products; conclusion of transactions in which clients may incur liability; and investments, variation or termination of any term of a financial product. According to Financial Advisory and Intermediary Services Act 37 of 2002,12 a provider must at all times render financial services honestly, fairly, with due skill, care and.