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[2011] ZALCJHB 217
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Minister of Higher Education and Training and Another v Service Sector Education and Training Authority and Others (J 604/11) [2011] ZALCJHB 217 (27 May 2011)
AC BASSON, J
IN THE LABOUR COURT OF SOUTH
AFRICA
HELD AT BRAAMFONTEIN
CASE NO: J604/11
In the matter between:
MINISTER OF HIGHER EDUCATION
AND TRAINING
..........................
1
st
Applicant in the application for leave to appeal
SIHLE MOON
...........................
2
nd
Applicant in the
application for leave to appeal
and
SERVICES SECTOR EDUATION
AND TRAINING AUTORITY
.
.........................................................
First
Respondent
IVOR BLUMENTHAL
................................................................
Second
Respondent
UASA THE UNION
......................................................................
Third
Respondent
FEDERATION OF UNIONS OF
SOUTH AFRICA
.........................................................................
Fourth
Respondent
CONFEDERATION ASSOCIATIONS
IN THE PRIVATE EMPLOYMENT
SECTOR (“FEDUSA”)
...................................................................
Fifth
Respondent
ASSOCIATION OF PERSONNEL
SERVICE ORGANISATIONS OF SOUTH
AFRICA (“APSO”)
.........................................................................
Sixth
Respondent
BEVERLY ANN JACK
.............................................................
Seventh
Respondent
LEON
GROBLER
.......................................................................
Eighth
Respondent
CLIVE
EDWARD WICKS
.............................................................
Ninth
Respondent
SHADRACK
MOTLOUNG
...........................................................
Tenth
Respondent
FEROZA
FAKIR
......................................................................
Eleventh
Respondent
Date of judgment : 8 June 2011
Date of hearing : 27 May 2011
________________________________________________________
JUDGMENT
________________________________________________________
A.C BASSON J:
This is an application for
leave to appeal (by the 1
st
and 2
nd
applicants
– the Minister of Higher Education and Training and Mr. Sihle
Moon) against my judgment dated 3 May 2011 in
terms of which an
order was granted in terms of prayers 2 to 11 of the Notice of
Motion. The first and second applicants were
also ordered to pay
costs of the application jointly and severally the one paying the
other to be absolved.
At the heart of this
application for leave to appeal is whether the respondents have made
out a case in their papers for the orders
that the Court granted
them with costs (ad paragraph [2] of the applicant’s heads of
argument). Leave to appeal is sought
against the whole of the
judgment and the orders granted by the Court. In this regard it was
submitted firstly, that the Court
materially misinterpreted sections
9, 10, 11 and 13 of the Skills Development Act 97 of 1998
(hereinafter referred to as ‘the
SDA’) and, secondly,
that the Court materially misinterpreted the regulations promulgated
in terms of the SDA.
I do not intend for purposes of
this brief judgment to repeat the grounds of appeal as they are set
out in the application for
leave to appeal nor do I intend to
revisit the facts and arguments and the factual findings as
contained in the judgment.
The test in the
application for leave to appeal
It is trite that there is no
automatic right of appeal against a judgment of the Labour Court.
This much is clear from section
166(1) of the Labour Relations Act
66 of 1995 (hereinafter referred to as the “the LRA”)
which provides that any
party to any proceedings before the Labour
Court may apply to the Labour Court for leave to appeal to the
Labour Appeal Court
against any final judgment or final order of the
Labour Court. In order to be entitled to leave to appeal, an
applicant in an
application for leave to appeal must satisfy this
court that there is a “
reasonable prospect that another
court could come to a different conclusion
”. (See
Woolworths Ltd v Matthews
[1999] 3 BLLR 288
(LC).) The test
is not whether or not there is a possibility that another court
could come to a different conclusion, the test
is whether or not
there is a reasonable prospect that another court could come to a
different conclusion. (See also
Westing House Break &
Equipment (Pty)Ltd v Bilger Engineering (Pty) Ltd
1986 (2) SA
555
(A) where the Court reiterated the general principle that in
order for an applicant for leave to appeal to succeed, the applicant
must demonstrate that it has a reasonable prospect of success on
appeal. It was also stated that an appeal should be allowed
where
the matter is of great importance or where the matter is of public
importance or where the Court is of the view that the
decision might
affect other questions. (See in this regard
Moller v Keimoes
School Committee & Another
[1911] AD 585.)
Argument
It appears from the oral
argument that the main attack on the Court’s judgment is the
Court’s finding that the respondents
have succeeded in making
out the case pleaded, namely that they have validly constituted
their council (referred to in the main
application as “
the
members’ council
”) on 12 April 2011. In this regard
it was argued that, because the respondents have failed to make out
a case (in respect
to the establishment of their own council), it
therefore followed that the application had to be dismissed on this
ground alone.
It was further argued that, although the Court had
found that the Minister’s actions in establishing the
(Minister’s)
Council was invalid, it did not follow that it
also had the effect of making the actions of the respondents in
establishing their
own Council (the members’ Council) valid.
The respondents, so it was argued, still needed to demonstrate that
their own
council was lawfully constituted in terms of the enabling
legislation in order to be successful. This, so it was argued, they
have failed to do.
Validity of the
establishment of the member’s council
As already pointed out, Mr.
Mokhari on behalf of the applicants submitted that the respondents
have not made out a case in the
founding papers that the Services
SETA’s Council (the members’ Council) established by the
respondents on 12 April
2011 was lawfully constituted nor have they
made out a case that the persons listed in annexure “Y”
to the founding
affidavit are the lawful members of the Services
SETA’s Council. It was also argued that the appointment of the
members’
Council did not comply with the very constitution
that it relied upon in that the 2002 constitution provides,
inter
alia,
for 24 voting members, 7 non-voting members, and 6
discretionary non-voting members.
I am generally in agreement
with the submission that in light of the fact that a SETA is a
creature of statute, it must strictly
comply with the requirements
of the law which created it in order for it to be validly
constituted. Similarly, it is accepted
that a Council of a SETA is a
creature of statute and that it must therefore comply strictly with
the requirements of the legislation
(the SDA) which created it.
Furthermore, I am in agreement that non-compliance with section 11
of the SDA will render the appointed
Council invalid and of no force
and effect.
In order to consider the merits
of this argument in the context of this particular application, it
is necessary to have regard
to the founding affidavit in order to
determine what was in fact pleaded by the respondents and whether or
not they have in fact
made out a case namely that their Council was
established in terms of the provisions of the enabling legislation
and in terms
of the 2002 constitution. In paragraph [71] of the
founding affidavit the following is stated:
“
Acting
in terms of the Services SETA constitution (annexure “C2”)
1
which remains applicable, the members of the Services SETA,
comprising the representatives of organised business and organised
labour, have taken the necessary steps on 12 April 2011 to finalise
the process of constituting a new Council as the SETA’s
accounting authority. They do not recognise the validity of the steps
taken by the Minister or the second respondent, including
the
purported appointment of the second to fifth respondent. Instead they
have elected new Council members, whose names are listed
in annexure
“Y”, which reflects also whether they represent organised
business or organised labour (I point out that
some of them were
purportedly appointed by the Minister. Not only did he not have power
to do so, but he also was mistaken as to
the constituency which some
of them represent. In the process he failed to comply even with the
new “model” constitution
he has sought to impose. There
is also imbalance between business and labour constituencies which is
in contravention of the Act)”.
What was therefore pleaded was
that the members of the SETA were elected to the council in terms of
the 2002 constitution.
The applicants answered to
paragraph [71] of the founding affidavit as follows in paragraph
[107]:
“
I
reiterate my submissions that this established SETA is acting
contrary to the law and approved constitution of the services SETA.
I
reiterate the submissions I have already made.”
It is
patently clear in my view from a plain reading of the papers that the
applicants have not placed in dispute the contention
made in the
founding affidavit namely that the members’ Council was
established in terms of the 2002 constitution. What is
placed in
dispute is that the Council is acting contrary to the law and the
approved constitution. The answering affidavit also
does not state
that the members’ Council was established contrary to the
enabling legislation and the 2002 constitution.
In
Administrator,
Transvaal, & Others v Theletsane & Others
[1990] ZASCA 156
;
1991
(2) SA 192
(AD) the Appellate Division (as it then was) restated the
legal position namely that an applicant must make out its case in the
founding affidavit.
2
In light of
the pleadings and especially what is contained in the answering
affidavit, I am not persuaded that the respondents (the
applicants in
the main application) have not made out a case in the founding
affidavit in respect of the contention that their
(members’)
council have been validly established in terms of the enabling
legislation and in terms of the 2002 constitution.
At this juncture I must also
point out that the argument in respect of the validity of the
members’ Council was not even
raised during argument when the
(original) application was argued – it was raised for the
first time when the application
for leave to appeal was argued. I,
however, accept in principle that new legal arguments may be raised
at subsequent proceedings
such as when arguing an application for
leave to appeal. It is also accepted that a respondent who files an
affidavit and answers
to the factual allegations as contained in the
founding affidavit is entitled to advance legal contentions in
respect of the
facts as they appear in the affidavits provided that
in raising these legal arguments the applicant is not prejudiced
thereby
(see in this regard
Angus v Kosviner
1996 (3) SA 215
(W) (ad 222G-I).) It is likewise accepted that a respondent has the
right to raise an objection
in limine
that the founding
affidavit does not make out a
prima facie
case for the relief
claimed (see in this regard
Valentino Globe bv v Phillips
[1998] ZASCA 43
;
1998
(3) SA 775
(SCA) (ad paragraph 779F)
.
In the present case no
such point
in limine
has been raised nor has the applicants
demonstrated that the facts as they appear from the papers support
the argument that the
applicants have not made out a case namely
that their council has been validly established in terms of the
enabling legislation
and the 2002 constitution: The applicants have
failed to place the validity of the establishment of the members’
Council
in dispute and cannot therefore now rely on facts not placed
in dispute in the papers. Moreover, it is severely prejudicial to
the respondents to raise this issue at the stage when the
application for leave to appeal is argued particularly in
circumstances
where no factual basis for such contention exists on
the papers. In this regard Mr. Kennedy for the respondents contended
that,
if the validity of the establishment of the members’
Council was placed in dispute in the answering affidavit, the
applicants
certainly would have dealt with it in the reply. In light
of the fact that the validity of the members’ Council was not
placed in dispute, the respondents (the applicants in the main
application) therefore did not have to place facts before the Court
to substantiate the allegation made in the founding papers.
In light of the foregoing I am
of the view that this argument is devoid of any merit. I am
furthermore also of the view that there
exists no reasonable
prospects that another Court may come to a different conclusion in
respect of the validity of the establishment
of the members’
Council.
The Minister’s
Constitution
[12] It was also contended on
behalf of the applicants that the Court had misdirected itself in
concluding that the Minister appointed
his Council in terms of the
standard constitution annexed to the answering affidavit as annexure
“H2”. In this regard
it was submitted that annexure “H2”
was merely a standard constitution which was never adopted by the
Services SETA
nor was it approved by the Minister. It was further
submitted that annexure “H2” is merely a draft
constitution that
was circulated for comment by the parties and that
it was therefore not a final document. It was also submitted that the
court
committed a misdirection when it failed to consider annexure
“AA13”, which is the model constitution which was adopted
by the respondents on 24 February 2011. Further in this regard it was
submitted that the Court had failed to appreciate the adoption
of the
constitution annexed to the answering affidavit as annexure “AA13”
and the fact that it was binding on the respondents
and that they
were therefore not entitled to depart from it. The respondents were
therefore bound by the 24 February 2011 constitution
and not the 2002
constitution as its lifespan had ended on 31 March 2011.
[13] The Court has dealt with
this issue in paragraph [27] of the judgment and I do not intend
repeating what is stated in the judgment.
Suffice to point out that
it was common cause on the papers that annexure “H2” was
the constitution that was adopted
by the Minister. What is now being
contended by the applicants is that there was an error in their
answering affidavit and that
it is in fact clear from the answering
affidavit that the constitution of February 2011 is the one that was
adopted by the parties.
[14] There can, in my view, be
no doubt about the fact, apart from this unqualified admission in the
answering affidavit, that it
was common cause on the papers that
annexure “H2” was the constitution adopted by the
Minister and imposed on the SETA.
The papers and the annexures
thereto also confirm that at least two further drafts of the
constitution were submitted
after
the constitution dated 28
February 2011. The letter by Dr. Blumenthal attached to the founding
affidavit as annexure “I”
refers to a further draft on 18
March 2011 and yet a further draft dated 22 March 2011. It is
furthermore clear from this letter
that Blumenthal (on behalf of the
respondents) had serious concerns about the further drafts that were
forwarded to the SETA after
the one that was signed in February 2011.
Put differently: The fact that further constitutions were submitted
after the constitution
dated 28 February 2011 strongly supports the
contention that the draft adopted by the Minister could not have been
the one dated
28 February 2011. It is accordingly in my view clear
from the papers and the annexures thereto that the argument advanced
on behalf
of the applicants is not supported by the documents.
[15] The applicants are
furthermore effectively asking this Court to accept that an erroneous
admission has been made in the papers.
There is, however, nothing by
way of an affidavit on oath to the effect that the admission was in
fact erroneously made nor has
there been any attempt in offering an
explanation as to why that error arose. In this regard the Court was
referred to the matter
in
Bellairs v Hodnet & Another
1978
(1) SA 1109
(A) (ad paragraph 1150F – G) where the Court held
as follows in regard to admissions made erroneously:
“
This vital admission having been raised
by the Court during argument on appeal, Mr. Kentridge asked for leave
to amend the plea
by deletion of the admission. The application was
opposed by Mr. O'Donovan. The Court's power, in its discretion to
allow amendment
of pleadings at any stage of the proceedings, even on
appeal, is undoubted. (See Gordon v Tarnow, supra at p. 532.) But, as
it
has frequently been stated, an amendment cannot be had merely for
the asking. This is equally, if not especially, true of a proposed
amendment which involves the withdrawal of an admission in such cases
the Court will generally require to have before it a satisfactory
explanation of the circumstances in which the admission was made and
the reasons for now seeking to withdraw it
.”
[16] In light of the above I am of the view that the applicants
should not be allo
wed to
withdraw the said admission in the absence of an application for
leave to amend or withdraw the admission having been granted
by the
Court and for which a satisfactory and
bona
fide
explanation of
the circumstances in which the admission was made and the reasons for
now seeking to withdraw it, were properly placed
before the Court.
Furthermore, the facts do not support the contention that the
Minister had adopted the constitution dated 28
February 2011 as the
new constitution and not the one annexed to the papers as annexure
“H2”. I am therefore of the
view that there is no basis
for the argument advanced on behalf of the applicants namely that the
Court was wrong in finding that
the constitution as approved by the
Minister was in fact the one as contained in “H2”.
[17] It should also be pointed
out that the applicants have also failed to advance arguments in
respect of the
validity
of the constitution dated 28 February
2011 (annexed as annexure “AA13”). In other words, even
if it is to be accepted
in the applicants favour that annexure “AA13”
was the version approved by the Minister, this does not assist the
applicants
at all in that the version signed in February 2011 suffers
from similar defects to that suffered by the constitution approved by
the Minister annexed to the papers as annexure “H2”. This
constitution (attached as annexure “AA13”) also
conflicts
with the enabling provisions of section 13 of the SDA.
The re-establishment of
the SETA on 11 November 2011 in terms of the government gazette
No
.
33756
[18] It was common cause that
the Minister had re-established a number of SETAs on 11 November
2010. A lengthy argument was advanced
in Court in respect of whether
or not the Minister had the power to “
establish
” a
Council in terms of section 9(1) of the SDA without a constitution
and whether or not the Minister may do so without a
constitution and
only adopt a constitution at a later date. The question therefore is
namely whether it follows that when the Minister
establishes
a
Council in terms section 9 (1) of the SDA it must do so
with
a
constitution. In this regard the Court was,
inter alia
,
referred to what had happened in 1999 when the Council of the SETA
was established and Gazetted. More specifically the Court was
referred to the fact that only in 2000 did the Minister approve the
constitution. The said constitution was gazetted only in 2002.
With
regard to the re-establishment of the SETA, the argument therefore
was that when the Minister re-established the SETA in 11
November
2010 it merely established a Council and that it was not necessary to
do so with a constitution. Life was only breathed
into the SETA on 1
April 2011when the new constitution was adopted. It was also argued
that the Court by finding that the 2002
constitution still applied in
fact absorbed the Minister’s duty to establish a Council
with
a constitution because the 2002 constitution had expired by this
time. The Court was consequently strongly urged to find that there
is, in light of this argument, a possibility that another Court can
interpret the wording of section 9 (1) and especially the word
“
establish
” differently and therefore that leave
to appeal should be granted.
[19] Again, in order to evaluate
this argument, regard should be had to the papers. In paragraph [82]
of the founding affidavit
the following is stated:
“
There
is no substance to the Minister’s Council in the correspondence
that the Services SETA ceased to exist and was then
re-established
and that this (somehow) entitled him to impose a new constitution.
The
constitution gazetted in 2002 survived the formalities of
re-establishment as borne out by past conduct.
3
In
any event, even if the Minister was at large to require a new
constitution, he could not impose that unilaterally, especially
without a full and fair process of consultation which he failed to
provide. Nor was he empowered to impose a constitution the contents
of which were in various respects materially inconsistent with the
requirements of s 13 of the Act and the relevant regulations.”
Furthermore at paragraph 83 the
following is stated:
“
I
point out further that the so-called ‘re-established’
Services SETA was re-established in terms of the gazette notice
of 11
November 2010 (annexure “F3”).
The
constitution gazetted in 2002 was then in existence, had been
approved, and continued to apply.
4
The
SETA had assets, personnel and contractual rights and obligations
which survived its expiry of office and ‘re-establishment’.”
In the answering affidavit under
the heading “Ad paragraphS 74 to 95” the following is
stated:
“
107.1
I deny that the Minister acted contrary to the applicable legislative
framework in the manner as alleged or in any other manner,
or that
the second respondent acted unlawfully in regard to Blumenthal’s
suspension.”
“
107.2
Annexure “T” sets out in broad terms the legal Authority
within which the Minister acted. Full legal argument
will be made at
the hearing of this matter in this regard and with reference to other
documents that have been referred to”.
[20] If regard is had to the
answering affidavit it is clear that the applicants have again failed
to specifically deny the contention
expressly made in the founding
affidavit namely that the 2002 constitution had survived the
re-establishment of the Council.
[21] I am therefore in light of
the aforegoing of the view that this argument advanced on behalf of
the applicants has likewise
no merit.
Validity of the Minister’s
actions
[22] The Court has found that
the constitution imposed upon the Services SETA by the Minister was
in fundamental respects in clear
conflict with the express
requirements of section 13(1)(a)(vi) and (xi) of the SDA. In the
judgment it was pointed out that those
provisions make it clear that
the constitution of a SETA must provide,
inter alia,
that the
members of the SETA with voting rights (that is the representatives
of organised business and the representatives of organised
labour)
must elect the persons who are to be members of the SETA’s
accounting authority (the SETA Council). This section
further makes
it clear that these representatives must elect the other office
bearers and the chief executive officer of the SETA.
The Court has,
with reference to the SDA and various clauses contained in the
constitution, held that the constitution (as annexed
to the papers as
annexure ‘H2’ and unilaterally imposed by the Minister on
the SETA) is manifestly in conflict with
the aforementioned
provisions of the SDA. The Court further held that the Minister’s
actions in appointing the second and
further respondents (as sited in
the application) as members of the Minister’s Council as well
as Dr. Moon as the chairperson,
has taken place in clear violation of
section 13 of the SDA in that the second and further respondents (as
sited in the application)
have been appointed by the Minister and not
by the members of the Services SETA.
[23] Mr Mokhari in his oral
argument wisely stayed away from addressing the validity of the
Minister’s constitution and the
validity of the appointment of
the Minister’s council. I am, in any event, in agreement with
Mr. Kennedy that there is no
viable argument to be advanced to
overcome this fundamental difficulty.
[24] There is therefore in my
view no realistic or reasonable prospect that a higher Court may come
to the conclusion that the applicants
were correct in defending the
Minister’s imposition of a new constitution and in appointing
the second and further respondents
(cited as respondents in the main
application) as chairperson and members of a new Council (the
Minister’s Council) in circumstances
where the Minister’s
actions indisputably were in conflict with the enabling statute.
[25] In the event I am of the
view that there is no reasonable prospect that another Court could
come to a different conclusion
than the conclusion arrived at by this
Court.
[26] In the event, the
application for leave to appeal is dismissed with costs.
__________________
AC BASSON, J
For the applicant : WR Mokhari
SC
P Malindi SC
Adv Zulu
Instructed by: The State
Attorney
For the respondent: Paul Kenndy
SC
Instructed by: Edward Nathan
Sonnenbergs Attorneys
1
At
the hearing of the matter it was pointed out that the reference to
annexure “H2” is clearly a typographical error
and that
it should have read annexure “C2” which refers to the
constitution that was adopted in 2002.
A
t
the time of the hearing of
the
application
it was accepted by the
applicants
that it
was a typographical error.
2
See
H
art v Pinetown Drive- In
cinema (Pty) Ltd
(1972) 1 SA 464
(
D
).
I
t is trite in our law that if the respondent’s
answering affidavit fails to admit or deny, or confess and avoid,
allegations
in the affidavit, the court will for the purposes of an
application accept the applicant’s allegation as correct. See
in
this regard Moosa
v
Knox
1949 3 SA 327
(
N
)
at 331
.
3
The
Court’s emphasis.
4
Ibid.
17