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[2007] ZALAC 39
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Broadcasting Eletronic Media And Allied Workers Union v South African Broadcasting Corporation (JA11/05) [2007] ZALAC 39 (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:
1.
"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").
2.
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.
3.
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.
4.
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
(c)
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;
(b)
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