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[2013] ZALCJHB 33
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Mkhize v Antrobus SC NO and Another (JR 1342/12) [2013] ZALCJHB 33; (2013) 34 ILJ 2893 (LC) (20 March 2013)
Reportable
REPUBLIC OF
SOUTH AFRICA
THE LABOUR COURT OF SOUTH AFRICA,
IN JOHANNESBURG
JUDGMENT
case
no: JR 1342/12
In the matter between:
THOKOZANI RAYMOND MKHIZE
Applicant
and
MARK ANTROBUS S.C. (
N.O.
)
First Respondent
BONITAS MARKETING (PTY) LTD
Second Respondent
Heard
:
12 March 2013
Delivered
:
20 March 2013
Summary:
(Interlocutory application – review proceedings
- Security for costs - principles - applicant to provide security –
amount to be determined by the registrar).
JUDGMENT
LAGRANGE, J
Introduction
This is an interlocutory application for security for costs brought
by the second respondent in a review application, Bonitas
Marketing
(Pty) (‘Bonitas’). The applicant in the review
application is Mr T M R Mkhize (‘Mkhize’). He
has
applied to set aside the award in private arbitration proceedings in
which the arbitrator concluded at the end of a lengthy
and detailed
award that Mkhize’s dismissal by Bonitas was procedurally and
substantively fair.
Prima facie view of the merits of the review application
The founding affidavit in the review application is also lengthy and
detailed. However, the vast majority of points raised in
review are
more akin to points that might arise on appeal, even though they are
identified as reviewable irregularities. To give
some examples of
the points raised, a few will be mentioned:
Whether the applicant was guilty of gross insubordination, gross
negligence and/or incompetence and breach of trust as charged.
Whether Van Heerden [a member of the respondent’s board] was
elected as the BMC board chairman as per his evidence or
not.
Whether the applicant committed these alleged offences and whether
there was gross negligence on his part as charged.
The analysis of each of these questions of fact are set out in the
founding affidavit and focus on an evaluation of the evidence,
the
thrust of which is that the arbitrator came to the wrong conclusions
on these questions. As mentioned, these issues, which
relate to the
substantive merits of the charges against Mkhize, are more
reminiscent of grounds of appeal than grounds of review.
On the question of procedural unfairness, Mkhize raised two main
grounds of review. Bonitas was prepared to concede that one
of these
could properly be viewed as a ground of review. That one concerned
an allegation of misconduct on the arbitrator's part,
alternatively
a gross irregularity, because he apparently indicated on a number of
occasions that the applicant's case had not
been put to the
respondents’ witnesses when they were cross-examined, without
bearing in mind that the applicant could
not afford legal
representation and without bringing the requirement to his attention
or that of his representative In this matter.
Mkhize also alleged that the arbitrator committed misconduct or
alternatively a gross irregularity on whether his original enquiry
had been fair because it had not been chaired by a neutral
chairperson. The arbitrator recorded that the decision to dismiss
Mkhize had been taken by the board of the company on a
recommendation from a subcommittee to terminate his employment. He
noted
that the company's disciplinary code did not require the
appointment of an independent chairperson and in the circumstances
there
was no more senior executive manager who could have conducted
the enquiry because Mkhize was the managing director. He held that
it was commonplace for disciplinary enquiry is to be conducted
in-house and there was nothing inherently unfair or untoward about
that fact.
The respondent argues that the first of these two points is without
merit because the record shows that there was considerable
discussion about the admission of Mkhize's representative. The
arbitrator was not opposed to the parties appointing representatives
of their choice, but Mkhize objected to the company been represented
by an advocate unless he could be represented by his brother,
Mr S
Mkhize (‘S Mkhize’). Bonitas had objected to this
arrangement on the basis that S Mkhize was neither an employee,
union representative or legal practitioner. S Mkhize countered that
he was a human resources manager currently employed by TransNet.
The
company then qualified its objection on the following basis:
"If Mr Mkhize and Mr Sipho Mkhize can assure us Bonitas and
yourself Mr Arbitrator, that Mr S Mkhize been a human resources
manager at TransNet, has the necessary skill and knowledge to assist
his brother in his process, that he is au fait with the laws
of
evidence; that he is au fait with the principles of labour law
relating to unfair dismissal coupled with the whole was Whistle
blowing issue which would emanate from the pleading; that he will be
able to assist in this process, then and only then would Bonitas
say
we will not object to him representing.”
(
sic
)
The employer's counsel at the arbitration then emphasised that
Bonitas did not want a situation to arise where halfway through
the
dispute the employee would say that his brother could not advise him
on an aspect of the law because he was a lay person.
After taking
offence to counsel’s submissions because he believed that they
cast aspersions on his abilities, S Mkhize
emphatically confirmed
that they were ready to begin the case and that he was qualified to
represent his brother in the process.
Following this undertaking,
the company withdrew its objections to S Mkhize representing his
brother.
In the light of this forthright statement of S Mkhize's capabilities
in response to the employer's concerns about whether or
not issues
such as points of evidence might arise that he could not deal with,
I do not think the arbitrator can be faulted for
not reminding him
of his responsibilities in conducting Mkhize's defence. On a
prima
facie
view of the case, this ground of review seems rather weak.
In relation to the other procedural points raised, the arbitrator
clearly considered the limitations the company faced in finding
someone to chair the enquiry within the company given Mkhize's
seniority the but concluded that there was no obligation on it
to
appoint an independent outsider to conduct the enquiry. Indeed, I am
unaware of any authority that compels an employer to
appoint an
independent external chairperson in the absence of an agreement or
disciplinary code which requires it. The fact that
an employer might
take such a step to minimise the possibility of anyone with prior
knowledge been involved in determining the
outcome of the enquiry is
commendable, but for the purposes of satisfying the standard of a
disciplinary enquiry envisaged by
the Labour Relations Act 66 of
1995 (‘the LRA’)
1
,
a failure to do so in circumstances where there is no one more
senior in the company to hear the matter does not mean the standard
has not been met. Accordingly, this ground of review also does not
strike me as one that has much prospects of success.
In short, the applicant in the main seems to be attempting to pursue
an appeal in the guise of a review. Further, the limited
procedural
challenges which are raised appear to have very limited prospects of
success. It must also be stressed that in a review
of private
arbitrator’s award which is not conducted under the auspices
of the LRA but in terms of the
Arbitration Act 42 of 1965
, an award
cannot be reviewed on the basis of the principles laid down in
Sidumo
, but only on the grounds specified in
s 33(1)
of that
Act.
2
Like s 145 of the LRA, that section sets out the following grounds
of review:
“
1 Misconduct by the
arbitrator in relation to his duties as arbitrator.
2 The commission by the arbitrator of a gross
irregularity in the conduct of the arbitration.
3 The
arbitrator has exceeded his power.
4 The
award was not properly obtained.”
Therefore unlike reviews under the LRA, the arbitrator’s
reasoning is not subject to review with reference to the standard
of
unreasonableness set out in
Sidumo & another v Rustenburg
Platinum Mines Ltd & others
(2007) 28
ILJ
2405 (CC)
, namely: “Is the decision reached by the
commissioner one that a reasonable decision-maker could not reach?”
3
In so far as it is even possible to construe the grounds of review
which attack the arbitrator’s reasoning as grounds of
review
rather than grounds of appeal, the applicant cannot rely on the test
in
Sidumo
to augment his grounds of review and those grounds
he raises going to the merits of his case do not appear to be ones
that can
easily be legitimised as genuine grounds of review in terms
of one or more of the provisions of s 33(1).
The application for security for costs
The Labour Court rules do not specifically provide for applications
for security for costs. However, rule 11 (3) provides that
where the
Labour Court rules do not provide for a particular situation in
proceedings the court may adopt "any procedure
deems
appropriate in the circumstances", and the Labour Court has
inherent jurisdiction to deal with the question.
4
In this matter the employer is arguing that the review application
is vexatious and has requested that this application be heard
before
it is required to reply to the applicant’s founding affidavit.
The reason for seeking security for costs is practical:
the
arbitration took place over some five days and the record including
the transcript of the arbitration is substantial amounting
to at
least five lever arch files of documentation. It is reasonable to
suppose that significant legal fees will be incurred
by the
respondent owing to the necessity of its legal representatives
perusing the extensive record and preparing a reply to
the founding
affidavit of nearly 60 pages.
Orders for security for costs are not a regular feature of
proceedings in this Court. It must be remembered that the
legislature
deliberately adopted principles governing cost awards
which are not the same as those which apply in other Courts.
Sub-sections
162(1) and (2) of the LRA state:
“
1) The Labour Court may make an order
for the payment of costs, according to the requirements of the law
and fairness.
(2) When deciding whether or not to order the payment of costs,
the Labour Court may take into account—
(a) whether the matter referred to the Court ought to have been
referred to arbitration in terms of this Act and, if so, the extra
costs incurred in referring the matter to the Court; and
(b) the conduct of the parties—
in proceeding with or defending the matter before the Court; and
(ii) during the proceedings before the Court.”
It might happen that no award of costs is made to a successful party
because of other considerations of fairness.
5
Nonetheless, where an unsuccessful party pursued a matter and
canvassed significant amounts of irrelevant material or where the
matter ought not to been pursued because prospects of success were
minimal, the Court has been willing to make an order of costs
against that party.
6
On the basis of the scant prospects of success discussed above and
the fact that most of the review is based on grounds of appeal
there
is reason to believe that the applicant is intent on pursuing this
review with a reckless disregard for the likely outcome.
There is
also a question mark over whether he has the means to meet an
adverse cost order or not. In the circumstances, I believe
it is not
unfair to require him to provide reasonable security to the
respondent so that it will not be out of pocket if it is
ultimately
shown that the review application was without merit.
There is insufficient material on the costs of the review to
determine the appropriate quantum of such security, so this should
be decided by the registrar if the parties are unable to agree on
it.
Order
The applicant is ordered to establish security for the third
respondent's costs in this matter, in an amount to be determined
by
agreement between the applicant and the third respondent or, failing
such agreement being reached within 15 days of this judgment,
the
amount must be determined by the Registrar of this Court.
Costs of this application shall be costs in the cause.
_______________________
R LAGRANGE, J
Judge of the Labour Court of South
Africa
APPEARANCES
APPLICANT: I M Shongwe of Shongwe Attorneys
SECOND RESPONDENT: W P Bekker instructed by A Gray of Gildenhuys
Malatji Inc.
1
See
Avril Elizabeth Home for the Mentally
Handicapped v Commission for Conciliation, Mediation &
Arbitration & Others
(2006) 27
ILJ
1644
(LC)
at 1652E-1652F.
2
See
National Union Of Mineworkers on behalf of
Employees v Grogan No & Another
(2010)
31
ILJ
1618
(LAC)
in which the LAC held, at 1639,[32],
that:
“
The
grounds of review set out in s 145 of the LRA are the same as the
grounds of review set in
s 33
of the
Arbitration Act
. The only
difference is that there are court decisions which have interpreted
some of the grounds of review set out in
s 145
of the LRA to include
certain grounds of review taken from the Constitution whereas, as
far as I know, there is no decision of
any court which has
interpreted
s 33
of the
Arbitration Act to
include any grounds of
review that are not explicitly expressed in
s 33
of the
Arbitration
Act
. Of course, I am, in this regard, referring to the grounds of
review of unjustifiability of CCMA awards articulated by this court
in Carephone (Pty) Ltd v Marcus NO, of the irrationality of CCMA
awards as articulated by this court in Shoprite Checkers (Pty)
Ltd v
Ramdaw NO & others
(2001)
22 ILJ 1603 (LAC)
as
well as that of the unreasonableness of CCMA awards imputed to
s 145
of the LRA by the Constitutional Court in Sidumo & another v
Rustenburg Platinum Mines Ltd & others.”
3
At
2439,[110].
4
See
Kastinger V Doornbosch Restaurant CC
(1999) 20
ILJ
386 (LC) at 387, where Landman J stated:
“
[2] This
court has inherent jurisdiction conferred upon it by
s
151(2)
of
the
Labour Relations
Act
66 of 1995
.
I understand that in terms of these inherent powers this court may
grant security for costs in such circumstances as are laid
down by
common law.
[3] The rules relating to the
provision of security at common law have been conveniently
summarized by White
J in Vanda v Mbuqe & Mbuqe; Nomoyi v Mbuqe
1993 (4) SA 93
(Tk) at 94E. I quote:
'1 The
general rule is that a plaintiff or applicant who is an incola will
not be required to furnish security
for costs . . . . The purpose of
the general rule is that every citizen should have uninhibited
access to the Courts. . . .
2 There
are certain exceptions, arising from both common law and statutory
law, to the principle that incolae
will not be called upon to
furnish security for costs . As the exceptions are limited
in
number and only refer to a few specific cases, they make virtually
no inroads on the general rule. An incola who embarks on
reckless or
vexatious litigation, or an insolvent who embarks on litigation
other than that which he is empowered to embark on
by the
Insolvency
Act 24 of 1936
may be called upon to furnish security - Ecker v
Dean
1938 AD 102
at 110. If an incola who is a man of straw
litigates in a nominal capacity, or is a front for another, he
may be
ordered to furnish security - Mears v Brook's Executor & Mears'
Trustee
1906 TS 546
at 550.'”
5
Callguard
Security Services (Pty) Ltd v Transport & General Workers Union
& others
(1997) 18
ILJ
380 (LC)
at 388E–392B, in which Zondo J, as he then was, held that
equal weight should be given to considerations of law and
fairness,
a dictum which was approved in
Xaba v
Portnet Ltd
[2000] 1 BLLR 55
(LAC)
at 68,par 4.10.
6
E.g.
see
SAMWU v City of Johannesburg
(2007) 28
ILJ
2815 (LC)
at 2820,[22] [case with no merit withdrawn
at last moment] and
Botha v Gensec Asset Management (Pty) Ltd
[2000] 3 BLLR 260
(LC)
at 270 [costs awarded on a punitive scale
on account of being devoid of merit and the inclusion of irrelevant
material] .
.