About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: North Gauteng High Court, Pretoria
SAFLII
>>
Databases
>>
South Africa: North Gauteng High Court, Pretoria
>>
2013
>>
[2013] ZAGPPHC 241
|
|
Rustenburg Platinum Mines Ltd v Dicker NO and Another (3762/13) [2013] ZAGPPHC 241 (13 August 2013)
NOT
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA (NORTH GAUTENG HIGH COURT)
CASE
NO. 3762/13
DATE:13/08/2013
In
the matter between:
RUSTENBURG
PLATINUM MINES LTD
….............................................................
Applicant
and
ADV
L P DICKER
N.O.
..................................................................................
First
Respondent
HERTUS
MINING & INDUSTRIAL SERVICES
CC
...............................
Second
Respondent
Date
heard: 23 July 2013 Judgment delivered: 13 August 2013
JUDGMENT
VAN
NIEKERK J
Introduction
[1]
This is an application in terms of
s 33
(1) (b) of the
Arbitration
Act, 42 of 1965
, in which the applicant seeks to review and set aside
a ruling made by the first respondent (‘the arbitrator’).
In
his ruling, the arbitrator ordered the applicant to pay the costs
of an application for an amendment to its statement of defence
on the
scale as between attorney and own client (such costs to include the
costs attendant on engaging senior counsel), the wasted
costs
attendant on the amendment (on the same scale) such costs to include
the costs of the Arbitration Foundation of South Africa
for four
days, and the costs attendant on the engagement of counsel for four
days, with fifty percent of the cost of counsel’s
preparation
for trial to be considered to be wasted costs.
[2]
The applicant contends that in ordering as he did, the arbitrator
exceeded his powers.
Material
facts
[3]
The material facts are not in dispute. The parties agreed to submit a
dispute between them to arbitration, to be conducted by
the
arbitrator under the rules of the Arbitration Foundation of South
Africa (‘AFSA’). They agreed to an exchange of
pleadings
and discovery affidavits, and to a hearing before the arbitrator on
11 to 14 December 2012. In relation to procedure,
the arbitration
agreement provides that the arbitrator would have the power to
determine the procedure to be followed and that
in doing so, he would
have the same powers as a judge of the High Court. In relation to
costs, in terms of the minutes of the pre-
arbitration agreement held
on 19 September 2012, the parties agreed that inter alia that:
15.2
The costs of the arbitration will include the arbitrator’s fee
and the costs of recording and hiring the arbitration
venue,
calculated on the High Court scale.
15.3
The cost of any postponement of the hearing will include costs of up
to and including, but not exceeding, three trial days.
Notice of no
less than five days of any postponement must be given the arbitrator,
failing which the arbitrator may recover his
fees on the basis set
out in this paragraph. Should a postponement be agreed upon or
granted in the period between six and fifteen
days before the hearing
of the arbitration, the arbitrator wilt be entitled to a fee
equivalent to half the amount of the fees
as calculated above
15.7
Taxation of the claimant's and/or defendant's bills of costs,
excluding the arbitrator's fees and other AFSA disbursements,
such as
room hire and recording fees, shall be at the High Court tariff by a
Taxing Master of the High Court'
[4]
On 10 December 2012, a day before the commencement of the
arbitration
hearing,
the applicant delivered a notice of intention to amend its statement
of defence, in which it sought to withdraw an admission
previously
made. The notice did not contain any tender of the second
respondent’s wasted costs. The second respondent objected
to
the amendment. On the morning of 11 December, the applicant served
its notice of intention to amend, again without any tender
of wasted
costs. On 12 December 2012, answering and replying affidavits were
filed and the application argued. The arbitrator delivered
the ruling
that is the subject of these proceedings on 13 December 2013. It is
regrettable that the arbitrator’s reasons,
which were made
available to the parties, have not been incorporated into the papers
before me, but be that as it may, the ruling
reads as follows:
‘
1.
The defendant is granted leave to amend its statement of defence
dated 8 October 2012 in accordance with its notice of intention
to
amend, dated 7 December 2012 and delivered on 10 December 2012;
2.
The defendant shall effect the amendment by no later than close of
business on 13 December 2012;
3.
The claimant may effect such consequential amendments as it may wish
and/or deliver a reply to the amended statement of defence,
by no
later than the close of business on 14 June 2013;
4.
The arbitration is postponed to 21 January 2013 at Circle Chambers
for hearing there from 21 to 25 January 2013;
5.
The defendant shall pay the costs of the application for amendment on
the scale as between attorney and own client, including
the costs
attendant upon the employment of senior counsel;
6.
The defendant shall pay the wasted costs attended upon the amendment
on the scale as between attorney and own client, such costs
to
include:-
6.1
The costs of AFSA for four days, such costs to include the costs
attendant upon the reservation of the revenue and the arbitrator
for
that period;
6.2
The costs attendant upon the employment of senior counsel for 4 days;
6.3
Fifty percent of the cost of counsel’s preparation for trial is
to be considered to be wasted costs.
The
issue
[5]The
issue, crisply stated, is whether the arbitrator exceeded his powers
by ordering as he did in paragraphs 5 and 6 of the ruling
under
review.
Analysis
[6]
In essence, the court to determine whether the arbitrator purported
to exercise powers that he did not have, and not whether
he
erroneously exercised a power that he did have (see Telcordia
Technologies Inc v Telkom SA Ltd
[2007] All SA 243
(SCA), at para
[52] of the judgment). In other words, whether the arbitrator
exceeded his powers is a matter that goes to jurisdiction
(to be
determined objectively from the relevant instruments) and not to the
merits.
[7]
It is not disputed that the arbitrator’s powers in the present
instance were derived from the Act, the AFSA Rules, and
the minute of
the pre-arbitration hearing. I deal below with each of the
applicant’s contentions.The award of costs on the
attorney own
client scale.
[8]
The arbitration agreement between the parties is silent on the scale
of costs that the arbitrator may award. Section 35(1) of
the Act
provides that subject to the terms of any arbitration agreement, and
arbitrator may in his or her discretion award costs
and give
directions as to the scale on which costs are to be taxed. The
section provides that an arbitrator may "... award
costs as
between attorney and client.” Although the Supreme Court of
Appeal has on at least one occasion
1
questioned whether an award of costs on the scale as between attorney
and own client is justifiable, the prevailing authority suggests
that
there is no difference between them. In Aircraft Completions Centre
(Pty) Ltd v Rossouw,
2
Stegmann J, in an extensive judgment, concluded:
‘
8.
Therefore, an order in the hybrid form that one party should pay the
costs of another ‘taxed as between attorney and own
client’,
does not, as a matter of law achieve anything more than an order in
the established form that one party should pay
the costs of another
‘taxed as between attorney and client’. Equally, an
agreement in the hybrid form takes the matter
no further than an
agreement to pay ‘attorney and client’ costs.
9.
For all of these reasons, the Taxing Master is obliged to act on an
order that one party is to pay the costs of another ‘taxed
as
between attorney and own client1 in exactly the same way as he is
obliged to act on an order that one party is to pay the costs
of
another ‘taxed as between attorney and client’. As a
matter of law there is no difference between them...”
3
[9]
To the extent that the applicant’s objection to the
arbitrator’s award is premised on the s 35 (1) of the Act, and
in particular, the power of an arbitrator to award costs as between
attorney and client, it follows that the arbitrator’s
ruling
amounts to no more than what is contemplated by the Act, and that the
objection to an order that costs be paid on the scale
as between
attorney and own client is of no consequence. In my view, there is no
basis beyond the pedantic on which to interfere
with the arbitrator’s
ruling.
50% of counsel's fees
[10]
Section 35 of the Act empowers an arbitrator to determine any part of
the costs to be paid. This is precisely what the arbitrator
did, in
ordering that 50% of the costs of counsel’s preparation for
trial is to be considered wasted costs. The applicant’s
primary
objection to this part of the award is that what constitutes wasted
costs is a matter to be determined by the taxing master.
[11]
In the present instance, the arbitrator heard argument on the
application for leave to amend. He was in possession of the pleadings
that had been exchanged prior to the scheduled commencement of the
hearing, and was in a position to assess the nature and extent
of the
amendment sought, as well the extent to which preparation for the
hearing had been frustrated. The arbitrator was thus well-placed
to
quantify the amount of preparation that had been wasted.
[12]
In making the order that he did, in my view, the arbitrator did not
usurp the powers of the taxing master, nor did he exercise
powers not
contemplated by s 35 of the Act. In the course of making orders for
costs, the courts frequently engage in exercises
of quantifation in
relation to preparation. In doing so, they do not purport to perform
the function of taxation, which remains
the purview of the taxing
master, who is at liberty to scrutinise any bill of costs prepared in
accordance with the court’s
directions, and to tax-off any
unreasonable amounts claimed.
[13]
In my view, the arbitrator was empowered to make the order he did in
relation to the costs of preparation for the arbitration
hearing.
The
amount of days for wasted costs
[14]
The parties do not dispute the proposition that where an application
to amend is made at a stage when postponement is necessary
in order
to enable a respondent to meet the amended pleading, the applicant is
ordinarily liable for all wasted costs. The applicant
contends that
in terms of the pre-arbitration minute, any liability for wasted
costs is limited to the costs of three days, and
that by ruling as he
did, the arbitrator exceeded his powers. The second respondent
submits that properly construed, clause 15.3
of the minute relates
to
a postponement prior to the commencement of proceedings, and not to
any costs wasted in consequence of an application for amendment
to
pleadings moved during the course of the hearing
[15]
In my view, the wording of clause 15.3 of the pre-arbitration minute,
read in its proper context, regulates postponements prior
to the
commencement of the arbitration proceedings, and then only liability
for the arbitrator’s fees consequent on the postponement.
In
the present instance, the first three days of the scheduled hearing
were taken up by the application to amend, the fourth day
being a day
on which consequent on leave to amend being granted, the second
respondent was entitled to file a reply to any consequential
amendments. In other words, the four wasted days (11 to 14 December)
were wasted by reason of the amendment sought by the applicant,
and
not consequent on any postponement. Even if the hearing had
continued, there would in any event have been four days’
wasted
costs.
[16]
For these reasons, the application to review and set aside the
arbitrator’s ruling fails. There is no reason why an order
for
costs should not follow the result, such costs to include the costs
consequent on the employment of senior counsel.
I
make the following order:
1.
The application is dismissed, with costs, such costs to include the
costs consequent on the employment of senior counsel.
ANDRE
VAN NIEKERK
ACTING
JUDGE OF THE HIGH COURT NORTH GAUTENG DIVISION
APPEARANCES
FOR
THE APPLICANT: Adv C Rip, instructed by Mothle Jooma Sabdia Inc,
(012) 362 3137, fax 086 694 4081 (ref RUS2.0029)
FOR
THE SECOND RESPONDENT: Adv Q Pelser SC, instructed by Cromje-De Waal
Skhosana fnc , c/o HW Theron Inc (012 347 2000)
1
See
AA Alloy Foundry (Pty) Ltd v Titaco Projects (Pty) Ltd
2000(1) SA 639 at 648H
2
2004 (1) SA 123
(W),
3
At
186 H-187A