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[2013] ZASCA 135
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Ethekwini Municipality v South African Municipality Workers Union and Others (442/2011) [2013] ZASCA 135 (27 September 2013)
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THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Not reportable
Case no: 442/2011
In
the matter between:
ETHEKWINI
MUNICIPALITY
.........................................................................
Appellant
and
THE
SOUTH AFRICAN MUNICIPAL
WORKERS
UNION
............................................................................
First
Respondent
THE
INDEPENDENT MUNICIPAL AND
ALLIED
TRADE UNION
...............................................................
Second
Respondent
THE
SOUTH AFRICAN LOCAL GOVERNMENT
BARGAINING
COUNCIL
.................................................................
Third
Respondent
Neutral citation:
Ethekwini
Municipality v SAMWU
(442/11)
[2013] ZASCA 135
(27 September
2013)
Bench:
PONNAN, CACHALIA, LEACH, MAJIEDT and WILLIS JJA
Heard: 17 SEPTEMBER 2013
Delivered: 27 SEPTEMBER 2013
Summary:
Appeal – s 21A(1) of the Supreme Court Act 59 of 1959 –
power of court to dismiss appeal where judgment or order sought
would
have no practical effect or result.
___________________________________________________________________
ORDER
___________________________________________________________________
On
appeal from
:
Labour Appeal Court (Jappie JA
(Davis and Revelas JJA concurring)):
The appeal is dismissed in terms of s 21A of the Supreme Court Act 59
of 1959 and each party is ordered to pay its own costs.
___________________________________________________________________
JUDGMENT
___________________________________________________________________
PONNAN JA (CACHALIA, LEACH, MAJIEDT and WILLIS JJA concurring):
[1] In this appeal counsel were, at the outset of the hearing,
required to address argument on the preliminary question of whether
the appeal and any order made thereon would, within the meaning of
Section 21A of the Supreme Court Act 59 of 1959 (the Act), have
any
practical effect or result. After hearing argument on this issue the
appeal was dismissed on 17 September 2013 in terms of
that section
and each party was ordered to pay its own costs of the appeal. It was
intimated then that reasons would follow. These
are those reasons.
[2] Courts should and ought not to decide issues of academic interest
only. That much is trite. In
Radio
Pretoria v Chairman,
Independent Communications Authority of South Africa & another
2005 (1) SA 47
(SCA), this court expressed its concern about the
proliferation of appeals that had no prospect of being heard on the
merits as
the order sought would have no practical effect. It
referred to
Rand Water Board v Rotek Industries (Pty) Ltd
2003
(4) SA 58
(SCA) para 26 where the following was said:
'The present case is a good
example of this Court's experience in the recent past, including
unreported cases, that there is a growing
misperception that there
has been a relaxation or dilution of the fundamental principle . . .
that Courts will not make determinations
that will have no practical
effect.'
[3] Section 21A(1) of the Supreme Court Act 59 of 1959 provides:
'When at the hearing of any
civil appeal to the Appellate Division or any Provincial or Local
Division of the Supreme Court the
issues are of such a nature that
the judgment or order sought will have no practical effect or result,
the appeal may be dismissed
on this ground alone.'
Of s 21A, this court stated in
Coin Security Group (Pty) Ltd v SA
National Union for Security Officers & others
[2000] ZASCA 137
;
2001 (2) SA 872
(SCA) para 7:
'The purpose and effect of s 21A
has been explained in the judgment of Olivier JA in the case of
Premier, Provinsie
Mpumalanga, en 'n Ander v Groblersdalse Stadsraad
1998
(2) SA 1136
(SCA). As is there stated the section is a reformulation
of principles previously adopted in our Courts in relation to appeals
involving what were called abstract, academic or hypothetical
questions. The principle is one of long standing.'
[4] The primary question therefore, one to which I now turn, was
whether the judgment sought in this appeal would have any practical
effect or result. It arises against the backdrop of the following
facts. On 29 May 2007 the appellant, the Ethekwini Municipality
(the
Municipality), concluded a collective agreement styled 'Divisional
Conditions of Service' (the agreement) with the South African
Municipal Workers Union (SAMWU) and the Independent Municipal and
Allied Trade Union (IMATU), the first and second respondents,
respectively. The agreement was concluded within the South African
Local Government Bargaining Council (SALGBC). Although cited
as a
party SALGBC took no part in the proceedings either in the courts
below or in this one.
[5] On 18 July 2007 SAMWU lodged an urgent application in the Labour
Court (LC). It sought the following relief:
'1. (a) That it be and it is
hereby declared that the document described as the Collective
Agreement on Divisional Conditions of
Service . . . is void and of no
legal effect;
(b) That the First Respondent
[the Municipality] be and it is hereby interdicted and restrained
from implementing the terms of the
Divisional Agreement;
(c) That the First Respondent
pay the costs of this application.
2. That the interdict in
paragraph 1 (b) above operate with immediate effect pending the final
determination of this application.'
[6] In support of that application SAMWU alleged:
'11.
As appears from [SALGBC's]
Constitution a distinction is made between the Central Council of
[SALBBC] and Divisions of the Council.
The distinction between the
Central Council and the Divisions of the Council is pivotal to the
validity of collective agreements
concluded in the council. This is
because a distinction is drawn between matters of national competence
and matters of divisional
competence in relation to the powers to
conclude collective agreements dealing with those topics. The matter
was dealt with in
a collective agreement which was published in the
Government Gazette dated 18 June 2004 under Notice R716. A copy of
that agreement
is annexed hereto marked "C". The agreement
although expressed to remain in force until 30 June 2005 has
continued to
remain in force and the levels of bargaining set out in
that agreement continue to bind the parties to [SALGBC]. The
[municipality]
is a member of SALGA, which is a party to the council
and the [municipality] is accordingly bound by the Constitution and
Collective
Agreement of the [SALGBC].
12.
Section 4 of the published
agreement specifically directs that certain matters may be bargained
collectively at a national level
only. Other matters are to be
bargained at a divisional level only . . .
13.
It follows from the aforegoing
that the eThekwini division has no jurisdiction to bargain with
regard to matters falling within
a national competency. These have to
be bargained in the Central Council . . .
14.
The Divisional Agreement deals
with a whole host of matters that fall within national competency and
beyond the jurisdiction or
competency of the eThekwini Division . . .
. . . .
17.
In those circumstances I am
advised that the Divisional Agreement covering matters that are
beyond its competence, is void and of
no legal effect.
18.
The Applicant has sought to take
this matter up through the [SALGBC]. It referred the matter to the
[SALGBC] by letter date 14 June
2007 . . .
19.
I indicated in the letter that
in the light of these defects which go to the heart of the collective
agreement that [SAMWU] asked
for the agreement to be set aside in its
entirety to enable the parties to recommence negotiations in
accordance with the relevant
resolution of the [SALGBC's] Executive
Committee.'
[7] On 8 August 2007 IMATU launched a separate application in the LC.
It sought relief that was to all intents and purposes identical
to
that sought by SAMWU. In due course there was a consolidation of
those two applications and both matters came to be argued before
the
LC on 14 September 2007.
[8] In the meanwhile, by circular dated 30 March 2007, the City
Manager of the Municipality notified its employees that it was
implementing the agreement with effect from 1 April 2007. Thus by the
time the application came to be heard by the LC the interim
relief
sought had been rendered academic.
[9] On 26 September 2007 the LC (per Moshoana AJ) issued the
following order:
'1. The collective agreement on
Divisional conditions of service dated 29 March 2007 is hereby
declared null and void and of legal
force and effect.
2. No order as to costs.'
[10] With the leave of the LC the Municipality appealed to the Labour
Appeal Court (LAC). The LAC dismissed the appeal with costs.
Jappie
JA (Davis and Revelas JJA concurring) reasoned:
'[36] It is common cause that
the Division Agreement in clauses 8 and 9 deal with annual leave and
the conversion of vacation leave
to sick leave, which are matters
reserved to be bargained for at national level. Similarly clauses 15
and 17 of the Divisional
Agreement in respect of medical aid and
pension fund membership are in conflict with clauses 4.2.1 and 4.2.3
of the National Collective
Agreement.
. . . .
[38] . . . In the present matter
the parties were bound by the National Collective Agreement. Clauses
4.2 and 4.3 of the National
Collective Agreement expressly reserved
certain matters that are to be bargained for at national level only.
It is apparent that
the parties, when concluding the Divisional
Agreement, bargained for matters beyond their competence and which
fell exclusively
within the ambit of the National Collective
Agreement. The parties, therefore, bargained and contracted beyond
their contractual
capacity.
[39] The question of
severability although raised by the parties, seemed not to have been
considered by the
court
a quo
. However, this
does not assist the Appellant. The Appellant contended that those
parts of the Divisional Agreement that are in
conflict with the
Constitution of SALBGC and the National Collective Agreement should
be severed. It seems to me that matters such
as medical aid, leave
pay and membership of a pension fund form an integral part of the
Divisional Agreement and the parties had
spent a great deal of time
in negotiating these matters. To sever these provisions from the
Divisional Agreement would create doubt
as to whether the parties
would have reached consensus when concluding the Divisional
Agreement.'
[11] Clause 2 of the divisional agreement headed 'Period of
Operation', reads:
'This agreement shall come into
operation in respect of the parties to the Agreement, on 1 [April]
2007 and shall remain in force
until
31
March 2012
.'
As the agreement had already run its course, the registrar of this
court was directed to enquire of the parties whether the appeal
was
being persisted in and inform them that at the outset of the hearing
of the appeal they would be required to address argument
on the
preliminary question of whether the appeal and any order made thereon
would within the meaning of s 21A have any practical
effect or
result. In the further heads of argument filed on behalf of the
parties to address the preliminary point raised, as also
from the bar
in this court, it was urged upon us that we should proceed to a
consideration of the appeal on the merits.
[12] In supplementary heads of argument filed on its behalf, the
Municipality alludes to the ramifications for it, were it to reverse
the implementation of the divisional agreement. But none of that is
new. As long ago as 11 September 2007 the Municipality asserted
in a
supplementary affidavit deposed to by Mr David Vincent Cloete, its
human resource manager, that:
‘
[A]
total of 5,656 employees from the former North, South, Inner West,
Outer West and Umkomaas entities had their salaries increased
from 1
April 2007 as a result of the pay parity clause in the collective
agreement (see clause 35). The annualised cost to the
first
respondent of these increases amounts to R11.3m.’
Mr Cloete then proceeded to describe in some detail what the reversal
of pay parity would entail for the Municipality. Of necessity,
so he
stated, a re-calculation would have to be undertaken by the
Municipality of, inter alia, income tax, pension fund contributions,
overtime, UIF contributions, responsibility and stand-by allowances
that had already been paid by the Municipality to its employees.
[13] On 16 July 2007 and prior to deposing to that affidavit, Mr
Cloete wrote in response to a letter from SALGBC:
'We refer to your fax dated 2
nd
July 2007 received by ourselves
on 3
rd
July.
We note that your General
Secretary has been mandated to conduct an investigation into the
Collective Agreement on Divisional Conditions
of Service.
. . . .
Further confusion has been
created in this matter in that SAMWU have instructed Shanta Reddy
Attorney to threaten urgent litigation
in the Labour Court. This
threat is inappropriate and premature given that you are in the
process of investigating the very same
subject. Please confirm from
Samwu that the investigation will not be hampered by litigation. It
is submitted that until your investigation
is complete, threats of
litigation are premature and made in bad faith.'
[14] And so after initially asserting that an application to court
would be premature, the Municipality took thereafter to contending
that it would work grave hardship on it were it to be ordered to
reverse the implementation of the agreement. That latter contention
was in any event at odds with the Municipality’s stance in the
SAMWU application. In disputing SAMWU’s assertion that
the
matter was urgent, Mr Cloete in his answering affidavit dated 23 July
2007 stated:
‘
In the
extraordinarily unlikely event that [SALGBC] decides that the entire
divisional agreement is invalid, any financial prejudice
to any
employee resulting therefrom can be easily redressed.'
[15] I may add that leave to appeal was granted to the Municipality
by this court on 8 June 2011. The LC had disposed of the matter
fairly promptly. Thereafter, for reasons that do not emerge from the
record, it took in excess of three years for the matter to
be
finalised before the LAC. Having obtained leave from this court on 8
June 2011, the Municipality was obliged in terms of the
rules of this
court to lodge the record of the proceedings with the registrar of
this court on or before 7 October 2011. It, however,
initially sought
an extension until 7 February 2012 because as it was put 'a possible
settlement is being negotiated'. Thereafter,
a further three
extensions were sought for the filing of the record and the record
only came to be lodged with this court on 30
November 2012.
[16] Thus, notwithstanding the passage of some six years since the
commencement of the matter and what at times can only be described
as
the Municipality's desultory approach to the prosecution of the
appeal, it is now being urged upon us that the appeal still
presents
live issues. In my view it does not. The thrust of counsel’s
argument from the bar in this court was that in all
likelihood there
will be further litigation between the parties flowing from the
implementation of the agreement, which has since
been held to be
‘void and of no legal effect’. Precisely what disputes
will form the subject of that litigation and
in which fora those
disputes will be pursued was the subject of some speculation before
us. In
Clear Enterprises (Pty) Ltd V Commissioner for South
African Revenue Services & others
(757/10)
[2011] ZASCA 164
(29 September 2011) a similar contention was dealt with in these
terms:
‘
[17]
Simply put, whatever issues do arise in the pending matters none of
them are yet "ripe" for adjudication by this
court. To
borrow from Kriegler J in
Ferreira
v Levin NO & others
;
Vryenhoek
v Powell NO & others
1996
(1) SA 984
(CC) para 199:
"The essential flaw in the
applicants' cases is one of timing or, as the Americans and,
occasionally the Canadians call it,
"ripeness". That term
has a particular connotation in the constitutional jurisprudence of
those countries which need
not be analysed now. Suffice it to say
that the doctrine of ripeness serves the useful purpose of
highlighting that the business
of a court is generally retrospective;
it deals with situations or problems that have already ripened or
crystallised, and not
with prospective or hypothetical ones.
Although, as Professor
Sharpe
points out and our Constitution
acknowledges, the criteria for hearing a constitutional case are more
generous than for ordinary
suits, even cases for relief on
constitutional grounds are not decided in the air. And the present
cases seem to me, as I have
tried to show in the parody above, to be
pre-eminent examples of speculative cases. The time of this Court is
too valuable to be
frittered away on hypothetical fears of corporate
skeletons being discovered."
[18] Although expressed somewhat
differently and in the different context of constitutional
adjudication where ‘ripeness’
has taken on a particular
meaning, both the principles and policy considerations articulated by
Kriegler J resonate with the jurisprudence
of this court. Thus in
Coin Security Group
(Pty) Ltd v SA National Union for Security Officers & others . .
.
[2000] ZASCA 137
;
2001 (2) SA 872
(SCA) para 9, Plewman JA quoted with approval from the speech of Lord
Bridge of Harwich in the case of
Ainsbury
v Millington
[1987] 1
All ER 929
(HL), which concluded at 930
g
:
"It has always been a
fundamental feature of our judicial system that the Courts decide
disputes between the parties before
them; they do not pronounce on
abstract questions of law when there is no dispute to be resolved".
In a similar vein, in
Western
Cape Education Department v George
.
. .
1998 (3) SA 77
(SCA) at 84E, Howie JA stated:
"Finally, it is desirable
that any judgment of this Court be the product of thorough
consideration of,
inter
alia
,
forensically tested argument from both sides on questions that are
necessary for the decision of the case.”
And in
Radio
Pretoria
(para 44),
Navsa JA said:
"Courts of appeal often
have to deal with congested court rolls. They do not give advice
gratuitously. They decide real disputes
and do not speculate or
theorise (see the
Coin
Security
case
(
supra
)
at paragraph [7] (875A-D)). Furthermore, statutory enactments are to
be applied to or interpreted against particular facts and
disputes
and not in isolation."
[19] In effect what the parties
are seeking is legal advice from this court. But as Innes CJ observed
in
Geldenhuys &
Neethling v Beuthin
1918
AD 426
at 441:
"After all, Courts of Law
exist for the settlement of concrete controversies and actual
infringements of rights, not to pronounce
upon abstract questions, or
to advise upon differing contentions, however important."
In
National
Coalition for Gay and Lesbian Equality & others v Minister of
Home Affairs & others
2000
(2) SA 1
(CC) para 21 footnote 18, the Constitutional Court echoed
what the learned Chief Justice had stated over eight decades earlier
when it said:
"A case is moot and
therefore not justifiable if it no longer presents an existing or
live controversy which should exist if
the Court is to avoid giving
advisory opinions on abstract propositions of law." '
[17] There is a further obstacle in the path of the Municipality. In
National Union of Mineworkers & another v Samancor Ltd
(Tubatse Ferrochrome) & others
(2011) 32
ILJ
1618
(SCA), Nugent JA expressed it thus:
'[14] But that is not the end of
the matter. The basis for the decision of this court in
National
Union of Metalworkers of SA v Fry's Metals (Pty) Ltd
[2005
(5) SA 433
(SCA)] was that it will not interfere with a decision of
the Labour Appeal Court only because it considers it to be wrong:
what
is required in addition are special circumstances that take it
out of the ordinary. It is because of that approach that this court
takes to appeals from the Labour Appeal Court that leave to appeal
will not be granted in cases that do not fall within that category.
As it was expressed in that case:
"No doubt every appeal is
of great importance to one or both parties, but this court must be
satisfied, notwithstanding that
there has already been an appeal to a
specialist tribunal, and that the public interest demands that labour
disputes be resolved
speedily, that the matter is objectively of such
importance to the parties or the public that special leave should be
granted.
We emphasize that the fact that applicants have already
enjoyed a full appeal before the LAC will normally weigh heavily
against
the grant of leave. And the demands of expedition in the
labour field will add further weight to that."
That is consistent with the
observation by the Constitutional Court in
Dudley
v City of Cape Town
[2005
(5) SA 429
(CC) para 9] that -
"[t]he LAC is a specialised
appellate court that functions in the area of labour law. Both the
LAC and the Labour Court were
established to administer labour
legislation. They are charged with the responsibility for overseeing
the ongoing interpretation
and application of labour laws and the
development of labour jurisprudence".'
[18] Nugent JA added (para 15), ‘[t]he fact
that leave to appeal has been granted upon application to the
President of this
court is not decisive of whether a case meets the
criteria laid down in
Fry’s
Metals
. That question is one that is
ultimately to be answered by the court itself upon consideration of
an appeal’. Here, one searches
in vain for ‘
special
circumstances that take this case out of the ordinary’.
[19] The cumulative consequence of all the factors that I have
alluded to is that no practical effect or result can be achieved
in
this case. For the aforegoing reasons the appeal was dismissed.
[20] That leaves costs: On 7 July 2011 the registrar of this court
directed the attention of both parties to the provisions of
s 21A and
enquired whether the appeal was being persisted in. Both parties
intimated that the appeal was being persisted in. That
was the stance
adopted before us in argument as well. Neither was an unwilling
participant in the appeal. Moreover, the point which
was held to be
decisive of the matter was raised by the court and not one of the
parties. In those circumstances it was deemed
appropriate that each
party be ordered to pay its own costs.
_________________
V PONNAN
JUDGE OF APPEAL
APPEARANCES:
For
Appellant: G O van Niekerk SC (with P N Schumann)
Instructed
by:
Shepstone
& Wylie, Durban
Webbers
Attorneys, Bloemfontein
For
1
st
Respondent: M Pillemer SC
Instructed
by:
Tomlinson
Mnguni James Attorneys, Umhlanga Rocks
Honey
Attorneys, Bloemfontein
For
2
nd
Respondent: M Pillemer SC
Instructed
by:
Futcher
Attorneys, Umhlanga
Honey
Attorneys, Bloemfontein
For
3
rd
Respondent: Abides the Decision of the Court
Instructed
by:
South
African Local Government Bargaining Council, Durban