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[2010] ZAGPJHC 111
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Stocker and Another v Workforce Group (Pty) Ltd (A3006/2010, 39246/09) [2010] ZAGPJHC 111; (2011) 32 ILJ 883 (GSJ) (17 November 2010)
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
SOUTH GAUTENG HIGH COURT
JOHANNESBURG
CASE Nos.
A3006/2010
(Appeal case
number)
39246/09
(Motion Court
case number)
DATE:
17/11/2010
In the matter of
the appeal of:
CHRISTINE SUSAN
STOCKER
..............................
First
Appellant
and
JEFFERY EDWARD
GIDDINGS
............................
Second
Appellant
and
THE WORKFORCE
GROUP (PTY) LTD
.................
Respondent
____________________________________________________________
JUDGMENT
WILLIS J:
[1] In the court
below (
per
van
Eeden AJ), summary judgment was granted against the appellants,
jointly and severally, the one paying, the other to be absolved.
The
appellants, who were the defendants in the court below, were ordered
to pay the plaintiff (who is now the respondent) the sum
of R1 881
307.47 (one million, eight hundred and eighty one thousand, three
hundred and seven rands and forty-seven cents), together
with
interest and costs. The appellants now appeal to the full court with
the leave of the court below. The judgment of the court
below was
delivered on 10 December, 2009.
[2] The judgment
was granted against the appellants on the basis that they were
sureties for a debt owed by Crystal Pack (Pty) Ltd,
the principal
debtor.
[3] In the
plaintiff’s particulars of claim, it was alleged that the debt
arose from services which the plaintiff, as a duly
registered private
employment agency, had rendered to the principal debtor in procuring
and providing the services of employees
who were mainly general
workers, electricians and code 10B drivers. These services were
provided in terms of four separate written
agreements concluded
between the plaintiff and the principal debtor. The plaintiff also
alleged in its particulars of claim that
the principal debtor
acknowledged its indebtedness in the sum of R 1 881 307.47, in
writing, on 17 June, 2009 and also acknowledged
that “the
amount is due and payable and not disputed”. In its particulars
of claim the plaintiff furthermore alleged
and relied upon a clause
in the deeds of suretyship in terms of which the sureties agreed that
“all acknowledgements of indebtedness
and admissions by the
debtor shall be binding on me”. In their affidavits resisting
summary judgment, the appellants do not
dispute these allegations.
[4] It would
appear that the principal debtor paid an amount of R14 896 923.53 to
the plaintiff out of a total of R16 778 231.00
due to the plaintiff
in terms of invoices for the services rendered by the plaintiff.
This is how the amount claimed from the
sureties is derived: it is
for the balance on an account. It appears that the principal debtor
continues to do business with the
plaintiff. It seems that a change
in the directorship of the principal debtor explains, at least in
part, why the plaintiff is
proceeding against the appellants rather
than the principal debtor, although the reasons are somewhat murky.
Both of the appellants
are former employees of the principal debtor.
The first appellant was its financial director at the time of signing
the deed of
suretyship. As is so often the case with claims based on
suretyship, one cannot escape a sense of sympathy with the
appellants.
[5] The appellants
have resisted judgment on the following bases:
(i) The plaintiff
had overcharged the principal debtor in an amount of “at least”
R208 908,30 and had also applied incorrect
charge rates;
(ii) The High
Court lacked jurisdiction to hear the matter;
(iii) The
plaintiff was not duly registered as a person providing employment
services in terms of the
Skills Development Act, No. 97 of 1998
.
[6] Insofar as the
defendant’s contention that there is a dispute as to whether or
not the plaintiff overcharged or charged
at excessive rates in an
amount of at least R280 908,38 is concerned, it is significant that
in paragraph 21 of the plaintiff’s
particulars of claim, it
alleges that on 17 June, 2009, the principal debtor acknowledged in
writing that it owed the plaintiff
the amount of R1 881 307,47 and
that “the amount is due and payable and not disputed”. As
has already been mentioned,
the plaintiff went on to allege that the
deeds of suretyship contained a clause in terms of which the sureties
agreed that “all
acknowledgements of indebtedness and
admissions by the debtor shall be binding on me”. These
allegations as to (a) the acknowledgement
by the principal debtor of
the amount of the indebtedness, (b) as well as the acknowledgement by
the principal debtor’s obligation
to pay the same and (c) the
binding nature of such acknowledgements upon the sureties are not
denied by the appellants.
[7]
It is trite that sureties are
promissores
subsidiarii
,
that their obligations are accessory to that of the principal
debtor.
1
This entails,
inter
alia
,
that a surety as the same defences
in
rem
as the principal debtor has. In plain English, the Latin in this
paragraph may be summarized as meaning that sureties have the
same
substantive defences as are available to the principal debtor, no
more and no less. Apart from the
beneficium
ordinis seu excussionis
(the benefit of excussion), the
beneficium
divisionis
(the benefit of division) and the
beneficium
cedendarum actionum
(the benefit of cession of actions), none of which
beneficia
are relevant to this case, a surety has the same rights as the
principal debtor. Put conversely, a surety cannot succeed against
a
creditor in circumstances where the principal debtor would not be
able to do so. As the principal debtor in this case has admitted
the
amount owing and its liability to pay the same, it is not open to the
sureties to dispute these facts with the creditor. To
compound the
appellants’ difficulties, they have both agreed that
“acknowledgements of indebtedness” by the principal
debtor shall be binding on them. Accordingly, there is no merit in
this ground of appeal. The surety’s remedy, in such a
situation, is to claim, by way of recourse, from the principal
debtor.
2
In this particular case, this right of recourse would not seem to be
merely hypothetical. The principal debtor appears to be thriving.
[8] The next
argument of the appellants is that because the respondent is a
private employment services agency, the Labour Court
has, in terms of
section 31
(1) of the
Skills Development Act, No. 97 of 1998
,
exclusive jurisdiction to hear the matter. The argument went that
upon a proper interpretation of the long title of
Skills Development
Act, read
together with
sections 2
91
) (h),
3
(a),
24
(1),
33
(d) and
33
(e) of that Act, the legislature clearly regulates employment
services as provided by an agency such as the plaintiff and, as
section 31
confers exclusive jurisdiction on the Labour Court “in
respect of all matters arising from this Act”, the High Court
had no jurisdiction in the matter. It is indeed clear enough that
Skills Development Act does
regulate employment services of the kind
provided by the plaintiff. It is also clear that
section 31
provides
that the Labour Court has exclusive jurisdiction in respect of all
matters arising from the
Skills Development Act. The
question is
therefore, simply, whether the plaintiff’s claim is one
“arising from” the Act by reason of the fact
that the Act
regulates the business of the plaintiff? There is no need to repeat
the sections of the Act
verbatim
.
[9]
It seems clear from the decision of the Constitutional Court in
Gcaba
v Minister for Safety and Security
3
that the High Court retains its jurisdiction to determine matters as
it has always done in terms of common law or as provided for
in other
statutory laws. The exception is that, when it comes to remedies that
pertain to rights specifically brought into being
by the Labour
Relations Act, No 66 of 1995 (“the LRA”) and certain
additional statutes such as the
Skills Development Act and
the
Basic
Conditions of Employment Act, No. 75 of 1997
, the Labour Court is the
court given exclusive jurisdiction to determine whether or not such
remedies are legally justifiable in
the particular circumstances of
any specific case. An obvious example of how such exclusivity
operates occurs is to be found in
the case of the right, in terms of
the LRA, not to be unfairly dismissed.
4
This right not to be unfairly dismissed may be contrasted with the
right, at common law, not to be unlawfully dismissed. In the
absence
of a statutory intervention, an unfair dismissal, unless it was also
unlawful at common law, would be without a remedy.
The LRA not only
enables legal recourse and creates legal remedies for an unfair
dismissal which was not also unlawful at common
law
5
but, furthermore, determines that the Labour Court is the court which
has exclusive jurisdiction to make determinations as to (a)
the
unfairness of a dismissal and (b) the appropriate remedy in the event
that a dismissal is unfair.
6
In
general terms, this position is made explicit in the judgment of the
Supreme Court of Appeal in the case of
Makhanya v University of Zululand.
7
By parity of reasoning, the same position must obtain in regard to
the conferral of exclusive jurisdiction to the Labour Court
in terms
of the
Skills Development Act. In
other words, the jurisdiction of
the High Court is not ousted either by the LRA or the
Skills
Development Act. Rather
, the Labour Court is given exclusive
jurisdiction in matters which the High Court would never previously
have been able to determine.
The High Court would not have been able
to determine these matters because the rights created by these Acts
did not exist at common
law. The position may perhaps be illustrated
by the following examples: employees owed money by their employers
in terms of their
contracts of employment may pursue their claims in
either the High Court or the Labour Court;
8
on the other hand, employees of private employers who wish to claim
reinstatement because they were dismissed on the grounds of
their
employer’s operational requirements but without the provisions
of
sections 189
or
189A
of the LRA having been properly complied with
would have to pursue their claims in the Labour Court.
9
A critical question in determining whether the Labour Court has
exclusive jurisdiction in any matter is, as a first step, whether
the
litigant seeking to enforce rights would have had such rights at
common law. Those litigants seeking to enforce rights which
they
would, since time immemorial, have been able to enforce in the High
Court may still do so, unless, of course, the common law
has been
specifically abrogated by legislation or disuse. If these rights
sought to be enforced concern their contracts of employment,
litigants may, however, elect to do so in the Labour Court rather
than the High Court. The Labour Court is the court having exclusive
jurisdiction only in instances where (a) rights sought to be enforced
did not exist at common law and (b) a statute has specifically
conferred exclusive jurisdiction upon the Labour Court in respect of
such rights. Accordingly, I shall now turn to consider whether
the
rights which the plaintiff sought to enforce in the court below had a
“common law quality”.
[10]
Apart from the issue raised in general terms in the next paragraph,
the appellants do not allege any substantive contravention
by the
plaintiff of any of the provisions of or regulatory measures that
derive from the
Skills Development Act. The
liability of the
appellants was determined on the basis of agreements of suretyship.
As has already been observed, the liability
of the principal debtor
arose from a written agreements in terms of which the principal
debtor placed orders with the plaintiff
for the procurement and
provision, from time to time, mainly of general workers electricians
and code 10B drivers. In other words,
the plaintiff’s claim
against the principal debtor arose from services rendered to the
principal debtor by the plaintiff
at the principal debtor’s
special instance and request. These claims of the plaintiff and the
remedies which arise therefrom
owe nothing to any novel provisions of
law introduced either by the LRA or the
Skills Development Act. The
remedies that arise from the plaintiff’s claim have not been
abrogated by legislation or by disuse. The legal instrument
of
suretyship, known in Latin as
fideiussio
,
descends to us via Roman Law, is found in the
Digest
and has absorbed the attention of such well known old authorities as
Grotius
,
Voet
,
Van der Linden
,
Van Leeuwen
and
Pothier
.
10
The contract between the plaintiff and the principal debtor was one
of
locatio
conductio operis
and not
locatio
conductio operarum
:
vis-à-vis
the
principal debtor, the plaintiff was an independent contractor and not
an employee. The remedies as between the
conductor
(the
plaintiff) and the
locator
(the
principal debtor) are ancient, arising quite independently of any
statute. The cause of the plaintiff’s action and the
remedies
which it seeks do not “arise from” the
Skills Development
Act. There
is, in my opinion, no merit in the appellants’
“jurisdiction point”.
[11]
The last ground of appeal is that, despite the fact that the
plaintiff, in its particulars of claim, alleged that it is a duly
registered private employment agency in terms of
section 24
of the
Skills Development Act, the
appellant denies this and accordingly
contends that the plaintiff was operating unlawfully and that for a
court to enforce the
agreement would condone illegality. In my
opinion, the principles set out in
Breitenbach
v Fiat SA (Pty) Ltd
11
must operate in favour of the plaintiff. The appellant has set out
this defence in a manner that is far too bald, vague and sketchy
to
be taken seriously. It would have been a simple matter to put
credible supporting evidence in the affidavit resisting summary
judgment if it was indeed true that the plaintiff was operating
illegally. A mere “say-so” is, in the circumstances,
insufficient. This ground of appeal fails as well.
[12] I my opinion,
the careful and well reasoned judgment of the court below cannot be
faulted.
Accordingly, I
should dismiss the appeal with costs
.
______________________
N.P.WILLIS
JUDGE
OF THE HIGH COURT
I
agree. The appeal is dismissed with costs.
______________________
P.
BORUCHOWITZ
JUDGE
OF THE HIGH COURT
I
agree.
_______________________
R.MONAMA
JUDGE
OF THE HIGH COURT
Counsel
for the Appellants:
D.J.
Vetten .
(Heads of
argument prepared by
L.Hollander
)
Counsel
for the Respondent:
L.M.
Malan
Attorneys
for the Appellants: Darryl Furman & Associates
Attorneys
for the Respondent: Hunts (Inc. Borkums) Attorneys
Date
of hearing: 2 November, 2010.
Date
of judgment: 17 November, 2010.
1
See, for example,
Imperial
Cold Storage and Supply Company Limited v Julius Weil and Co
1912 AD 747
at 750 and
Trust Bank of Africa Ltd v Frysch
1977 (3) SA 562
(A) at 584F-G.
2
See, for example,
Van
der Walt’s Trustees v Van Coller
1911 TPD 1173
at 1175-6.
3
2010
(1) SA 238
(CC) at paragraph [73} as well has the preceding
paragraphs leading up to the conclusion contained in paragraph [73]
4
In
terms of
section 185
(a) of the LRA every employee has “the
right not to be unfairly dismissed”.
5
An
“unfair dismissal” is, of course, an “unfair
dismissal” as provided for in the LRA.
6
As
with an “unfair dismissal”, the remedy must, of course,
fall within the scope provided for in the LRA.
Section 157
(1) of
the LRA provides that “Subject to the Constitution and section
173 (which relates to the jurisdiction of the Labour
Appeal Court)
and except where this Act provides otherwise, the Labour Court has
exclusive jurisdiction in respect of all matters
that elsewhere in
terms of this Act or in terms of any other law are to be determined
by the Labour Court”. The remedies
for an unfair dismissal are
provided for in section 193 of the LRA. Sight must not be lost of
the fact that, in terms of section
191 of the LRA, certain disputes
may be referred to the Commission for Conciliation, Mediation and
Arbitration (“the CCMA”)
or appropriate councils such as
Bargaining Councils for determination by arbitration. Arbitration
awards made by the CCMA or
certain councils such as Bargaining
Councils may be reviewed by the Labour Court in terms of section 145
of the LRA.
7
2010
(1) SA 62
(SCA) at paragraphs [94] and [95]
8
Not only would the employee have had this right at common law but
also s
ection
77 (3) of the
Basic Conditions of Employment Act 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 conditions of employment
constitutes a term of the contract.
”
9
The
reason is that no such right to claim reinstatement for unfair
dismissal based procedural defects in matters of retrenchment
or
redundancy exists in common law: the right is created by the LRA
itself.
10
One
need merely glance through Chapter 37 of
Wille’s
Principles of South African Law
,
9
th
ed. Juta’s, Cape Town, 2007 to confirm that this is indeed
the case.
11
1976 (2) SA 226
(T) at 227g-228H