About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Labour Appeal Court
SAFLII
>>
Databases
>>
South Africa: Labour Appeal Court
>>
2012
>>
[2012] ZALAC 6
|
|
UASA- The Union v Impala Platinum Ltd and Others (JA 22/10) [2012] ZALAC 6; [2012] 7 BLLR 708 (LAC) (6 March 2012)
REPUBLIC
OF SOUTH AFRICA
IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA
(HELD
AT JOHANNESBURG)
Reportable
Case No: JA 22/10
In
the matter between:
UASA
– THE UNION
…..................................................................................
Appellant
and
IMPALA
PLATINUM LIMITED
…......................................................
First
Respondent
NATIONAL
UNION OF MINEWORKERS
…................................
Second Respondent
JH
CONRADIE N.O.
…....................................................................
Third
Respondent
Heard: 13 September 2011
Delivered: 06 March 2012
Corum: Davis JA, Tlaletsi JA and
Sandi AJA
________________________________________________________________
JUDGMENT
DAVIS JA
Introduction
[1] This is an appeal against a
judgment of the court
a quo
which dismissed an application
brought by appellant to have a private arbitration award set aside on
review. With leave of the
court
a quo,
appellants have
approached this court on appeal.
Factual Background
[2] On 23 July 1997, first and second
respondent, which, at all material times represented the majority of
employees employed by
first respondent, entered into a threshold
agreement in terms of section 18 of the Labour Relations Act 66 of
1995 (‘LRA’).
This agreement created three bargaining
units, one category comprising employees in job categories 2 –
8 and ungraded employees,
a second category of artisans and miners
and a third category of officials. This agreement established a
threshold of 35% representativity
by a registered trade union within
the defined bargaining unit for the exercise of organisational
rights.
[3] On 23 March 1998, first respondent
entered into a series of recognition agreements with trade unions
which had attained the
35% threshold in one or other of the
bargaining units, including second respondent. It appears that
subsequent thereto, appellant
obtained recognition in the second
bargaining unit as well as in the third bargaining unit.
[4] The recognition of appellant
continued until 30 October 2006 when first respondent, second
respondent and appellant concluded
a new recognition agreement. In
terms of this agreement, the parties agreed that there would be a
single bargaining unit comprising
all employees in job categories A3
– A5. In terms of clause 4.1 of this agreement, it was agreed
that:
‘
[T]he
company recognizes the union (NUM) and association (UASA) as the
collective bargaining representative bodies of all employees
in the…
bargaining unit provided that the parties meet the representivity
thresholds agreed from time to time and contained
in a threshold
agreement.’ The agreement would terminate ‘if the
union/association fails to meet the representivity
level as
determined by the threshold agreement as amended from time to time.’
[5] It is common cause that, at all
material times, in excess of 50% of employees in the single
bargaining unit were members of
second respondent and that 7% of
employees in the bargaining unit were members of appellant. In other
words, appellant had approximately
2000 members out of the 27000
employees in the bargaining unit.
[6] On 28 March 2007 first and second
respondent concluded a bilateral threshold agreement. In terms of
this agreement NUM (being
the majority union in the workplace) and
first respondent agreed to conclude a collective agreement that
established a “threshold
of representativeness in accordance
with the provisions of section 18 of LRA.” The threshold for
the grant of organisational
rights to a trade union would now to be
50% plus one membership within the bargaining unit. It was further
agreed that this agreement
would replace the 1997 threshold agreement
and that trade unions that were currently entitled to organisational
rights which did
not meet the threshold, would be afforded three
months to do so, failing which their rights would be terminated on 30
days’
notice.
[7] On 2 April 2007, first respondent
gave appellant three months’ notice in which to meet this
threshold. On 11 May 2007,
appellant declared a dispute in this
regard in terms of clause 20 of the 2006 recognition agreement. The
essence of this dispute
turned on appellant’s contention that
clause 4.1 of the 2006 recognition agreement contemplated that a
trilateral and not
a bilateral threshold agreement would be
concluded, which implied that appellant had to be involved in the
conclusion of any such
agreement. Following a dispute resolution
meeting on 22 June 2007, on 27 June 2007, appellants’ referred
the dispute to the
CCMA, the dispute being described as concerning
the interpretation/application of a collective agreement in terms of
section 24
of the LRA. It was common cause that appellant had invoked
the provisions of clause 20 of the 2006 recognition agreement in
proceeding
in this manner.
[8] On 4 July 2007, first respondent
gave appellant notice that its organisational rights were terminated
as from 31 July 2007.
On 19 July 2007, appellant launched an
application in the Labour Court for urgent interim relief, pending
the outcome of the CCMA
referral.
[9] In its answering affidavit, first
respondent repeated its tender of private arbitration which was
finally accepted by appellant
on 24 July 2007. It was further agreed
that the award would be final and binding ‘subject to either
parties’ right
to approach the Labour Court to review the award
on appropriate grounds.’
[10] On 27 July 2007, the parties held
a pre-arbitration conference where it was agreed that a dispute
existed between the parties,
“that the exact dispute will be
defined in pleading”’ that would be exchanged and the
arbitrator would preside
over the arbitration. On 8 August 2007, the
parties held a second pre-arbitration conference where it was agreed
that appellant
would amend its statement of case and that the
arbitration proceedings would be subject to the
Arbitration Act 42 of
1965
.
[11] Subsequent thereto, appellant
delivered an amended statement of case to which first respondent
delivered a statement of defence.
[12] These documents presented
competing interpretations of clause 4.1 of the 2006 recognition
agreement. These differences can
be summarised thus:
(i) Appellant pleaded that clause 4.1
provided that it and second respondent would obtain immediate
recognition and that such recognition
would continue until it failed
to meet the threshold of representation, ‘agreed from time to
time’ between all three
parties to the agreement.
(ii) By contrast, first respondent
pleaded that, in terms of clause 4.1, organisational rights were only
extended to trade unions
which met the requirements of the 2007
threshold agreement and that it was permissible in terms of
section
18
of the LRA for first and second respondents to conclude a
bilateral threshold agreement, in that second respondent was the
majority
union.
The Arbitration
[13] The arbitration was conducted on
14, 15 and 17 August 2007, in which both parties were represented by
senior counsel. After
hearing argument, the arbitrator (third
respondent) dismissed an exception raised by first respondent against
appellant’s
amended statement of case. This order necessitated
the hearing of evidence regarding the surrounding circumstances
relating to
clause 4.1 of the 2006 recognition agreement.
[14] After hearing this evidence,
third respondent issued an award in terms of which he dismissed
appellant’s claim.
[15] On 13 September 2007, appellant
launched a review application, together with an application for
urgent interim relief, pending
the final determination of a review
application.
[16] On 18 September 2007, the urgent
application was heard and an order of interim relief was granted by
Moshoana AJ, in terms
of which, first respondent was effectively
prohibited from ‘derecognising’ appellant, pending the
final determination
of the dispute.
[17] On 15 March 2010 Basson J, in the
court
a quo,
dismissed the application for review, essentially
on the following grounds:
‘
I
accept that the arbitrator articulated the (second) dispute with
reference to
section 18
of the LRA. I also accept that the arbitrator
found that
section 18
of the LRA did not sanction the conclusion of
the threshold agreement between the company and NUM. What I do not
accept is the
submission that the arbitrator in deciding the matter
on the broader basis namely that the parties must have intended a
bilateral
threshold agreement, the arbitrator strayed beyond his
jurisdiction. He was, after all, given the jurisdiction to interpret
clause
4.1 which he did. The arbitrator was, in my view, entitled to
rely on the background circumstances to find that UASA’s
interpretation
of the collective agreement to contemplate a
tripartite agreement was incorrect and that its contention that the
bipartite agreement
constituted a repudiatory breach of the
collective agreement was therefore incorrect. Although the company’s
pleaded case
did not rely on the common understanding point, the
introduction of the point was fully ventilated. Moreover, it
certainly cannot
be said that the arbitrator had ventured beyond the
jurisdiction conferred in the arbitration agreement.
The
arbitrator, as already pointed out, stayed well within the boundaries
of his jurisdiction, which was to interpret whether or
not the
company breached the recognition agreement. I am thus of the view
that the arbitrator was entitled to decide the matter
as he did. I am
also in agreement with the submission that the pleadings played their
ordinary roll in the arbitration process.
No new disputes were
introduced by the amendment. Moreover, the non – pleaded issue
was fully ventilated before the arbitration
without any objection. In
so far as this has been done, and with no objection forthcoming on
behalf of UASA, it can hardly be concluded
that UASA suffered any
prejudice. At the very least it can be concluded that the parties,
through their conduct during the argument,
tacitly agreed to the
arbitrator’s terms of reference being extended to include the
common understanding point.’
It is against this decision that
appellant has approached this court on appeal.
Appellant’s case
[18] Mr Grundlingh, who appeared on
behalf of appellant, conceded that the review was based on
section
33(1)
of the
Arbitration Act, that
is that third respondent had
exceeded his powers; hence the ambit of the review was limited.
However, Mr Grundlingh submitted that,
in the evidence placed before
the court
a quo
, third respondent had ventured beyond the
jurisdiction conferred on him in terms of the arbitration agreement.
That agreement,
in effect, indicated that the parties had accepted
that the exact dispute which would be dealt with by way of
arbitration, would
be defined by the pleadings.
[19] In Mr Grundlingh’s view,
appellant’s case as pleaded was clear. It pleaded that the
threshold agreement as envisaged
in
section 4.1
of the 2006
recognition agreement would have to be tripartite, in particular the
proviso contained in clause 4.1, namely that the
parties meet the
representativity threshold ‘as agreed from time to time’
before that threshold agreement could be
triggered. First respondent
had pleaded that
section 18
of LRA permits an employer and the
majority union to conclude a threshold agreement governing
organisational rights. It pleaded
further that the appellant was not
a party to the 2007 threshold agreement by virtue of
section 18
(1)
of the LRA which did not require it to be a participant, in that its
members were not the majority of the employees employed
by the first
respondent. Furthermore, the 2006 agreement provided for
organisational rights which were extended only to parties
which met
the requirements of the threshold agreement as enforced in terms
section 18
of the LRA.
[20] In summary, Mr Grundlingh
submitted that first respondent’s case was that the validity of
the 2007 threshold agreement
was to be located within the provisions
of
section 18
of the LRA, which permits an employer and the union
enjoying majority representation in the workplace to agree on the
threshold
of representation that a union must meet before it could
enjoy organisational rights in the workplace.
[21] Notwithstanding this pleaded
case, third respondent did not rely on
section 18
of LRA. Instead he
found:
‘
I
do not need to enter into the controversies raised by her reliance on
s18
(Ms Simon who testified on behalf of first respondent). Ms
Simon’s inappropriate reliance on
s18
did not make the
threshold agreement invalid. Whatever her motivation was, a solid
basis for the agreement was that UASA had, in
terms of the
recognition agreement, agreed that the employer and NUM were entitled
to proceed the way they did.’
Relying on correspondence which had
been generated by Mr Kruger, the divisional manager of appellant,
third respondent found that,
when appellant concluded the recognition
agreement, ‘it intended the expression “as agreed”
to mean “as
agreed between the employer and NUM”. This is
also the employer’s intention’.
[22] Appellant’s case can be
reduced to the following: by deciding the matter on a broader basis
of common understanding of
an agreement as opposed to the provisions
of
section 18
of the LRA which had been specifically pleaded by first
respondent, third respondent had exceeded his powers and therefore
strayed
beyond his jurisdiction. For this reason, he had committed an
irregularity which justified the setting aside of his award in terms
of
section 33
of the
Arbitration Act, which
permits such interference
on the grounds of misconduct, gross irregularity or excess of powers.
Evaluation
[23] In order to evaluate these
submissions, it is necessary to return to the case as pleaded by
appellant, which appears from the
amended statement of case which was
placed before third respondent. In para 9 thereof appellant states as
follows:
‘
The
operative clause by which recognition was conferred (clause 4.1 of
the agreement) states that the ‘company recognizes
the union
[i.e. NUM] and association [i.e. UASA] as the collective bargaining
representative bodies for all employees and the applicable
bargaining
unit provided that the parties meet the representivity thresholds as
agreed from time to time and contained a threshold
agreement.’
In paragraph 10, the following is
pleaded:
‘
10.
The said clause means and was understood to mean that:
10.1
UASA together with the NUM would obtain immediate recognition from
the employer as a collective bargaining representative within
the
bargaining unit.;
10.2
the recognition would continue until:
10.2.1
a party failed to meet the threshold of representation;
10.2.2
‘agreed from time to time’ between all three parties in a
threshold agreement.’
In para 11, appellant avers that
clause 4.1 of the 2006 recognition agreement is unambiguous. The
exact pleaded paragraph reads:
‘
11.
Clause unambiguous
The
meaning above assigned to clause 4.1 unambiguously derives from-
11.1
a proper construction of the clause;
11.2
as read in the context of the agreement as a whole;
11.3
and in the context of such evidence it is admissible to place the
agreement within its contextual matrix.’
Then follows an alternative to para 11
in which, insofar as it is relevant to this dispute, reads as
follows:
‘
12.1
Insofar as clause 4.1, so interpreted, might be deemed to be
ambiguous, either on the basis that, given the privos (sic), no
immediate recognition is conferred or on the basis that a Threshold
Agreement can be concluded by more bilateral consensus, then
UASA
states that the meaning assigned above derives from-
…
12.2.5
the exchanges, oral and written, between the parties in the course of
negotiating the recognition agreement, and the stances
adopted in the
course of such negotiations, and the understanding shared between the
parties immediately prior to the conclusion
of the agreement;…’
[24] While it is correct to contend
that first respondent referred in its pleadings to
section 18
of the
LRA to justify its interpretation of the 2006 recognition agreement,
it was also its case that it denied the interpretation
contended for
by appellant, namely that clause 4.1 was unambiguous and that the
notice of termination constituted a clear breach
of the particular
clause.
[25] In summary, the precise issue
which was placed before third respondent, as an arbitrator was to
determine whether the meaning
of the phrase, contained in clause 4.1,
namely ‘as agreed from time to time’ meant that the
threshold agreement provided
for a bilateral as opposed to a
trilateral agreement. That was the precise dispute that third
respondent was called upon to determine.
Indeed, in paragraph 11 of
its pleadings, appellant pleaded that clause 4.1 was unambiguous and
that such unambiguity derived,
inter alia, from ‘the context of
such evidence, it is admissible to place the agreement within its
contextual matrix.’
Further, in paragraph 12.2.5 of its amended
statement, appellant suggested, as an alternative to para 11, that
the meaning of the
clause could be gleaned from surrounding
circumstances in which included:
‘
the
exchanges, oral and written, between the parties in the course of
negotiating the recognition agreement, and the stances adopted
in the
course of such negotiations, and the understandings shared between
the parties immediately prior to the conclusion of the
agreement.’
Significantly, appellant discovered a
letter of 27 July 2006 which was contained in the common bundle of
documents which had been
placed before third respondent. Third
respondent found support for his conclusion in the manner in which Mr
Kruger in this correspondence
had acknowledged that first and second
respondents could set this threshold. Significantly, when Mr Kruger
was cross-examined over
the contents of this letter, appellant’s
senior counsel did not object, but rather re-examined the witness
upon completion
of the cross-examination.
Conclusion
[26] The exact case, which came before
third respondent and, which first respondent was required to meet,
was whether clause 4.1
of the recognition agreement justified
appellant’s contention that there was a trilateral agreement in
place and that no
exclusion of appellant could take place prior to
compliance with this trilateral agreement. That first respondent
might have raised
section 18
of the LRA to justify its interpretation
did not mean that third respondent was restricted to examining the
implications of
section 18
as opposed to discharging the overall
obligation placed upon him, namely to interpret the contents of
clause 4.1. of the 2006 agreement.
Not only does this emerge from the
case as pleaded but also from the conduct of the parties, in
particular appellant’s conduct
during the proceedings before
third respondent.
[27] In summary therefore, there is no
basis by which to justify the conclusion that third respondent
exceeded his powers in arriving
at an interpretation of clause 4.1.
He performed the task of interpreting the clause, as he was required
to do. That interpretation
then provided an answer to the dispute
between the parties. Accordingly, there is no basis by which to
interfere with his decision.
[23] For these reasons, the appeal is
dismissed with costs, including the costs of two counsel.
___________________
DAVIS JA
I agree,
________________
Tlaletsi JA
I agree,
_________________
Sandi AJA
APPEARANCES
For the appellant: R Grundlingh
Instructed by : BESTER & RHOODIE
ATTORNEYS
For the respondent: Anton Myburgh SC
with Omphemetse Mooki
Instructed by : EDWARD NATHAN
SONNENBERGS ATTORNEYS