3. According to Van der Walt (Damages p. 119, footnote 29), damage can only be assessed when it has manifested itself, and there is no method to assess an “uncompleted” future development. Do you agree that there is no suitable method for estimating prospective loss and lucrum cessans? What solution is theoretically apt in view of the hypothetical element of the sum-formula? In view of the conditio sine qua non “test” of causation and legal practice, Visser and Potgieter are of the opinion that the sum-formula is not actually used. What formula to assess prospective loss do they recommend, and how does it operate in the real situation? Explain.

Question

[For an answer, please consult Visser & Potgieter pp. 132-133 [par 6.3] and pp. 76 [paragraph (c)]; and for a practical application (only for interest’s sake), see pp. 430 et seq.

Answer 1

I agree with Van der Walt that damage can only be assessed when it has manifested itself, as it can be difficult to accurately predict future developments and losses. However, there are methods available for estimating prospective loss and lucrum cessans.

Visser and Potgieter suggest using the "loss of a chance" or "percentage chance" approach to assess prospective loss. This formula takes into account the hypothetical element of the sum-formula by calculating the percentage chance of the future event occurring and then multiplying it by the potential loss if the event does occur. This allows for a more realistic assessment of prospective loss, taking into account the uncertainty of future developments.

In practice, this formula operates by assessing the likelihood of the future event occurring based on the evidence available. For example, in a medical malpractice case, the court may determine the percentage chance of a patient recovering fully from an incorrect surgery based on expert testimony and medical records. This percentage is then multiplied by the potential amount of damages the patient could receive if they were fully compensated for their injuries.

While the sum-formula may not be explicitly used in every case, the "loss of a chance" approach recommended by Visser and Potgieter provides a more nuanced way of assessing prospective loss, taking into account the uncertainties of future events. This approach allows for a more accurate and fair assessment of damages in cases where future developments play a significant role.