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[2011] ZALCCT 69
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Davids v Boland Rugby (Pty) Ltd (C12/10) [2011] ZALCCT 69 (5 September 2011)
IN
THE LABOUR COURT OF SOUTH AFRICA
HELD
IN CAPE TOWN
REPORTABLE
CASE
NO: C12/10
In
the matter between:
DEON
H
DAVIDS A
pplicant
and
BOLAND
RUGBY (PTY) LTD
Respondent
Date
of Hearing :
3 August 2011
Date
of Judgment :
5 September 2011
JUDGMENT
GUSH
J
1.
The Applicant was employed by the
respondent as head coach of its rugby team the Boland Cavaliers on
10 November 2008. The
applicant’s contract of employment
was for a fixed term commencing on 1 November 2008 and was due to
expire on 21 October
2012.
2.
The
applicant avers that his contract was “wrongfully and
unlawfully repudiated by the respondent ... [which] repudiation
has
caused the applicant damage and prejudice”
[1]
and referred a dispute to the Court in terms of section 77(3) of the
Basic Conditions of Employment Act (BCEA).
[2]
In his statement of claim, the applicant seeks the following
relief:
“
2.1
an order directing that the contract appointing the applicant as
head
coach of the Boland Cavaliers be cancelled”
[3]
2.2 an
order directing that the respondent pay the balance of the contract
which is to endure until 31 October 2012 in the amount
of
R1 190 000.00 together with interest thereon at the
prescribed legal rate of interest”.
[4]
3.
When
the matter was to be heard, the respondent raised a point
in
limine
namely “whether the applicant had suffered any damages in
consequence of any breach which it might prove and, if no damages
have been suffered, whether applicant’s claim falls to be
dismissed”.
[5]
The
parties agreed that the determination of the point raised by the
respondent would, if successful or partially successful,
dispose of
the matter in its entirety or at least considerably shorten the
proceedings and accordingly that it was appropriate
that it be heard
and determined first.
4.
In order to deal with the preliminary
issue, the parties filed a statement of “AGREED FACTS FOR THE
PURPOSE OF DETERMINING
ISSUE WHETHER APPLICANT HAS SUFFERED
DAMAGES”(sic).
5.
The agreed facts were as follows:
5.1.
“
Respondent paid applicant the full
monthly remuneration due to him in terms of the employment contract
concluded on 10 November
2008 up until end May 2010.
5.2.
The salary applicant would have earned in
terms of clause 1.1 of the employment contract from June 2010 to 31
October 2012
amounts to R1 015 000.00.
5.3.
In January 2010, applicant was employed as
a consultant by the University of the Western Cape (UWC) and earned
R20 000.00 during
that month.
5.4.
In the period February to March 2010,
applicant continued to be employed by UWC at R22 800.00 a month,
and accordingly earned
R45 600.00 in those two months.
5.5.
In the period April 2010 to February 2011,
applicant was employed by UWC at R25 000.00 a month and earned
R275 000.00
in that period.
5.6.
From 1 March 2011 applicant has been
employed by the Golden Lions Rugby Union in terms of a written
contract of employment at a
monthly salary of R52 500.00. The
contract commenced on 1 March 2011 and is to endure until 31 October
2012. The amount the
applicant will earn if he remains employed by
the Golden Lions Rugby Union until 31 October 2012 will be
R1 050 000.00.
5.7.
The total amount earned from his employment
with UWC and with the Golden Lions Rugby Union up to 31 October 2012
is the sum of R603 000.00,
which is R412 000.00 less than
the amount of R1 015 000.00 referred to in para [5.2]
above.
5.8.
This honourable court is asked to make a
finding, having regard to the facts as set out in paragraphs [5.2] to
[5.7] above, on the
question of whether, in the event that applicant
establishes that respondent breached the contract of employment as
alleged in
paragraph 23 of the statement of case:
5.8.1.
The amount of R603 000.00 referred to
in paragraph [7] above falls to be deducted from the amount claimed
by applicant,
5.8.2.
The further amounts to be earned by
applicant from his employment with the Golden Lions in
the period August 2011 to
October 2012 should be taken into account
in assessing whether applicant has suffered any damages and if so in
what manner they
are to be taken into account.
5.8.3.
Applicant has suffered any damages in
consequence of any breach which it might prove and if no damages have
been suffered whether
applicant’s claim falls to be dismissed.”
6.
The respondent argued that the applicant
was under a duty to take all reasonable steps to mitigate the loss
caused by the respondent’s
alleged repudiation of his contract
of employment and that on the strength of the agreed facts the
applicant had mitigated any
loss which he may have suffered should it
be found that the respondent had breached the agreement and therefore
as the applicant
had not suffered any damages his claim should be
dismissed.
7.
The
applicant’s statement of claim seeks an order directing that
the contract with the respondent be cancelled and for payment
of the
balance of the contract based on the averment that the respondent’s
alleged repudiation caused the applicant to suffer
damages. The
applicant avers that his damages are equal to the “balance of
the contract which is to endure until 31
October 2012”
[6]
.
The agreed facts however clarify this by stipulating that the
amount the applicant is claiming is that which has not been
paid to
the applicant since the end of May 2010 and the amount claimed as
damages is the amount that would have been paid to the
applicant for
the balance of the contract period.
8.
The
applicant has approached the Court in terms of section 77(3) of the
BCEA and has accordingly confined his claim to a contractual
claim
for damages arising out of the contract of employment. The law
relating to a “plaintiff’s” obligation
to mitigate
his damages is clear. In
The
Law of South Africa
[7]
the learned authors express the rule thus:
The
first and fundamental rule is that the plaintiff must take all
reasonable steps to mitigate the loss cause to the plaintiff
by the
defendant’s wrongful act. The plaintiff cannot recover damages
for losses which he or she could have avoided by taking
steps
reasonable in the circumstances of the case. ... The third rule is
that, where the plaintiff has reduced his or her losses,
the
defendant is liable only for the loss as lessened. ... This rule
emphasises the purpose of a damages award, namely that it
is strictly
compensatory in nature.
[8]
[footnote omitted]
9.
In
Buthelezi
v Municipal Demarcation Board
,
[9]
the Labour Appeal Court followed the decision in
Myers
v Abrahamson
[10]
where the court held that the “correct approach for computing
damages for a premature dismissal” was as follows:
The
measure of damages accorded such employee is, both in our law and in
the English law, the actual loss suffered by him represented
by the
sum due to him for the unexpired period of the contract less any sum
he earned or could reasonably have earned during such
latter period
in similar employment.
[11]
10.
The
respondent relied on the decision in the matter of
Toerien
v Stellenbosch University
[12]
as authority for the proposition that the respondent could not rely
on the principle that the applicant was required to mitigate
his
damages and that his claim did fall to be reduced by the amount he
had earned (and was due to earn) from his employment as
set out in
the statement of agreed facts.
11.
The
applicant’s counsel, Ms Golden, suggested that the Court was
obliged to follow the decision in
Toerien
[13]
unless it was convinced that that matter was wrongly decided.
However, as is obvious from the
Toerien
judgment, the issue in question in that matter was a claim based on
specific performance as opposed to the applicant’s claim
in
this matter which is clearly expressed as a claim for the damages he
averred he had suffered arising from the respondent’s
purported
repudiation of his employment contract.
12.
The court in the
Toerien
matter held
inter alia
In my
view, only such factors as are consonant with a claim for specific
performance should be taken into account in deciding to
what extent a
creditor's claim stands to be reduced. One must be careful not to
approach the claim as if it is one for damages.
[14]
and
“
It
was common cause between the parties that the applicant tendered his
services and put them at the disposal of the respondent
at all
material times”.
[15]
13.
Whilst the court in
Toerien
held further that:
“
Whereas
it may seem inequitable for the applicant to be remunerated 'twice'
as it were, one must consider the other side of the
coin as well. Why
should the respondent, who is in breach of its obligations in terms
of the contract of employment, benefit from
that very breach? This
would be contrary to the underlying principle that the employer's
obligation to remunerate an employee is
based on the availability of
the employee's services and not for work actually done”.
[16]
it
is abundantly clear from the statement of agreed facts that the
applicant had secured alternative employment and in fact sought
a
directive from the Court cancelling the contract inter alia on the
grounds that “it would be untenable in the circumstances
... to
return as head coach of the Boland Cavaliers.”
[17]
The applicant most certainly had not at the time of his suspension
nor was he now tendering his services.
14.
The
principle applicable to the circumstances of this matter, should it
be established that the respondent repudiated the appliocant’s
contract of employment, was enunciated in
Le
Monde Luggage CC t/a Pakwells Petje v Dunn NO and Others
[18]
as
follows:
The
compensation which must be made to the wronged party is a payment to
offset the financial loss which has resulted from a wrongful
act. The
primary enquiry for a court is to determine the extent of that loss,
taking into account the nature of the unfair dismissal
and hence the
scope of the wrongful act on the part of the employer. This court has
been careful to ensure that the purpose of
the compensation is to
make good the employee's loss and not to punish the employer. See M S
M Brassey
Commentary
on the Labour Relations Act A8-155; also Ferodo (Pty) Ltd v De Ruiter
(1993) 14 ILJ 974 (LAC).
[19]
15.
The applicant clearly has mitigated his
damages. What remains to be considered, however is whether the
future earnings to
which the applicant is entitled in respect of that
portion of the contract the applicant has secured with the Golden
Lions Rugby
Union which still has to run, amounts to mitigation of
the of the applicant’s claim for damages in respect of the
balance
of the period of the applicants contract.
16.
The issue is simply that at this point when
the enquiry is made as to whether the applicant has in fact mitigated
his damages, the
answer is that he has. He has secured a
contract in terms of which he will earn in excess of the amount he
would have earned
from his contract with the respondent. There
is nothing to suggest that the applicant’s contract with the
Golden Lions
Rugby Union is tenuous and/or that the applicant
continued employment is at risk. It is neither appropriate nor
necessary
to speculate on whether there exists a possibility that the
applicant’s contract with the Golden Lions Rugby Union might
be cancelled before the end of October 2012.
17.
In the circumstances, I am satisfied that
as the applicant has mitigated his damages, the point
in
limine
accordingly must succeed.
Therefore, even in the event that it is proved that the
respondent repudiated the contract, the
applicant has not suffered
any damages. At the outset, when the matter commenced, the
parties agreed in submitting that the
point
in
limine
should be heard separately, that
the outcome of the point if decided in favour of the respondent would
dispose of the matter.
18.
There is no reason in fairness why the
costs should not follow the result.
19.
In the circumstances therefore make the
following order:
19.1.
The applicant has not suffered damages and
accordingly the applicant’s claim is dismissed;
19.2.
The applicant is to pay the respondent’s
costs
_______________
GUSH
J
Appearances:
For
the Applicant :
Adv T Golden
Instructed
by :
Riley Inc
For
the Respondent:
Adv A Oosthuizen
SC
Instructed
by :
Malherbe
Hanekom Inc
[1]
Applicant’s
statement of claim paragraphs 23 and 24.
[2]
Act
No. 75 of 1997.
[3]
Applicant’s
statement of claim para 27.1.
[4]
Applicant’s
statement of claim para 27.2.
[5]
“
Agreed
Facts For The Purpose Of Determining Issue Whether Applicant Has
Suffered Damages” para 8.3.
[6]
Statement
of claim para 27.2.
[7]
Joubert
WA et al
The
Law of South Africa
2 ed vol 7 (Lexis Nexis Butterworths, Durban 2005).
[8]
Ibid
at
page 41 para 38 (a) and (c).
[9]
[2005]
2 BLLR 115
(LAC) at para20.
[10]
1952
(3) SA 121 (C).
[11]
Above
no 9 at para 20 as cited in
Myers
v Abrahamson
1952
(3) SA 121
(C) page 127 D.
[12]
1996
(1) SA 197 (C).
[13]
Ibid.
[14]
Ibid
a
t
page 200 A-B.
[15]
Ibid
at
page 201H-I .
[16]
Ibid
a
t
page 201H-I.
[17]
Statement
of claim para 26.
[18]
(2007)
28 ILJ 2238 (LAC).
[19]
Ibid
at para 30; see also
Rawlins
vs Kemp T/A as Centralmed
[2011] 1 BLLR 9
(SCA).