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[2014] ZALAC 20
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Lavangee v National Bargaining Council For The Chemical Indusrty and Others (DA13/12) [2014] ZALAC 20 (30 May 2014)
REPUBLIC
OF SOUTH AFRICA
IN THE LABOUR APPEAL
COURT OF SOUTH AFRICA, DURBAN
REPORTABLE
CASE NO: DA 13/12
In
the matter between:
CASSIM
ZOOBAIR LAVANGEE
Appellant
and
NATIONAL
BARGAINING COUNCIL
FOR
THE CHEMICAL INDUSTRY
First
Respondent
N.
MASEKO N.O.
Second Respondent
ENGEN
PETROLEUM LIMITED
Third
Respondent
Heard:
17 September 2013
Delivered:
30 May 2014
Summary: Rescission of
an arbitration award in terms of section 144 of the LRA- Established
principle that good cause is an element
for consideration in such
applications-- commissioner ought to consider the reasonableness of
the explanation and whether applicant
had a
prima facie
defence. Commissioner narrowly interpreting section 144 and failing
to consider good cause- Labour Court upholding rescission ruling-
Appeal upheld- Labour Court judgment set aside- Arbitration award
rescinded.
CORAM:
Tlaletsi DJP, Dlodlo et
Mokgoatlheng AJJA
JUDGMENT
TLALETSI
DJP
Introduction
[1]
This is an appeal against the judgment and
order of the Labour Court (Gush J) in which the appellant’s
application to review
and set aside a rescission ruling by the second
respondent was dismissed with costs. The appellant is in this Court
with leave
obtained pursuant to a petition to the Judge President
having failed to obtain leave from the Labour Court.
Background
[2]
The appellant was dismissed by the third
respondent on allegations of misconduct on 2 August 2010. He referred
a dispute of unfair
dismissal to the first respondent (the Bargaining
Council). A conciliation hearing was scheduled for 21 September 2010.
The third
respondent did not attend. The reason for the third
respondent’s failure to attend was, strangely, that it was not
interested
in the conciliation of the dispute. Since the dispute
could not be conciliated because of the attitude adopted by the third
respondent,
it remained unresolved.
[3]
The dispute was referred to arbitration on
behalf of the appellant by his attorneys on 22 September 2010. During
October 2010, appellant
enquired from his attorneys on the progress
of the matter. He was advised that they were still waiting for a date
from the Bargaining
Council. On 4 November 2010, the appellant
received a telephone call from his attorneys informing him that
“
there was a mishap with regards
to the notice of set down
”.
[4]
What happened, which is not disputed, is
that the notice of set down was transmitted by telefax to appellant’s
attorneys of
record on 1 October 2010. The fax machine to which the
notice was sent is used by about 10 staff members. At the time, there
were
renovations taking place at the appellant’s attorneys’
offices. In the process of moving the furniture, files and other
documents around, the notice of set down was mistakenly misplaced by
one of the staff members. The said notice was only placed
on the
incoming post box of the attorney handling the matter on behalf of
the appellant on 4 November 2010. Upon perusal of the
document, the
said attorney realised that the arbitration proceedings had been set
down for 25 October 2010.
[5]
Appellant’s attorney telephoned the
Bargaining Council and ascertained that the appellant’s
referral of his dispute
was dismissed by the arbitrator on 25 October
2010 due to non-appearance of the appellant.
[6]
The appellant brought an application to
rescind the ruling dismissing his referral on 9 November 2010. The
application was opposed
by the third respondent. In the application,
the appellant contended that his failure to attend the arbitration
proceedings was
not due to wilful conduct on his part since he was
not informed by his attorneys that the hearing was scheduled for that
day. His
attorneys as well were not aware of the date of set down
because of the fact that the notice of set down from the Bargaining
Council
was misplaced and never brought timeously to the attorney
handling the matter on behalf of the appellant. He contended further
that he would suffer prejudice should his application not be granted.
[7]
The
third respondent contended that the appellant did not raise any of
the grounds listed in section 144 of the Act
[1]
as the basis of his application. It was further contended that the
appellant’s failure to attend was through the gross negligence
of his attorneys and that he has recourse against them through a
civil action. It is important to state that the deponent did not
deal
with, or dispute any of the factual averments made by the appellant
in the founding affidavit.
[8]
The nub of the commissioner’s
reasoning in dismissing the application is to be found in the
following paragraphs of the award.
Analysis of Submissions
‘
The
applicant has been duly notified to attend the arbitration hearing.
This is not in dispute. It is also common cause that he
did not
attend the arbitration hearing, and attributes this to his attorney
of record. It must therefore be accepted that there
was proper notice
on the part of the Council. The applicant must therefore show that
the ruling was erroneously sought or obtained
in
absentia.
I am inclined to agree with the respondent that the applicant cannot
be heard to claim that the ruling was erroneously obtained.
The
Commissioner based his decision on what he had before him. Negligence
on the part of his attorney of record is the sole reason
for
non-attendance.
There seem to be a
dispute of fact on whether the applicant has good prospects of
success. Be that as it may, I am not persuaded
that the applicant
will suffer severe prejudice as compared to what the respondent is
likely to grapple with. The latter in my
view has made attempts to
have the matter finalized by attending the compulsory arbitration
hearing. He therefore stands to suffer
severe prejudice. The
applicant on the other hand has a remedy to deal with his attorney of
record.’
The
review
[9]
The appellant sought to review the award on
the grounds that the commissioner misconstrued the evidence before
him, failed to apply
his mind properly to the evidence, exceeded his
powers and displayed a sense of biasness.
[10]
The appellant’s founding affidavit
was accompanied by a confirmatory affidavit of Pragasen Yerriah, a
candidate attorney at
the appellant’s attorneys of record. The
deponent stated that he is currently responsible for the handling of
the file in
connection with the matter “
more
specifically the administrative issues pertaining to bringing the
matter before court
.” He
confirmed having read the founding affidavit of the appellant and
confirmed the contents in so far as it relates to
him.
The
appellant in the replying affidavit responded to the legal arguments
raised by the third respondent in its affidavit opposing
the
application and mentioned further that he was denied his right to a
fair hearing by the third respondent; that his disciplinary
hearing
was held on a day when his witness was not available and was refused
an adjournment in order to call his witness to testify
on his behalf;
that the evidence of his witness will prove that he was not guilty of
the misconduct he was charged for; in the
alternative should it be
found that he is guilty, he intends to show that in the circumstances
the sanction of dismissal was very
harsh compared to other employees
found guilty of similar misconduct.
[11]
In considering the appellant’s
application, the court below noted that the application was
incorrectly brought in terms of
section 145 instead of section 158(g)
of the Act. The court however found it appropriate in the
circumstances of the matter to
consider whether the appellant’s
application for review of the rescission ruling had any merit. The
Labour Court noted that
on the previous occasion the application to
review the rescission ruling was set down for hearing in the Labour
Court and same
was dismissed due to the failure of the appellant’s
attorneys to appear to argue the matter. The appellant thereafter
filed
an application to rescind the said order. However the parties
agreed that the rescission application be granted so that the merits
of the review application could be adjudicated. The Labour Court
remarked that it is noteworthy that the circumstances surrounding
the
failure of the attorney to appear at the arbitration are to a large
extent mirrored by the reasons why the appellant’s
attorneys
did not appear when the matter was enrolled in the Labour Court. In
both cases, the court below remarked, the attorneys
do not deny
having received the notice of set down by telefax, but in both cases
they aver for a variety of reasons that the fax
did not come to the
attention of the attorney who was dealing with the matter.
[12]
The court below considered section 144 of
the Act and what constitutes a judgment that is erroneously granted
and concluded that
since the notice of set down was properly served
and that the dismissal of the referral was not erroneously made, the
ruling was
therefore correctly made and is not reviewable. The court
held further that in so far as it was necessary to take into account
the applicant’s prospects of success, it was incumbent upon the
appellant to do more than simply aver in his rescission application
that he has a good case and reasonable prospects of success. The
application for review was in the result dismissed with costs.
The
Appeal
[13]
In this Court, Mr Allen who appeared on
behalf of the appellant contended
inter
alia,
that the court
a
quo
erred in finding that the decision
taken by the commissioner was not one which a reasonable
decision-maker could not reach. He submitted
that the court
a
quo
should have found that the
appellant had made out a case for the rescission of the Default Award
since the commissioner failed
to apply the law relating to rescission
applications correctly.
[14]
On
the other hand, Mr Matyolo who appeared on behalf of the third
respondent, contended that the commissioner’s finding that
the
non-attendance of the appellant and his attorney could not be said to
have been within the meaning of section 144 of the Act,
was a correct
finding and is supported by the decision of the Supreme Court of
Appeal in
Lodhi
2 Properties Investments CC and Another v Bondev Developments (Pty)
Ltd
[2]
and
Colyn
v Tiger Food Industries Ltd t/a Meadow Feed Mills (Cape)
[3]
).
Counsel contended further that the argument by the appellant that the
court
a
quo
did not consider the principle of good cause is fatal to the
appellant’s case because he failed to make a case either on
the
provisions of sec 144 of the Act or the principle of (good) just
cause.
[15]
Section 144 of the Act dealing with
variation and rescission of arbitration awards and rulings provides:
‘
Any
commissioner who has issued an arbitration award or ruling, or any
other commissioner appointed by the
director
for that purpose, may on that commissioner’s own accord or, on
the application of any affected party, vary or rescind an
arbitration
award or ruling -
(a)
erroneously sought or erroneously made in the absence of any party
affected by that
award;
(b)
in which there is an ambiguity, or an obvious error or omission, but
only to the extent
of that ambiguity, error or omission; or
(c)
granted as a result of a mistake common to the parties to the
proceedings.’
[16]
It is indeed correct that on the narrow
interpretation of sec 144 of the Act, it cannot be said that the
commissioner was wrong
in finding that the appellant’s
application for rescission of its ruling fell within the provisions
of rule 144 of the Act.
I mention this aspect because it cannot be
said, on the facts of this case, that the dismissal of the
appellant’s referral
when there was no appearance either by
himself or his legal representative was erroneously sought or made.
Neither can it be said
that the award was granted as a result of a
mistake common to the parties to the proceedings.
[17]
However,
this Court had an opportunity to interpret the provisions of sec 144
within the context of the Constitution of the Republic
of South
Africa 108 of 1996 and the labour relations regime in our country.
In
Shoprite Checkers (Pty) Ltd v Commission for Conciliation, Mediation
and Arbitration and Others,
[4]
the
Court held
inter
alia,
that
sec 144 must be interpreted so as to include good cause as a ground
for the rescission of a default arbitration award. In particular,
the
Court had the following to say:
‘
As
there are circumstances which can be envisaged, such as in the
present case, and which fall outside the circumstances referred
to in
s 144 of the Act, in such cases both logic and common sense would
dictate that a defaulting party should, as a matter of
justice and
fairness be afforded relief. It follows, that if one was to hold that
s 144 of the Act does not allow for the rescission
of an arbitration
award in circumstances where good cause is shown and that an
applicant who seeks rescission of an arbitration
award was compelled
to bring the application within the limited circumstances allowed by
the wording of the section it could lead
to unfairness and injustice.
In my view this would be inconsistent with the spirit and the primary
object of the Act referred to
above. Furthermore, I am of the view
that to interpret s 144 of the Act so as to include ‘good
cause’ as a ground for
rescission is to give the Act an
interpretation that is in line with the right provided for in s 34 of
the Constitution because,
if s 144 is not interpreted in that way, a
party who can show good cause for his default would be denied an
opportunity to exercise
his right provided for in s 34 of the
Constitution despite the fact that he may not have been at fault for
his default. This could
be a grave injustice.’
[5]
[18]
It is clear from the award of the
commissioner that the binding authority in the above quoted case was
not followed. The commissioner
after finding that the appellant’s
application did not fall within any of the circumstances listed in
sec 144, did not take
the enquiry any further except to note that
there seemed to be a dispute of fact on whether the appellant had
good prospects of
success. This dispute of fact was neither
investigated nor resolved by the commissioner. Instead, the
commissioner concluded that
the appellant was not going to suffer
severe prejudice as compared to what the third respondent was likely
to grapple with, should
rescission of the ruling granted in the
absence of the appellant be rescinded.
[19]
The
commissioner was obliged to consider whether the appellant had shown
good cause for the granting of the order. In doing so,
the
commissioner ought to have considered at least two factors, namely,
the explanation for the default (whether the explanation
is
reasonable and
bona
fide
)
and whether the appellant had a
prima
facie
defence. In
MM
Steel Construction CC v Steel Engineering & Allied Workers Union
of SA and Others,
[6]
it
was held that while the absence of one of the two essential elements
would usually be fatal, they are not to be considered mechanically
and in isolation but they are to be weighed together with other
relevant factors in determining whether it should be fair and just
to
grant the indulgence.
[20]
In
casu
,
there is no doubt that the appellant was not aware of the date of set
down of the arbitration hearing. Furthermore, the averment
that the
notice issued by the Bargaining Council and sent to the appellant’s
attorneys did not come to the attention of his
attorney is not
challenged and must be accepted. The fact that in subsequent review
proceedings in the Labour Court the review
application was dismissed
due to the default of the appellant and his attorney is not relevant
to the application for rescission
of the default dismissal of the
referral, since it is not a factor that served before the
commissioner. I am not persuaded that
had the commissioner considered
whether the appellant had shown good cause he would in any case have
found the appellant and his
attorney’s non-appearance to be
unreasonable and not
bona fide
.
The remark that the appellant had a remedy to deal with his attorney
of record was in my view made under the misconception by
the
commissioner of the interpretation of sec 144 and not on the
reasonableness and
bona fide
of the default. Put differently, this remark was based on the
understanding that the door was closed for the appellant as he did
not meet the requirements set out in sec 144 which understanding was
based on a narrow interpretation of sec 144 contrary to the
binding
precedent of this Court. In my view, this is not a case where it
could be found that the appellant should be made to suffer
because of
the negligence of his attorney.
[21]
The second leg of the enquiry is whether
the appellant had established that he had a
bona
fide
defence to the allegations against
him. It is only so that when the appellant’s referral was
dismissed, the commissioner
acted in terms of Rule 30(1)(a) of the
Rules for the Conduct of Proceedings before the CCMA. No evidence was
presented by the third
respondent in an attempt to prove misconduct.
In fact, from the Outcome Report of the Arbitration Proceedings dated
25 October
2010, it is noted that :
‘
1.
both parties did not attend;
2.
the applicant (appellant) properly notified by fax of the date, time
and venue
of the hearing;
3.
the matter was dismissed.’
It
is therefore clear from the record of the proceedings that both
parties did not attend the proceedings before the arbitrator
and the
outcome affected the appellant adversely only because he is the party
who referred the dispute. In my view, it was also
open to the
commissioner to act in terms of Rule 30(b)(ii) by adjourning the
proceedings to a later date. Commissioners should
in my view, avoid a
rigid approach in the adjudication of disputes in deserving cases.
What is regrettable in my view is that the
third respondent has
decided to capitalise on the default of the appellant by opposing the
rescission application when it was also
in default. It is the same
party who elected not to attend the conciliation proceedings only
because it was not interested in the
conciliation of the matter much
against the purpose and the spirit of effective resolutions of labour
dispute provided in the Act.
[22]
The appellant in his founding affidavit did
not do much to demonstrate that he has good prospects of success. He
only alleged that
he has a good case and have more than reasonable
prospects of success. As already indicated, the opposing affidavit
filed on behalf
of the third respondent, a person whose identity is
not disclosed, but only that he is ‘
an
adult male presently employed by the [third respondent] as an
Employee Relations Consultant based in Johannesburg
’
does not deal with any of the factual allegations made by the
appellant. They are not at all disputed. The affidavit in
the main
application refers to case law on rescission application, the
procedures in terms of the CCMA rules and the interpretation
to be
ascribed to sec 144. In short, there is no averment whatsoever to say
that the appellant does not have a
bona
fide
defence to the allegations against
him. Neither does it state what the actual allegations against the
appellant are and what was
proved to be misconduct against him.
[23]
On the basis of this information, it would
have been difficult for the commissioner to comprehend what the
allegations against the
appellant were and what his defence would be.
In the replying affidavit, the appellant took the matter further by
stating that
he was denied a fair hearing by the third respondent,
that the hearing was held on a day when his witness was not available
and
was refused adjournment in order to call his witness to testify
on his behalf. He stated that he was not guilty of the misconduct
he
was charged for. He mentioned that he should never have been found
guilty and even if found guilty, the third respondent acted
inconsistently by not dismissing employees found guilty of similar
misconduct.
[24]
It is evident from the averment that the
commissioner did not deal with the averments by the appellant.
Neither were they disregarded
on the basis that they were only made
in reply. If the averments made by the appellant can be proved to be
correct it would mean
that his prospects of success on the merits are
reasonable.
[25]
In
my view, the court below ought to have considered the principles
established by this Court in the
Shoprite
Checkers
matter and considered whether the appellant had shown good cause
before the commissioner for the award granted in his absence to
be
rescinded. The court below instead relied on the
Lodhi
2 Properties Investments CC(Pty) Ltd v Bondev Developments and
Colyn
v Tiger Foods
cases
[7]
and held that the
appellant had failed to show that the dismissal of his referral was
erroneously made and as such the ruling dismissing
the application
for rescission was correct and not reviewable. As pointed out
earlier, this approach goes against the binding authority
of the
Court. The court below however, did also find, in so far as it was
necessary to take into account the prospect of success,
that it was
incumbent upon the appellant to do more than simply aver in his
application that he has good and reasonable prospects
of success.
Again this approach is not in line with the averments referred to
above in determining whether good cause has been
shown.
[26]
In light of what has been discussed above,
the court
a quo
should have set aside the ruling of the commissioner. This matter
comes a long way. Up to now, the merits of the dismissal dispute
have
not been considered. It would serve no purpose, other than a further
delay, to send the matter back to the Bargaining Council
to consider
the rescission application afresh. Referring the matter back would
defeat the primary object of the Act which is effective
and
expeditious resolution of disputes. This Court is in as good a
position as the court below was to decide the rescission application.
[27]
The facts relating to the rescission
application have been set out above and are mostly common cause. It
is therefore not necessary
to repeat them. I find that the
explanation for the failure to appear by the appellant at the
arbitration proceedings is reasonable
and
bona
fide
. I further find that the appellant
has shown good cause for the rescission of the award granted in his
and the third respondent’s
absence. It would also, in my view
be in accordance with the requirements of law and fairness that each
party carries its costs
of the review application and the appeal
against the order of the Labour Court.
[28]
In the result, I make the following order:
1.
The appeal is upheld
2.
Each party to pay its costs
3.
The order of the Labour Court is set aside
and replaced with the following order:
a.
The application for review succeeds.
b.
No order is made as to costs
c.
The ruling issued by the second respondent
(Commissioner Nkosinathi Maseko) dismissing the rescission
application is hereby set
aside and is replaced with the following.
“
The
arbitration award issued on 25 October 2010 by A.S. Dorasamy is
hereby rescinded and the dispute can be set down for arbitration
with
notice to all parties.”
_______________
Tlaletsi
DJP
Deputy Judge President
of the
Labour
Appeal Court of South Africa
Dlodlo AJA and
Mokgoatlheng AJA concur in the judgment of Tlaletsi DJP
APPEARANCES:
FOR
THE APPELLANT:
Adv K. Allen
Instructed
by Henwood Britter & Caney Attorneys
FOR
THE THIRD RESPONDENT:
Adv X.D Matyolo
Perrot,
Van Niekerk, Woodhouse, Matyolo Inc
[1]
Labour
Relations Act 66 of 1995
.
[2]
2007
(6) SA 87 (SCA).
[3]
2003 (6) SA 1 (SCA).
[4]
(2007) 28 ILJ 2246 (LAC).
[5]
At para 33.
[6]
(1994) 15 ILJ 1310 (LAC) at IB131I -1312A.
[7]
Supra.