Crouse N.O and Another v Workers Union of South Africa (CA1/2006) [2008] ZALAC 5; [2008] 10 BLLR 919 (LAC); (2008) 29 ILJ 2571 (LAC) (19 May 2008)

About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Labour Appeal Court
SAFLII
>>
Databases
>>
South Africa: Labour Appeal Court
>>
2008
>>
[2008] ZALAC 5
|

|

Crouse N.O and Another v Workers Union of South Africa (CA1/2006) [2008] ZALAC 5; [2008] 10 BLLR 919 (LAC); (2008) 29 ILJ 2571 (LAC) (19 May 2008)

IN THE LABOUR
APPEALCOURT OF SOUTH AFRICA
(HELD
AT JOHANNESBURG)
Case No. CA1/2006
JOHAN
CROUSE N.O. First Appellant
THE
DEPARTMENT OF LABOUR Second Appellant
and
WORKERS
UNION OF SOUTH AFRICA Respondent
JUDGMENT:
DAVIS
JA:
Introduction
[1] In 2002 certain workers employed at Atlantis Farge Plant in
Atlantis, Western Cape, decided to form a new trade union because
they considered the existing union, the National Union of Metal
workers of South Africa (NUMSA), had not adequately served their
interests,
inter alia,
because they had a lack of confidence
in the local organizer and further because certain employees had
complained about the dismissal
of shop stewards, including Mr. D
Braaf and Mr. D Willemse.
[2] In
October 2003 some fourteen employees at the plant held a meeting
which was
chaired by an employee, Mr. R Muller. At this meeting, the
establishment of a new trade union was discussed. Muller informed
the meeting that he and a Mr. K Booysen had visited Braaf and
Willemse and inquired as to whether they were interested in forming
a
new union. The two men agreed to so participate. An interim
committee was formed to deal with the process of union registration.

Braaf and Willemse were appointed to that committee. They were the
only executive committee members who were not employees of
Atlantis
Farge. It was then agreed that interested employees would meet on
18
th
October 2003 to elect drafters of the constitution of
the proposed union.
[3] On 18 October 2003 the executive committee mandated Braaf and
Willemse to do the necessary research in order to draft the
constitution
of the proposed union. They were also mandated to
approach labour lawyers who would advise on the requirements for the
establishment
of the union. Braaf was elected as chairperson of the
committee and Willemse as its secretary.
[4] On 25 October 2003 another meeting of the executive committee was
held. At that meeting Willemse reported that he and Braaf
had
approached lawyers, who, unfortunately, had not had the necessary
background in the registration of trade unions. He informed
the
meeting that he and Braaf would do the necessary research for a fee
of R 5 000.00 (five thousand rand). This matter was deferred
to the
next meeting. At the next meeting on October 1, 2003, the
chairperson asked those present to decide on the name of the proposed
union and whether it should broaden its scope. A proposal was
adopted that the union be called ‘The Workers Union of South
Africa’
and that it should be multi-sectoral.
[5] On 18 March 2004 first appellant received an application by
respondent for registration. On 1 April 2004 officials of second
appellant visited respondent’s offices to which respondent had
moved the day before. Braaf informed these officials that the office
would be occupied for some two months. A checklist was then
completed by these officials. From the completed checklist it
appeared
that respondent had been formed after Braaf and Willemse had
been unfairly dismissed and that four members attended the inaugural
meeting. The checklist also reflected that respondent had 3000
“potential members’. The checklist showed Braaf to be
respondent’s
president and Willemse its secretary. The
constitution had not yet been adopted and the union was not yet in
operation. In short,
it appeared that an application was made for
registration before the union operationally existed.
[6] An amended registration form was submitted on 8 April 2004, after
officials of second appellant had advised that the composition
of the
executive had to be altered.
[7] On 13 April 2004 a special general meeting was held. At that
meeting a central committee was elected, a management committee
was
also elected and it was agreed that a banking account would be
opened.
[8] On the same day, 13 April 2004, respondent’s attorneys wrote to
first appellant informing him that respondent had been advised
not to
collect monies from members and operate a bank account in that , if
it did so , this would constitute a breach of the Labour
Relations
Act of 66 of 1995 (‘the Act’).
[9] On 3 June 2004 respondent’s attorneys wrote to first appellant
advising him that respondent was attempting to obtain stop orders
and
membership forms and requested him to finalize the registration of
the union as soon as possible.
[10] On 13 July 2004 first appellant informed respondent that the
application for registration had been refused on the grounds that
the
respondent was not a genuine organization as envisaged by the Act.
The first appellant stated that respondent had not functioned
in
terms of its constitution and had been established for personal
financial gain.
[11] On 22 July 2004 respondent’s attorney requested written
reasons for the decision. These were set out in a letter generated
by first appellant on 16 August 2004; to which I shall make detailed
reference presently.
[12] On 15 October 2004 respondent lodged an appeal to the Labour
Court in terms of s111 (3) of the Act against the decision of first
appellant not to register the respondent. On 29 July 2005 Murphy AJ
upheld the appeal and ordered the registration of respondent.
It is
against this decision that, with the leave of the court
a quo,
appellants comes on appeal before this Court.
The
applicable legislation
[13] In order to analyse the merits of this appeal, it is necessary
to set out the relevant provisions of the Act. Section 95
of the
Act provides as follows:
Requirements
for registration of trade unions or employers' organisations
(1)
Any trade union may apply to the registrar for registration if-
(a) it has adopted a name that meets the requirements of subsection
(4);
(b) it has adopted a constitution that meets the requirements of
subsections (5) and (6);
(c) it
has an address in the Republic; and
(d) it
is independent.
(2)
A trade union is independent if-
(a) it is not under the direct or indirect control of any employer or
employers' organisation; and
(b) it
is free of any interference or influence of any kind from any
employer or employers' organisation.
(3)
Any employers' organisation may apply to the registrar for
registration if-
(a) it
has adopted a name that meets the requirements of subsection(4);
(b) it has adopted a constitution that meets the requirements of
subsections (5) and (6), and
(c) it
has an address in the Republic.
(4) Any trade union or employers' organisation that intends to
register may not have a name or shortened form of the name that so
closely resembles the name or shortened form of the name of another
trade union or employers' organisation that it is likely to mislead
or cause confusion.
(5)
The constitution of any trade union or employers' organisation that
intends to register must-
(a) state that the trade union or employers' organisation is an
association not for gain;
(b) prescribe
qualifications for, and admission to, membership;
(c) establish the circumstances in which a member will no longer be
entitled to the benefits of membership;
(d) provide
for the termination of membership;
(e) provide for appeals against loss of the benefits of membership or
against termination of membership, prescribe a procedure for
those
appeals and determine the body to which those appeals may be made;
(f) provide
for membership fees and the method for determining membership fees
and other payments by members;
(g) prescribe
rules for the convening and conducting of meetings of members and
meetings of representatives of members, including
the quorum required
for, and the minutes to be kept of, those meetings;
(h) establish
the manner in which decisions are to be made;
(i) establish
the office of secretary and define its functions;
(j) provide for other office-bearers, officials and, in the case of a
trade union, trade union representatives, and define their
respective
functions;
(k) prescribe
a procedure for nominating or electing office-bearers and, in the
case of a trade union, trade union representatives;
(l) prescribe
a procedure for appointing, or nominating and electing, officials;
(m) establish
the circumstances and manner in which office-bearers, officials and,
in the case of a trade union, trade union representatives,
may be
removed from office;
(n) provide
for appeals against removal from office of office-bearers, officials
and, in the case of a trade union, trade union representatives,
prescribe a procedure for those appeals and determine the body to
which those appeals may be made;
(o) establish
the circumstances and manner in which a ballot must be conducted;
(p) provide
that the trade union or employers' organisation, before calling a
strike or lock-out, must conduct a ballot of those of
its members in
respect of whom it intends to call the strike or lock-out;
(q) provide
that members of the trade union or employers' organisation may not be
disciplined or have their membership terminated
for failure or
refusal to participate in a strike or lock-out if-
(i) no
ballot was held about the strike or lock-out; or
(ii) a ballot was held but a majority of the members who voted did
not vote in favour of the strike or lock-out;
(r) provide
for banking and investing its money;
(s) establish
the purposes for which its money may be used;
(t) provide
for acquiring and controlling property;
(u) determine
a date for the end of its financial year;
(v) prescribe
a procedure for changing its constitution; and
(w) prescribe
a procedure by which it may resolve to wind up.
(6) The constitution of any trade union or employers' organisation
which intends to register may not include any provision that
discriminates directly or indirectly against any person on the
grounds of race or sex.
(7) The registrar must not register a trade union or an employers'
organisation unless the registrar is satisfied that the applicant
is
a genuine trade union or a genuine employers' organisation.
(8) The Minister, in consultation with NEDLAC, may by notice in the
Government Gazette publish guidelines to be applied by the registrar
in determining whether an applicant is a genuine trade union or a
genuine employers' organisation.
The Relevant Factual Matrix
[14] Within the context of this legal framework, it is now possible
to turn to the key facts which gave rise to the present dispute.
To
recapitulate: (a) respondent lodged an application for registration
on 18
th
March 2004; (b) on 1
st
April 2004 an
inspection by officials of second appellant took place; (c)on 12 July
2006, first appellant refused to register respondent.
[15] A flurry of correspondence was then generated, not all of which
is strictly relevant to this dispute. However, of particular
relevance is the fact that on 13
th
July 2004, respondent’s
attorneys received a letter from first appellant stating that its
application for registration had been
refused with effect from 12
July 2004. That letter reads: “I acknowledge receipt of your
letter …. dated 13 April 2004 and
have to advised that the union’s
application for registration has been perused and found not
acceptable for approval and I base
my decision on the following
grounds:
The union is not a genuine organization as envisaged by the Act
The union does not function in terms of its constitution
The trade union was established for financial gain and to circumvent
the provisions of the Act
Consequently you are advised that the application for registration is
refused with effect from 12 July 2004.”
[16] On 22
nd
July 2004 respondent’s attorneys requested
reasons for this decision, which were provided on 16
th
August 2004. The relevant portion of this letter reads: “I refer
to the facsimile letters dated 22 July 2004 and 4 August 2004
respectively and have to inform you that the decision of the
Registrar is final and cannot be reconsidered. The only route to
follow
is provided for in section 111 of the Act ….
In arriving at the above decision, I relied on the guidelines issued
by the Minister of Labour in terms of section 95 (8) of the
Act and
the following facts regarding the application:
The trade union is not a genuine organization as envisaged by the
Act
Trade union as per definition of the Act means “An association of
employees whose principal purpose is to regulate relations between
employees and employers, including any employers’ organization”.
From the information at hand, the formation of the union and the
subsequent operation thereof, did not involve employees associating
together, but was initiated by the President Mr. Dalton Braaf, and
the General Secretary, Mr. David Willemse, after they were dismissed
from their respective employment. This means that unemployed
persons established the union. Mr. Braaf claims to be self-employed
and the conclusion was that the formation of the union did not
involve “employees” as defined in section 213 of the Act. The
democratic principles on which a union is based did not apply and it
cannot be argued that worker established this union.
The union was established for gain of individuals
The argument above also applies to this point as it can only be
argued that the motive behind the establishment of the union by the
two individuals was for gain. A new application form with an
amended executive committee that was later submitted to this Office,
reflects Mr. Dalton Braaf who, in conjunction with Mr. David Willemse
established the union, as the general secretary whilst Mr.
Willemse
position is that of treasurer. This happened after it was pointed
out to the officials of the union that the office bearers
namely Mr.
Braaf who is not an employee, could not in terms of the definition of
“office bearer” qualify to be the President,
he was then
positioned as the General Secretary. This is unconstitutional and
it was clearly done only to satisfy the registration
requirements.
Although this was clearly an attempt to remedy the composition of the
executive committee by moving the names around,
the executive
committee is still not acceptable in light of the involvement of the
people who established the organization.
The organization is not functioning in terms of its constitution
The organization is not functioning as yet and has only potential
members who are willing to join the union after it is registered.

Only the “steering committee” is active. The constitution that
was submitted for approval does not make provision for a steering
committee. The organization has to function according to its
constitution even if its not registered and upon application for
registration,
must prove that it is operational in terms of the
constitution.’
Judgment of the court
a quo
[17] It was against this decision of first appellant that the appeal
to the court
a quo
was lodged. In his judgment, Murphy AJ
examined section 95 through the prism of the guidelines issued in
terms of section 95 (8)
of the Act [Government Gazette 25515 of 10
October 2003]. The learned judge concluded that section 95 (7) of
the Act read together
with the guidelines gave first appellant a
narrow discretion to refuse to register an unregistered trade union
seeking registration.
Accordingly, ‘it makes sense to limit the
determination to paying attention to the manner in which the
organization was established
and formed and without having regard to
the actual activities and functioning’. para 21 of the judgment.
[18] Murphy AJ proceeded to find that in terms of section 111 of the
Act the appeal before him constituted an appeal in the wide
sense.
It could involve a complete rehearing and adjudication on the merits
with or without additional evidence or information.
[19] Based on these premises and his examination of the reasons
provided by first appellant in his letter of 16 August 2004, Murphy
AJ concluded: ‘I am persuaded that the registrar is mistaken in
his interpretation and application to the facts before him of
the
guidelines issued in terms of section 95 of the LRA. Most
particularly in that he clearly failed to take important relevant
considerations into account and was influenced by irrelevant
considerations. His finding that the appellant is not an
association
of employees by reason that certain of its promoters were
unemployed is simply wrong. Likewise, his conclusion that the union
was
not operational in terms of its constitution and was established
for the gain of two individuals is also incorrect and amounts to
irrelevant consideration that improperly influenced his exercise of
discretion’. para 31 of the judgment.
The
appeal to this court
[20] On appeal, Ms. Rabkin-Naicker, who appeared on behalf of
respondent, submitted that section 111 of the Act provided for an
appeal
in the wide sense to the Labour Court. Thus, it involved a
complete rehearing and adjudication of the merits. She submitted
that,
the court
a quo
had correctly followed this approach and
had made its own findings on the evidence placed before it. She
submitted further that
for these reasons there was no basis to upset
the court
a quo’s
order.
[21] In support of this submission, counsel for the respondent relied
upon a judgment of this Court in
Staff Association for Motor and
Related Industries Motor Industries Staff Association and another
(1999) 20 ILJ 2552 (LAC). In that case, this Court examined s111 (3)
of the Act. S113 (3) provides “any person who is aggrieved
by a
decision of the registrar may appeal to the Labour Court against that
decision in 60 days of
(a) the date of the registrar’s decision or
(b) if written reasons for the decision are demanded, the date of
those
reasons.”
[22] In both judgments which were delivered, by Ngcobo AJP and
Conradie JA, emphasis was placed on the fact that the aggrieved
person
in that case was a third party, being a trade union which had
objected to the registrar’s decision to register another union.

Accordingly, in both judgments it was held that a review of such a
decision was not possible, because the third party had not been
involved in the decision making process nor in the provision of
information to the registrar prior to the decision to register the
other trade union. The Court held that the matter had to be heard
afresh, the court held that the word ‘appeal’, as it appears
in
s111 (3), had to be given a wide meaning.
[23] That case did not, in any way, examine the problem posed by the
facts of the present case, namely whether an applicant trade
union
which was refused registration in terms of a discretionary act of the
registrar pursuant to s95 (7) of the Act, is entitled
to an appeal
(in the wide sense) against the adverse decision of the registrar as
opposed to a review of such a decision.
[24] Given the approach which I adopt, it is unnecessary for me to
deal with this interpretive question. The key issue is whether
an
appeal against first appellant’s ‘decision’ was competent.
For section 111 (3) to be applicable, a final decision by the
registrar has to made. The appeal, in terms of s111(3) of the Act,
is against this decision. In terms of s96 (4) of the Act,
it is
clear that, where the registrar acting in terms of his power under s
95, decides that he is not satisfied that the applicant
union meets
the requirements for registration, he is obliged to notify the
applicant of this decision and must provide reasons for
the decision.
Further, he must provide a 30 day period in which the applicant
union has an opportunity to meet the statutory requirements
for
registration.
[25] It is common cause that no such application of this provision
took place in the present case. First appellant made his decision
on
12
th
July 2004. Only after a letter from respondent’s
attorneys were reasons provided on 16 August 2004 by the first
appellant.
There was clear non compliance with the provisions of
section 96 (4), in that no opportunity was provided to respondent to
deal with
the problems raised by first appellant in his letter of
16
th
August 2004.
[26] Though section 96 (4) (a) refers to “a written notice of the
decision
and the reasons for that
decision
”, (my
emphasis) it is clear, when this provision is read together with
subsections (5) and (6), that the
decision
taken in terms of
section 96 (4) (a), is but a provisional decision. The Act mandates
first appellant to inform the applicant that
it has 30 days from the
date of the notice to meet the requirements which the first appellant
has found not to have been met and
the failure of which justified the
initial decision. In terms of s96 (5), where an applicant such as
respondent meets the requirements
for registration in this 30 day
period, first appellant is mandated to register the union.
[27] For this reason, no legally effective decision was taken by
first appellant which was final and therefor could have been the
subject of an appeal. Expressed differently, until there was
compliance with the provisions sections 96(4), (5), (6), no decision
had been made which determined the rights or interests of respondent.
This could have only taken place after due compliance with
s 96(3),
being the provision of reasons, an opportunity to respond and a
decision taken pursuant to such response. As the Constitutional
Court held in
Fedsure Life Assurance Ltd v The Greater
Johannesburg Transitional Metropolitan Council
[1998] ZACC 17
;
1999 (1) SA 374
(CC) at para 59, the principle of legality is central to the rule of
law. That means that a body exercising a power such as first
appellant is required to act lawfully within the powers granted to
it. In this case, a decision by first appellant could not have
been
lawfully made until there was due compliance with its provisions of
section 96 of the Act.
Conclusion
[28] It follows from this analysis of the law that, when the matter
came before the court
a quo,
the proper course was to find
that no appeal could be prosecuted in terms of section 111 until a
final decision had been made which
could then be the subject of an
appeal. Given the lack of compliance with the provisions of s96(3),
in particular, the court
a quo
was required to refer the
matter back to first appellant in order that a decision could be made
pursuant to the provisions of the
Act. With regard to costs, I am of
the view that the requirements of the law and fairness dictate that
there should be no order of
costs both in this Court and in the Court
a quo.
[29] For
these reasons therefor the following order is made:
The appeal is upheld.
There is no order of costs on appeal.
The decision of the Labour Court of 29 July 2005 is set aside and
replaced with the following order.
(a) The decision which first respondent took on 12
th
July
2004 in which he refused to register applicant in terms of Section 96
of the Act 66 of 1995 is set aside.
The application for registration by applicant is referred back to
first respondent in order for him to comply with the provisions
of
Section 96(3)
of the
Labour Relations Act 66 of 1995
There is no order as to costs.
______________
DAVIS
JA
___________
I
agree ZONDO JP
___________
I
agree TLALETSI AJA
Date
of Judgment: 19 May 2008
Appearances
For
the Appellant Advocate T Bruinders SC assisted by Adv. E. Tolmay
For
the respondent Advocate H Radkin-Naiker