About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Johannesburg Labour Court, Johannesburg
SAFLII
>>
Databases
>>
South Africa: Johannesburg Labour Court, Johannesburg
>>
2012
>>
[2012] ZALCJHB 83
|
|
Mohale v Net 1 Applied t/a Cash Paymaster Services Northern (Pty) Limited (J1981/2010) [2012] ZALCJHB 83; [2013] 2 BLLR 199 (LC); (2013) 34 ILJ 930 (LC) (8 August 2012)
REPUBLIC OF SOUTH AFRICA
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Reportable
CASE NO: J1981/2010
In the matter between :
SOLOMON P MOHALE
.....................................................................................
Applicant
and
NET 1 APPLIED t/a CASH PAYMASTER SERVICES
NORTHERN (PTY) LIMITED
.........................................................................
Respondent
Heard: 10 July 2012
Delivered: 8 August 2012
JUDGMENT
Dodson AJ:
A contractual relationship existed between the applicant and the
respondent. The applicant says it was an employment relationship.
The respondent disputes this.
A dispute arose between the parties. That dispute was settled on 21
November 2008 by conclusion of a settlement agreement between
the
parties.
The settlement agreement provided in relevant part as follows:
‘
I,
the undersigned, Solomon Poroma Mohale confirm that I … am
prepared to accept, as I hereby do, the amount of R2 500 000
(two million five hundred thousand rands) in full and final
settlement of the Settlement Claims.
…
I further confirm that any
relationship, contractual or otherwise, between NET1 and myself …
are (sic) terminated with immediate
effect.
…
The ‘Settlement Claims’
means any claim, of whatsoever nature, I may have against NET1,
including any claims which may
have resulted from the termination of
the rel
ationships (or otherwise in respect hereof)
contemplated above.’
After this the parties entered into a further contractual
relationship. A new dispute arose.
The applicant referred the new dispute as an unfair dismissal
dispute to the Commission for Conciliation, Mediation and
Arbitration
(“the CCMA”) in terms of section 191(1)(a)
of the Labour Relations Act No. 66 of 1995 (“the LRA”).
Conciliation
failed. The matter was referred to arbitration in terms
of section 191(5)(a) of the LRA.
The respondent raised two points
in limine
. The first was
that the settlement agreement concluded on 21 November 2008 also
settled the new dispute. The second was that
the applicant was not
an employee of the respondent, but rather an independent contractor.
The parties agreed that the Commission
needed to give a ruling in
respect of the first objection
in limine
before it arbitrated
the dispute.
On 18 June 2010, the commissioner responsible for the arbitration
handed down a ruling, the material part of which read as follows:
‘
4.1
The applicant concluded a settlement agreement with the respondent
during 2008 for a particular cause of action which was between
the
parties and the settlement agreement was in full and final between
the parties.
4.2 It was apparent that the
parties had further engaged one another which resulted in another
cause of action.
4.3 The crucial issue is whether
or not the settlement agreement that was concluded between the
parties during 2008 did, or did
not, cover the possible future claims
or legal liability that the applicant may have against the
respondent.
4.4 The cases cited by both
parties are in congruent to one another in that they all indicate
that if the issue in dispute is about
the term of the agreement then
the Labour Court and the High Court have concurrent jurisdiction in
terms of section 77(3) of the
BCEA.
4.5 Given the evidence before
me, I conclude, that the CCMA has no jurisdiction to deal with the
matter.’
Although the commissioner’s reasoning is somewhat opaque, it
appears that he declined jurisdiction, not on the basis that
the
matter had been settled, but rather on the basis that only the High
Court or the Labour Court had jurisdiction to resolve
a dispute
about the interpretation of a settlement agreement.
The applicant then referred by way of a statement of case in terms
of Rule 6 of the rules of this court, the sole question of
-
‘
whether
or not the settlement agreement concluded between the applicant and
the respondent on 21 November 2008 settles any further
claims and/or
liability that might arise between the applicant and the respondent
after 21 November 2008.’
The respondent pleaded as a point
in limine
that this court
does not have jurisdiction. However, in a pre-trial minute, the
parties agreed that -
‘
4.3
The narrow question to be determined by the court is whether or not
the settlement agreement concluded between the Applicant
and the
Respondent on 21 November 2008 settles any further claims and/or
liability that arise between the Applicant and the Respondent
after
21 November 2008.
4.4 If court answers aforesaid
question in negative (sic), then the matter must be referred back to
the CCMA for determination of
two issues. Firstly, whether an
employment relationship existed between the parties. Secondly, if the
first question is answered
in the affirmative, whether the Applicant
had been unfairly dismissed by the Respondent.
4.5 The parties agree that costs
should follow the result.’
The parties agreed further that the point was to be decided by this
court without the leading of any evidence. It appears that
the point
in limine
pleaded by the respondent was abandoned.
The respondent, however, in its heads of argument has taken up the
attitude that in agreeing in the minute on the issue to be
decided,
both parties erroneously overlooked the fact that this court has no
jurisdiction to entertain the dispute because –
it is not for this court to determine academic issues; and
the ruling of the commissioner should rather have been taken on
review to have it set aside, if the applicant wished to take
issue
with it.
The respondent relies on the trite point that the parties cannot by
agreement confer upon the Court jurisdiction which it does
not
otherwise have.
1
The applicant argues that the commissioner correctly found that he
lacked jurisdiction to interpret a settlement agreement and
further
that that was the only issue in respect of which the commissioner
declined jurisdiction. The applicant argues further
that if the
issue in respect of which the commissioner declined jurisdiction is
determined by this court, the way is then open
for the commissioner
to resume the arbitration in respect of the balance of the issues in
dispute.
The respondent argues that it was within the power of the
commissioner to decide whether or not the settlement agreement
precluded
the applicant’s unfair dismissal claim and further
that his declining of jurisdiction pertained to the entire matter
and
not just the question presented for determination by this court.
Hence the need for a review of the commissioner’s ruling,
says
the respondent, if the applicant wishes to compel the commissioner
to resume the arbitration proceedings.
A preliminary difficulty which I raised with the applicant is the
fact that neither the CCMA nor the commissioner are party to
the
proceedings. On that basis any relief which requires either the CCMA
or the commissioner to be mandated to do anything, such
as to resume
the arbitration proceedings based on this court’s ruling, is
out of the question. Mr Orton, on behalf of the
applicant, accepted
that this was so, but argued that it was nonetheless open to this
court to rule solely on the issue of whether
or not the settlement
agreement precluded the applicant’s claim. If the ruling is in
the applicant’s favour, the
applicant will take the necessary
steps to have the matter set down for a resumed hearing before the
commissioner.
I also asked Mr Orton on behalf of the applicant to identify which
provision of the LRA he relied on as providing the source
of this
court’s jurisdiction. In response he placed reliance on
section 158(1)(a)(iv) which gives this court the power
to make a
declaratory order.
In my view, there are two impediments to the relief sought by the
applicant.
In the first place, the arbitrator’s actual ruling on
jurisdiction was not expressed in terms which confined it to the
narrow issue which the applicant now asks this court to determine.
Paragraph 1.1 of the commissioner’s ruling introduces
the
matter by saying-
‘
This
matter was set down for arbitration hearing on the 18
th
June 2010.’
Under paragraph 2 with the heading “
Issue to be
Determined”
, the commissioner defined the issue as being -
‘
to
determine whether or not the CCMA has jurisdiction to hear
the
matter
.
’
(emphasis added)
He did not say “
to determine whether or not CCMA has
jurisdiction to hear
the first point in limine
”.
In paragraph 5 he sets out his ruling as follows:
‘
I
rule that the CCMA has no jurisdiction to deal with
the
matter
.’
(emphasis added)
There is thus no attempt by the commissioner to confine his ruling
merely to the narrow point which had been raised. As I read
it, the
commissioner decided that he had no jurisdiction to decide the
matter at all.
I agree with the respondent that the only way of reigniting the
arbitration proceedings before the commissioner in these
circumstances
was to take his ruling on review in terms of section
145 of the LRA, joining both him and the CCMA, as well as the
respondent,
as parties. A successful review would allow this court
to remit the matter and order a resumption of the arbitration
proceedings.
Absent a review, the commissioner is in my view
functus officio
and the matter must be treated as having been finalised until his
ruling is set aside.
In the second place, I do not agree that the commissioner had no
jurisdiction to interpret the settlement agreement. The applicant
based his case in this regard on certain decisions of this court and
a decision of the High Court.
In
Premier, Limpopo Province v Makgoka & Others
2
the applicant sought a stay of execution of a warrant enforcing a
settlement agreement made an arbitration award in terms of
section
143(3) of the LRA by the relevant bargaining council. A dispute had
arisen subsequent to the award as to the correct
interpretation of
the settlement agreement.
The court remarked,
obiter
, that it, and not the bargaining
council, was the appropriate body to have interpreted the settlement
agreement and referred
to the fact that “
the arbitral
powers of CCMA commissioners and bargaining council arbitrators are
limited when it comes to matters of interpreting
agreements,
to
the interpretation and application of collective agreements.”
It is not clear from the judgment why the provisions of section
24(8) of the LRA did not come into play in the circumstances.
It
provides that –
‘
If
there is a dispute about the interpretation or application of a
settlement agreement contemplated in either section 142A or
158(1)(c), a party may refer the dispute to a council or the
Commission and subsections (3) to (5), with the necessary
changes,apply
to that dispute.’
Subsections (3) to (5) provide for the usual sequence of referral of
a dispute, conciliation and, failing successful conciliation,
arbitration by the council or the CCMA.
Section 142A(2) defines a settlement agreement as –
‘
a
written agreement in settlement of a dispute that a party has the
right to refer to arbitration or to the Labour Court…’
I will revert to this provision below. Leaving aside section 24(8),
the comments in
Makgoka
must be understood in their context.
In that matter, the referral of an unfair labour practice to the
relevant bargaining council
had been taken to its final conclusion
in the form of the settlement agreement made an award of the
arbitrator. The court was
of the view that the bargaining council
did not have jurisdiction to determine what was a fresh dispute
which had arisen solely
about the interpretation of the settlement
agreement.
The present matter is distinguishable. The need to interpret the
settlement agreement arose in the course of (not following after
the
final settlement of) the arbitration of a valid referral of an
unfair dismissal dispute to the CCMA. The interpretation of
the
settlement agreement was incidental to and part of the issues to be
decided by the commissioner in arbitrating the alleged
unfair
dismissal. In the circumstances, he had both the power and duty to
interpret the agreement as part of the arbitration
process which he
was seized of. Commissioners do that all the time, particularly in
the form of interpretation of employment
contracts in the course of
deciding unfair dismissal disputes. It would be absurd if, on every
occasion that a CCMA commissioner
was required to interpret an
employment contract or other agreement in the course of the
arbitration of a valid unfair dismissal
dispute, the matter had to
be stayed pending an interpretation by the Labour Court.
The second case relied on was
First National Bank Limited
(Wesbank Division) v Mooi NO & Others.
3
In that case, the third respondent employee entered into a
settlement agreement with the applicant employer at the stage when
an internal appeal was pending. Notwithstanding the settlement
agreement, the third respondent subsequently purported to refer
an
unfair dismissal dispute to the CCMA, along with an application for
condonation of the late referral. When the dispute was
referred for
arbitration before a commissioner of the CCMA, the third respondent
argued that the settlement agreement had been
entered into as a
result of a
justus
error. The commissioner essentially agreed
with this submission, ignored the settlement agreement and granted
condonation.
In a review of the commissioner’s order of condonation, the
Court held as follows:
‘
[16]
The powers of commissioners of the CCMA to rule on the interpretation
and application of agreements is, in my view, confined
to collective
agreements in terms of s 24 of the
Labour Relations Act … In
order to have the agreement set aside the third respondent ought to
have approached either the civil courts or this court in terms
of
s
77
of the BCEA.
[17] In my view the commissioner
committed a gross irregularity and exceeded his powers in finding
that the agreement was invalid
or the termination of the employment
relationship was not by mutual agreement between the parties. The
ruling stands to be reviewed
for this reason alone.
[18] The Commissioner further
committed a gross irregularity in ruling on the validity of an
agreement which was never placed before
him. Whilst it is clear the
agreement was confidential between the parties, the commissioner
could have called for the agreement
and considered it in camera under
the seal of confidence.’
In my view, the comments were made in a similar context as that
outlined above in relation to the
Makgoka
decision. What the
Court was conveying was that a commissioner of the CCMA would not
have a distinct jurisdiction to receive
and arbitrate a dispute
aimed at the
setting aside
of a settlement agreement. This
does not mean to say that a commissioner would not be able to
interpret a settlement agreement
in the course of adjudicating an
unfair dismissal dispute which was validly referred to him or her.
In fact if one takes into account that the Court in the
Mooi
matter reviewed and set aside the condonation ruling and then
remitted the matter to the CCMA for consideration by another
commissioner,
it becomes clear that the Court was of the view that a
CCMA commissioner could indeed deal with the matter, including the
employer
party’s reliance on the settlement agreement as
requiring a determination of the arbitration in its favour. The
commissioner’s
decision was also patently reviewable on the
other grounds referred to in the judgment.
The third decision relied on was
Independent Municipal &
Allied Trade Union v Northern Pretoria Metropolitan Substructure &
Others.
4
In this matter it was held that a High Court did not enjoy
concurrent jurisdiction with the institutions established in terms
of the LRA to adjudicate upon disputes about the interpretation or
application of a collective agreement. The judgment does not
say
that the CCMA or a bargaining council cannot interpret or apply an
agreement other than a collective agreement in the course
of the
adjudication of a dispute validly referred to it.
I am also supported in my view that the commissioner had the
requisite jurisdiction, by
section 24(8)
of the LRA. If a
commissioner of the CCMA has the express power to determine disputes
pertaining specifically to the interpretation
or application of a
settlement agreement, it is difficult to conceive how he or she
would not have jurisdiction to interpret
or apply a settlement
agreement where that duty arises as an incident of the adjudication
of an unfair dismissal dispute properly
referred to him or her.
In the circumstances, I am in agreement with the contentions
advanced by the respondent that this court does not in these
circumstances
have jurisdiction to determine the issue purportedly
presented to it by agreement in the parties’ minute. I do not
express
any view on whether or not the court would have jurisdiction
in circumstances where the matter had not arisen as an incident of
separate proceedings in the CCMA.
The respondent contends that the wasted costs of the day when the
matter was argued should be awarded against the applicant,
as he
ought to have withdrawn the referral upon receiving the respondent’s
heads of argument.
In my view, the following of the incorrect procedure emanated from
errors on the part of both parties and on the part of the
arbitrator. The matter was not that clear cut that withdrawal was
the obvious response to the belated raising of the point by
the
respondent. I am accordingly of the view that each party should bear
its own costs.
I accordingly make the following order:
The referral is dismissed.
No order is made as to costs.
________________
DODSON AJ
Acting Judge of the Labour Cour
Appearance
s:
For the applicant: RJC Orton of Snyman Attorneys
For the respondent: Adv W Hutchinson instructed by Fluxmans Inc
1
NUM
obo 35 employees v Grogan NO
[2010] 8 BLLR 799
(LAC).
2
(2010)
31 ILJ 2974 (LC).
3
(2009)
30 ILJ 336 (LC).
4
(1999)
20 ILJ 1018 (T)