Gangat v Minister of Foreign Affairs (A571/13) [2016] ZAGPPHC 1019 (8 December 2016)

40 Reportability
Contract Law

Brief Summary

Contract — Employment contract — Appellant, a foreign service officer, claimed damages for remuneration and allowances related to his diplomatic posting in Ramallah — Respondent denied the existence of a new contract based on a transfer letter, asserting it merely informed the appellant of his transfer and did not create new contractual rights — Court held that the transfer letter did not have contractual effect as claimed by the appellant, and the appellant was not entitled to remain in his post for four years or to six months' notice prior to transfer, as the posting was subject to the needs of the state and the discretion of the Department of Foreign Affairs.

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[2016] ZAGPPHC 1019
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Gangat v Minister of Foreign Affairs (A571/13) [2016] ZAGPPHC 1019 (8 December 2016)

IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
CASE
NO: A571/13
8/12/2016
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
1/12/16
In
the matter between:
MOHAMAD
RAFIQ ABDOOLHAQUE GANGAT
Appellant
and
MINISTER
OF FOREIGN
AFFAIRS
Respondent
JUDGMENT
Tuchten
J:
1.
This is an appeal from a decision of Mavundla J, dismissing the
appellant's action for damages against the respondent. The appellant

claimed payment of certain remuneration and allowances arising from a
diplomatic posting to the Palestine Authority at Ramallah
in the West
Bank. The appellant refers to the geographical area to which he was
posted as Palestine and I shall merely for convenience
use that term
as well.
2.
The appellant was at the time of his posting a foreign service
officer in the Department of Foreign Affairs (DFA). At the time
of
his posting, he had reached the rank of deputy director: foreign
service (second leg).
3.
It is important to note that the plaintiff grounded his action
exclusively in contract. In his particulars of claim, he alleged
that
he concluded a contract of employment with the respondent on about 1
February 1996. The respondent admitted this allegation.
4.
The appellant was, in a letter dated 17 February 2001, appointed by
the then Minister of Foreign Affairs as "South Africa's

Representative to the Palestinian National Authority". The
appellant pleaded that the actual appointment was made on 31 December

2002 and that his title was Head of Mission: Palestine. None of the
documents before us indicate that the appellant was accorded
that
title but it is admitted by the respondent that the appellant while
in Ramallah carried out the functions of a head of mission.
5.
It is further common cause that a written performance agreement was
concluded between the DFA and the appellant on about 1April
2003. The
purpose of the performance agreement was to assist the appellant to
define his responsibilities, duties and priorities,
to provide for
dispute resolution, to encourage the appellant by providing
appropriate support and to encourage and improve communication

between the appellant and his manager. The service agreement provided
that disputes between the appellant and the DMR should be
conciliated
between the appellant and his manager within the DMR. The service
agreement goes on to say:
Should
the result not be satisfactory and there is a disagreement, the
normal dispute resolution procedure must be followed.
6.
The appellant went on, however, to plead that a further contract of
employment was concluded between the parties. This contract,
the
plaintiff alleged, arose from an undated letter written by the
Director­ General of the DFA to the appellant informing
him of
his transfer to Ramallah with effect from 31 December 2002. Ishall
refer to this letter as the transfer letter. The respondent
denied
that the transfer letter constituted a new or further employment
contract between the parties and asserted that it was in
fact a
letter of transfer which regulated the appellant's terms and
conditions of service during his term of duty in Ramallah.
7.
In my view, the transfer letter did not have contractual effect in
the sense for which the appellant contends. It included an
invitation
to the appellant to state by signing the letter that he agreed with
its contents. But the purpose of the transfer letter
was not to
conclude a new contract; its purpose was to inform the appellant that
he had been transferred to Ramallah and to record
the fact that its
author had calculated the benefits which were to accrue to the
appellant
in accordance with those applicable to DFA officers in
the position of the appellant
and to invite the appellant to
agree that such benefits had been correctly calculated. The transfer
letter must be read in conjunction
with and subject to the other
prescriptions which had a bearing on the contractual relationship
between the appellant and the Minister.
These prescriptions included,
as the transfer letter makes clear, the Public Service Act, the
Public Service Regulations the Public
Service Staff Code and the
Administrative Code for Foreign Service.
8.
As with any other document, in
interpreting the provisions of the transfer letter which are in
issue, the starting point is inevitably
the language of the document
but it falls to be construed in the light of its context, the
apparent purpose to which it is directed
and the material known to
those responsible for its production. Context, the purpose of the
provision under consideration and the
background to the preparation
and production of the document in question are not secondary matters
introduced to resolve linguistic
uncertainty but are fundamental to
the process of interpretation from the outset.
[1]
9.
The first issue relates to the period of the appellant's posting to
Ramallah. The transfer letter reads:
In terms of our current policy, it is
the intention that the posting abroad will be for a period of four
years. The Department,
however, retains the right to adjust this
period should this be necessary.
In
the case of a transfer.  A maximum of three months notice will
be given
.
[2]
10.
The transfer letter also reads:
The
Labour Relations Act no. 66 of
1995
, as amended, has brought about a new labour dispensation for the
Public Service. Service conditions, including the foreign service

remuneration system, are subject to negotiation and may result in
adjustments, either upwards or downwards. Your transfer conditions,

including remuneration and allowances, are therefore subject to such
changes as may be brought about by legally prescribed negotiation

processes. Your transfer is also based on the understanding that the
conditions contained in this letter cannot be guaranteed for
the full
duration of your tour of duty.
In the event of any changes to your
conditions of service as may be determined by negotiations, you will
receive written notice
thereof six months prior to it taking effect.

.
Your transfer is furthermore subject
to the gradings of missions and post levels which are subject to
periodic review in order to
ensure that the interests of the State
are being properly upheld. Such reviews may also be necessitated by
factors outside the
Department's control. This implies that the
grading of missions and post levels as a whole, as well as allowances
associated with
such gradings and post levels, may be adjusted
upwards or downwards.
If any adjustment in the grading
should occur in respect of the post level on which the abovementioned
allowances are based, the
difference will not exceed one post level.
Should such changes become necessary, you will be given six months
prior notice in writing,
after which you will be required to indicate
- within three months - whether the change is acceptable. If you find
the adjustment
of your allowances unacceptable, a suitable date of
your transfer to Head Office will be negotiated, which will take
effect within
the abovementioned six months notice period.
11.
The appellant interprets this to mean that he had a contractual right
to remain in his post in Ramallah for four years subject
only to the
respondent's right to effect an adjustment to this arrangement if it
were objectively necessary to do so. And then
the appellant contends,
firstly, that he had an absolute right to remain in his post pending
the resolution of all and any disputes
arising between the appellant
and the DMR in accordance with the normal dispute resolution
procedure and, secondly, that he was
entitled to receive six months
notice of the DFA's intention to transfer him.
12.
I do not think that this is correct. As to the duration of the
posting, the passage in question says no more than that it was
then
the policy of the DFA to retain officers who are posted abroad in
their posts for four years. At the level of language, in
my view, it
did not create a contractual entitlement on the part of the appellant
to remain in that post for four years or any
other period. This view
is fortified by the purpose of the posting and the circumstances in
which it was made.
13.
Those circumstances which I see as important for present purposes are
the following: Firstly, the posting was of a diplomatic
nature. It
was designed, as all such diplomatic postings are, to advance and
represent the interests of the Republic of South Africa,
as
interpreted by the executive from time to time. In this context,
changes may need to be made at a moment's notice. An individual
who
holds a particular diplomatic posting may be seen not to advance or
represent those interests for reasons personal to that
individual.
Secondly, the posting to Ramallah was to a region of particular
tension and sectarian and ethnic conflict. Perceptions
are of great
significance in this region. Thirdly, the posting of the appellant to
Ramallah was as
de facto
head of mission. The appellant was in
effect the public representative of the Republic.
14.
For these reasons, it might be necessary to transfer an officer such
as the appellant away from Ramallah. Such a transfer might
be
perceived by the officer subjectively as a promotion or a demotion
but it would in fact be neither, provided the officer retained
his or
her rank within the DFA and was not required to do work inconsistent
with that rank.
15.
It is in this light that the statement in the transfer letter, that
the period of the posting might be adjusted, should this
be
necessary, must be read. It expressed the obvious: the posting of the
appellant was to promote the interests of the Republic;
but while as
a general proposition, the appellant might expect to remain in his
post in Ramallah for four years, this could be
curtailed if the
interests of the South African state, as interpreted by the
executive, so required.
16.
Finally on this topic, the provision in the transfer letter relevant
to transfers for necessity provided for a
maximum
of three
months notice. The references to six months notice did not relate to
transfers for necessity.
17.
A dispute arose between the appellant and the DMR. The South African
mission at Ramallah, became, under the appellant's leadership,

dysfunctional. The dysfunctionality arose because of conflict between
the appellant on the one hand and two officers of the DMR
stationed
at the Ramallah mission and some locally recruited personnel on the
other. The DMR obtained guidance through two reports,
described in
the court below as the Nojozi and Memela reports. Ms Nojozi was the
Director: Human Rights at the DMR. Mr Memela was
the Chief Director:
East Africa at the DMR. Mr Memela conducted an investigation
following that of Ms Nojozi. The Memela report
found that the
appellant had failed to provide sound leadership to the mission at
Ramallah and recommended that the appellant be
recalled.
18.
The appellant testified that he was not the cause of the
dysfunctionality; but this in my opinion cannot avail the appellant.

He was the
de facto
head of mission. It was his duty to ensure
that a properly functional mission operated in Ramallah. The
dysfunctionality of a South
African mission to this volatile and
potentially violent part of the world could give rise to a diplomatic
crisis. The DMR was
quite right to view the situation as serious and
to recommend urgent remedial action to the Minister. This is what the
DMR did.
19.
Counsel for the appellant submitted that the DFA was contractually
obliged under the circumstances I have described to provide
the
appellant with support to enable the appellant to overcome the
dysfunctionality. I do not agree. Perhaps on the level of labour
or
administrative law, this submission might have substance. I express
no opinion on this aspect. But in the realm of contract,
in my view,
the DFA was fully entitled to take the view that the personality of
the appellant was such that swift intervention
was required. It was
therefore necessary that the appellant be redeployed.
20.
There is a further factor which, objectively and on its own,
justifies the appellant's immediate redeployment. It emerged, and
was
admitted by the appellant, that the appellant had, knowingly smuggled
simcards into the Gaza Strip. He did so under the cover
of his
diplomatic status and used a motor vehicle assigned to the mission at
Ramallah for this purpose. He justified his action
on the basis that
the citizens of Gaza had the right freely to communicate. It is
hardly necessary to state how serious a breach
of the appellant's
duties this was. It could very seriously have compromised the
Republic's stated intention of acting to bring
peace to this troubled
region.
21.
It cannot avail the appellant
that this serious misconduct on the part of the appellant was not
known to the DFA when the appellant
was recalled. At the level of
contract, the determination of necessity in this context is
objective. A contracting party is entitled
to rely on any facts to
justify his conduct in cancelling an agreement, whether or not such
facts were known to him at the time
the cancellation was effected.
[3]
22.
The remedial action recommended by the DMR to the Minister was that
the respondent be recalled and another official put in his
place to
act as
de facto
head of mission. The Minister accepted the
recommendation. Accordingly, in a letter dated 14 April 2004, Dr
Sooklal, the Deputy
Director-General: Asia and Middle East at the DMR
informed the appellant that a decision had been made to transfer him
to South
Africa with effect from 1 June 2004.
23.
Prior to the decision, the DMR informed the appellant of the case for
dysfunctionality of the mission at Ramallah and the recommendation

that he be transferred back to South Africa. The appellant was also
provided with certain material in the Memela report. The appellant

was invited to respond to the case against him which he did,
submitting his response to the DMR on 17 March 2004.
24.
In the letter recalling the appellant to South Africa, the DMR
recorded that the appellant had failed to provide the DMR with
any
new information or evidence that materially affected the findings and
recommendations in the report and that the explanations
given by the
appellant had not constituted a satisfactory justification for his
conduct. The DMR expressed the view that the comments
made by the
appellant in response to the report had not substantially affected
the findings and recommendations contained in the
report.
25.
The appellant did not challenge the validity of the administrative
decision to terminate his posting to Ramallah. Instead, the
reaction
of the appellant was to tender his resignation from the DMR in a
letter dated 10 May 2004. The appellant's resignation
was not
accepted. The appellant was assigned a new post at the DMR's head
office in South Africa. The appellant remained in his
position as
deputy director and was assigned work consistent with that position.
26.
By letter dated 29 June 2004, the appellant, through his attorney,
purported to cancel the contract the appellant claimed regulated
his
posting to Ramallah on the ground of repudiation by the respondent.
It became clear when the appellant gave evidence that he
claimed,
consistently with the way his case was pleaded, that, in addition to
the performance agreement with the DFA which Ihave
mentioned, there
were two contracts between the respondent and the appellant: his
general contract of employment and the contract
he claimed was
evidenced by the transfer letter. I have already said that I do not
accept that the transfer letter constituted
an independent contract.
But I shall deal with the appellant's own allegations regarding the
alleged repudiation.
27.
A repudiation is constituted by
the conduct of a party which, fairly interpreted, exhibits a
deliberate and unequivocal intention
no longer to be bound by a
contract and when a party refuses to give effect to an important term
of an agreement.
[4]
28.
Firstly, the appellant says, he was removed by an officer of the DFA
when only the Minister had the authority to remove him.
At the level
of contract, if the officer in question did not have the authority so
to act, then the appellant's removal could not
be said to be that of
the Minister. Actions in the contractual context could only have
consequences for the Minister if they were
the actions of the
Minister himself or his authorised representatives.
29.
Secondly, the appellant claims that he was not given six months
notice as the transfer letter states. I have dealt above with
this
point. I do not think that the appellant was contractually entitled
to six months notice.
30.
Thirdly, the appellant claims that due process was not followed in
relation to the dispute he had with the DFA. In this regard
the
appellant says that there was no compliance with the conciliation
process contemplated in the performance agreement. But the
appellant
did not ask for conciliation procedures to be followed. And if they
had, such conciliation procedures would clearly have
been
unsuccessful. In any event, the failure to follow agreed conciliation
procedures is not a repudiation as I have described
that concept.
31.
Fourthly, the appellant says that the post to which he was
transferred was a demotion. But it was not. In the eyes of the
appellant,
the instruction to return to head office diminished his
status but he retained the rank of deputy director. He does not
suggest
that the work he was assigned was inappropriate for a person
holding his rank. At the level of contract there was no demotion.
32.
Fifthly, the appellant questions the reliance by the DFA on the
Memela report and asserts that he was only given portions of
that
report. The evidence produced on behalf of the respondent, which was
accepted by the court below, was that the appellant did
not ask for
the full report. But even if the appellant is correct on this score,
the reliance by the DFA on the Memela report cannot
constitute a
repudiation of his contract with the respondent.
33.
For these reasons, in my view, the appellant failed to prove that the
respondent repudiated the contract with the appellant.
The learned
judge in the court below correctly came to the same conclusion.
34.
There is a further reason why, in my view, the appellant cannot
succeed, even if it is accepted, against my findings, that the

transfer letter constituted a contract and that the contract so
hypothetically concluded was repudiated by the respondent.
35.
The appellant claims that the remuneration to be paid to him while he
was at his post in Ramallah was made up of two components:
his salary
as deputy director and his allowances as an officer of the DFA posted
away from South Africa.
36.
But the salary was due to the appellant in terms of the general
contract of employment, not the contract the appellant claims
was
constituted by the transfer letter. In coming to this conclusion, I
have not overlooked that the transfer letter sets out the

remuneration the DFA intended paying the appellant while he was at
his post in Ramallah. It could not have been the intention of
the
parties that the appellant's general contract of employment would be
suspended while the appellant was serving outside the
Republic and,
indeed, this was not pleaded or suggested by the appellant.
37.
The other component of the
appellant's remuneration was the allowances due to him as an officer
of the DFA serving outside the Republic.
Those allowances were paid
to him as compensation for the inconvenience of serving outside the
Republic and in my view were not
recoverable once he ceased so to
serve, for whatever reason. This was the conclusion to which the
Labour Court came in
Nehawu
obo Gift Lebethe v Minister of International Relations and
Cooperation.
[5]
38.
And even if the appellant was originally entitled to his remuneration
and allowances pursuant to a contract constituted by the
transfer
letter, this changed when his general contract of employment was
amended pursuant to the very legally prescribed negotiation
processes
referred to in the transfer letter and which I have quoted above.
39.
So the termination of the hypothesised agreement constituted by the
transfer letter did not give rise to any damages on the
part of the
appellant. He continued as an deputy director within the DFA to
receive his salary as adjusted pursuant to the negotiation
processes
which I have mentioned. Once the appellant was no longer stationed in
Ramallah, he was no longer entitled to the allowances.
40.
The appeal must therefore fail and costs must follow the result. I
propose that the following order be made:
The appeal is dismissed with costs.
Such costs will include the costs consequent upon the employment of
both senior and junior counsel,
where two counsel were so employed.
_______________
NB
Tuchten
Judge
of the High Court
1
December 2016
I
agree. An order is made
as
set out in paragraph 40 above.
________________
C
Pretorius
Judge
of the High Court
1
December 2016
I
agree
_________________
RG
Tolmay
Judge
of the High Court
1
December 2016
[1]
Dexgroup
(pty) Ltd v Trostco Group International (Ply) Ltd and Others
2013
6 SA 520
SCA para 16 with reference to
Natal
Joint Municipal Pension Fund v Endumeni Municipality
2012 4 SA 593
SCA paras 18 and 25-26
[2]
My emphasis
[3]
See eg
Stewart
Wrightson (pty) Ltd v Thorpe
1977 3 SA 943
A 953G
[4]
Van Rooyen v Minister van Openbare Werke en Gemeenskapsbou
1978 2 SA
835
A 844-846
[5]
Labour Court case no. J1436/2013, decided on 26 July 2013 at para
26.