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[2015] ZASCA 17
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Greater Tzaneen Municipality v Le Grange (685/2013) [2015] ZASCA 17 (18 March 2015)
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THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case
no
:
685/2013
Reportable
In
the matter between:
GREATER
TZANEEN
MUNICIPALITY
...........................................................................
Appellant
and
ANDRE
JEAN JACQUES LE
GRANGE
.......................................................................
Respondent
Neutral
citation:
Greater Tzaneen
Municipality v Le Grange
(685/2013)
[2015]
ZASCA 17
(18 March 2015)
Coram:
Brand, Leach, Willis, Zondi JJA and Dambuza AJA
Heard:
23 February 2015
Delivered:
18 March 2015
Summary:
Jurisdiction – an undertaking to employ in a
contract is not a matter falling within the purview of s 157 of the
Labour Relations
Act. – the high court has jurisdiction –
rectification – on the evidence the contract was not truly
reflective
of the intention of the parties and agreement properly
rectified.
ORDER
On
appeal from:
North Gauteng
High
Court, Pretoria (Hiemstra AJ sitting as court of first instance):
‘
The
appeal is dismissed with costs, such costs to include the costs of
the application for an interdict’.
JUDGMENT
Dambuza AJ
(Brand, Leach, Willis and Zondi JJA concurring):
[1]
This appeal is with the leave of this court, against the judgment of
the North Gauteng High Court, Pretoria (Hiemstra AJ), dismissing
an
application by the appellant (municipality) to have the respondent
(Mr Le Grange) interdicted from accessing the municipal premises
as
an employee of the municipality. The court a quo also rectified an
agreement concluded between the municipality and Mr Le Grange.
Before
us counsel for the municipality informed us that the interdict
originally sought by the municipality had become academic
and that
the municipality was abandoning its appeal and tendering costs in so
far as it related to that issue. What remained for
determination was
the appeal against rectification of the agreement.
[2] The agreement at
the centre of the dispute between the parties, was concluded on 9
April 2010. Prior to the conclusion of the
agreement Mr Le Grange had
been employed by the municipality as the ‘Head: Section Finance
Expenditure’. He had been
employed by the municipality for the
17 years preceding the conclusion of the agreement. In terms of the
agreement Mr Le Grange
took up employment with the municipality as
the chief financial officer (CFO) for a period of three years,
starting from 1 December
2009 until 30 June 2012. Upon the expiry of
the three year period, Mr Le Grange continued to present himself at
the premises of
the municipality, insisting that the municipality had
an obligation to keep him in his employ.
[3]
The municipality denied that it was obliged to employ Mr Le Grange.
Instead, on 7 July 2012, the municipality approached the
high court,
on an urgent basis, seeking an order that Mr Le Grange be interdicted
from accessing the municipal premises as an employee
of the
municipality and that he be ordered to return the access cards with
which he had been provided as an employee. The municipality
contended
that Mr Le Grange’s right to access the municipality premises
as an employee of the municipality ceased when the
term of his
employment as CFO of the municipality expired.
[4]
Mr Le Grange opposed the application brought by the municipality and
asserted his right of continued presence at the municipal
premises.
He relied on a portion of clause 2.3 of the agreement which, he
contended, entitled him to a further contract of employment
with the
municipality. He brought a counter-application in which he sought to
enforce his right to a contract of that kind. He
also sought
rectification of the agreement in terms more fully set out in the
paragraphs that follow.
[5]
The high court dismissed the application for an interdict, holding
that no authorisation for institution of the court proceedings
by the
municipality had been shown. It then granted an order for
rectification of the agreement and found that on expiry of Mr
Le
Grange’s term of employment as CFO, the municipality was
obliged to employ him as provided in the rectified agreement.
[6] It was not in
dispute, both before the high court and in this court, that in its
original form, and as signed by Mr Le Grange,
clause 2.3 of the
agreement provided that:
‘
2.3
It is specifically recorded that there is no expectation that this
Contract will be renewed or extended beyond the term referred
to in
clause 2.2 [the three year term]. The Employer’s decision not
to renew or extend the contract shall not constitute
an unfair
dismissal and the Employee shall not be entitled to any form of
compensation.
2.3.1
However, during the discussions with the Mayor regarding the short
period of the Contract, it was agreed that the Employer,
in the case
of non-renewal or extension of this contract will
endeavour
to suitably accommodate the Employee in a permanent position on the
service register that fits his status, qualifications and
experience.’ (My emphasis.)
[7]
The order for rectification of the agreement provided for replacement
of the word ‘endeavour’ in clause 2.3.1 with
the words
‘be obliged’. It was common cause that, about a month
into Mr Le Grange’s term of employment as CFO,
Mr Mangena, the
municipal manager at the time, deleted clause 2.3.1 from a copy of
the agreement and signed that copy on behalf
of the municipality (on
19 April 2010).
[8]
Subsequent to the deletion of clause 2.3.1 there was an exchange of
correspondence between Mr Le Grange (through his attorneys)
and the
municipality on the propriety of the deletion of the clause.
Essentially, Mr Le Grange maintained that he had concluded
an
agreement with the municipality in the terms set out in the original
agreement. He also lodged a grievance with the Mayor protesting
the
purported amendment to the agreement. The dispute remained unresolved
until the expiry of Mr Le Grange’s term of employment
as the
chief financial officer (CFO).
[9]
The appeal against rectification is premised, mainly, upon two
grounds. The municipality contends, first, that Mr Le Grange
had
failed to establish that when the agreement was concluded both
parties were labouring under a common mistake. Its second contention
was that because the remedy sought by Mr Le Grange is founded in the
provisions of the Labour Relations Act 66 of 1995 (LRA), the
high
court (and this court) had no jurisdiction to entertain the
counter-application. This submission extended to an argument that
employment to the position(s) contemplated by Mr Le Grange required
approval of the municipal council which had not been obtained
prior
to the conclusion of the agreement and therefore the agreement was
illegal and unenforceable. For that reason it could not
be rectified.
Although the high court did not pertinently consider the issue of
jurisdiction, it is expedient that I deal with
it before considering
the other grounds on which the appeal is founded.
[10]
Jurisdiction
The
contention that the high court had no jurisdiction to hear Mr Le
Grange’s complaint was foreshadowed, rather obliquely,
in the
municipality’s founding affidavit. The allegation was that,
rather than repeatedly presenting himself at the municipal
offices
and disturbing the peace, Mr Le Grange should have approached the
labour court to assert his claim for ‘reinstatement’.
In
the answering affidavit, Mr Le Grange denied that he sought
re-instatement and explained that his claim was for specific
performance
of a term of an agreement. Counsel for the municipality
persisted before us that in terms of s 77(3) of the Basic Conditions
of
Employment Act
[1]
(the BCEA),
only the labour court had jurisdiction to hear the claim brought by
Mr Le Grange as the claim was founded on s 186(2)(
c
)
of the LRA.
[2]
The argument was
that Mr Le Grange’s case was essentially one of unfair labour
practice by the municipality in refusing to
reinstate him to
employment. This is incorrect.
[11] First, the
provisions of the LRA did not arise in this case. The remedy sought
by Mr Le Grange was not ‘re-instatement’
to a position
previously held with the municipality; nor did he seek renewal of the
expired agreement. What he sought was specific
performance of clause
2.3.1 of the agreement as reflected in the declaratory order. In
Gcaba v Minister for Safety and Security
2010 (1) SA 238
(CC)
the Constitutional Court explained the basis on which the nature of
issues raised in proceedings must be determined. That
court held that
jurisdiction is determined on the basis of the pleadings and not on
the substantive merits of the case. Mr Le Grange
had pleaded, as the
relief he sought, the common law remedy of specific performance,
based on the fact that the municipality was
obliged, in terms of the
agreement, to employ him after 30 June 2012. The fact that the relief
sought related to employment did
not necessarily mean that it was
rooted in the provisions of the LRA. And the fact that Mr Le Grange
had been employed by the municipality
prior to 30 June 2012 did not
mean that he was seeking re-instatement. In
Makhanya v University
of Zululand
2010 (1) SA 62
(SCA) this court held that:
‘
When
a claimant says that the claim arises from the infringement of the
common-law right to enforce a contract, then that is the
claim, as a
fact, and the court must deal with it accordingly. When a claimant
says that the claim is to enforce a right that is
created by the LRA,
then that is the claim that the court has before it, as a fact. When
he or she says that the claim is to enforce
a right derived from the
Constitution, then, as a fact, that is the claim. That the claim
might be a bad claim is beside the point.’
[3]
[12] Further, even
if Mr Le Grange was seeking reinstatement, s 77(3) of the BCEA on
which the municipality relied (perhaps unwittingly),
provides that:
‘
The
Labour Court has concurrent jurisdiction with the civil courts to
hear and determine any matter concerning a contract of employment,
irrespective of whether any basic condition of employment constitutes
a term of that contract.’
In
Gcaba
[4]
the Constitutional Court clarified the issue concerning the overlap
in jurisdiction of the labour court and the high court in respect
of
employment matters by explaining that the labour court has exclusive
jurisdiction over those matters which the LRA prescribes
should be
determined by it.
[5]
That court,
however, endorsed the concurrency of jurisdiction between the two
courts
[6]
but warned that s
157(2) should not be understood to extend the jurisdiction of the
high court to determine issues which, in terms
of s 157(1) of the
LRA, fall exclusively under the jurisdiction of the Labour Court.
[7]
[13]
In this case the municipality brought its application for an
interdict in the high court. In its founding affidavit it set
out
what it considered to be the relevant portion(s) of the agreement as
the ‘background facts to the application’.
It pleaded
that because the agreement had expired, Mr Le Grange’s right to
access the municipal premises as an employee had
ceased. The defence
tendered by Mr Le Grange was, in essence, that the agreement went
beyond the terms set out in the founding
affidavit; it also regulated
certain rights and obligations of the parties after 30 June 2012.
Therefore, even if Mr Le Grange’s
claim had been founded in the
LRA it would not have been acceptable for the municipality to plead
that Mr Le Grange be directed
to approach the labour court. Such a
course would result in an undesirable duplication of proceedings in
which essentially the
same disputes would arise. The contention that
Mr Le Grange should have approached the labour court was therefore
misplaced.
[14]
Rectification
In
granting the order for rectification, the high court found that Mr Le
Grange had proved that both him and the municipality had
intended
that the municipality be obliged to offer employment to Mr Le Grange
on expiry of his term of employment as chief financial
officer. The
challenge against the finding of the high court was based on two
grounds: that Mr Le Grange had failed to prove a
mistake common to
both parties at the time of the conclusion of the agreement and that
the agreement fell foul of certain statutory
requirements and was
therefore illegal and could not be rectified. I start with the last.
[15]
The contention by the municipality was that the agreement could not
be rectified as it was tainted by an underlying illegality
in that it
was concluded with the mayor who lacked the necessary power to do so.
This argument on behalf of the municipality was
based on an
assumption that Mr Le Grange sought to be employed to a position
regulated by
s 57
of the
Local Government: Municipal Systems Act 32
of 2000
. This section regulates the terms of employment contracts for
municipal managers and managers directly accountable to municipal
managers. In terms of
s 56
of the same Act, municipal managers and
managers directly accountable to the municipal manager must be
appointed by the municipal
council in consultation with the municipal
manager.
[16]
This description of Mr Le Grange’s case was wrong on three
fronts. It was not Mr Le Grange’s case that the agreement
was
that he would be employed to a s 57 position; he also did not seek
employment to such a position. His case was that the municipality
had
undertaken to employ him in a ‘permanent position on the
service register that fits his status, qualification and experience’.
All that he sought was to be employed as agreed. In fact, the
evidence was that on expiry of his term as the CFO he had demanded
to
be employed in a position similar or the one he had occupied prior to
the conclusion of the agreement. By all accounts such
position was
not a s 57 position.
[17]
It was also not Mr Le Grange’s case that he had concluded the
agreement with the mayor. His case had always been that
the agreement
was concluded with the council. The agreement reflects that to have
been the case. The fact that he had held discussions
with the mayor
relating to the agreement is irrelevant. Therefore the argument that
the agreement was unenforceable did not assist
the municipality.
[18]
In the end, whether the agreement was eligible for rectification fell
to be determined on whether the evidence tendered proved
that the
agreement, in particular, clause 2.3.1, was not a correct recordal of
the true agreement between Mr Le Grange and the
municipality. In
essence the enquiry was whether use of the word ‘endeavour’
in clause 2.3.1 was due to a mistaken
understanding of the meaning
thereof by both parties, as Mr Le Grange contended.
[19] The
municipality insisted that the determination of the intention of the
parties had to be limited to the word ‘endeavour’
as used
in the agreement without recourse to the background against which the
agreement was concluded. On the wording of the agreement,
the
municipality was only obliged to endeavour to employ Mr Le Grange, so
it was argued. This interpretation of the agreement impermissibly
isolates the word ‘endeavour’ from the rest of clause
2.3.1. The clause sets out the background and motivation for
the
agreement to employ Mr Le Grange in a permanent position after 30
June 2012. In addition Mr Le Grange tendered further evidence
in
respect of the background to the conclusion of the agreement. The
evidence was to the effect that it was Mr Le Grange and Mr
Visser,
the municipality’s human resource manager at the time, who
prepared the agreement. In his affidavit, filed in support
of Mr Le
Grange, Mr Visser explained that when Mr Le Grange was recommended
for the position of CFO, he (Mr Le Grange) advised
the municipal
council that he would accept the position on condition he was
‘provided with security that he would not be
without an
appointment/work after 30 June 2012’. It was on this basis that
Mr Visser was instructed to draft the agreement.
He explained that
the word ‘endeavour’ was used as a translation for the
Afrikaans word ‘onderneem’, which
both he and Mr Le
Grange, being Afrikaans speaking, had intended to use in the
agreement.
[20]
Both Mr Le Grange and Mr Visser highlighted in their evidence that,
at the discussions relating to the three year CFO position,
Mr Le
Grange had insisted on protecting the security of his long term
employment with the municipality. This evidence is consistent
with
the inclusion of clause 2.3.1 in the agreement.
[8]
As against this evidence, the municipality tendered the evidence of
Mr Thulani Twala, the municipal manager who took office at
some stage
subsequent to Mr Mangena. Mr Twala denied that the use of the word
‘endeavour’ was a mistake. However, Mr
Twala did not set
out the basis on which he could attest to the facts relating to the
conclusion of the agreement. There was no
evidence indicating that he
was present at any stage during the negotiations relating to the
conclusion of the agreement.
[21]
On the evidence before the high court, Mr Twala could only have
hearsay knowledge about the terms on which the agreement was
concluded. There was no evidence tendered on behalf of the
municipality, by a person who was privy to the negotiations. The high
court could only determine the true intention of the parties on
credible evidence before it. Only the evidence of Mr Le Grange
and Mr
Visser was properly before the high court and the finding of that
court, that the use of the word ‘endeavour’
was
attributable to an erroneous translation of the Afrikaans word
‘onderneem’ by Mr Le Grange and Mr Visser, was properly
made. A proper case for rectification had been made and the
declarator was correctly granted. Consequently the appeal must fail.
[23]
In the result, the following order is made:
‘
The
appeal is dismissed with costs’.
______________
N Dambuza
Acting Judge of
Appeal
APPEARANCES
For
Appellant: GN Moshoana
Instructed by:
Mushoana Inc,
Pretoria
Lovius
Block Attorneys, Bloemfontein
For
Respondent: JS Stone
Instructed
by:
Kruger Nagel &
De Jager Attorneys, Tzaneen
Bezuidenhouts
Attorneys, Bloemfontein
[1]
Basic
Conditions of Employment Act 75 of 1997
.
[2]
Section
186
of the LRA deals with the meaning of dismissal and unfair labour
practice.
Section 191
provides that if there is a dispute about the
fairness of a dismissal or a dispute about an unfair labour practice
the dismissed
employee or the employee alleging an unfair labour
practice may refer the dispute in writing for conciliation or
arbitration.
[3]
At
82G-I at 71G-I.
[4]
Supra,
paras 70 – 72.
[5]
S157(1)
of LRA. Such matters include review of arbitration awards in terms
of
s 145
of the LRA and those regulated by
s 186
of the LRA.
[6]
S157(2)
of the LRA provides that: ‘The Labour Court has concurrent
jurisdiction with the High Court in respect of any alleged or
threatened violation of any fundamental right entrenched in Chapter
2 of the Constitution of Republic of South Africa, 1996,
and arising
from –
(
a
)
Employment and from labour relations;
(
b
) any
dispute over constitutionality of any executive or administrative
act or conduct,. . . by the State in its capacity as an
employer;
and
(
c
)
the application of any law for the administration of which the
Minister is responsible’.
[7]
At
261D-E
[8]
The
evidence was that it was only after an (unspecified) inquiry was
made by ‘National Treasury regarding the clause that
Mr
Mangena deleted it. Although in the correspondence following from
the deletion of clause 2.3.1, the municipal (through Mr
Mangena)
disputed that the clause had been properly included in the
agreement, in its replying papers to the counter-application
it
disavowed Mr Mangena’s attempts at altering the agreement, by
deletion of the clause. It only contended that Mr Le Grange’s
interpretation of the clause as entitling him to ‘remain’
in the employment of the municipality was incorrect as
the clause
only compelled the municipality to ‘endeavour’ to employ
Mr Le Grange. The argument was that Mr Le Grange
had not proved that
the municipality had failed to meet its obligation to ‘endeavour’
to employ him.’