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[2014] ZALAC 89
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Cassim Zoobair Lavangee vs Engen Petroleum Ltd (DA 13/12) [2014] ZALAC 89 (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rescinded.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.