Vaal Toyota (Nigel) v Motor Industrial Bargaining Council and Others (JA15/01) [2002] ZALAC 18 (8 August 2002)

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[2002] ZALAC 18
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Vaal Toyota (Nigel) v Motor Industrial Bargaining Council and Others (JA15/01) [2002] ZALAC 18; [2002] 10 BLLR 936 (LAC) (8 August 2002)

IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA
HELD
AT JOHANNESBURG
Case
No: JA15/01
In the
matter between
:
VAAL
TOYOTA (NIGEL) Appellant
and
MOTOR
INDUSTRY BARGAINING
First
Respondent
COUNCIL
HEIN
GERBER Second Respondent
A.J.L.
WYNGAARDT Third Respondent
MOTOR
INDUSTRY STAFF ASS Fourth Respondent
_______________________________________________________________
JUDGEMENT
_______________________________________________________________
ZONDO
JP
Introduction
[1] This
is an appeal from a judgement of the Labour Court in a review
application brought by the present appellant to review and
set aside
an arbitration award issued by the second respondent, an arbitrator,
under the auspices of the first respondent. The terms
of that
judgement will appear later in this judgement. Before dealing with
the appeal, it is necessary to set out the facts of this
matter.
The
facts
[2] The
third respondent was employed by the appellant in 1997 as a car
salesman. His immediate superior was one Mr Venter. Mr Venter’s
position was described as that of a dealer principal. Prior to the
two men working together in the appellant’s business, they had
had
occasion to work together elsewhere some years before within the
motor industry in connection with the selling of cars. Then
the third
respondent had been employed as a principal dealer and was Mr
Venter’s immediate superior. The third respondent had worked
in
that company as a principal dealer for at least ten years. Mr Venter
was the first of the two to join the appellant’s employment.
Within
a few days after Mr Venter had joined the appellant, he recruited the
third respondent to work for the appellant as a car
salesman.
[3] Clause
10 of the third respondent’s letter of appointment provided that
the rates and frequency of salary increments were entirely
at the
discretion of the board of directors of the appellant. The procedure
to obtain a salary increase was for the supervisor of
an employee to
request the appellant’s managing director to approve a salary
increase for the employee. The managing director would
take a
decision on the request but his decision would be subject to
ratification by the board of directors.
[4] In
about May 1998 the third respondent approached Mr Venter and
requested a salary increase. Mr Venter agreed to give him an extra
R
500,00 per month. Mr Venter told the third respondent that the
increase was going to be in the form of an
“over
allowance”
.
In terms of the appellant’s policy, an
“over
allowance”
was
a special discount which the appellant granted to a customer in order
to facilitate the purchase of a vehicle. It was payable
only to the
customer.
[5] The
third respondent described how the special over-allowance granted to
him by Mr Venter worked as follows:
“
...
[ Mnr Venter] het vir my gese AJL ek gaan vir jou die verhoging gee
in die vorm van ‘n OA, ‘n over allowance eenmaal per
maand
wanneer die geld betaalbaar was, partykeer was dit eers ‘n week of
wat in die volgende maand na gelang my transaksies geloop
het, het ek
op die OA op die ODP was daar in gevalle meer as een over allowance
want as daar ‘n voertuig ingerull is en die voertuig
se netto
waarde is R30 000,00 en die voertuig wat aangekoop word, kom ons se
ons het in meer verstaanbare taal nie dat ek se jy verstaan
dit nie,
‘n kortig van byvoorbeeld R10 000,00 dan het ons die klient R40
000,00 aangebied en dan OA teruggeskryf van R10 000,00
en dit is dan
op die ODP aangetoon sodat hierdie
voertuig
in sy korrekte netto waarde in voorraad gebring word en in gevalle
waar daar dan nou ‘n voertuig betrokke was wat ons
ingeruil het en
dit was nou tyd vir my R500,00 het ek gowoonlik geskryf OA R500,00
sodat mnr. Venter dit kon van die voertuig afhaal.
”
[6] The
third respondent began receiving the special over-allowance in May
1998. For convenience I shall refer to the over-allowance
of
R500,00 per month paid to the third respondent as a “
special
over
allowance
”.
This is necessary to distinguish it from the normal over allowance
that the appellant used to pay to its customers to facilitate
the
purchase of a motor vehicle. The payment of the special
over-allowance entailed in some cases that a crossed cheque---
usually
in the amount of R 500,00 --- would be made out in the name
of a customer who was purchasing a vehicle. This was done without the
customer’s knowledge. The cheque would not be given to the customer
nor would the money ever find its way to the customer. The
third
respondent would cash such a cheque with the appellant’s cashier.
This was possible because Mr Venter and one Mrs Barnard,
both of whom
were required to co - sign cheques in the appellant, approved the
third respondent’s cashing of such cheques with
the appellant’s
cashier. This would be done without the cheque having been endorsed
by the customer in whose name it had been made
out. The third
respondent would then pocket the cash. Some cheques were made out in
the third respondent’s name. The initials used
in those cheques
which bore the third respondent’s surname had the initials
“A.J”
,
sometimes
“AJP”
and sometimes
“JP”
.
The third respondent’s names and surname as they appear in the
answering affidavit in this matter are Andries Johannes Lombard
Van
Wyngaardt.
[7] One
of the cheques was made out on the 31
st
October 1998 --- initially to
“AJ
v Wyngaardt” ---
but later the initials
“AJ”
were crossed out and the initials
“JP”
were written above them. The surname remained as v Wyngaardt. The
cheque had the words
“NOT
TRANSFERABLE”
written across it. Another cheque in the amount of R500,00 was issued
on the 4
th
December 1998 in the name of a customer by the name of E.
Matomentheni. In the internal document relating to that cheque the
words
“Discount
to client”
were written by hand. That client never got that discount. On the
10
th
October 1998 a crossed cheque was made out in the name of the Greater
Town Council, Nigel, in the amount of R 500,00. The Greater
Town
Council, Nigel, had purchased a vehicle from the appellant. That
cheque was never given to the Greater Town Council, Nigel.
It was
cashed by the third respondent with the appellant’s cashier and the
third respondent pocketed the money. The Greater Town
Council, Nigel,
was never made aware that a cheque would be, or, had been made out in
its name but that it would not receive the
cash.
The
Disciplinary inquiry
[8] In
February 1999 Mr Barkett, who had just taken over as managing
director of the appellant, became aware of transactions involving
the
payment of the special over
allowance
to the third respondent. He then initiated an investigation which
led to the third respondent’s suspension from work.
The third
respondent was given a notice to attend a disciplinary inquiry. The
charges that the third respondent was called upon to
answer in the
disciplinary inquiry were formulated thus:-
“
1. Continuing
inadequate performance
Knowingly
submitting incorrect commission sheet with effect of (sic) causing
or attempting to cause loss to the company
Falsely
stating payments to customers thereby causing loss to the company.”
[9] The
transactions relating to the payment of the special over-allowance
to
the third respondent fell under the third charge in the notice. The
minutes of the disciplinary inquiry reveal that with regard
to the
first charge the presiding officer in the disciplinary inquiry
commented that the third respondent had
“openly
admitted to substandard performance;”
and that he also commented that
“non-performance
cannot be tolerated”
,
but proceeded to say that
“the
benefit of the doubt will be given to [the third respondent]”
and,
accordingly, did not find the third respondent guilty of the first
charge of misconduct. He found the third respondent guilty
of the
second and third charges of misconduct. As a result of this the third
respondent was summarily dismissed by the chairman of
the
disciplinary inquiry.
The
internal appeal
[10] The
third respondent noted an internal appeal against the findings made
against him of guilt and the sanction of dismissal.
In the internal
appeal he did not challenge the fairness of the procedure followed in
the disciplinary inquiry but challenged the
findings of guilt and the
sanction of dismissal. The result of the internal appeal was that the
finding of guilt in respect of the
second charge was overturned but
the finding of guilt in respect of the third charge was upheld. The
third respondent’s dismissal
was confirmed.
The
arbitration
[11]
A dispute then arose between the appellant and the third respondent
about the fairness of the dismissal. The third respondent
referred a
dispute of an alleged unfair dismissal to the Motor Industry
Bargaining Council, the first respondent, for conciliation.
Attempts
to resolve the dispute through conciliation failed. He then requested
that the dispute be arbitrated. The second respondent
was appointed
to arbitrate it and presided over the arbitration proceedings that
followed. The third respondent was represented by
a union official,
Mrs Keyter, in the arbitration proceedings. An attorney initially
appeared for the appellant and moved an application
for permission
that the appellant be represented by a lawyer. The application was
opposed by the third respondent. The second respondent
dismissed it.
Thereafter a Mr Britz, a human resources manager, represented the
appellant in the arbitration proceedings. Messrs
Barkett, Chilvers,
Azzie, Strattford and Moodley testified on behalf of the appellant.
The third respondent testified on his own
behalf but also called Mr
Venter as well to testify on his behalf.
[12] The
third respondent’s evidence was to the effect that he had
approached Mr Venter for a salary increase in May 1998 which
was
about a year after he had commenced employment with the appellant. He
testified that Mr Venter had agreed to give him a R 500,00
per month
increase which he said would take the form of an over-allowance that
would be paid once every month.
[13] He
also testified that Mr Venter and Mrs Barnard approved of the manner
in which these payments were made to him as well as the
procedure
that was followed in connection with such payments. In his
evidence-in-chief the third respondent was asked whether the
other
sales people also got this special over-allowance and he answered
that he did not know that they got it. When he was asked
whether the
issue of the other sales people receiving the special over-allowance
like himself was ever discussed with Mr Venter,
he replied:
“Ek
kan nie spesifiek, ek meen elke man moet maar seker sy eie saak
hanteer maar ek wil my heriner dat hy wel genoem het dat hy
nie ‘n
algehele verhoging kan...”
Asked if he knew whether Mr Venter had cleared this special
over-allowance arrangement with any of his seniors, the third
respondent
said that the did not know.
[14] In
his evidence in chief the third respondent admitted that, although
some of the cheques meant for him as special over- allowance
were
issued in his name, there were others that were also meant for him as
special over-allowance which were not issued in his name
but were
issued in the name of customers. He admitted that in neither case
were the customers made aware of the transactions nor
did they
receive the money. He admitted, too, that the cheques were not
endorsed by the customers in whose name they had been made
out before
he cashed them with the appellant’s cashier. The third respondent
stated that Mr Venter gave instructions that some
of the cheques that
had been made out in the third respondent’s name be changed and be
made out in the names of customers. The
third respondent was asked
whether Mr Venter had given any reason for this and he replied that,
as far as he knew, no reason had
been given by Mr Venter for this
instruction.
[15] Under
cross examination the third respondent testified that he saw nothing
wrong with cashing cheques made out in customers’
names and in
cashing them with the appellant’s cashier when such cheques were
marked
“NOT
TRANSFERABLE”
.
He said that, if he had had a problem with that, he would not have
cashed the cheques. At some stage during cross-examination about
how
he came not to see anything wrong with this special over-allowance
that he got, the third respondent said that he had asked for
an
increase and he had got an increase and that was that.
[16] Under
cross-examination the third respondent was further asked what his
explanation would have been, if after he had cashed a
crossed cheque
that had been made out in a customer’s name, the customer returned
and told him that he had become aware that a
cheque had been made out
in his name and asked him where his (i.e. the customer’s) money
was. The third respondent’s answer to
this question was that he did
not know whether to call that speculation and said that it had never
happened. He was then asked how
he would have answered the customer
if it had happened. He replied that he would have explained that
that was an internal matter
that had to be debited against an
account.[ In Afrikaans he said:
“Dan
sou ek glo ek aan hom kon verduidelik dat hierdie is jou interne
aangeleentheid wat ons teen ‘n rekening moet debiteer.”]
He
was then asked why the cheque had to be made in the customer’s name
and not in his name. He answered that there were cheques
that were
made in his name and there were cheques that were made in the names
of customers. At this stage he was asked why the cheques
were not
consistently made in his name. To this he answered that that was done
in the administration office and that he could not
take
responsibility for this as he was not the one who wrote out the
cheques nor was he the one who did the requisitions. The third
respondent admitted under cross-examination that in principle a
crossed cheque is supposed to be deposited into an account and not
cashed.
[17] Mr
Venter, who was called by the third respondent to testify on his
behalf, corroborated the third respondent’s evidence in
regard to
his approval of the payment of the special over - allowance to the
third respondent. However, Mr Venter added that he had
secured the
approval of Mr Strydom, the then managing director of the appellant,
for the special over allowance.
[18] The
third respondent’s representative had intended to call Mr Strydom
as a witness but closed the third respondent’s case
without calling
him. She indicated that Mr Strydom was no longer available and that
was why she was not calling him. The appellant’s
representative
then made an application to the second respondent for the re-opening
of the appellant’s case so that he could call
Mr Strydom to give
evidence. The second respondent dismissed the appellant’s
application. The reasons that the second respondent
gave for this
decision were that:
(a)
it was not clear what Mr Strydom’s evidence was going to be as none
of the parties had consulted with him and,
(b) it
was uncertain what difference Mr Strydom’s evidence would make.
The
Finding in the Arbitration Proceedings
[19] The
second respondent found that the dismissal was procedurally fair but
substantively unfair. As the third respondent did not
seek
reinstatement, the second respondent ordered that he be paid
compensation equal to 12 months’ remuneration. This appears to
have
totalled R 82 802, 28. No order as to costs was made. Aggrieved by
this decision, the appellant brought an application in the
Labour
Court to have the award reviewed and set aside. That application came
before Revelas J who dismissed the application with
costs. With the
leave of the Labour Court, the appellant now appeals to this Court .
The
Appeal
[20] The
first decision of the second respondent that the appellant sought to
have reviewed and set aside was the decision denying
the appellant
legal representation. The appellant’s application for permission to
be represented by a lawyer had been made in terms
of s 140(1)(b) of
the Labour Relations Act, 1995 (Act No 66 of 1995)(
“the
Act”
).
Sec 140(1) of the Act provides thus:-
“
140.
Special Provision about dismissals for reasons related to conduct or
capacity.
(1) If
the dispute being arbitrated is about the fairness of a dismissal and
a party has alleged that the reason for the dismissal
relates to the
employee’s conduct or capacity, the parties, despite section
138(4), are not entitled to be represented by a legal
practitioner in
the arbitration proceedings unless -
(a) the
commissioner and all the other parties consent;
(b) the
commissioner concludes that it is unreasonable to expect a party to
deal with the dispute without legal representation, after
considering-
(i) the
nature of the questions of law raised by the dispute
(ii) the
complexity of dispute
(iii) the
public interest and
(iv) the
comparative ability of the opposing parties or their representatives
to deal with the arbitration of the dispute.”
[21] Sec
140(1)(a) did not apply in this matter. Sec 140(1)(b) did. In dealing
with the appellant’s application for permission to
be represented
by a lawyer, the second respondent took the view that it would not be
unreasonable to expect the appellant to deal
with the dispute in the
arbitration without legal representation. In coming to this
conclusion, he indicated that he had considered
the factors set out
in sec 140(1)(b)(i) to (iv) of the Act. He held that there were no
complex legal issues in the matter and the
matter was not one that
was in the public interest.
[22] In
the review application the appellant attacked the second respondent’s
decision not to permit it legal representation on
the basis that the
second respondent had acted unreasonably in making that decision.
That attack is wholly without merit. This dispute
is certainly not
complex. No difficult question of law arises in this matter nor is
there any public interest involved. The comparative
abilities of the
parties were also not such that the appellant should have been
allowed legal representation. The second respondent’s
approach that
the test was whether or not it would be unreasonable to expect the
appellant to conduct the arbitration without legal
representation was
the correct approach. (see
Afrox
Ltd v Laka & others (1999)20 ILJ 1732 (LC) at 1737 par 13.).
The second respondent was perfectly correct in dismissing the
appellant’s application for permission to be legally represented.
[23] The
second decision of the second respondent that the appellant attacked
both in the Court a quo and before us was the second
respondent’s
decision refusing the appellant’s application to re-open its case
so that it could call Mr Strydom. I have already
stated above the
reasons that the second respondent gave for refusing the appellant’s
application. Because of the view I take of
the merits of the appeal,
I do not consider it necessary to deal with the appellant’s
challenge of the second respondent’s decision
to refuse its
application to re-open its case and call Mr Strydom.
[24] The
appellant attacked the second respondent’s award on its merits on
the basis that it was unjustifiable. In this regard the
appellant
contended that the second respondent had failed to consider or to
properly consider the probabilities of the parties’
versions.
Reduced to its essence, the issue before the second respondent was
whether or not the third respondent had acted dishonestly
in playing
the role that he played in relation to the special over - allowance
scheme. All parties approached the matter on this
basis both in the
arbitration proceedings before the second respondent, in the Court a
quo as well as in this Court. Indeed, that
had been the
understanding of the main issue in the internal appeal hearing as
well.
[25] The
second respondent found that the third respondent had not been shown
to have acted dishonestly or to have intended to mislead
the
appellant. Accordingly he found that the dismissal was substantively
unfair. The second respondent stated in his award that it
was common
cause that the third respondent had cashed crossed cheques in the
appellant’s drive way some of which were made in the
names of
customers
and
that Mr Venter had approved this. He stated that the third
respondent’s defence was that he did what he did with the full
authority
and permission of Mr Venter and that on that basis he
could, therefore, not be said to have been guilty of fraud or to have
falsely
stated payments to customers. I think the charge of falsely
stating “
payments
to customers thereby causing loss to the company”
was
inelegantly framed. However, as I have already said, everybody
understood that its essence was that the third respondent’s role
in
the scheme involved dishonesty and the matter has, throughout, been
dealt with by all parties on this basis.
[26] The
second respondent said that the third respondent did not have a
dishonest state of mind because, as far as he knew, the scheme
had
been approved by Mr Venter. It is true that Mr Venter had approved
the scheme. The appellant conceded this much throughout. However,
the
appellant’s case is that the scheme was illegal, involved
dishonesty and, having regard to all of the circumstances that were
known to the third respondent, the third respondent participated in
the scheme with full knowledge that it was illegal and involved
dishonesty. The appellant’s case has throughout been that the fact
that Mr Venter had approved the scheme did not exonerate the
third
respondent. This line of argument was pursued by the appellant’s
representative even during his cross - examination of the
third
respondent in the arbitration proceedings. In this regard it is
necessary to refer to certain extracts of the evidence that
was led
before the second respondent about both what the appellant’s case
was against the third respondent and about the latter’s
defence
that there was nothing wrong with his role in the scheme.
[27] One
of the transactions from which the third respondent pocketed a
special over - allowance related to a vehicle that was purchased
by a
Mrs Pillay. In giving evidence about this transaction, Mr Barkett had
this to say in part:-
“
A
vehicle is sold for R37 000,00, the details of the vehicle sold is on
the top right - hand corner of the Honda Lux line automatic
and
effectively the customer pays R37 000,00 for the vehicle. It is a
cash deal and there is no trade - in on this vehicle. Just
below the
part that is crossed out, the trade in vehicle part where there is a
line through it, you will see writing there that reflects
OA, which
stands for over - allowance, R500,00 bonus and R500,00 to customer is
written next to it , totalling R1 000,00.
You
will also notice that the offer to purchase is, salesman’s name is
[the third respondent] and its Mr van Wyngaardt’s, I assume
Mr
Wyngaardt’s signature there and Mr Venter’s signature under
general/administration manager.
The
customer did not see that R1 000,00 over allowance. This document is
the legal document of the contract of purchasing a vehicle
between
the company and the customer, in this case Mrs Pillay.
If
Mrs
Pillay came back to the company and requested a record this was the
document we will show her. Unfortunately she did not receive
the R1
000,00. That came out at the disciplinary inquiry and Mr Wyngaardt
himself said that he received the cash.
MR
BARKETT:
The
R1 000,00 is described, the first page is a cheque requisition that
it made out that reflects the allocation of R1 000,00. As
you can see
the allocation is described as discount to client, R1 000,00, which
is obviously not correct. The cheque is actually,
in this instance,
made out directly to Mr van Wyngaardt for R1 000,00, which
corresponds to the R1 000,00 that is in the bottom right
- hand
corner of the offer to purchase.
Despite
the cheque being not transferable this cheque was cashed on our own
driveway, the R1 000,00 was paid across to Mr van Wyngaardt
and he
kept it for his own gain
,
so
the record in the company’s books was incorrect, it was fraudulent.
It was not a discount to the client, Mrs Pillay did not receive
this
cash. The offer to purchase was fraudulent because, as I said, Mrs
Pillay did not receive
cash.
The
company suffered loss because the profit that it made on this
vehicle, whatever it was
,
was
reduced by R1 000,00 because R1 000,00 was charged against the deal.
The bank paid out R1 000,00, sorry not the bank, the company
paid out
R1 000,00 against a non - transferable cheque and on page 18 you will
see how the whole scheme was completed by the cheque
being re
-
banked
back into the company’s own bank account. It is a Hallmark Motor
Group cheque. Sorry, the photostat obviously did not come
through
very clearly, of R1 000,00 that goes back into the company’s bank
account obviously balancing the receipts on the driveway
for petrol
sales but effectively showing R1 000,00 less profit on the vehicle,
which was kept by Mr van Wyngaardt.
Page
19, 20 and 21, sorry, page 19 and 20 is a similar
modus
operandi
.
In this case the cheque is actually made out to Mr Malan, who is the
customer. Mr Malan did never receive this money, this R500,00.
By Mr
van Wyngaardt’s own admission at the disciplinary inquiry he cashed
the money and kept the R500,00, once again described
falsely as an
over - allowance of R500,00. Once
again
no trade - in so there wold be no purpose for an over - allowance on
a cash deal. Effectively why not just give the customer
R500,00 off
the purchase price.
MR
BRITS:
Okay, continue.
MR
BARKETT:
So on, page 21, page 22, same story. A vehicle sold, whether it is
coincidence or a family member I am not sure, to a Mr JP van
Wyngaardt.
This time there is s trade in and there is two amounts.
There is an over - allowance of R25 500,00 and there is another over
- allowance
where it has actually got Mr van Wyngaardt’s initials
next to it, D D W, of R500,00. Once again the customer never saw the
R500,00
despite the cheque being not transferrable.
Page
23, a vehicle sold to Mr Dirks. Here the
modus
operandi
changed to the one of the first one again where the cheque was
actually made out to Mr van Wyngaardt himself, cashed on the driveway
again. If the original cheques are looked at in some instances, well
in all instances where they are made out to customers there
is no
endorsement by the customer, obviously reflecting the fact that the
customer was never in receipt of the cheque, but there
is no
endorsement in any event which (inaudible) negotiable instruments I
am told is illegal, the cheques should never have been
cashed.
And
Mr Dirks, same story, R500,00 reflected
incorrectly
in the company’s books as a discount of the vehicle and quite
clearly received from Mr van Wyngaardt.
On
page 25,26, a Mr Matomenteni, Elvis Matomenteni, this time the amount
involved was R2 000,00. It was actually started at R2 000,00
and then
was changed to R2 500,00. Once again the correct way to describe
this, if it never went to Elvis it would have been to just
deduct it
off the purchase price. The R2 500 was cashed on the driveway. A
R500,00 cheque, in addition to the R2 000,00 cheque is
on page 27.
So
obviously the first amount was R2 000,00. There may have been enough
profit in this deal for them to believe that the company could
afford
to lose another R500,00 and so it was adjusted to R2 500,00.
COMMISSIONER:
But document 26 and 28 is a similar document.
MR
BARKETT:
The same document.
COMMISSIONER:
The same one.
MR
BARKETT:
Just to, 28 accompanies 27.
COMMISSIONER:
I understand what you are saying.
MR
BARKETT:
And the procedure continued. The Greater Town Council Nigel was
really the one that, one of the first to come to our attention and
there has frightening consequences for the company
.
There
was a tender document that accompanied the purchase of this vehicle.
We, like other companies, tender for the business of the
Town Council
Nigel. You will see on page 31 there is a town council order in the
exact amount, R78 620,69 on page 30, which is the
offer to purchase,
yet we describe ,although it is a cash deal, a R500,00 over -
allowance on it. If the town council of Nigel ever
get hold of this I
would imagine, being a government department, that the natural
conclusion that they could have come to was that
somebody was getting
a backhander for awarding the tender to Vaal Toyota of R500,00.
The
cheque is made out to the Greater Town Council Nigel but cashed by Mr
van Wyngaardt and the money put in his pocket. Also no dispute
on Mr
van Wyngaardt’s part on that either the disciplinary inquiry or
the appeal hearing”.
[28] Mr
Barkett made the point in his evidence for the appellant that the
third respondent should have known that what he was involved
in was
illegal. He put it in these terms under cross - examination.
“I
am not disputing that [the third respondent] probably did it with Mr
Venter’s authority, but that it must have been known to
[the third
respondent] that it was not legal to be done. That is what I am
saying
”.
Analysis
[29] The
third respondent conceded under cross - examination that a crossed
cheque is required to be deposited in a bank account and,
unless the
crossing was cancelled, it cannot be cashed. It was common cause that
some of the cheques involved in the transactions
were made out in the
names of customers and were marked
“ NOT
TRANSFERABLE”
and yet the third respondent had cashed them with the appellant’s
cashier and pocketed the money - all of this without the knowledge
of
the customers in whose names the cheques had been made out. Anyone in
the third respondent’s position who was innocent would
have found
it queer that cheques intended for him were made out in the names of
customers and would have queried this. The third
respondent did not
query this. He simply cashed the cheques and put the money in his
pocket ---- not once ---- but more than once.
He testified that at
some stage Mr Venter had given instructions that cheques that had
already been made out in his name and were
intended for him be
changed and made out in the names of customers. An innocent person
would definitely have taken that opportunity
to ask Mr Venter why he
was giving such an instruction. The third respondent did not ask this
question. His conduct in this regard
is, in my view, wholly
irreconcilable with the conduct of a person who was innocent and
believed that he was legitimately entitled
to the money being paid
through the cheques.
[30] The
third respondent also could not dispute Mr Barkett’s evidence that
the appellant’s records of the transactions in which
the third
respondent had cashed crossed cheques made out in customers’ names
reflected that the appellant had paid the money to
customers - not
to the third respondent - as an over - allowance or as a discount. It
was within this context, therefore, that in
the arbitration
proceedings, the appellant’s representative confronted the third
respondent with the obvious but very critical
question on the third
respondent’s evidence that he had seen nothing wrong with his role
in the scheme. In this regard the relevant
part of the transcript
reads thus:-
“
MNR.
BRITS: Wat sou gebeur het dan as ‘n klient wel die dokument sien en
merk hier is ‘n over allowance en verder merk dat ‘n
tjek
uitgemaak is in sy naam wat deur u gewissel is, watse aanspraak sou
so ‘n klient dan op die hele transaksie
.
MNR.
VAN WYNGAARDT:
Ja wel ek glo nie die klient, ek sou antwoord dat by die, op daardie
stadium is hierdie transaksie totaal afgehandel daarom sal u
sien op
sekere OTP’s is daar selfs gevalle waar daar twee Oas aangetoon
word Mnr. Die Kommissaris en dit is dit. Hierdie is totaal
intern, ek
wonder of
dit
dalk korrek is om ons uiteindelike korrekte profyt op die bord aan
te toon want wat u nou vir my se is daarop, ek weet nie hoe
werk die
ander takke of werk hulle dan glad nie op ‘n OA ek meen kan hulle
kliente nie terug gaan en dan die OA’s, ek het mos
verduidelik hoe
ons OA’ s werk .
MNR.
BRITS: Okay. Ek is op die ou einde verstaan ek die beginsel maar die
probleem is wat ek vir u se is dat die tjek word aan die
klient
uitgemaak en u wissel die tjek en hierdie klient kom terug na u toe
en se kan ek hierdie dokument sien en hy merk dit op die
dokument dat
die tjek is uitgemaak aan hom en hy vra waar was geld en dan?
MNR.
VAN WYNGAARDT:
Ja Mnr. Die Kommissaris ek weet nie of ek dit spekulasie moet noem
nie maar dit het nooit met my gebeur nie.
KOMMISSARIS:
Kom
ons se nie
.....
MNR.
BRITS:
As dit sou gebeur het
KOMMISSARIS:
Ja
MNR.
BRITS:
Ekskuus tog, Mnr. Die Kommissaris.
MNR.
VAM WYNGAARDT:
Dan sou ek glo ek aan hom kon
verduidelike
dat hierdie is jou interne aangeleentheid wat ons teen ‘n
rekening moet debiteer.
MNR.
VAN WYNGAARDT:
Ja
MNR.
BRITS:
Hoekom dan word die klient se naam op die tjek gespesifiseer en nie
u s’n nie?
MNR.
VAN WYNGAARDT: En dan verder is na die klient se naam daarvoor kan
ek nie verantwoording doen nie, dit is in die administratiewe
kantoor, ek maak nie die rekwisisies uit nie, ek maak ook nie die
tjeks uit nie en teken dit nie”.
[31] Asked
how he would have explained where the customer’s money was if one
of his customers had become aware that a cheque had
been made out in
his name, the third respondent’s answer was in effect that this was
an internal matter and that he did not make
out cheques nor did he
make requisitions. That, of course, is a totally unsatisfactory
answer. It, nevertheless, highlights the fact
that it is highly
improbable that a person in the position of the third respondent
would not have known that he was taking part in
an irregular and
illegal scheme when his role in the scheme entailed that he cash
crossed cheques made out in other people’s names
without their
knowledge and pocket the money.
[32] It
is not as if the third respondent was, for some reason, unaware that
the cheques that he was cashing were made out in other
people’s
names. He was aware. He was unable to advance any convincing reason
why in this case he should have thought that he was
entitled to cash
crossed cheques made out in other people’s names. All he said was
that, because all of this was approved by Mr
Venter, it was
acceptable as far as he was concerned. In my view that defence is not
acceptable and the third respondent’s version
that he saw nothing
wrong in all of this is not true. He knew that there was something
wrong. He was content not to ask any question
because he was the
beneficiary of this unusual scheme. He thought, if this was
discovered, he would escape liability or discipline
by hiding behind
the fact that his immediate superior had approved the scheme. In my
view the appellant’s contention that his immediate
superior’s
permission is no defence is correct because in law any one’s
permission for the commission of a crime is not a defence.
I do not
have the slightest doubt in my mind that on the evidence that was
before the second respondent the role that the third respondent
played in these transactions entailed acting dishonestly and being
party to false statements about who was paid certain amounts,
the
reasons for such payments and statements to the effect that certain
discounts were made to customers when no such discounts had
been made
to customers. This scheme resulted in the appellant losing to the
third respondent money that it was entitled to as part
of its profit.
Mr Barkett’s evidence was to this effect and must be accepted.
[33] The
second respondent did not in his award refer to much of the evidence
and aspects of the matter that I have referred to above
and yet those
aspects and those portions of the evidence were critical for the
proper evaluation of the role played by the third
respondent in the
scheme. The Court a quo also did not refer to this evidence and these
aspects. The approach that was taken by the
second respondent was
simply to focus on the fact that the scheme had been approved by the
third respondent’s immediate superior,
Mr Venter. He then proceeded
without much ado to conclude that the third respondent could not have
had any intention to mislead or
to act dishonestly since he believed
that what he was doing was authorised by his superior. In reaching
this conclusion the second
respondent omitted to consider, among
others, the critical question whether anybody in the third
respondent’s position could, with
his eyes wide open, take a
crossed cheque made out in another person’s name, cash it without
such person’s knowledge or endorsement
and pocket the money without
it occurring to him that this was strange and asking those who issued
the cheque why they wrote someone
else’s name on his cheque and not
his and asking them to change it and write his name on the cheque.
[34] Having
said this, it is necessary to bear in mind that this is a review
matter, and, accordingly, the Court must not take an
approach that
blurs the distinction between reviews and appeals. That distinction
remains important. Both the Labour Court and this
Court must
constantly remind themselves of it. I, nevertheless, think that the
matters I have referred to above are so critical that,
once they are
taken into account, the third respondent’s dishonest role in the
scheme becomes so glaring that the finding that
the second
respondent’s award is unjustifiable becomes irresistible.
Accordingly, I am of the view that the Court a quo ought to
have
granted the application. This appeal must, therefore, succeed. In my
view it accords with the requirements of law and fairness
that the
third respondent should bear the costs.
[35] In
the result I make the following order:-
The
appeal is upheld and the third respondent is ordered to pay the
appellant’s costs of the appeal.
The
order of the Court a quo is hereby set aside and replaced by the
following order:-
“
a The
arbitration award issued by the second respondent in the dispute
between the applicant and the third respondent is hereby reviewed
and
set aside.
b. The
dismissal of the third respondent by the applicant was for a fair
reason.
The
third respondent is ordered to pay the applicant’s costs of the
application”.
_______________
ZONDO
JP
I
agree.
_______________
WILLIS
JA
I
agree.
__________________
MOGOENG
JA
Appearances
For
the Applicant Mr Watt Pringle
Instructed
by Deneys Reitz
For
3
rd
and 4
th
respondents Mr A P du Plessis
Instructed
by Hofmeyr Herbstein & Gihwala Inc.
Date
of judgement 8 August 2002