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[2011] ZALCJHB 120
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Breet v Maxam Dentex South Africa (Pty) Ltd (J2025/2010) [2011] ZALCJHB 120; (2012) 33 ILJ 1634 (LC) (20 December 2011)
REPORTABLE
IN THE LABOUR COURT OF SOUTH AFRICA
HELD AT
JOHANNESBURG
Case Number
: J2025-2010
In
the matter between:
ANNA GOUSHEVA BREET
…........................................................................
Applicant
and
MAXAM DANTEX SOUTH AFRICA (Pty) Ltd
…........................................
Respondent
___________________________________________________________________
JUDGMENT
___________________________________________________________________
This matter was initially referred to the Labour Court on an urgent
basis. However, on 18 November 2010 it was struck from the
roll due
to a lack of urgency.
In its answering affidavit the Respondent raised a preliminary point
that this Court lacked jurisdiction to hear and determine
the
dispute on the basis that the Court does not have jurisdiction to
determine disputes relating to contracts other than contracts
of
employment. However, by the time that the matter came before me this
point
in limine
had been withdrawn.
Background
The Applicant was employed in the position of Finance Manager –
Africa with effect from 1 February 2009.
While it is not necessary to go into all the details for purposes of
this judgment, it appears that the parties reached a stage
where the
continuation of the Applicant’s employment with the Respondent
was in question. This is apparent from a meeting
that was held
between the parties on 14 September 2010. While there is a dispute
about exactly what transpired at this meeting,
what is clear is that
the Respondent intended to proceed with disciplinary action against
the Applicant. The parties, however,
opted to “settle”
the matter as opposed to proceeding with the disciplinary hearing.
The Applicant’s version as to what happened at the meeting is
that a final and binding separation agreement was reached
in terms
of which she would resign, not return to the Respondent’s
premises, be paid until the end of October 2010 and
be paid a
further amount equal to six months remuneration.
The Respondent’s version is that an agreement was reached in
principal that the parties would negotiate the terms of a
separation
agreement. The broad terms which were discussed were that the
Applicant would resign and be paid until the end of
October 2010.
The Applicant proposed that in addition to this she would be paid a
package equivalent to six months remuneration.
The Acting Managing
Director of the Respondent, Tjaart Louw (Louw), required an
undertaking from the Applicant that she would
not access any of the
Respondent’s systems, which undertaking was given by the
Applicant. It is further the Respondent’s
version that Louw
first needed to get approval from the Respondent’s parent
company in Spain before any final agreement
could be reached.
Following on this meeting, and at about 21h15 that evening, Louw
sent an email to the Respondent’s directors in Spain.
In this
email he indicated that he had discussions with the Applicant and
that the matter could be disposed of in two ways. Either
the
Respondent could suspend the Applicant and hold a disciplinary
hearing, or they could agree with her to resign and offer
her
compensation. He also stated that the Applicant indicated that she
may accept six month’s salary. He accordingly recommended
that
the Respondent negotiate a maximum payment of six months with the
Applicant. In the event that she decides not to accept
this she
would be suspended on full pay pending a disciplinary hearing.
On 15 September 2010, Louw went to the Respondent’s offices in
order to collect her personal belongings and vacate her
office. She
was informed that the separation agreement would be available later.
To this end the Respondent’s Human Resources
Manager, a Mr de
Jager, arranged to meet the Applicant at a shopping mall at 16h30
that afternoon.
According to the Applicant, at this meeting she was handed the
separation agreement which was in an envelope. She did not read
it
at this stage. She, however, asked for an opportunity to take advice
on the separation agreement, which De Jager agreed to.
When the Applicant arrived at home she noticed that the agreement
was already signed on behalf of the Respondent. She also noticed
that the separation agreement included a clause 8 dealing with the
company’s property.
1
There is a dispute between the parties as to whether or not this
provision had been discussed with, or mentioned to, the Applicant
during the meeting which they had on 14 September 2011.
In the meantime the Respondent discovered on the evening of 15
September 2010, that the Applicant had accessed the work email
system and had intercepted the email sent to Spain the night before.
It is common cause that she did this and sent a copy of
the
intercepted email to her consultant, Adrian Thomas (Thomas). As a
result Louw made arrangements to meet with the Respondent's
attorneys to discuss the matter.
According to the Applicant, the following day on 16 September 2010,
she requested that the company attach to the agreement a
payment
schedule setting out a summary of the payment terms contained in the
agreement. She did not, however, receive any response
to this
request and therefore attempted to contact De Jager on his cell
phone. When he did not answer his cell phone she left
a message. De
Jager responded shortly afterwards to say that he was in a meeting
but that he had sent the payment schedule to
the company’s
lawyers. As she did not wish to delay matters further she signed the
separation agreement at about 18h00
on 16 September 2010 and emailed
it to the Respondent.
The Applicant then immediately went to the Respondent’s
offices, and pursuant to clause 8 of the agreement, handed the
Respondent’s property to the security officer. According to
her she also deleted the electronic data stored on the computer
in
her possession. She says that she returned the company information
and property shortly after emailing the signed agreement
as she
understood that she had to do so upon signature of the agreement.
The Respondent’s version is that the Applicant phoned De Jager
on the morning of 16 September 2010 and explicitly indicated
to him
that she was not prepared to sign the separation agreement in its
current form and that she required that an addendum
be made to the
agreement. The Applicant, thereafter, sent an email to De Jager in
which she states that “
I’ve no problem signing the
contract provided that we finalise and sign off on the schedule as
part of this agreement”
.
The Respondent does not agree that what the Applicant was seeking to
do was simply to provide a quantification of what was set
out in the
agreement. According to the Respondent, the schedule which the
Applicant provided was incomplete, and she required
that it be
finalised between the parties. Furthermore, it sets out the
Applicant’s view that she should be remunerated
until the end
of October, whereas the agreement provided that her remuneration
would be until 15 October. In addition to this
the schedule also
dealt with the payment of her cell phone account until the end of
September, payment of car insurance until
end of October and payment
of pension fund contributions until end of October. These issues
according to the Respondent were
not part of the original agreement.
The Respondent views this as a counter offer.
At the meeting which Louw had with the attorneys on 16 September
2010 he instructed them to draft a letter to the Applicant stating
that the discussions around the separation agreement were
terminated, that the Applicant was suspended with immediate effect
and that a disciplinary hearing would be convened in due course.
This letter was sent by the attorneys to the Respondent via
email at
16h07 on 16 September. According to the Respondent it intended
sending the letter to the Applicant on the same day but
did not do
so due to the fact that Louw was assisting forensic investigators
who had been appointed to determine how the email
was intercepted.
On 20 September 2010 the Respondent’s attorney sent an email
to the Applicant requesting a meeting with her at 10h00 the
following day to discuss the alleged breach of the warranty
contained in clause 8 of the agreement, as well as the alleged
interception of private email communications between the
Respondent’s management.
The Applicant replied to the letter when she saw the mail on 21
September 2010, indicating that she was not available for the
proposed meeting due to prior commitments and that she would revert
to the attorneys.
While she was in the process of setting up a consultation with her
attorneys, she received a further letter in terms of which
the
Respondent purported to cancel the agreement and suspend her pending
the outcome of a disciplinary hearing. According to
this letter,
pursuant to the Respondent’s investigations into the
Applicant’s unlawful conduct it had decided to
cancel the
separation agreement with immediate effect on the basis that she had
breached the agreement and that her conduct in
entering into the
agreement was dishonest and intended to mislead the Respondent with
regard to the nature of her violation of
the company’s IT
systems. The letter goes on further to state that the agreement is
accordingly terminated with immediate
effect and as a consequence
“the
status quo ante
has been restored”. Working
from the basis that the Applicant was still an employee, the
Respondent then set out the complaint
against her and suspended her.
Following on this, the disciplinary hearing was held. The Applicant
did not attend this hearing as she did not accept that the
purported
cancellation of the separation agreement revived her employment
contract.
On Wednesday 6 October 2010 the employee was notified of her summary
dismissal.
Did a binding agreement come into existence?
The first question to be answered is whether or not a binding
agreement came into existence between the parties. There are,
however, other issues linked to this question. They include whether
or not an oral agreement was reached on 14 September in respect
of
the terms of the separation between the parties. There is also the
question as to whether or not the Applicant’s email
containing
a schedule of payments amounted to a counter-offer, as well as
whether or not the Respondent was induced into signing
the
separation agreement by a fraudulent misrepresentation on the part
of the Applicant. Much time is taken up in the affidavits
of both
parties, as well as in their heads of argument, putting forward
their respective versions in this regard. Given the view
that I take
in this matter, it is not necessary for me to deal with all these
issues.
From the available evidence it appears that a binding agreement was
in place. On 20 September 2010 the Respondent’s attorneys
wrote to the Applicant and advised her as follows –
“
We act for Maxam Dantex South Africa
(Pty) Ltd which has forwarded to us a separation agreement signed by
our client on 15 September
2010 and by you on 16 September 2010. In
terms of clause 8 of the separation agreement, you warranted and
undertook that as of
the close of business on 15 September 2010 you
had no property in your possession which belongs to our client. You
warranted further
that you had not reproduced or copied any property
in your possession which is the property of our client.
Subsequent to its signature of the separation agreement, our
client ascertained that not only were you in breach of the warranties
set out above but that you have also intercepted private email
communication among senior management members of our client. In
doing
so, you were acting not only in breach of your employment duties and
in breach of the warranties given by you in separation
agreement, but
your conduct was unlawful and in breach of the provisions of the
Regulation of Interception of Communications and
Provision of
Communication-related Information Act No 70 of 2002.
In light of the above, we have advised our client that it is
entitled to cancel the agreement on the basis of your breach.”
It is clear that the Respondent accepted that a valid and binding
agreement was in place, hence the reference to its right to
cancel
the agreement for alleged breach on the part of the Applicant. There
is no mention in this letter that no agreement came
into existence
because of a counter offer made by the Applicant, nor is there
reference to the possibility of cancelling the
agreement on the
basis of fraudulent misrepresentation on the part of the Applicant.
The letter of 20 September 2010 was followed up by a further letter
sent by the Respondent itself to the Applicant. In this letter
the
Respondent states that “
pursuant to the company’s
investigation into your unlawful conduct, the company has decided to
cancel the separation agreement
with immediate effect on the basis
that you have breached the agreement and that your conduct in
entering into the agreement
was dishonest and intended to mislead
the company as regards the nature of your violation of the company’s
IT systems.
” The letter then proceeds as follows –
“
The separation agreement is accordingly terminated with
immediate effect as a consequence of which the status quo ante has
been
restored.
The company therefore accepts that you remain
in its employ
.”
The fact that the company now elected to cancel the agreement also
clearly indicates that an agreement was in existence. In the
circumstances I accept that a valid agreement came into existence
between the parties.
Was there fraudulent misrepresentation?
In the above letter from the Respondent, it is however suggested
that the agreement was being cancelled because the Applicant’s
conduct in entering into the agreement was dishonest and intended to
mislead the company regarding the nature of her violation
of the
company’s IT systems.
Even if the Applicant had undertaken at the meeting of 14 September
that she would not access the Respondent’s IT systems,
her
failure to observe this undertaking cannot amount to a fraudulent
misrepresentation when she concluded the settlement agreement.
Any
such agreement would be distinct from the settlement agreement, and
if indeed concluded would probably have been on the basis
that
pending the finalisation of the settlement of the dispute between
the parties, the Applicant would not access the Respondent’s
IT system. Any breach of that agreement would be exactly that –
a breach of that agreement and not a breach of the settlement
agreement. Further, the settlement agreement itself does not have
any provision which refers to an undertaking of this nature.
If the complaint is that the Applicant concluded the settlement
agreement knowing full well that she was already in breach of
clause
8 of the settlement agreement, and that this somehow amounted to a
fraudulent misrepresentation, then this argument is
also rejected in
light of the view that I take below when dealing with clause 8.
I am therefore of the view that the Applicant was not entitled to
cancel the separation agreement as a result of fraudulent
misrepresentation.
Was there a breach of the agreement?
The Respondent argues that it was entitled to cancel the agreement
on the basis that the Applicant breached clause 8 of the agreement.
According to the Respondent, when the Applicant signed the
separation agreement on 16 September she warranted that as of 15
September she was not in possession of information belonging to the
Respondent, nor had she copied such information to anyone.
This
according to the Respondent was done by the Applicant knowing full
well that she was in possession of an email which she
had no
entitlement to be in possession of and that she had copied this
email to her advisor.
Clause 8 provides as follows-
“
8.1 The employee warrants that as of
close of business on 15 September 2010, she has no property in her
possession which is the
property of the company. This includes,
without limitation, computer equipment, and any and all documentation
relating to the business
of the company or its customers, notes,
records, in whatever form such exist, including hard copies and
electronically stored data,
office keys and electronic equipment
provided to her by the company during her employment.
8.2 The employee warrants further that she has not reproduced or
copied any property in her possession which is the property of the
company nor has she committed or procured any other person to do so.”
8.3 The employee undertakes not to disclose any information and
documentation acquired during her employment by the company to any
third party.”
The Respondent argues that the Applicant breached clause 8.1 by
accessing the Respondent’s computer system on 14 and 16
September 2010. As far as 14 September is concerned, the evidence is
that she accessed this email and then forwarded a copy to
Thomas. It
may well be that she breached clause 8.1. However, it is also
arguable that the act of accessing the email in question
does not
fall within the scope of clause 8.1 which deals specifically with
the possession of the Respondent’s property.
It also does not
extend to a third a party such as Thomas.
There is also no evidence that shows that the Applicant breached
clause 8.1 on 16 September 2010. The Respondent’s argument
in
this regard is that the Applicant accessed the Respondent’s
computer system by intercepting and viewing an email sent
by its
attorney at 16h07 and received by De Jager at 16h11. They based this
submission on a report prepared by a computer forensic
company.
However, this submission is not borne out by the report. Nowhere in
the report does it indicate that the email from
the attorney sent at
16h07 was intercepted by the Applicant. In its report the forensic
company states that they were tasked
with investigating the
leaking/intercepting of an email message that was sent from a Mr
Juan Moleres Vidal to Louw on 14 September
2010 at 21h32. There is
no reference to the email from the attorney sent at 16h07 on the
16
th
of September. In fact, the report also states that
representatives of the forenscis company collected the Applicant’s
laptop,
in order for it to be forensically imaged, on 16 September
2010. Unless they collected the laptop after 16h07, the breach would
not have even occurred at the time that they collected the laptop.
In the conclusion of the report, mention is also only made
of the
email message of 14 September 2010. No mention is made of the email
of 16 September 2010. There is therefore no evidence
before me that
the Applicant accessed the email system after 15 September 2010.
As far as clauses 8.2 and 8.3 are concerned, these types of clauses
are generally inserted into a contract in order to protect
the
propriety interests of a company. The aim is to ensure that such
information is not copied and passed on to competitors.
It appears
to be common cause between the parties that the Applicant had access
to the email system as part of her duties. Her
viewing of the emails
in itself would therefore not be questionable. There can, however,
be no question that her advisor to whom
she sent the email had no
right to view that email.
As unacceptable as the Applicant’s conduct was, the question
is whether or not this amounted to a breach of clauses 8.2
and 8.3.
The contents of the email had a bearing on the relationship between
the Applicant and the Respondent, and more particularly
on the
termination of that the relationship. I can see no basis on which
this information, however obtained, falls within the
ambit of what
clauses 8.2 and 8.3 would normally cover.
In any event, although there may be some debate in respect of clause
8.2, it appears that clause 8.3 is prospective in that it
requires
the Applicant, going forward, not to disclose any information and
documentation which she may have acquired during her
employment with
the company to any third party.
Even if any breach of clause 8 has taken place, I do not believe
that such a breach would be material in light of what the parties
were trying to achieve through the settlement discussions, and the
nature of the possible breaches.
In the circumstances I am of the view that it was not open to the
Respondent to terminate the separation agreement.
The revival of the employment contract
Even if there was a basis for terminating the agreement, this did
not revive the underlying employment contract. The separation
agreement was a compromise that terminated the employment contract.
A compromise is a settlement by agreement of disputable obligations.
It is an absolute bar to an action on the underlying agreement that
is the subject matter of the compromise. Repudiation or breach
of a
compromise agreement that is not subject to a suspensive or
resolutive condition precludes reliance on the original or
underlying compromise agreement
2
The Respondent argued that the settlement agreement cannot be a
compromise agreement because there are no disputed obligations.
I
reject this argument on the basis that the parties were in dispute
in respect of the Applicant’s obligations in terms
of her
employment contract, hence the intention to conduct a disciplinary
hearing.
The separation agreement is not subject to a suspensive or
resolutive condition. It does not contain a provision providing for
the reversion to the employment contract in the event of repudiation
or breach. It follows that the employment contract could
not revive
upon repudiation or breach of the separation agreement.
In the circumstances I make the following order -
The Applicant did not breach the separation agreement concluded
between the Applicant and the Respondent on 16 September 2010.
The purported cancellation of the separation agreement is invalid
and unlawful.
The Applicant’s purported dismissal is incompetent in law.
The Respondent is directed to delete or cause to delete any
reference in its employment records to its dismissal of the
Applicant
on or about 6 October 2010.
The Respondent is directed to comply with the terms of the
separation agreement within 5 (five) days of the date of this court
order.
The Respondent is to pay the Applicant’s costs.
Conradie AJ
For the Applicant
Adv PJ Pretorius SC, instructed by Brink Cohen Le roux INC
For the Respondent
Adv C Orr, instructed by Webber Wentzel
Date of Judgment: 20 December 2011
1
This
clause is set out in full below.
2
RH
Christie, The Law of Contract in South Africa, 5
th
ed,
page 455-461.
13