Bid to declare RAF delinquent

Bid to declare RAF delinquent

TWENTY EIGHT Road Accident Fund claimants, who are still awaiting payments although their matters have either been settled or they have obtained court orders for payment are turning to the court to ask that it declares the entity’s board, including its CEO delinquent and not fit and proper to run the it.

It is said in court papers that while the minister of transport in 2019, when he appointed a permanent RAF board, called on the board to bring stability and leadership to the struggling organisation, the opposite happened.

In an affidavit filed with the Gauteng High Court, Johannesburg, the applicants’ attorney Kabelo Malao stated that the current situation at the RAF under the leadership of its CEO Collins Letsoale is the opposite of what the minister envisaged in 2019. He said the board and its CEO dismally failed to carry out its fiduciary and other duties.

“As things stand, it is evident that the RAF is on autopilot and is a shadow of its former self,” Malao said.

He said the time has come to declare the entire board and its CEO not fit and proper to run the fund.

As part of their application, the applicants have also filed a notice in terms of Rule16A for the court to take notice that they are raising several constitutional issues in their application. This includes the question whether “the RAF misleading Parliament” is Constitutional.

In terms of this notice to the court any interested party, whether they are claimants waiting for payment, attorneys, doctors or other stakeholders can now apply to take part in the application as a friend of the court.

The applicants meanwhile said that they believe there is a connection between Letsoalo’s track record at Prasa and the Road Traffic Management Corporation (RTMC) prior to his appointment as RAF CEO, and the way in which he is managing the fund.

They said his track record at those institutions was riddled with controversy and that he almost caused the RTMC to close down.

“Now the RAF is on the verge of collapse, if it has not already collapsed,” they said.

Malao said in his affidavit that Letsoalo refused to follow directives or policy at RTMC and he is doing the same at the RAF.

He said a good example at the RAF is that when the transport minister told him to withdraw a case against the Auditor-General South Africa, Letsoalo refused to do so.

The court last month ruled against the fund. The application was sparked when the RAF could not table its audited financial statements in Parliament for the 2020/21 financial year after the auditor-general gave it a disclaimer.

This led to a dispute over accounting standards used by the RAF when it compiled its annual financial statements. The RAF wanted the disclaimer to be set aside, but the court found that the fund’s change of its accounting standards improved its financial statements.

The RAF is considering taking this judgment on appeal, along with several other legal defeats recently.

According to Malao, Letsoalo said apart from refusing to pay his clients what is due to them following legal court orders and settlement agreements, Letsoalo also believes that attorneys, judges and the auditor-general are wrong, while he refuses to take responsibility for his own actions.

During a media briefing last week in which Letsoalo launched the “Drive Your Claim Forward” campaign aimed at reducing the backlog for claims submitted, he also lashed out at the judiciary for ruling against the fund in the numerous legal bids.

He said in some cases, once they see who is sitting on the bench, they (the fund) “already knows the outcome”.

Letsoalo, however, assured all that the fund is “putting claimants at the centre of what it does”.

But Malao differed vastly in his affidavit, and said since Letsoalo got rid of the fund’s panel of attorneys, the fund is unwilling to resolve matters which leads to default judgments being granted. This in turn leads the fund having to pay legal costs on a higher scale – money which the taxpayers have to fork out.

He said there were about 7 000 RAF trials in the Gauteng High Court, Pretoria in 2020 – most due to default as the fund had failed to tender offers or simply failed to appear in court. Even if orders are given in favour of claimants, many are not paid.

These 28 applicants, who have been waiting for four years for their money, said they are extremely frustrated with the way things are going, and they have no idea when and if they will ever get paid.

While Letsoalo and the fund must still file their opposing papers in this application, Letsoalo last week gave the assurance that as part of its transformation journey, the fund is committed to efficiently settling claims in 120 days.

He said the “Drive Your Claim Forward” campaign is aimed at reducing the backlog for claims submitted before April, 2021. Currently, the RAF is sitting with a backlog of 321 000 claims that have not been finalised.

The main reason for delays in the claims process is that outstanding documents are required to support a claim, Letsoalo said.

Pretoria News