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[2018] ZAECMHC 39
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Joni v Kei fresh Produce Market (936/2012) [2018] ZAECMHC 39; (2018) 39 ILJ 2405 (ECM) (14 August 2018)
IN
THE HIGH COURT OF SOUTH AFRICA
(EASTERN
CAPE LOCAL DIVISION: MTHATHA)
CASE
NO. 936/2012
KHOLEKA
JONI
PLAINTIFF
And
KEI
FRESH PRODUCE
MARKET
DEFENDANT
JUDGMENT
DAWOOD
J
1.
The
Plaintiff herein instituted action against the Defendant claiming
damages arising out of an alleged unlawful termination of
a fixed
term contract.
2.
The
Plaintiff’s averment were to the effect that
inter
alia
:
a)
The
parties concluded a written fixed term contract of employment
effective from 01 July 2010 for a period of 5 (five) years and
terminating on 30
th
June 2015.
b)
The
Defendant breached the fixed term of contract by wrongfully and
unlawfully terminating the same on 30 November 2011.
c)
As
a result of the Defendant’s wrongful and unlawful termination
of the fixed term contract, the Plaintiff has suffered damages
in the
sum of R213 937 – 15 which the Defendant has despite demand
failed to pay.
3.
The
Defendant admits:
a)
That
the parties entered into a written contract of employment on the 26
th
May 2010.
b)
That
the Plaintiff would be employed for a fixed term of five (5) years
for the period 01 July 2010 to 30 June 2015 subject to the
terms and
conditions embodied in the agreement.
c)
That
it was an express term of the agreement that:
i)
Either
party was entitled to terminate the agreement on not less than one
calendar month’s written notice given to the other
party.
ii)
Notwithstanding
anything to the contrary the agreement may be terminated on any
grounds recognized in law to be sufficient.
d)
That
the agreement was terminated by the Defendant by giving the Plaintiff
one calendar month’s written notice and leave of
absence from
work for the month of October 2011, and paid her one month’s
salary in lieu of the notice pay.
e)
That
the termination of employment constituted a valid ground as
contemplated in paragraph 10.2 of the employment contract and
consequently the termination of the Plaintiff employment was not
unlawful.
f)
Alternatively:
i)
The
agreement between the parties was terminated by the Defendant in a
due process of retrenchment due to the Defendant operational
requirements.
ii)
The
retrenchment of the Plaintiff for operational requirements
constitutes a ground of termination recognized in law sufficient
as
contemplated in paragraph 10.3 of the employment agreement and
consequently the termination of the Plaintiff employment was
not
unlawful.
4.
The
Plaintiff,
albeit
at a late stage applied for a separation of the merits from the
quantum without any objection by the Defendant, and in the interest
of justice the separation was granted. Accordingly a determination of
the merits only will be made at this stage.
5.
The
Plaintiff testified in support of her claim
inter
alia
as
follows:
a)
She
confirmed the contents of the agreement and the fact that the terms
thereof were explained to her.
b)
She
stated that the agreement should have lasted for 5 (five) years but
it did not. She was given a retrenchment offer and then
a letter
indicating that it was a letter of dismissal or removal or firing.
c)
The
letter dated 26 August 2011 is headed ‘Re: Voluntary
Retrenchment package offer and stated that the offer was valid until
30
th
September 2011 and the notice month shall be October 2011.
d)
The
undated letter was headed Termination of Employment contract and
stated that Kei Fresh Produce Market has been forced to restructure
its operation and the position of general assistant has become
redundant.
e)
It
was put to her in cross examination
inter
alia
that her position has been terminated due to new operational
requirements with effect from 1
st
November 2011.
f)
She
stated that Kei Fresh Produce could terminate her contract of
employment on one (1) month notice provided they gave her the
whole
package. They did not give her pay for the five (5) year contract and
that is how she understood the agreement.
6.
The
Plaintiff closed her case after her testimony and the Defendant
sought absolution from the instance on the following basis:
a)
That
it was a fixed term contract but in terms of section 37 (1)
(c)
of the Basic Conditions of Employment
inter
alia
a notice period of 4 weeks needed to be given as minimum notice
period and this was done.
b)
He
argued that the Plaintiff was simply entitled to her notice period
and this was given and she received all that she was entitled
to.
7.
The
Plaintiff argued that a fixed term contract cannot be terminated
prior to the expiration of the term specified therein and relied
on
the common law position as set out
inter
alia
in:
a)
Buthelezi
v Municipal Demarcation Board
[1]
b)
Nomaza
Nkopane and Others v Independent Electoral Commission
[2]
.
8.
The
Defendant in reply referred this court to the case of
Morgan
v Central University of Technology, Free State
[3]
in support of the proposition that where the fixed term of contract
provides for termination it can be terminated by giving the
requisite
notice provided for in the agreement.
9.
The
issue to be determined herein is:
i)
Whether
or not the Defendant has satisfied the requirements for the granting
of absolution considering the arguments advanced in
other words,
whether or not the Plaintiff has failed to make out a prima facie
case that she is entitled to relief on the basis
that the contract
she concluded is only terminable upon expiration of the 5 (five) year
period.
10.
Applicable
legal principles in respect of application for absolution from the
instance.
a)
Harms
JA in
Gordon
Lloyd Page & Associates v Rivera and Another
[4]
stated at paragraph 2 as follows:
“
The
test for absolution to be applied by a trial court at the end
of a plaintiff's case was formulated in Claude Neon Lights
(SA) Ltd v
Daniel
1976 (4) SA 403
(A) at 409G-H in these terms:
“
.
. . when absolution from the instance is sought at the close of
plaintiff's case, the test to be applied is not whether the evidence
led by plaintiff establishes what would finally be required to be
established, but whether there is evidence upon which a Court,
applying its mind reasonably to such evidence, could or might (not
should, nor ought to) find for the plaintiff. (Gascoyne v Paul
and
Hunter,
1917 T.P.D. 170
at p. 173; Ruto Flour Mills (Pty.) Ltd. v
Adelson (2),
1958 (4) SA 307
(T)).”
This
implies that a plaintiff has to make out a prima facie case - in the
sense that there is evidence relating to all the elements
of the
claim - to survive absolution because without such evidence no court
could find for the plaintiff (Marine & Trade Insurance
Co Ltd v
Van der Schyff
1972 (1) SA 26
(A) 37G-38A; Schmidt Bewysreg 4th ed
91-92). As far as inferences from the evidence are
concerned, the inference
relied upon by the plaintiff must be a
reasonable one, not the only reasonable one (Schmidt 93).
The test has from
time to time been formulated in different terms,
especially it has been said that the court must consider whether
there is “evidence
upon which a reasonable man might find for
the plaintiff” (Gascoyne loc cit) - a test which had it origin
in jury trials
when the “reasonable man” was a reasonable
member of the jury (Ruto Flour Mills). Such a formulation tends
to
cloud the issue. The court ought not to be concerned with
what someone else might think; it should rather be concerned with
its
own judgment and not that of another “reasonable” person
or court. Having said this, absolution at the end
of a
plaintiff's case, in the ordinary course of events, will nevertheless
be granted sparingly but when the occasion arises a
court should
order it in the interests of justice.”
[5]
b)
In
Septoo v
City of Johannesburg
[6]
at
paragraph 15 it was held:
“
The
test for absolution from the instance sought at the close of the
Plaintiff’s case is not whether the evidence established
what
would finally be required to be established, but whether there is
evidence upon which a court applying its mind reasonably,
to such
evidence could or might (not should or ought to) find for the
Plaintiff” (see Municipality of Christiana v Victor
1908
TS1117; Van Rensburg v Reid 1958 (2) 1958 (2) 249 E; and
De Wet v Western Bank Ltd 1977 (2) SA 1033 (W).
[7]
c)
In
Tsoanyane
v University of South Africa
[8]
it was held at paragraphs 14 - 16:
“
The
applicable principle in an absolution stage has been enunciated in
the Gascoyne v Paul & Hunter
1917 TPD 171
at 173, a case that has
been followed in many other subsequent cases, as follows:
“
At
the close of the case for the plaintiff, therefore, the question
which arises for the consideration of the Court is, is there
evidence
upon which a reasonable man might find for the plaintiff? And if the
defendant does not call any evidence, but close his
case immediately,
the question for the Court would be, “Is there such evidence
upon which the Court ought to give judgment
in favour of the
plaintiff?”.”
The same
principle is stated by the Appellate Court in Oosthuizen v Standard
General Versekeringsmaatskappy Bpk
1981 (1) SA 1032(A)
at 1035H-1036A
as follows:
“
If
at the end of the plaintiff’s case there is not sufficient
evidence upon which a reasonable man could find for him or her,
the
defendant is entitled to absolution.” Where there is only one
defendant, as in casu, at the close of the case for the
plaintiff,
“it can be fairly inferred that …the Court has heard all
the evidence which is available against the defendant,
any further
evidence that would be forthcoming if the case continued would be
likely to operate only to the detriment of the plaintiff.
That being
so it is considered unnecessary in the interest of justice to allow
the case to continue any longer if, the plaintiff
has closed his
case, there is no prima facie case against the defendant; vide
Putter v Provincial Insurance Co Ltd and Another
1963 (4) SA 771
(W)
at 772F-G.
In Gordon Lyod
Page & Associates v Rivera & Another
2001 (1) SA 88
(SCA) at
p92 para [2] where the Court said that:
“
The
test for absolution to be applied by a trial court at the end of the
plaintiff’s case was formulated in Claude Neon Lights
(SA) Ltd
v Daniel
1976 (4) SA 403
(A) at 409G-H in these terms:
‘…
(W)hen
absolution from the instance is sought at the close of the
plaintiff’s case, the test to be applied is
not whether the
evidence led by the plaintiff establishes what would finally be
required to be established, but whether there
is evidence upon
which a Court, applying its mind reasonably to such evidence, could
or might (not should, nor ought to) find for
the plaintiff Gascoyne
and Hunter 1971 (TPD) 170 at 173; Ruto Flour Mills (Pty) Ltd v
Adelson (2) 1958 (4) SA307 (T).)
This
implies that a plaintiff has to make out a prima facie case—in
the sense that there is evidence relating to all the elements
of the
claim—to survive absolution because without such evidence no
court could find for the plaintiff (Marine & Trade
Insurance Co
Ltd v Van der Schyff
1972 (1) SA 26
(A) at 37G-38A; Schmidt Bewysreg
4
th
ed at 91-2).”
[9]
d)
In
the commentary to Rule 39 (6) absolution from the instance Erasmus
et
al
stated:
“
Where
a Plaintiff’s case depends upon the interpretation of a
document, the court ought to refuse absolution unless the
interpretation
contended for by the Plaintiff is not a reasonably
possible interpretation”.
[10]
11.
Application
of the legal position to the facts of this case.
a)
In
this case it is common cause that the agreement was for a fixed term
basis and commenced on 01 July 2010 and ends 30 June 2015
(five year
contract) clause 1.2 of the agreement headed fixed contract
employment as a general assistant.
b)
It
is also common cause that paragraph 10 of the agreement provided for
termination of employment in particular paragraph 10.2 and
10.3 reads
as follows:
“
Paragraph
10.2
After the
probationary period you or Kei Fresh Produce Market will be entitled
to terminate this contract on not less than one calendar
month’s
written notice given to the other party.
Paragraph 10.3
Notwithstanding
anything to the contrary, this agreement may be summarily terminated
on any grounds recognized in law as sufficient.”
c)
It
is trite law that a fixed term contract cannot be terminated in the
absence of a repudiation or a material breach of contract
by the
other party in terms of the common law. However even in the case of
Buthelezi
[11]
referred to by the Plaintiff’s counsel at paragraph 9 Jafta AJA
stated that the exception was where the terms provide for
such
termination emphasizing the parties legitimate right to contractual
freedom at paragraph 9:
“
The
first question that arises in the present matter is whether the
respondent was entitled to terminate the employment contract
between
it and the appellant when it cancelled it. There is no doubt that at
common law a party to a fixed – term contract
has no right to
terminate such contract in the absence of a repudiation or a material
breach of the contract by the other party.
In other words there is
no
right to terminate such contract even on notice unless its terms
provide for such termination
.
The rationale for this is clear. When parties agree that their
contract will endure for a certain period as opposed to a contract
for an indefinite period, they bind themselves to honour and perform
their respective obligations in terms of that contract for
the
duration of the contract and they plan, as they are entitled to in
the light of their agreement, their lives on the basis that
the
obligations of the contract will be performed for the duration of
that contract in the absence of a material breach of the
contract.
Each party is entitled to expect that the other has carefully looked
into the future and has satisfied itself that it
can meet its
obligations for the entire term in the absence of any material
breach. Accordingly, no party is entitled to later
seek to escape its
obligations in terms of the contract on the basis that its assessment
of the future had been erroneous or had
overlooked certain things.
Under the common law there is no right to terminate of a fixed –
term contract of employment prematurely
in the absence of a material
breach of such contract by the other party….”
[12]
d)
In
Morgan
supra
at
paragraph 19 it was held
“
It
should be borne in mind that the employment contract
specifically
permitted the Respondent to terminate on the basis of misconduct
,
medical unfitness, operational requirements or incompetence. This is
not
the
same state of affairs the court dealt
with in Buthelezi v Municipal Demarcation Board (2004) 25 ILJ 2317
(LAC) where the court was prepared to award compensation for
the
balance of the period of the contract, subject to the date when the
applicant secured alternative employment”
e)
I
accept that if no termination clause was present the right of
termination would be restricted in terms of the common law but there
is a termination clause present here that is set out in clear and
unambiguous terms.
f)
In
Lottering
v Stellenbosch Municipality
[13]
Cheadle AJ held at page 4 as follows:
“
If
the contract is for a fixed term, the contract may
only
be terminated on notice
if
there is a specific provision permitting termination on notice during
the contractual period – it is not an inherent feature
of this
kind of contract and accordingly requires specific stipulation
”.
[14]
(my
emphasis)
g)
In
this case the agreement specifically provided for termination on
one
calendar months’ notice.
h)
There
was a notice of termination served on the Plaintiff, the notice for
termination is undated but the Plaintiff has not raised
the fact that
this notice did not comply with the terms set out in the agreement or
failed to constitute a one calendar months’
notice.
i)
There
was no restriction placed on the grounds upon which the contract
could be terminated.
j)
The
Defendant in this case provided the Plaintiff with the reasons for
termination being that of operational requirements.
k)
It
is clear that in this agreement there was no closed lists of grounds
upon which an agreement could be terminated by giving one
month’s
notice.
l)
Clause
10.2 of the agreement cannot be restrictively interpreted to exclude
the possibility of retrenchment and is indeed wide enough
to cover
this situation such inclusion would not be against public policy.
m)
The
implementation of the terms of the clause in this instance is not
unjust or inequitable. (If indeed this court would be able
to go into
those grounds).
n)
Clause
10.3 of the agreement is not applicable to this situation as it
speaks about summary termination which would in all likelihood
deal
with instances of gross misconduct or material breaches of the
agreement that warrant immediate termination thereof.
12.
The
Plaintiff has unfortunately failed to demonstrate a
prima
facie
right to the relief sought. She has failed to demonstrate that her
contract was wrongfully and unlawfully terminated. The agreement
was
lawfully terminated in accordance with the provisions of the
agreement.
13.
The
Defendant has correctly argued for absolution from the instance. The
interpretation contended for by the Plaintiff, having regard
to the
ipsimma
verba
(actual wording) of the agreement, is not a reasonably possible
interpretation having regard to the clear and unambiguous termination
provisions incorporated in paragraph 10.2 of the agreement.
14.
I
am accordingly of the view that it would serve no purpose to allow
the matter to go any further and that this is a matter that
warrants
the grant of the order of absolution from the instance.
15.
The
Plaintiff legitimately believed that she was entitled to payment for
the full duration of the fixed term contract and she was
also advised
of the same. She was not vexatious in litigating and I believe this
is a case where she should not be mulcted in an
adverse costs order
being granted against her especially in circumstances where she is
unemployed, and has been since the lawful
termination of her contract
of employment.
16.
I
accordingly make the following order:
a)
Absolution
from the instance is granted.
b)
Each
party to pay her/it’s own costs.
__________________________
DAWOOD
J
JUDGE
OF THE HIGH COURT
DATE
HEARD: 30 JULY 2018
JUDGMENT
DELIVERED: 14 AUGUST 2018
FOR
THE PLAINTIFF: MR JOZANA
PLAINTIFF’S
ATTORNEYS: B. MAKADE INC
NO
7 IDK BUILDING
92
SUTHERLAND STR
MTHATHA
FOR
THE DEFENDANT: MR HOBBS
DEFENDANT’S
ATTORNEYS: MPETO & ASS
26
MADEIRA STR
MTHATHA
[1]
[2005]
2 LLR 115 (LAC).
[2]
[2007]
2 BLLR 146 (LC).
[3]
[2013]
1 BLLR 52 (LC).
[4]
(384/98)
[2000] ZASCA 33
;
2001 (1) SA 88
(SCA);
[2000] 4 All SA 241
(A) (31
August 2000)
[5]
Id.at par 2.
[6]
(2018) 39
ILJ 580 (LAC)
[7]
Id.at par 15
[8]
(12677/08)
[2009] ZAGPPHC 83; (2009) 30 ILJ 2669 (GNP) (22 May 2009)
[9]
Id.at paras 14 - 16
[10]
See
Botha v Minister Vann Lande
1967 (1) SA 72
(A); De Klerk v Absa Bank
Ltd 2003 ALLSA 651 (SCA).
[11]
Buthelezi
(note
1 above) at par 9
[12]
Id.at par 9
[13]
(2010)
19 LC and12
BLLR 1306 (LC);
See
also Metal Industries Benefit Funds Administration v Banham Myburg
JS854113.
[14]
Id.at page 4