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[2016] ZAGPPHC 352
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Pretorius and Another v Transport Pension Fund and Others (42355/2015) [2016] ZAGPPHC 352 (13 May 2016)
IN THE HIGH COURT OF
SOUTH AFRICA
(
GAUTENG
DIVISION, PRETORIA)
13/5/16
Case no. 42355\2015
Reportable
Of interest to other
judges
Revised.
IN THE MATTER BETWEEN:
JOHAN PIETER HENDRIK
PRETORIUS 1
st
Plaintiff
MONTANA DAVID
KWAPA 2
nd
Plaintiff
and
TRANSPORT PENSION
FUND 1
st
Defendant
TRANSNET SECOND
DEFINED BENEFIT FUND 2
nd
Defendant
TRANSNET
LIMITED 3
rd
Defendant
JUDGMENT
LEGODI J;
HEARD ON: 4
APRIL 2016
JUDGMENT HANDED DOWN
ON: May 2016
[1] ‘An exception
is a legal objection to the opponent’s pleadings. It
complains of a defect inherent in the pleadings
admitting for the
moment that all the allegations in the particulars of claim or
declaration, or plea are true. It asserts that
even with such an
admission, the pleading does not either disclose a cause of action,
or a defence, as case may be
[1]
.
It follows that, where an exception is taken, the court must look at
the pleading excepted to as it stands
[2]
,
no facts outside those stated in the pleadings can be brought into
issue, except in the case of inconsistency
[3]
;
and no reference may be made to any other document
[4]
.
This is precisely the difference between exceptions, on the one hand
and the pleas in bar, dilatory pleas, and pleas in abatement,
on the
other; the latter usually introduce fresh matter, which requires to
be proved by evidence.
[5]
[2] The object of an
exception is to dispose of the case or a portion thereof in an
expeditious manner or to protect a party against
an embarrassment
which is so serious as to merit the costs even on an exception
[6]
.
An exception provides a useful mechanism for weeding out cases
without legal merit
[7]
. Thus an
exception founded upon the contention that the particulars of claim
or declaration disclose no cause of action or that
a plea lacks
averments necessary to sustain a defence, is designed to obtain a
decision on a point of law which will dispose of
the case in a whole
or in part, and avoid the leading of unnecessary evidence at the
trial
[8]
. If it does not
have that effect, the exception should not be entertained.
[9]
[3] This case is about an
exception. The plaintiffs Johan Pieter Hendrik Pretorius and Montana
David Kwapa, pension members of Transport
Pension Fund and Transnet
Second Defined Benefit Fund (the Funds) respectively, are suing in
both their personal capacity and in
the interests of the members of
the Funds.
[4] The Funds are the
first and second defendants respectively. The third defendant is
Transnet Limited (Transnet), a company incorporated
in terms of
Section 2 of the Legal Succession to the South African Transport
Services Act 9 of 1989.
[5] The Plaintiffs
instituted an action against the Funds and Transnet based on three
causes of action. The averments constituting
claim 1 referred to as a
‘Promise’ are that in terms of the rules governing the
Funds, the members of the Funds, were
or are entitled to pension
increases of 2 %. That during 1989, a promise was made which promise
became a practice over years before
and after 1989 and executed until
2002, in terms of which the members of the Funds were entitled to
pension increase of at least
70 % of the rate of inflation. The
promise was made by a person or persons authorised to make such a
promise on behalf of the Funds
and that the promise was confirmed in
subsequent brochures and or other documents.
[6] For claim 1, the
relief sought is that Transnet’s failure to cause the Funds to
keep the promise be declared unlawful
and that the Funds be ordered
to keep the promise by increasing the pension benefits of all the
members of the Funds by an annual
rate of not less than 70% of the
rate of inflation with effect from 2003 and that the defendants be
ordered to pay the arrear increases
to the pensioners of the Funds
with interest at a temporae.
[7] Claim 2 referred to
as ‘Legacy Debt’, is based on the following set of
averments: That SARRH and SATS were obliged
by section 12 (13) of the
Railway and Harbours Pension Act 35 of 1971 and section 11(3) of the
Railway and Harbours Pensions for
Non- White Act 43 of 1974, to pay
into the White Fund and Black Fund such amounts as were necessary to
maintain them in a sound
financial condition. That Transnet inherited
these obligations in terms of section 3(2) of Succession Act.
That in terms
of section 16 (2) of the Succession Act, the amount
payable to the Funds by SATS was to be determined by state actuary in
consultation
with an actuary appointed by the Minister of the Public
Enterprise and that the state actuary duly determined the legacy debt
in
consultation with an actuary appointed by the Minister of Public
Enterprise and that the amount claimed as so determined is R 171
806
billion, payable to the Funds.
[8] The relief sought in
Claim 2 is that Transnet be declared indebted to the Funds for
payment of the legacy debt of R171 806
billion plus interest as
from 1 April 1990 at a rate of not less than 12 % per annum
determined by the state actuary. That Transnet
be ordered to pay the
legacy debt to the Funds and that the Funds and Transnet jointly and
severally pay the plaintiffs’
costs.
[9] Claim 3 referred to
as “unlawful donation”, is based on the following set of
pleaded averments: That on 23 November
2000, the trustees of
Transport Fund and Transnet agreed orally and in writing that the
Transport Fund would donate 40 % of its
members’ surplus to
Transnet and that the trustees of the Transport Fund will thereafter
implement the donation by paying
an amount of R309 121 000 to
Transnet. The plaintiffs’ cause of action is founded on the
following averments: That the
donation was unlawful and invalid
because the trustees did not have the power to make the donation and
that the trustees made the
donation in breach of their fiduciary duty
to act in the best interests of the Transport Fund and or its
members.
[10] As a result, the
plaintiffs ask that the donation be declared unlawful and invalid and
that Transnet be ordered to pay an amount
of R309 121 000.00 to
the Transport Fund with interest
a tempore morae
and that
Transnet and the Transport Fund pay the costs of the action.
[11] The Funds objected
to claims 1 and 3 on the basis that the particulars of claim are
vague and embarrassing and that they do
not sustain a cause of
action. Transnet on the other hand, objected to all the three claims
as being vague and embarrassing and
disclosing no cause of action.
For this purpose, I elect to start with the exception noted against
claim 2.
Legacy debt (claim 2)
[12] Transnet raised two
objections to the legacy debt claim. Firstly, that the
plaintiffs do not allege that the Funds were
in unsound financial
position and what amounts would be required to place them in a sound
financial position. I do not think
that the fact that the
plaintiffs do not allege that for any period under consideration, the
Funds were in unsound financial position,
requiring to be placed in
sound financial position, as contemplated in section 12(2) of the
Railways and Harbours Pensions Act
35 of 1971, lacks averments
necessary to sustain a valid cause of action. If it happens to
be Transnet’s contention
that an obligation to pay never arose,
because the Funds were never in unsound financial position, that is a
factor to be raised
as a defence to claim 2. In any event that is a
factor falling or ought to be falling within the knowledge of the
Funds and Transnet.
Obligation to pay is averred, inter alia,
in the particulars of claim as follows:
“
27. Section 16
of the Succession Act provides expressly or by implication that,
Transnet’s debt paramount to these obligations
(the legacy
debt) will be as determined by the state actuary in consultation with
an actuary appointed by the Minister of Public
Enterprise and will
bear interest at a rate of at least 12% per annum determined by the
state actuary.
28. The state actuary
only determined the legacy debt in consultation with an actuary
appointed by the Minister of Transport in
an amount of R 171 806
billion plus interest from 1 April 1990.”
[13] Firstly, averments
of unsound financial position can be implied in the pleaded averments
as a whole. Secondly, reference to
section 16 and averments of
determination of an obligation by the actuaries should be seen to
reinforce implied averments of unsound
financial position of the
Funds requiring financial assistance. Whether or not that is
so, would be determined by the issues
the defendants may want to join
in their plea and subsequent evidence thereto.
[14] I am unable to
comprehend the suggestion that the plaintiffs do not allege that
Transnet was obligated to pay such debt to
the Funds and the Second
Fund on calculation by the state actuary. What is pleaded in
paragraphs 27 and 28 of the particulars of
claim should also be seen
in the context of what is averred in paragraph 29 of the particulars
of claim. That is:
“
In Transport
Fund and upon its creation, the Second Fund inherited the right to
receive the legacy debt in terms of ss 2 and 12
of the Transnet
Pension Funds Act:
29.1 The Transport
Fund 45.1%
29.2 The Second Fund
56.9%”
.
[15] The suggestion that
‘the plaintiffs’ reliance on section 16 of the Succession
Act is bad in law as that section
does not provide for the
calculation of the alleged legacy debt, either in the terms pleaded
by the plaintiffs or all’, should
in my view, be seen in
context. Firstly, we should be reminded that insofar as there
can be an onus on either party on a
pure question of law, it rests
upon the excipient who alleges that the particulars of claim or
declaration discloses no cause of
action, or that the plea discloses
no defence. The excipient has the onus to persuade the court that the
pleading is excipiable
on every interpretation that can reasonably be
attached to it.
[10]
The
pleading must be looked at as a whole; no paragraph should be read in
isolation.
[11]
It must be
implied that the determination by the actuaries, is in respect of
what is required to put the Funds in a sound financial
position. If
there is uncertainty in regards to a pleader’s intention, an
excipient cannot avail himself thereof unless he
or she shows that
upon any construction of the pleadings, the claim is excipiable.
[12]
[16] Coming back to
reliance on section 16 of the Succession Act as pleaded, I am not
persuaded that it is excipiable on every interpretation
that can
reasonably be attached to it. Section 16(2) of the Succession Act
simply provides that the State guarantees all obligations
the SATS
transferred to Transnet including all obligations of SATS in respects
of pension funds. The obligations included payments
to the Funds to
ensure that their financial positions remain secured for the benefit
of its members. The calculation of what must
be paid, is as per
determination by the actuaries, something which had been averred in
the particulars of claim. To suggest otherwise,
would in my view, be
reading each paragraph of the pleaded averments in isolation.
The criticism to the effect that the plaintiffs
seek an order that
Transnet pay the legacy debt to the Funds, without alleging when the
debt became due for payment, would only
be valid if one was to
ignore what is pleaded in paragraphs 27 and 28 of the plaintiffs’
particulars of claim quoted
earlier in this judgment.
Consequently, I find that there is no merit to the suggestion that
claim 2 lacks the averment necessary
to sustain a cause of action and
or that is bad in law.
Unlawful donation
(claim 3)
[17] All three defendants
objected to claim 3 either as disclosing no cause of action or as
vague and embarrassing. Essential
averments regarding claim 3
are set out in paragraphs 37 to 38 of the particulars of claim. The
background and allegations to the
cause of action are: On 23 November
2000 at Johannesburg the trustees of the Transport Fund and Transnet
agreed orally and in writing,
in terms of which Transport Fund,
through its trustees agreed to donate to Transnet 40 % of its
members’ surplus. On
7 March 2001 the trustees of the
Transport Fund decided to implement the donation by paying an amount
of R309 121 000
to Transnet. The donation is alleged
to have been unlawful and invalid to the knowledge of both the
trustees of the Transport
Fund and Transnet because, the trustees did
not have the power to make the donation and that the trustees of the
Transport Fund
made the donation in breach of their fiduciary duty to
act in the best interest of the Transport Fund and its members.
[18] To these averments,
the objection is that the allegation that Transnet became liable for
repayment of the donation is a legal
conclusion and it is
insufficient to plead a conclusion of law without pleading the
material facts giving rise to the conclusion.
I am unable to
understand why it is suggested that the plaintiffs did not plead
material facts giving rise to the legal conclusion.
To come to this,
you need to ignore completely what is pleaded in paragraph 38 and at
the risk of repetition is pleaded:
“
38 The donation
was unlawful and invalid because to the knowledge of the trustees and
Transnet.
38.1 The trustees did
not have the power to make the donation, and
38.2 The trustees made
the donation in breach of their fiduciary duty to act in the best
interest of the Transport Fund and its
members.”
[19] The statement,
‘Transnet accordingly became liable for repayment of the
donation in March 2001’, as averred in
paragraph 39 of the
particulars of claim inasmuch as it is seen as a legal conclusion,
ought to be considered in the context of
what is averred in paragraph
38 of the particulars of claim quoted above and the background set
out in paragraph 17 above as pleaded
by the plaintiffs. There
can be no merit to the suggestion that the amended particulars of
claim lack averments necessary
to justify the conclusion that
Transnet became liable for repayment of the donation.
[20] It is suggested that
the amended particulars of claim do not identify the source of
Transnet’s alleged obligation to
repay the donation. This
postulation will only come into play if one was to ignore what is
pleaded in paragraph 38 of the
particulars of claim. The
donation will only become valid or lawful if it was to be proven that
it was lawfully made by Transport
Fund through its trustees. In other
words, if it was to emerge during trial that the trustees had the
power or authority to make
the donation and that they did not breach
their fiduciary duty towards the members of Transport Fund. I do not
have to be involved
in the categorisation of the claim at this stage,
despite the attempt to do so by the plaintiffs in their written
heads.
I am satisfied that the pleaded facts establish a cause
of action. I now turn to deal with claim 1.
1989 Promise (claim 1)
[21] The defendants took
a swipe at the plaintiffs’ lack of particularities regarding
the terms of the promise. The objection
is that it is not clear from
paragraph 14 of the amended particulars of claim whether the
plaintiffs allege that it was a term
of the promise: (a) that the
Fund would continue to increase the pensions as before or (b) that
the Funds would continue to increase
the pensions “at a rate of
at least 70 % of the rate of inflation”. It is alleged that the
distinction is important
because a promise to increase the pensions
“as before,” is entirely different in formulation to a
promise to increase
pensions “at a rate of at least 70 % of
inflation.”
[22] There is no merit to
the complaint. To come to the conclusion as suggested, one must
ignore what is pleaded in paragraph 13
of the particulars of claim.
That is: “Both funds however followed a consistent practice
over decades, with the concurrence
of SAR&H and SATS, of granting
higher pensions increases of at least 70 % of the rate of
inflation”. It is clear
that “as before” in
terms of paragraph 14 of the amended particulars, refers to ‘a
consistent practice over decades’
stated in paragraph 13. The
complaint is technical without substance. Therefore the
suggestion that the uncertainty renders
the amended particulars of
claim irregular, or vague and embarrassing ought to be rejected.
Failure to identify
the terms of the promise
[23] In paragraph 21 of
the Funds’ written heads, a complaint is raised as follows, as
is the case in their grounds of objection:
“
21. Moreover,
the amended particulars of claim do not identify
the other terms
of the promi
se. For example, the amended particulars of claim do
not allege:
21.1 Who would decide
the rate at which pensions would increase?
21.2 When would such a
decision be made and when would the pensions be increased?
21.3 For what period
of time would the promise endure?
21.4 Was the promise
made in perpetuity? If so, was the promise capable of termination and
on what basis?
[24] There seems to be
merit in the complaint raised in 21.1 to 21.4 of the written heads
quoted above. Failure to state the period
within which the promise
will endure is a material omission. For example, when would the
members of the Funds be entitled to such
pension increase of at least
70% of inflation? Which members of the Funds were or are
entitled to receive such benefits?
Is it every member of the Funds
entitled to enforce the promise irrespective of when each became a
member? And if so, the
facts upon which it is so alleged. The
questions are not exhaustive. Anything short of this, in my view,
would be lacking in particularities
and would be vague and
embarrassing.
Legislative regime
[25] The other complaint
raised is that the promise as pleaded is inconsistent with the
legislative regime. In the summation of
the point, it was argued that
the promise could not have had binding effect on the Funds because of
Rule 24 which dealt with the
annual increases and it provided, inter
alia:
“
The pension
fund received by the pensioners shall be increased by 2%, compounded
annually for each completed year in respect of
which the pension has
been or is received…”
[26] Then in paragraph 47
of the Funds’ written heads, is contended:
“
Even if it were
to be assumed for the sake of argument that a promise had lawfully
been made in 1989 to increase pensions
as before,
that is, at a rate of at least 70 % of inflation, and that the
promise had survived the promulgation of the Transport Fund Rules
in
1990, that promise would have been unlawful in 2000 when the Rules
and Second Fund were adopted. The promise could not
have
survived the adoption of Rule 24 of Rules of the Second Fund because
it was inconsistent with the Rule.”
[27] For two reasons the
exception on this ground cannot be upheld: First, Rule 24 did not
prohibit conclusion of the promise.
In my view, ‘…
increased by 2% compounded annually,’ does not prescribe the
maximum percentage of which the
pension compounded annually, shall be
increased. Rule 24 could be interpreted to mean that annually,
pension increases would not
be less than 2%. I am expressing no final
finding in this regard.
[28] Insofar as the Funds
seek to challenge the lawfulness of the promise and enforceability
thereof, this is an issue that can
appropriately be raised as a
defence, than as an exception. Just on this ground alone, the
exception based on the alleged unlawfulness
and unenforceability of
the promise is destined to fail, taking into account also that Rule
24 raises a legal question, which in
my view, is uncertain and
complex not to be entertained on exception.
Unlawful state conduct
[29] In paragraph 22 of
the amended particulars of claim the plaintiffs pleaded inter alia;
“
22.4 Transnet’s
failure to cause the Transport Fund and the Second Fund to keep the
promise and their failure to keep it are
unlawful at public law
because,
22.4.1 Their conduct
is legally and constitutionally unconscionable when tested against
the constitutional standards of reliance,
accountability and
rationality;
22.4.2 They impair the
rights of the members of the Transport Fund and the Second Fund of
access to social security in terms of
s27(1)(c) of the Constitution;
and
22.4.3They failed to
give effect to the legitimate pension benefit expectations they
created.
[30] In paragraph 35 of
the plaintiffs’ written heads, is contended:
“
The cause of
action is the same as the one the Constitutional Court upheld in the
KZN Joint Liaison Committee case. In September
2008, the KZN
Department of Education notified independent schools of the subsidies
payable to them the following year. The
first portion of the
subsidies was payable in April 2009. The Department did not
make this payment and in May 2009 announced
that it had decided to
reduce the subsidies with retrospective effect. The
Constitutional Court held that its conduct was
unlawful at public law
and that the independent schools were entitled to hold it to its
promise
.”
[31] What is stated above
prompted the Funds to take the point that the amended particulars of
claim do not allege that they (the
Funds) performed administrative
action when they failed to give effect to the ‘
legitimate
pension benefits expectations they created
’. This
contention preceded what is articulated in the Funds’ written
heads as follows:
“
51. The
plaintiffs seek to enforce their “legitimate expectation”
as a matter of “public law”.
52. A legitimate
expectation normally arises in the context of administrative action:
52.1. The doctrine of
legitimate expectation was first incorporated into our law in
a case dealing with the review
of an administrative decision, namely
Administrator, Transvaal v Traub.
52.2. The Constitution
refers to legitimate expectations only in the context of the right to
procedurally fair administrative action.
52.3 Similarly,
legislation refers to legitimate expectations only in the context of
provisions dealing with the right to fair administrative
action.”
[32] In KZN Joint Liaison
Committee v MEC for Education Committee Froneman J in his minority
judgment, inter alia, stated:
“
[84] According
to the main judgment the enforcement of this part of the claim should
have been brought under the provisions of the
Promotion of
Administrative Justice Act.”
[33] The KZN Joint
Liaison Committee’s case is relied upon by the plaintiffs for
their pleaded cause of action based on the
promise particularly with
regard to “legitimate expectation.” In paragraph [31] of
the main judgment aforesaid, Cameron
J stated:
“
31.Courts
enforce undertaking when parties agree by contract to be bound by
their terms; when the undertaking gives rise to legitimate
expectation and administrative fairness requires some measures of
their enforcement; or when any other legal principle or rule
requires
enforcement. In its affidavits, the applicant said its case was that
it relied purely on a promise or undertaking to pay.
It said that it
was neither “here nor there” whether this derived from
administrative action or “something akin
to a contractual
obligation”. But the form of the applicant’s case is
important.
If enforcement is brought on the basis of
administrative action, the proceedings should have been instituted
under the
Promotion of Administrative Act
(PAJA), in the form of a review, and (subject to condonation) within
the 180 day period PAJA allows.
None of this was done.
”
[34] ‘The current
position in our law is that where a party has legitimate expectation,
he or she is entitled to procedural
fairness. That is, an
opportunity to be heard before any adverse decision is made.
Our courts have expressly left opened
the question whether a
legitimate expectation may give rise to substantive benefit’.
(See, Bel Porto School Governing
Body and Others v Premier, Western
Cape, and Another
[2002] ZACC 2
;
2002 (3) SA 265
(CC),
2002 (9) BCLR 891
; [2002] ZAC
(2) in para 96; and South African Veterany Council and Another v
Szymanski 2003(4) SA SCA).
[35] The next question is
whether the plaintiffs’ enforcement of the promise in the
present case, is sought on the basis of
the administration action
seen in the light of the pleaded “legitimate expectation”
which is founded not on any legislative
or regulatory provisions, but
rather on the Funds’ benevolent to its members. This must be
distinguished from KZN Joint Liaison
Committee matter in which “the
promise” or undertaking was made as a form of subsidy which the
Member of the executive
Council for Education in Kwa- Zulu Natal
granted to the independent schools in the province in accordance with
section 48
of the
South African Schools Act 84 of 1996
which empowers
the MEC to grant subsidies to a registered school from funds approved
by provincial legislature for that purpose.
Sections 39
and
63
of the
Public Finance Management Act 1 of 1999
obliges the heads of
department (HOD) and the MEC to ensure that their expenditure is in
accordance with the budget vote of the
provincial department that
should be read together with the provisions of section 29 of the
Constitution which provides that everyone
has the right to a basic
education, including adult basic education. That, in my view, is what
made the constitutional court in
the Joint KZN Joint Liaison
Committee not to deal with the issue as a case based purely on
administrative action arising from legitimate
expectation created by
undertaking to pay the school subsidies for 2009.
[36] In the present case,
as contended by the Funds, the plaintiffs’ case on the promise
is founded on administrative decision
or action by an organ of state,
without pleading their entitlement to rely on PAJA. Then in paragraph
39 of the plaintiffs’
written heads, is contended:
“
39… if
there is any doubt on the applicability of the KZN Joint Liaison
Committee case,
then
the question of the development on the common law arises
.
In that event, given that the facts and legal norms are complex and
uncertain,
it
would not be appropriate to decide the issue on exception.
The Constitutional Court has held that in these circumstances, the
legal question ought to be decided only after hearing
and the
evidence having regarded to all relevant considerations.
[13]
(My emphasis
)
[37] In my view, the
question of, ‘the development of the common law arises’,
was discouraged in the matter of Minister
of Health and Another NO v
New Clicks South Africa (Pty) Ltd and Others (Treatment Action
Campaign and Another as Amici
Curial
[14]
wherein Ngcobo J held:
“
Our
constitutional contemplates single system of law which is shaped by
the constitution. To rely directly on Section 33 (1) of
the
Constitution
and on common law when PAJA, which was enacted
to give effect to section 33, is applicable, is
,
in
my view, inappropriate
. It will encourage the
development of two parallel system of law one under PAJA and another
under section 33 and the common
law. Legislation enacted by
Parliament to give effect to a constitutional right, ought not to be
ignored.
And where a litigant founds a cause of action on
such legislation, it is equally impermissible for a court to bypass
the legislation
and to
decide the matter on the
basis of the Constitutional provision that is being given effect to
by the legislation in question. (My
emphasis).
It follows that the
SCA… erred in failing to consider whether PAJA was applicable.
The question whether PAJA governs these
proceedings cannot be avoided
in these proceedings.”
[38] So, the provisions
of PAJA must be found to be applicable to the present proceedings.
Attempts to bypass the provisions of
PAJA by pleading or contending
that failure to keep the promise is ‘unlawful at public law’
because the Funds’
conduct ‘is legally and
constitutionally unconscionably when tested against the
constitutional standards of reliance, accountability
and
rationality’, and that they ‘impair the right of the
members of the Funds of access to social security in
terms of section
27(1) (c) of the Constitution and fail to give effect to the
legitimate pension benefit expectations they created’,
fly in
the face of what Ngcobo J sought to discourage.
[39] It is perhaps worth
mentioning that in the original particulars of claim, the plaintiffs
pleaded in paragraph 22 as follows:
“
Unlawful
administrative action”
22.1 …
22.2 …
22.3 …
22.4 Transnet’s
failure to cause the transport Fund and the Second Fund to keep the
promise and their failure to keep it,
22.4.1
Constitute administrative action
.
22.4.2 Are unlawful
because they fail to give effect to the legitimate expectation they
created; and
22.4.3 Are unlawful
because their conduct is unreasonable within the meaning of section
33(1) of the constitution and section 6(2)
(h) of the Promotion of
Administrative Justice Act 3 of 2000.” (My emphasis).
[40] No explanation has
been given for the abandonment of the aforesaid paragraph in the
amended particulars of claim. I venture
to say, it was so
abandoned to avoid complying with the provisions of section 7 of PAJA
which provides that proceedings for judicial
review must be
instituted without unreasonable delay and in any event within 180
days. Section 9(2) of PAJA however, provides that
a court may extend
the 180 days period where the interest of justice so requires.
[41] What was pleaded as
quoted in paragraph 38 above, should be seen in the context of what
is now pleaded in the amended particulars
of claim, part of which is
quoted is paragraph 28 above. Firstly, the heading, “
Unlawful
administrative action
” in the original particulars of claim
has now been changed to “unlawful state conduct.”
Furthermore, administrative
action was specifically pleaded in
paragraph 22.4 of the original particulars of claim.
[41] It must be settled
that without having pleaded the cause of action based on the
challenge to the administrative action not
to fulfil the promise, the
exception on this ground ought to succeed. The contention that ‘in
these circumstances, the legal
question ought to be decided only
after hearing all the evidence and having regard to all relevant
considerations’, as postulated
in paragraph 39 of the
plaintiffs’ written heads and quoted in paragraph 35 above,
should also be found to have no merit.
In my view, a legal
question which speaks to an administrative action without
specifically pleading administrative action indeed
ought to be
discouraged as is the case in the present matter. The authority
relied upon by the plaintiffs for the legal question
not being
appropriate to consider on exception, had to be viewed in context.
The context is this: In paragraph
11 of the H v Fetal
Assement Centre cited in paragraph 39 of the plaintiffs written
heads, the constitutional court held that ‘on
other occasions
it considered that the question of the development of the
common law would be better served after hearing
all the evidence’.
However, in the present case, as quoted in paragraphs 33 and 37 of
this judgment, such a development ought
to be discouraged as to do
so, would be to bypass the provisions of PAJA. Secondly, in
paragraph 12 of the Fetal Assessment
Centre’s judgment, the
constitutional court indicated that there is no general rule that
issues relating to the development
of the common law, cannot be
decided on exception, but where ‘the factual situation is
complex and the legal position uncertain’,
it will normally be
better not to do so.
[42] In my view, the case
of KZN Joint Liaison Committee leaves no uncertainty as to how to
deal with a state promise or undertaking.
Furthermore, as I
said, the constitutional court as per Ngcobo J in New Click’s
matter, made it very clear that you cannot
attempt to avoid the
provisions of PAJA by arguing the development of the common law. The
exception on “unlawful state conduct”
ought to succeed,
more so, that the plaintiffs are relying purely on the promise
without any legislative obligation on the part
of the Funds.
Unfair labour practice
[43] In their amended
particulars of claim, the plaintiffs pleaded:
“
23. Unfair
Labour practice
Transnet’s’
failure to cause the transport Fund and the second Fund to keep the
promise and their failure to keep it
in the aforegoing circumstances
also constitute an unfair labour practice of section 23 (1) of the
Constitution.”
[44] Both Transnet and
the Funds took a swipe at the pleaded particulars of claim, the
latter alleging that the plaintiffs are not
permitted to rely
directly on section 23 (1) of the Constitution and that the
constitutional court has endorsed the principle of
constitutional
subsidiary, that is, ‘where legislation is enacted to give
effect to a constitutional right, a litigant may
not by-pass that
legislation and rely directly on the constitutional standard.’
[15]
[45] In terms of section
23 (1) of the Constitution, everyone has a right to a fair
labour practice and a national legislation
in the form of
Labour Relations Act 66 of 1995
, gives effect to this right. The
contention on behalf of the Funds is that the principle of
constitutional subsidiary is that claims
of unfair labour practice
must be pleaded and brought in reliance of the
Labour Relations Act
and
that therefore the plaintiffs are not entitled to circumvent the
provisions of
Labour Relations Act and
rely directly on the
constitution.
[46] The point raised is
a legal question. At hand, the question is whether it can be
raised as an exception, or whether the
facts and legal norms in this
case are complex and uncertain to the extent that it would not be
appropriate to decide the issues
on exception. See in this
regard paragraph 39 of the plaintiffs’ written heads quoted in
paragraph 35 of this judgment
and the authority referred to therein
and dealt with in the preceding paragraphs. In my view, the facts of
the present case as
pleaded and the legal questions raised, are
complex and closely interlinked insofar as they relate to what is
pleaded as quoted
in paragraph 34 above. I think, a distinction
can easily be drawn between failure to plead “administrative
action”
as indicated earlier in this judgment and the pleaded
“unfair labour practice”. What is pleaded in
paragraph
23 of the amended particulars of claim is pleaded in such a
manner that it could safely be concluded that it is in the
alternative.
Therefore to want to refer this matter to the labour
court and insulate one related issue from the rest will not be in the
best
interests of justice. In any event, the point raised as a ground
of exception can be pleaded as a special defence to the plaintiffs’
claim.
Lack of
particularities on the unfair labour practice allegation
[47] My finding above
does not bring the issue of unfair labour practice to rest. For
reliance on unfair labour practice, it must
be pleaded that there was
and that there is still a relationship between the employer and
employee. The facts pleaded and
sought to be proved during
trial, must be pleaded with sufficient clarity, otherwise the
particulars of claim would be lacking
in substance and in averring
facts necessary to establish a cause of action based on unfair labour
practice.
[48] In paragraph 69 of
the Funds’ written heads of argument, the issue is contended
inter alia, as follows:
“
In any event, a
cause of action based on an alleged unfair labour practice must plead
the existence of a labour relationship between
the plaintiff and the
defendant. That is implicit in the nature of the alleged wrong, but
is also made clear in the wording of
the LRA. An unfair labour
practice is defined as any unfair act or omission that arises between
an employer and employee involving,
among others, unfair conduct by
the employer relating to the promotion, demotion, probation or
training of an employee or relating
to the provision of benefits to
an employee.”
[49] The same view is
expressed by Transnet who in its written heads stated:
“
63
The
Plaintiffs’ reliance on an unfair labour practice is bad in law
for at least two reasons.
64 Firstly, in order
to rely on unfair labour practice, the plaintiffs’ must have
been employees of Transnet at the time when
the promise was not
kept. The plaintiffs’ do not allege that they are
employees and in fact seek an order directing
Transnet to increase
the pensions of members of the Transport Fund and the Second Fund,
thereby indicating that the order being
sought relates to erstwhile
employees of Transnet,.
65 …
66 In the result,
Claim 1 of the plaintiffs’ amended particulars of claim lack
averments that are necessary to sustain a valid
cause of action,
alternatively are bad in law.”
[50] I have already dealt
with the bad in law argument and concluded that, because of other
issues connected hereto, which may not
have to be dealt with by
another court under the Labour Relations Act, and the fact that
unfair labour practice is pleaded in the
alternative, the exception
on this point ought to fail.
[51] However, the
objection that the plaintiffs’ amended particulars of claim on
unfair labour practice lack the averments
necessary to sustain a
valid cause of action, has merit. The objection on this ground ought
to be upheld and the plaintiffs’
ought to be given the
opportunity to cure the defects.
[52] Whilst I have not
specifically dealt with the grounds of exception raised by Transnet
regarding claims 1 and 3, such grounds
have been dealt with when
dealing with the exception grounds by the Funds which in main, are
similar to those raised by Transnet.
Costs.
[53] An appropriate order
for costs in the circumstances of the case would be that each party
to pay his or her own costs.
Both parties, in my view,
substantially succeeded.
Order
[54] Consequently an
order is hereby made as follows:
54.1 The exception by all
the defendants with regards to claim 1 is hereby dismissed except as
specifically indicated hereunder:
54.1.1 The exception to
what is referred to in this judgment as “failure to identify
the terms of the promise,” and
dealt with from paragraph 22
above, is hereby upheld.
54.1.2 The exception to
what is referred to as “unlawful state conduct” by the
plaintiffs in their amended particulars
of claim, and dealt with from
paragraph [28] of this judgment is hereby upheld.
54.1.3 The exception to
what is referred to as “unlawful labour practice” by the
plaintiffs in their amended particulars
of claim, is hereby upheld in
part for reasons mentioned from paragraph 47 of this judgement.
54.2 The exception to
claim 2 by the third defendant (Transnet) is hereby dismissed.
54.3 The exception to
claim 3 by all the defendants is hereby dismissed.
54.4 The plaintiffs are
hereby granted leave to amend within 14 days from date hereof their
particulars of claim affected by the
order of this court as indicated
in paragraphs 54.1.1 and 54.1.3 above.
54.5 Each party to pay
his or her own costs.
_________________________
M F LEGODI
JUDGE OF THE HIGH
COURT
For the 1
st
&
2
nd
Plaintiffs:
Adv Wim Trengove SC
Adv
Jaap Cilliers SC
Adv
J Bleazard
Instructed
by:
GEYSER
& COETZEE ATTORNEYS
For the 1
st
and 2
nd
Defendants: Adv M Chaskalson SC
Adv
A Cockrell SC
Adv
I Goodman
Adv
N Luthuli
Instructed
by: Attorneys
Edward Nathan Sonneberg Inc
For the 3
rd
Defendant:
Adv
CDA LOXTON SC
Adv
MA Chohan SC
Adv
B MAKOLA
ADV
A PANTAZIS
Instructed by
Attorneys:
BOWMAN
GILFILLAN INC
For the 2
nd
Respondent: No
appearance
Instructed
by:
BOWMAN
GILFILLAN
[1]
Steward V Botha 2008(6) SA 310 SCA at 313
[2]
Burger V Rand Water Board
2007 (1) SA 30
(SCA) at 32 D-E
[3]
Soma
V Morulane NO 1975 (3) SA 53 (T)
[4]
Wellington Court Shareblock v Johannesburg City Council
1995(3)SA 827 (A) at 833 F& 834D
[5]
Brown v Vlok
1925 AD 56
at 58
[6]
Francis v Sharp 2004(3) SA 230 (C) at 237 C-F
[7]
Tellematrix (Pty) t\a Matrix Vehicle Tracking v Advertising
Standards Authority SA
2006 (1) SA 461
(SCA) at 465 H
[8]
Marais v Steyn
1975 (3) SA 479
(T) at 487
[9]
Johnson v Leal
1980 (3) SA 927
(A) at 947
[10]
H v Fetal Assesment Centre 2015 (2) SA 193 (CC)at 199 B
[11]
Nel and others v Mc Arthur
2003 (4) SA 142
T at 149 F
[12]
Klerk N O v van Zyl and Maritz NNO
1989 (4) SA 263
(SE) 263 at
288E
[13]
H v Fatal Assement Centre 2015 (2)SA 193 (CC) paras 11-12, 78
[14]
2006 (2) SA 311
(CC),
2006 (1) BCLR; 2005
ZA CC 14 para 436-438
[15]
PEE International v Industrial Development Corporation of SA
2013 (1) SA (CC) para 27; De Lange v Residuary Bishop of the
Methodist Church of Southern Africa for the time being and another
2016 (1) BCLR 1
(CC) Para 53; My Vote Counts NPC v Speaker of the
National Assembly
2016 (1) SA 132
(CC) para 161.