DRDGold and ERPM appealed an earlier high court decision. The SCA threw out the appeal. From Moneyweb.
Last week the Supreme Court of Appeal (SCA) threw out an appeal by DRDGold and East Rand Proprietary Mines (ERPM) against an earlier Johannesburg High Court decision certifying that mine workers suffering harm in the course of their work constituted a ‘class’.
Read the judgment here.
The class action was brought on behalf of thousands of surviving or deceased mineworkers and their dependents who contracted silicosis as a result of breathing silica dust during their work.
The case has been 10 years in the making, most of that time in technical arguments, as the 32 gold mining companies cited as respondents resisted attempts to have the workers’ certified as a class.
In 2016, the South Gauteng High Court allowed the class action to proceed, a decision that was immediately appealed by the mining houses.
In 2018, 19 mining companies reached a settlement with lawyers for the claimants, under which mineworkers and their dependants could claim compensation for harm suffered in the course of their work. In 2019 the Johannesburg High Court was asked to approve the settlement.
The total claims could come to about R5 billion.
The high court certified two classes, a silicosis and a tuberculosis class. The class action comprises two phases: the first to establish liability of the mining companies, and the second to settle individual claims.
Keeping the argument going …
DRDGold and ERPM opted not to participate in the settlement agreement, and decided to argue their cases in the SCA.
The two mining houses are “the only mining companies who have persisted in litigating this matter” says a statement by class action pioneer, Richard Spoor Inc Attorneys, one of the firms representing the mineworkers.
“Their persistence has devastating effects as sick and dying mine workers hold on to life in a legal battle now raging for more than a decade and spanning decades of mining activity.”
Should DRDGold and ERPM appeal the SCA ruling to the Constitutional Court, this could add years to the case, as it must still go to trial, says George Kahn, a director at Richard Spoor Inc.
“However, if we ultimately reach a settlement with DRDGold and ERPM, this would likely bring the matter to a speedier conclusion, though we will still have to go to court to get its approval for the settlement.”
Reasons
Responding to the SCA ruling, DRDGold (of which ERPM is a subsidiary) said it had challenged the class certification on several counts:
- That it was too broadly defined;
- The tuberculosis class action against it had been withdrawn;
- It would have minimal involvement in the legal proceedings;
- It ceased underground mining at Durban Deep in 2000; and
- That there was no basis for the liability of parent companies.
ERPM further contended that it was provisionally liquidated and a compromise with creditors was reached in 2001, and that it ceased underground mining in 2008.
Lawyers for the mineworkers argued that while insolvency settlements provide protection against further creditor claims, this does not apply to claims of delict (violations of law).
DRDGold argued it would be prejudiced by having to participate in a class action suit in which it had a minimal role to play. Judge Christiaan van der Merwe, on behalf of the SCA, said this claim of prejudice “appears to be exaggerated.”
The Tshiamiso Trust, which was set up to administer claims, has paid out close to R1 billion to date, in 6 040 payments to affected mine workers and their families – R549 million in SA and R421 million in Lesotho.
Van der Merwe’s ruling says the certification of a class – of which DRDGold and ERPM sought to be excluded – was no more than a procedural device aimed at facilitating the determination of the class action. It could be altered by the court during the class action proceedings, and matters that do not affect the two mining companies could be separated from the main case and the companies excused.
Shameful legacy endures
Says Kahn: “The ongoing class action litigation deals with the legacy of apartheid that continues to endure in the lungs, families and communities of labourers that silicosis and tuberculosis followed home from the mines.
“The injustices … will persist with us so long as the finalisation or settlement of this action is delayed by the mining companies that grew massively wealthy off these stolen futures.”
The SCA also found that a ‘declarator’ issued by Johannesburg High Court, allowing general damages claims by deceased mineworkers to be transmitted to their dependants, remains intact.
This means the class action against DRDGold and ERPM will proceed to trial.
What’s next
Before summons can be lodged in the class action case, lawyers for the mineworkers must apply to the Johannesburg High Court for a ‘variation’ on the 2016 order, to exclude mines that have already settled.
“Then we give notice and only after notice periods [so people who want to opt out of the litigation and instruct their own lawyers have a chance to do so] will summons be issued,” says Kahn.
DRDGold says it still has no clear measure against which it can decisively gauge the risk of legal liability, and therefore “any offer in settlement beyond considerations of cost, risk or convenience would be tantamount to a donation”.
“To progress the matter the plaintiffs are now required to issue a summons to commence action. The grounds of appeal will be raised as a defence in addition to the defences raised on the facts of the matter and these issues will most likely be dealt with by way of points in limine [before the main case is heard].”
Kahn disputes that DRDGold cannot establish its legal liability in this case.
“The High Court in 2015 commented that the mining companies themselves would know what their anticipated liability would be because they alone carry all the relevant data points.”
This data would include earnings, the age of workers at date of dismissal as well as health information.
