MTN (Proprietary Limited) v Pragraj and Another (JA4/01) [2002] ZALAC 2 (1 February 2002)

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[2002] ZALAC 2
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MTN (Proprietary Limited) v Pragraj and Another (JA4/01) [2002] ZALAC 2; (2002) 23 ILJ 299 (LAC) (1 February 2002)

IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA
HELD
AT JOHANNESBURG
LABOUR APPEAL COURT CASE NO: JA4/01
(LABOUR COURT CASE NO: J1978/00)
In
the matter between:
MTN
(PROPRIETARY) LIMITED
Appellant
and
PRAVIN
PRAGRAJ
First Respondent
THANDI
ORLEYN N.O.
Second
Respondent
JUDGMENT
ON APPEAL
PAGE
AJA
[1] This
is an appeal from a decision of a Judge of the Labour Court,
Johannesburg, whereby he dismissed an application by the Appellant
in
terms of
s. 158(g)
of the
Labour Relations Act, 1995
, to review and
set aside a decision of the Director of the Commission for
Conciliation, Mediation and Arbitration, who is the Second
Respondent.
[2] The
facts giving rise to the decision under attack were, briefly, the
following.
[2.1] The
First Respondent was dismissed by the Appellant. He
alleged that he was unaware of any valid reason for his dismissal,
which was accordingly unfair, and referred the dispute to the CCMA in
terms of
s.191(1)(b)
of the Act. An attempt to resolve the dispute
through conciliation was unsuccessful and a commissioner duly
certified that the dispute
remained unresolved. First Respondent
requested that the dispute be arbitrated and the dispute accordingly
proceeded to arbitration
in terms of
s.191(a)(iii)
of the Act.
[2.2] In
the course of the arbitration First Respondent alleged
that his dismissal was due to unfair discrimination
on the ground
of race and, as such, an automatically unfair dismissal as defined in
s.187(1)(f)
of the Act. He accordingly withdrew his request for
arbitration and indicated his intention to refer the dispute to the
Labour Court
for adjudication in terms of
s.191(5)(b)(I)
of the Act.
[2.3] Despite
the fact that the 90-day time limit prescribed in
s.
191(5)(11)(a)
of the Act had expired, the dispute was referred to the
Labour Court for adjudication. When the point was taken that the
referral
was out of time, First Respondent applied to the Labour
Court for condonation of his non-observance of the timeframe
applicable.
That application was refused.
[2.4] The
First Respondent then applied to the Second Respondent to refer the
dispute to the Labour Court in terms of
s.191(6)
of the Act. The
Appellant objected on the ground that
s. 191(6)
only empowers the
Director to refer disputes of the type described in
s. 191(5)(a)
to
the Labour Court, whereas the dispute in question was one of the type
described in
s. 191(5)(b).
Despite this objection and after
following the procedure prescribed by
s. 191(7)
, the Second
Respondent decided to refer the dispute to the Labour Court for
adjudication and notified the parties accordingly. First
Respondent
thereupon filed his statement of claim with the Labour Court.
[2.5] The
Appellant then launched proceedings in the court
a quo
under
s. 158(1)(g)
to review and set aside the Second
Respondent’s decision to refer the dispute to the Labour Court on
the ground that it
was
ultra vires
s. 191(6)
, which only
applies
s. 191(5)(a)
disputes, whereas the dispute in issue fell
under
s. 191(5)(b).
[2.6] First
Respondent opposed the review not only on the merits, but also on the
basis that it was premature by reason of the
provisions of
s. 191(10)
, which reads as follows: “No person may apply to any
court of law to review the director’s decision until the
dispute
has been arbitrated or adjudicated, as the case may be”.
The decision referred to is clearly, in the context of the section,
the
decision of the Director to refer the dispute to the Commission
for arbitration or to the Labour Court for adjudication.
[2.7] The
Court
a quo
dismissed the review application on the ground
that it was premature, and found it unnecessary to decide upon the
merits of the review.
It is against this decision that the present
appeal has been brought.
[3] The
objection to the proposed review as premature must be dealt with and
decided as a point
in limine
. If it is well-founded, it would
be wrong to consider and premature to decide the merits of the
proposed review. The contents of
the review can only be taken into
account in the point
in limine
inasmuch as the nature of the
review may be relevant to deciding that point. This relevance is
confined to the form in which and
the grounds upon which the review
is sought to be brought. Those grounds are only relevant insofar as
they affect the jurisdiction
of the court to entertain the review at
this stage.
[4] It
is necessary at the outset to determine the nature of
s. 191(10).
Appellant has contended that it is what is generally termed an
ouster clause and that its operation must accordingly be
subject to the limitations which the courts have placed on such
clauses, and, in particular, the limitation that they cannot
preclude the courts from interfering with actions for which
there is “a manifest absence of jurisdiction”. It is
contended that the decision under attack constitutes such an
action and that the court will accordingly not be precluded from
setting it aside on review by the fact that there has not been
compliance with
s. 191(10).
[5] “Ouster
clauses” are defined by
Baxter
, Administrative Law, p 726 as
“provisions which appear to exclude or restrict judicial
review of administrative action”.
In my view
s. 191(10)
does
not fall within this description, for it neither excludes nor
restricts the jurisdiction of the Labour Court to review
decisions by the Director: it merely prescribes the procedure which
has to be followed before that jurisdiction can be invoked.
It is
more akin to so-called “limitation clauses”, of which the most
common are those requiring proceedings to be instituted
within a
prescribed period and after a prescribed period of notice has
elapsed. These are, in essence, a variety of ouster clauses
which
operate suspensively, as does
s. 191(10)
, which suspends the
aggrieved party’s right to approach the court for relief by way of
review until the condition stipulated by
it is fulfilled.
Baxter
(
op. cit.
p 736) points out that our courts have seldom
questioned the efficacy of such provisions, and states that this is
presumably because
there is less motivation for doing so as they do
not completely deprive an aggrieved individual of recourse to the
courts; and
also because, being based on practical
considerations, they are more reasonable than total ousters.
[6] Nonetheless,
the learned author does moot the possibility of circumventing
such clauses in the same manner as could be done
in the case of a
true ouster clause (
loc. cit.
n 423) i.e. by holding them
inapplicable to actions which are so tainted by a manifest absence of
jurisdiction that they
cannot be regarded as having been
committed in terms of the empowering statute at all and are, as such,
not subject to the limitations
placed by the statute on proceedings
to set aside actions committed in terms of that statute. In the note
cited the learned author
refers to
Anismisic Ltd v The Foreign
Compensation Commissioner and another
[1968] UKHL 6
;
[1969] 2 AC 147
, also
reported in
[1967] 2 AER 986
(CA) and
[1968] UKHL 6
;
[1969] 1 AER 208
(HL). The
relevant passages from the latter decision were quoted and applied in
Pinetown Town Council v President, Industrial Court,
1984 (3)
SA 173(N)
by LEON J at pp 178G – 179D, where he says the following:
“
The
substantial doctrine of jurisdictional review is stated in
Halsbury’s
Laws of England
(4
th
ed by Lord
Hailsham
)
vol 1 para 53 thus: “It is a primary function of the superior
courts to contain inferior courts within their jurisdiction. Such
a
court or tribunal lacks jurisdiction if it has no power to enter upon
an inquiry in the matter at all; and it exceeds its jurisdiction
if
it nevertheless enters upon such an inquiry, or having jurisdiction
in the first place, it proceeds to arrogate an authority withheld
from it by perpetrating a major error of substance, form or
procedure, or by making an error outside its limited areas of
competence.
Not every error committed by an inferior court or
tribunal, however, goes to jurisdiction. Jurisdiction to decide a
matter imports
a limited power to decide that matter incorrectly.”
This passage from
Halsburg
aptly summarizes the major feature
of the modern doctrine of jurisdictional review. It distinguishes
“want of jurisdiction” (see
BROWNE J IN
Anisminic Ltd v
Foreign Compensation Commission
[1969] 2 AC 223
at 235) in the
sense of a tribunal’s failure to meet the objectively predetermined
conditions precedent to its jurisdiction from
“the observance of
the law in the course of its exercise” – per Lord SUMNER in
R
v Nat Bell Liquors Ltd
[1922] 2 AC 128
(PC) at 156 where the
phrase in its full context appears thus:
“
That
supervision goes to two points: one is the area of the inferior
judgments and the qualifications and conditions of its exercise;
the
other is the observance of the law in the course of its exercise.
”
Where
the jurisdiction of a tribunal is dependent on the existence of a
particular state of affairs, it cannot give itself jurisdiction
by
incorrectly finding that the conditions for the exercise of
jurisdiction are satisfied, The conditions precedent to jurisdiction
are know as “jurisdictional facts” (see
Anisminic
Ltd v Foreign Compensation Commission
[1968] UKHL 6
;
[1969] 2 AC 147
(HL) at 208 per LORD WILBERFORCE) which must
objectively exist before the tribunal has power to act; consequently
a determination
on the jurisdictional facts is always reviewable by
Courts because in principle it is no part of the exercise of the
jurisdiction
but logically prior to it. (See also
Theron
en Andere v Ring van Wellington van die N G Sendingkerk in SA en
Ander
1976 (2) SA (A) at (15).”
[7] The
application of this approach to the present matter would involve
placing upon the expression “the director’s decision”,
the
interpretation of “the director’s decision in terms of the
section” which, as already stated, I consider to be the correct
interpretation in the context. This would then have the effect of
excluding from the operations of
s 191(10)
decisions by the Director
which, although purporting to have been made in terms of the
preceding provisions, were clearly not empowered
by those provisions
and so tainted by manifest absence of jurisdiction
[8] This
interpretation would avoid the otherwise illogical result of
requiring the arbitration or adjudication of a dispute by virtue
of a
referral (which is clearly foredoomed to be set aside) before the
court can be approached to set it aside and thus invalidate
the
proceedings conducted in pursuance thereof.
[9] This
interpretation would not have the effect of rendering the
provisions of
s. 191(10)
ineffective: they would continue to render
the completion of arbitration or adjudication in pursuance of a
decision of the Director
obligatory before a review of that decision,
in all cases except where the absence of jurisdiction to make the
decision was so manifest
as to bring it outside the ambit of the
sub-section.
[10] The
intention of the sub-section was apparently to enable a dispute
to be fully aired as expeditiously as possible
without being held
up by procedural objections. The above interpretation will
not frustrate that purpose, since
it will only remove from
the ambit of the section decisions which are so clearly
fatally flawed that no practical purpose
will be served in
implementing them before they are inevitably set aside. If the court
asked to review them is not satisfied that
this is the case, it will
insist that the procedure prescribed by
s. 191(10)
be followed.
[11] Applying
this approach to the present case, it becomes necessary to
investigate the basis upon which it is alleged that
the Director’s
decision is
ultra vires
to determine whether she
manifestly lacked jurisdiction to make that decision. The
scheme of dispute resolution envisaged
by
s. 191
is as
follows. If a dispute arises about the fairness of a
dismissal, the dismissed employee may refer it to a
council
or, if none exists, the Commission, which must attempt to
resolve it through conciliation. If this fails,
s. 191(5)
provides
that:
“
(a) the
council or the Commission must arbitrate the dispute at the request
of the employee if –
(i) the
employee has alleged that the reason for dismissal is related to the
employee’s conduct or capacity, unless
paragraph
(b)(iii) applies;
the
employee has alleged that the reason for dismissal is that the
employer made continued employment
intolerable
or
the
employee does not know the reason for dismissal; or
(b) the
employee may refer the dispute to the Labour Court for
adjudication if the employee has alleged that the reason
for
dismissal is –
(i) automatically
unfair;
(ii) based
on the employer’s operational requirements;
the
employee’s participation in a strike that does not comply with the
provisions of chapter IV; or
because
the employee refused to join, was refused membership of or was
expelled from a trade union party to closed shop agreement.”
[12] Sub-section
(6) provides, however, that;
“
Despite
sub-section 5(a), the director must refer the dispute to
Labour Court, if the director decides, on application by
any party to
the dispute, that to be appropriate after considering
the
reason for dismissal;
whether
there are any questions of law raised by the dispute;
the
complexity of the dispute;
whether
there are conflicting arbitration awards that need to be resolved;
(e) the
public interest.”
[13] Sub-section
(7) requires the Director to accord the parties a hearing
before making the decision, whereafter the Director
must, in terms of
sub-section (8)
“
refer
the dispute –
(a) to
the Commission for arbitration; or
(b) to
the Labour Court for adjudication.”
[14] Subsection
(9) provides that the Director’s decision is final and
binding. Thereafter follows the provision in issue,
subsection (10),
quoted earlier in this judgment.
[15] The
scheme which emerges is that, if the dispute is of the nature
described in ss. (5)(a), the Commission (or a council) must
arbitrate
it at the request of the employee. If it is of the nature described
in
ss. 5(b)
the employee may refer it to the Labour Court for
adjudication. The words “Despite sub-section 5(a)” by which
sub-section (6)
is introduced clearly mean that the power of a
Director to refer a dispute to the Labour Court is limited to
disputes of the nature
described in that paragraph. The employee is
already entitled himself to refer a dispute falling under paragraph
(b) to the Labour
Court and there would be no point in empowering the
Director to do so. What the section envisages is that there may be
disputes
which, although they fall within the description in
sub-section 5(a), nevertheless merit the attention of the Labour
Court by reason
of the factors in sub-section (6). The Director is
accordingly given the power, after considering the factors
enumerated, to refer
such a matter to the Labour Court for
adjudication or to leave it to the Commission to arbitrate.
[16] In
the present case the First Respondent, by alleging that his
dismissal was automatically unfair, placed it squarely
within the
ambit of sub-section 5(b) and removed it from the scope of
sub-section 5(a) and thus from the categories of dispute which
the
Director had jurisdiction to refer to the Labour Court for
adjudication under sub- section (6). The Director accordingly
manifestly
lacked the jurisdiction to refer it for adjudication under
sub-section (6) as she purported to do. Her action in so doing was
not
a decision made in terms of the section and does not enjoy the
limited protection afforded by sub-section (10) to decisions which
are made in terms of the section.
[17] I
do not consider that this conclusion does any injustice to the First
Respondent. It was his own conduct (which the Labour
Court found it
could not condone) which deprived him if a hearing before the court.
His only remedy was then to appeal against the
refusal of
condonation. He was not entitled to circumvent that refusal by
applying to the Director to refer the matter afresh to
the Labour
Court under a provision which did not apply to his situation and was
not intended for the purpose.
[18] It
follows that the Court
a quo
should not only have entertained
the review application but should also have granted the Appellant the
relief sought.
[19] I
would accordingly uphold the appeal with costs and substitute for the
order made by the Court
a quo
the following order:
An
order is granted in terms of prayer (a) of the Notice of Motion;
The
First Respondent is ordered to pay the costs of the application.
________________________
N.S
PAGE
ACTING
JUDGE OF THE LABOUR APPEAL COURT.
I
agree.
_______________________
R.M.M.
ZONDO
JUDGE
PRESIDENT OF THE LABOUR APPEAL COURT
I
agree.
________________________
C.R.
NICHOLSON
JUDGE
OF THE LABOUR APPEAL COURT.
I
agree.
For
the Appellant:
M.A.
CROWE
Instructed
by:
First
Respondent in person
No
appearance of Second Respondent.
Date of Judgment: 1
February 2002