RAF turns to private lawyers

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The cash-strapped Road Accident Fund (RAF) is looking to pivot to a hybrid litigation model in one of its biggest reforms in two decades as it seeks to rein in runaway legal costs, which risk crowding out key expenses, including compensation to victims of road accidents.The entity is battling escalating litigation, mounting default judgments, rising legal costs and severe capacity constraints, with individual attorneys managing between 2,000 and 3,000 matters at a time.Funded by the fuel levy paid by motorists, the RAF has spent nearly R30bn on legal costs over the past five years — almost as much as the state spends annually on social relief of distress grants.To achieve its goal of slashing costs, the RAF has embarked on an open tender process, requesting information from law firms with experience in RAF matters on a proposed hybrid litigation model.In a frank assessment, the RAF said its litigation function is under-resourced, with matters left undefended, court deadlines being missed, and settlements negotiated on the “steps of the courthouse” with inadequate preparation.“As a solution to address this problem, this business case proposes a hybrid litigation model, a dual-representation system in which state attorneys continue to handle the core litigation load, supported by a carefully procured panel of private attorneys to absorb overflow, regional demand, urgent applications, and matters requiring specialised expertise,” the entity said in a tender document.RAF (Nolo Moima) Critically, both streams would operate under the centralised governance of a strengthened legal administration department, which would serve as the command authority for all litigated matters, from the issuance of a summons to the entry of judgment.“The model is not a radical departure from existing practice. It is a disciplined, structured approach to doing what the RAF has always needed to do: defend matters properly, prepare files on time, comply with court rules, and bring litigation costs under control.“What changes is the architecture: centralised oversight, early file preparation, integrated case management technology, and a clear allocation framework that matches matters to the right representative.”The hybrid litigation model that the RAF is looking to deploy is intended to deliver economic, commercial, financial and management benefits. It said the expected outcomes include: Reduced default judgments- Improved court compliance rates;- Better mediation outcomes;- Lower overall legal costs;- A centralised governance structure; and- A strengthened institutional reputation.“The expected outcomes of the proposed model include a measurable reduction in default judgments, improved compliance with practice directives and the 2025 mandatory mediation directive and protocol, better trial readiness, and a significant decrease in unnecessary legal expenditure.”The RAF said this business case set out the strategic, economic, commercial, financial and management rationale for adopting the model.The South Gauteng high court in Johannesburg last year introduced mandatory mediation before civil trials. The directive requires parties to first undergo mediation before they can apply for a trial date. It mainly affects RAF matters, which clog the court roll, with an estimated 300 new RAF cases scheduled each week on Gauteng’s trial roll.Personal injury lawyers are challenging the legality and constitutionality of the directive issued by now deputy chief justice of the Constitutional Court, Dustan Mlambo, who was judge president of the Gauteng division when it was introduced.The RAF is currently burdened with a backlog of about 100,000 claims. National Treasury estimates the fund’s total liability at just over R400bn, although parliamentary committees and external assessments have warned that unrecorded or omitted claims could push its total liabilities beyond R500bn.The government on Friday increased the statutory limit for loss-of-income and loss-of-support claims to R390,664, with immediate effect. The adjustment is intended to counter the effects of consumer price index (CPI) inflation.The RAF has also faced persistent governance challenges over the years.The Association for the Protection of Road Accident Victims (APRAV) this week said evidence was emerging that paints the clearest picture yet of an institution struggling to fulfill its constitutional mandate while billions of rand continue flowing into the fund through the fuel levy.Business Times