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[2007] ZALAC 25
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Broadcasting Electronic Media and Allied Workers Union v South African Broadcasting Corporation (JA 11/05) [2007] ZALAC 25 (15 June 2007)
IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA
Case
No JA 11/05
In
the matter between
BROADCASTING
ELECTRONIC MEDIA AND
ALLIED
WORKERS UNION
Appellant
and
SOUTH
AFRICAN BROADCASTING CORPORATION
Respondent
JUDGMENT
KRUGER
AJA:
[1] Appellant is the Broadcasting, Electronic Media and
Allied Workers Union, a registered trade union. Respondent is the
South
African Broadcasting Corporation, a registered company and, a
public broadcaster in terms of the Broadcast Act 4 of 1999. The
appellant
and the respondent are herein after referred to as BEMAWU
and the SABC respectively.
[2] There
are two main disputes between the parties to this appeal. The one is
a forum dispute and the other a substantive dispute,
namely whether
the SABC properly terminated a collective agreement termed a
"Relationship Accord" (the "accord")
between
itself and BEMAWU. We are not asked to decide the latter dispute. The
forum dispute raises the question: Must the substantive
dispute go to
private arbitration in terms of the accord or to the Commission for
Conciliation, Mediation and Arbitration ("the
CCMA")?
[3] In
February 2004 BEMAWU applied to the Labour Court for relief relating
to the accord, which BEMAWU had concluded with the SABC
on 18 May
1994. The application was brought because the SABC took the view that
the accord had been cancelled, while BEMAWU contested
the validity of
the SABC's purported cancellation of the accord. At the hearing
before the Labour Court BEMAWU submitted a draft
order to the court
as to the relief sought. The following relief was sought therein:
"All
unresolved disputes that arose between the applicant and the
respondent before 1 February 2004 shall be resolved in
accordance
with clause 9 of the Relationship accord concluded between the
applicant and the respondent on 18 May 1994 ("the
Relationship
accord").
The
dispute between the applicant and the respondent relating to the
cancellation of the Relationship Accord by the respondent
with
effect from 1 February 2004 shall be resolved in accordance with
clause 9 of the Relationship Accord.
The
applicant and the respondent are ordered to take such steps as might
be necessary in terms of the Relationship Accord to enable
the
disputes referred to in paragraphs 1 and 2 to be resolved in
accordance with clause 9 of the Relationship Accord.
The
respondent is ordered to pay the applicant's costs of the
application."
[4] At
the hearing before the Labour Court the SABC contested the Labour
Court's jurisdiction to grant the appellant the relief
sought.
Jurisdiction in the present context means the power vested in a Court
by law to adjudicate upon, determine and dispose
of a matter. The
Labour Court upheld the respondent's argument in this regard. Tshiqi
AJ found that the Labour Court lacked jurisdiction
to grant the
appellant the relief that it sought and on that basis dismissed
BEMAWU's application with costs. BEMAWU appeals to
this Court against
the judgment of the Labour Court, with the leave of that Court.
The history of the
dispute between the parties
[5] On
31 October 2003 the SABC delivered a notice to BEMAWU in terms of
clause 16.4 of the accord communicating the SABC's intention
of
withdrawing from and terminating the accord with effect from 1
February 2004, being the end of the contemplated three month
notice
period. Clause 16.4 of the accord states:
"A
minimum of three (3) months notice of intention to withdraw from the
accord must be given in writing, stating fully the
motivations for
such withdrawal. Neither party will withdraw from the accord without
good reason recognised in law and without
affording the other party a
reasonable and fair opportunity to rectify any problems or breach
which may have initiated the notice."
[6] The
SABC's notice dated 31 October 2003 states
inter alia
:
"The
SABC hereby gives BEMAWU three (3) months' notice of its intention to
withdraw from and cancel the Relationship Accord
signed by the
parties on 18 May 1994. This means that the Relationship Agreement
will cease to operate from 1 February 2004.
As a result of the recent
threat of strike action over wages and other conditions of employment
and in view of the recent decisions
by the Labour Court and Labour
Appeal Court in
Columbus Joint Venture t/a Columbus Stainless
Steel vs NUMSA
(1999) 10 BLLR 1292
(LC) and in
County Fair
Foods (Pty) Ltd v FAWU and Others
(2001) 5 BLLR 494
(LAC), the
SABC is of the view that the necessity for such a recognition has
become superfluous. The
Labour Relations Act, 66 of 1995
, as amended
("the LRA") can more than adequately regulate the
relationship between the parties in a simple and efficient
manner. It
is our view that the LRA contains practical and effective procedures
to regulate such relationship. Thus for instance,
the provisions of
the LRA dealing with, inter alia, the following:
Organisational
rights;
Workplace
forums;
Restructuring;
Protected
industrial action; and
Dismissal
procedures
which
are prescriptive and would govern the relationship between the
parties.
The
Relationship Accord is unnecessary and the SABC hereby exercises its
right to terminate the accord by giving 3 months written
notice as
per the provisions of the same accord."
[7] On
10 November 2003 BEMAWU declared a dispute that the SABC had
unprocedurally and without reasons cancelled the relationship
accord.
The SABC responded on 13 November 2003, proposing that a dispute
resolution meeting be held on 19 November 2003. It raised
no
objection to private arbitration at that stage. On 3 February 2004
BEMAWU proposed names of possible arbitrators and dates.
On the same
day the SABC wrote a letter stating that it would respond on 6
February 2004.
[8] On
6 February 2004 the SABC wrote to BEMAWU, stating that the SABC
considered the accord to be at an end, and that cancellation
thereof
took effect on 1 February 2004. It added: "It is not possible
for your request for arbitration to be processed in
terms of the
Accord where that Accord no longer exists." Thereupon BEMAWU
applied to the Labour Court for an order that all
outstanding
disputes arising before 1 February 2004 be resolved in accordance
with the accord, and that the dispute regarding the
cancellation of
the accord be resolved in accordance with clause 9 of the accord.
That meant that such dispute should go to private
arbitration in
accordance with the accord. The Labour Court, per Tshiqi AJ, found
that the Labour Court lacked jurisdiction to
grant the appellant the
relief that it sought because neither the Labour Relations Act, 1995
(Act 66 of 1995) (“the Act”)
nor the Arbitration Act
conferred such jurisdiction on it.
The forum dispute
[9] Counsel for BEMAWU submitted that
this Court must determine the arbitral body which must arbitrate the
dispute. He submitted
that there is a dispute whether the CCMA or a
private arbitrator must arbitrate the dispute, and, in such case a
third party, the
Court, must decide the issue. Counsel for BEMAWU
submitted that, because the SABC maintains that the accord no longer
exists, this
is not a dispute about the interpretation or application
of an agreement as contemplated in s 24(2) of the Act. He submitted
that
an arbitration agreement is regarded as distinct from the main
agreement, a fact recognised by
s 3(1)
of the
Arbitration Act 42 of
1965
. Thus the determination of the arbitration clause is an
a
priori
dispute.
[10] Counsel
for the SABC submitted that the dispute is whether the agreement is
operative or not. That appears from prayer 2 of
the draft order
submitted to the Court
a quo
. He submitted that a dispute
about whether an agreement is operative or not, is covered by s 24(2)
of the Act. He also submitted
that, on the assumption that the SABC
was frustrating the terms of the arbitration agreement as
contemplated by s 24(2)(c) by failing
to submit the substantive
dispute to arbitration or has rendered it inoperative (as
contemplated in s 24(2)(b)) the CCMA has jurisdiction
to arbitrate
the dispute.
The legal position
[11] The
relationship accord is a collective agreement as defined in sec 213
of the Act. That is so because of s 13(2) of Schedule
7 which
provides that any agreement that was in force immediately before the
commencement of the Act is deemed to be a collective
agreement
concluded in terms of the Act. The accord comprises 57 pages and
covers a wide range of topics. Section 24(1) and (2)
of the Act
provide as follows:
"24.
Disputes about collective agreements
(1) Every
collective agreement excluding an agency shop agreement concluded in
terms of section 25 or a closed shop agreement
concluded in terms of
section 26 or a settlement agreement contemplated in either section
142A or 158 (1) (c), must provide for
a procedure to resolve any
dispute about the interpretation or application of the collective
agreement. The procedure must first
require the parties to attempt to
resolve the dispute through conciliation and, if the dispute remains
unresolved, to resolve it
through arbitration.
(2) If
there is a dispute about the interpretation or application of a
collective agreement, any party to the dispute
may refer the dispute
in writing to the Commission if—
(a) the
collective agreement does not provide for a procedure as required by
subsection (1);
(b) the
procedure provided for in the collective agreement is not operative;
or
any
party to the collective agreement has frustrated the resolution of
the dispute in terms of the collective agreement."
Section
24(2)(a)
[12] Sec 24(2) makes it clear that a
dispute about the interpretation or application of a collective
agreement has to go to the
CCMA in the event of any one of the
situations set out therein. In
Independent Municipal and Allied
Trade Union v Northern Metropolitan Substructure and Others
1999
(2) SA 234
(T) at 238E-239A it is pointed out inter alia that under
common law courts did not easily bypass an arbitration clause. Such
clause,
when it is contained in a collective agreement, would deprive
the CCMA of jurisdiction.
[13] Having regard to s 24(2)(a), the
question is whether the relationship accord provides for a procedure
to resolve the dispute.
Clause 9 of the relationship accord provides
a comprehensive and detailed dispute resolution procedure that
applies to a "dispute"
as defined in clause 1.8 of the
accord: Clause 1.8 reads:
"1.8
'Dispute' means a continued disagreement between the parties to this
accord regarding any work-related matter which may
affect the
relationship between the parties, or materially disturb the
structures and procedures established to maintain this relationship"
Clause 16.5 provides that an alleged
breach of the accord is to be dealt with in terms of clause 9. Clause
16.6 provides that the
accord shall not be "released, modified
or discharged except in accordance with the procedures contained
therein". Since
the accord does have a dispute resolution
procedure which covers disputes about the interpretation or
application of a collective
agreement, sec 24(2)(a) does not apply.
Section
24(2)(c)
[14] Having
regard to s 24(2)(c), the question is whether the SABC has
"frustrated" the resolution of the substantive
dispute. The
essence of the verb "frustrate" in this context is to "make
ineffectual; counteract; foil, annul; invalidate"
(
Shorter
Oxford English Dictionary s.v
. "frustrate").
Frustration in law is defined as "the premature termination of a
contract by circumstances that
make performance as envisaged by the
terms of the contract impossible" (
loc cit
). The SABC has
done nothing of the kind. It has simply advanced a contention, less
than novel, that a private arbitrator lacks
jurisdiction. That
contention is either good or bad, but it does not amount to
frustration of the arbitration procedure.
Did the arbitration clause survive
the alleged termination?
[15] An arbitration clause is often
not binding where a party contends that the principal contract was
void or voidable
ab initio
. The reason for this is that if
the contention is sound, then there would have been no binding
arbitral stipulation in the first
place. The qualification to this
proposition is that the language of the arbitration clause may be
wide enough to cover even such
a dispute (see
Van Heerden en
Andere v Sentrale Kunsmis Korporasie (Emds) Bpk
1973 (1) SA 17
(A) at 30F-H). Where the parties mutually agree to cancel or
terminate a contract, an arbitration clause also falls away unless
the parties provide otherwise. However, where one party repudiates a
contract, and the other party challenges the validity of
that
repudiation (and whether or not it accepts the repudiation), the
approach of the courts is to hold that the arbitration clause
both
survives the repudiation and governs the issue of repudiation.
Again, this is subject to the language of the arbitration
clause
itself (see
Atteridgeville Town Council and Another v Livanos t/a
Livanos Brothers Electrical
[1991] ZASCA 139
;
1992 (1) SA 296
(A) at 305 B-C).
[16] In the present case, as we have
seen, the SABC purported to terminate the accord in terms of clause
16, and BEMAWU challenges
that termination. The consequent
substantive dispute (which we may call “the termination
dispute”) is akin to a repudiation
issue in the sense mentioned
above. We should accordingly adopt the approach that the arbitration
clause survives the alleged
termination and governs that dispute
unless the language of the clause provides otherwise. It is clear to
me that the termination,
if unwarranted, would "materially
disturb the structures and procedures established to maintain this
relationship" (clause
1.8). The relevant language thus
reinforces the aforegoing approach rather than restricts it. I am
therefore of the view that
the termination dispute is referable to
arbitration.
[17] In reaching this conclusion it
may be argued that I interpret and apply a collective agreement in
conflict with section 24(2)
read with sections 157 and 158 of the
Act. The case of
South African Motor Industry Employers'
Association and Another v NUMSA and Others
(1997) 9 BLLR 1157
(LAC) is distinguishable. There this court held that the collective
agreements under consideration contained no dispute-resolution
procedure as contemplated by section 24. It followed that the CCMA,
and not the Labour Court, had jurisdiction to resolve the
substantive
issue between the parties.
[18] As was pointed out in that case
the scheme of section 24 is that disputes relating to collective
agreements should be resolved
by conciliation, failing which by
arbitration. It is only where the desired arbitration procedure is
absent or fails that such
disputes are referred to the CCMA. I have
already shown:
(a) that the accord does provide for
an arbitration procedure;
(b) that such procedure is operative;
and
(c) that
the SABC has not "frustrated" the resolution of the
termination dispute by arbitration.
In these circumstances section 24(2)
read with sections 157 and 158, does not constitute a bar to the
Labour Court determining the
proper forum for the resolution of the
substantive (i.e. the termination) dispute, as distinct from itself
resolving that dispute.
The parties were not required to approach an
arbitrator or the CCMA first for a provisional ruling on
jurisdiction. They were
entitled to approach the Labour Court for a
declarator as to the proper forum. The elements of interpretation
and application
involved in the court determining the procedural
dispute are not outlawed by the aforegoing sections of the LRA.
[19] In one respect BEMAWU goes too
far. It asks that "all unresolved disputes" that arose
before 1 February 2004 be
referred to arbitration. As we are not
furnished with particulars of those disputes, it would not be wise
for us to make an order
in regard to them. The declarator will be
confined to the termination dispute.
[20] As to costs, BEMAWU has achieved
substantial success. It seems to me that it would accord with the
requirements of the law
and fairness that BEMAWU be awarded its costs
in this Court and in the Labour Court.
[21] In the result the appeal
succeeds with costs. The order of the court
a quo
is set
aside and replaced by the following:
"(a) It
is declared that the dispute relating to the cancellation of the
Relationship accord between BEMAWU and the SABC be
heard and
determined by a private arbitrator in terms of clause 9 of the
Relationship Accord;
The respondent is to pay the
costs of this application."
____________________
Kruger AJA
I agree
____________________
Zondo JP
I agree
___________________
Comrie AJA
Counsel for
appellant: Adv FG Barrie
Attorneys
for appellant: Assenmacher Attorneys
Counsel for
respondent: Adv N A Cassim SC and
Adv F A Boda
Attorneys
for respondent: Leppan Beach Inc
Date of
judgment: 15 June 2007
Bloemfontein, Monday 9 October 2006
Dear Ray
BEMAWU V SABC CASE JA11/05
Herewith draft judgment for comment,
corrections and suggestions. It incorporates comments and amendments,
as well as further minor
changes suggested by Jock. Thank you for
your assistance herein.
Kind regards
Albert
Cc: Jock Comrie
Fax 021 788 7970