Blow for Eastern Cape Department of Health as SCA overturns ‘saviour judgment’

The Supreme Court of Appeal ruled on Wednesday, 11 February 2026, that a finding from the Eastern Cape that the health department can provide health services to a patient who has harmed by its negligence, instead of paying multimillion-rand settlement amounts for future medical expenses, “violated the child’s best interests”.

The ruling by appeal court judge Ashton Schippers overturned one of the key legs of the Eastern Cape Department of Health’s strategy to deal with mounting medico-legal claims against it. According to the latest available data released by Minister of Health Aaron Motsoaledi, this amount is now between R37-billion and R40-billion.

Most of these claims are for babies with cerebral palsy who were injured during birth at state facilities. The largest financial burden of these medico-legal payouts is the component for future medical expenses for the children. These are difficult to quantify, and successful claims result in court orders for multimillion-rand lump sum payments that must be made immediately.

In 2023, the Eastern Cape Department of Health brought a test case to the high court where it asked the court to develop the common law to include an allowance that instead of paying these large lump sum payments for future medical expenses, the department would be allowed to offer medical services in public sector hospitals and clinics instead, or pay for private medical services if it was not able to help.

In this case, a mother instituted legal action against the department after her child suffered severe birth injuries at Cecilia Makiwane Hospital in KuGompo City (formerly known as East London).

The injury resulted in the child being severely disabled and reduced his life expectancy. He is unable to stand, walk or sit, and is incontinent. He is totally dependent on a caregiver for positioning, mobility and all activities for daily living. He is virtually blind, but capable of hearing.

He will require extensive medical care and treatment for the rest of his life. His life expectancy is estimated to be about 23 years.

The department conceded that its staff were negligent. The mother sued it for R23-million, of which the bulk was for the child’s future care.

In this case the department was successful in persuading Judge Morgan Griffiths that the common law must be developed to allow it to provide future medical care to the mother, instead of paying out a multimillion-rand lump sum.

Read more: Eastern Cape Health Department wins significant legal victory against medico-legal claims

But on Wednesday, the Supreme Court of Appeal overturned this order by Griffiths, ordered that lump sum payments resume immediately, and said the high court ruling “violated the child’s best interests”.

Writing on behalf of the court, Schippers said the remedies ordered by Griffiths created “uncertainty and exposed the child, who is vulnerable and has suffered a catastrophic injury, to systemic failure by the department. It also deprives the child (and their caregiver) of the financial autonomy that lump sum damages provide.

“The high court, in a single case, abolished the rule in complete disregard of the impact of its order on other fundamental rights, and without considering the social and economic effects of the order on cases of this kind nationally. It did so with no assurance of the continuity of treatment or payments by the [Eastern Cape] under the order, apart from the say-so of the [department]’s witnesses,” he wrote in his judgment.

“Contrary to the court’s conclusion, this was no ‘limited incremental development’ of the common law. Rather, it is a radical restructuring of the law of damages.

“[The] real reason for the high incidence of children born with cerebral palsy in public hospitals in the [Eastern Cape], is negligence by the staff at those hospitals – the same hospitals which have been ordered to provide the public healthcare remedy. Indeed, Dr [Rolene] Wagner [who heads up the department] conceded that there is no comparison between the public and private healthcare sectors regarding the occurrence of cerebral palsy cases.

“And the province has the highest number of medico-legal cases involving cerebral palsy in the country, arising from the negligence of hospital staff. Is the answer to the ongoing negligence caused by public health practitioners and providers that the common law should be developed? I think not. And this, when the evidence discloses that the remedies will not result in the saving of public funds, unless the state reduces the risk of medical negligence,” he added.

He said in the trial record Dr Rolene Wagner, who heads up the department, testified that funds for the remedies had been ring-fenced for the then current financial year, and that it “will be ring-fenced in the ensuing years”.

However, on her own evidence, funds for the remedies were ring-fenced for only two financial years. This, in circumstances in which Dr Wagner conceded that the department’s “financial position is a threat” to the services it generally provides, let alone to its ability to sustain the remedies; and where the department was already unable to pay its suppliers for services provided.

At the time of her testimony (November 2021), the department owed suppliers R1-billion, with a projection that it would stand at R4.5-billion at the end of the financial year.

Professor Alex van den Heever, an expert in public health funding from the University of the Witwatersrand, also gave evidence in the trial on behalf of the plaintiff in the case.

“He observes that the department’s books are in dire shape: it carried roughly R1.8-billion in overdue invoices (mostly medical and pharmaceutical bills), and about 7.2% of its budget was tied up in arrears in excess of 30 days – by far the worst in the country. Indeed, systemic mismanagement of, and unauthorised and irregular expenditure by, the department are common ground.

“Treasury reports and civil-society audits have repeatedly flagged systemic financial mismanagement and a ‘culture of impunity’ in the province’s health finances,” Schippers continued in his summary of Van den Heever’s evidence.

Van den Heever expressed strong doubt that the department had the capacity to provide the healthcare that the child needed at a standard equivalent to that in the private sector.

He compared the Eastern Cape health department’s performance to the Western Cape Department of Health and concluded that the Eastern Cape was “materially less capable than the Western Cape department; that the performance weaknesses arising from the differences in capability are demonstrated in poor health outcomes and poor financial management; and that the department does not have systems in place to ensure continuous improvements in performance.”

He added that the reasons for this were financial mismanagement, more specifically, high levels of irregular and unauthorised expenditure, which included the failure to budget for predictable liabilities such as medico-legal claims. He emphasised that irregular and unauthorised expenditure had nothing to do with socioeconomic conditions or resource constraints.

Several other government departments, Motsoaledi and other provincial health departments were allowed to make submissions to the Supreme Court of Appeal as “friends of the court”.

Motsoaledi’s legal team argued that the first ruling should stand “to protect the fiscus and the sustainability of the public health system”.

But the health departments asked the Supreme Court of Appeal for clarification as they argued that the order, as given by the high court, could expose them to “unmanageable dual obligations: the payment of damages and the separate funding of lifelong public care, without uniform national rules”.

National rules

The provinces argued for national rules so that they could be applied uniformly “to protect provincial healthcare budgets from total collapse under escalating litigation”.

Schippers said in his judgment that this type of reform would be better handled by Parliament.

Schippers said the reasons provided by the department to motivate for the development of the common law were that everyone living in the Eastern Cape province has a right of access to healthcare, but that the expenditure of scarce public funding on damages awards was neither optimal nor reasonable.

He said the department argued that it could provide future medical care to the child and those similarly situated at substantially lower costs than the private sector.

The department further argued that the rule requiring damages to be paid in money, “unreasonably and unconstitutionally prevents the state from providing future medical care in the public healthcare sector; and obliges the state to allocate scarce public funds to future medical care”.

Andrew Donaldson from the National Treasury gave evidence before court that medico-legal claims were increasing faster than available resources: between 2018 and 2019, they increased by 24%, while resources to provincial health departments increased by 7-8% per year.

He further testified that the increase in claims and their payment as a lump sum threatened the state’s capacity to provide and improve health services. The actual payments made in respect of court cases amounted to 3-4% of the department’s budget and were a drain on its resources, which could be better used for other purposes.

Further evidence before court was that between 1 April 2014 and 31 March 2021 the department had settled claims totalling R3.462-billion. As these payments were not budgeted for the money had to be withdrawn from other programmes, reducing the money available to provide healthcare.

Schippers said that the evidence before the trial court made it “irrational to conclude that lifelong future medical treatment for the child will be provided at [Eastern Cape state hospitals], or that future payments will reliably be made under the remedies”.

He pointed out that the Eastern Cape Rehabilitation Programme (the Rehabilitation Programme) for children with cerebral palsy, using a multidisciplinary team approach, set up to provide these services had no data to prove its efficacy and no evidence of long-term staffing, infrastructure or service continuity.

Eastern Cape Department of Health Communications Director, Siyanda Manana, said it would ask for leave to appeal this case to the Constitutional Court.

“The department firmly believes that this matter raises fundamental constitutional questions that extend beyond the scope of existing common law precedents and, respectfully, require the further and deeper consideration they will receive in the Constitutional Court,” he said.

Manana added that the appeal was not an attempt to evade responsibility. He said that in the specific case before the court, the child had been provided with all the medical care that he needed.

“The lump-sum system currently drains billions from provincial health budgets –funds diverted from hiring doctors, buying medicine and upgrading infrastructure for the masses. By appealing this judgment, we are fighting to stem this loss. We are fighting to ensure that compensation provides actual care for the patient for the duration of their life, rather than transferring public funds into private trusts that are consumed by inflated legal fees and administrative costs and diverted to funding private-sector services,” he added.

He said the department “remains committed” to reducing negligence. “We are improving clinical standards, despite the impact of the historic debt on our ability to sustain services. For three consecutive quarters we have provided safer pregnancies and better maternal health outcomes, with significantly reduced maternal morbidity and mortality.”

He said that once an application for leave to appeal was filed, the court order that lump sum payments must resume immediately would be suspended. DM