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[2013] ZALCCT 3
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Ulster v Standard Bank of South Africa Ltd (C 647/2012) [2013] ZALCCT 3; (2013) 34 ILJ 2343 (LC) (15 February 2013)
REPUBLIC
OF SOUTH AFRICA
THE
LABOUR COURT OF SOUTH AFRICA, CAPE TOWN
Reportable
Of interest to
other judges
case
no: C 647/2012
In
the matter between:
EUGIENE
ULSTER
Applicant
and
THE
STANDARD BANK OF SOUTH AFRICA LTD
First
Respondent
CCMA
Second
Respondent
Heard
:
29 January 2013
Delivered
:
15 February 2013
Summary:
Settlement agreement at CCMA – application to set aside.
JUDGMENT
STEENKAMP
J
Introduction
[1] The applicant, Ms
Eugiene Ulster, entered into a settlement agreement with the
Respondent, Standard Bank, after conciliation
and at arbitration at
the Commission for Conciliation, Mediation and Arbitration (the CCMA,
the second respondent). She claims
to have done so under duress and
wants to have the agreement set aside.
Background facts
[2] The employee was
employed by the Bank from December 1981 until 28 March 2011, when she
was dismissed for incapacity in the form
of poor performance. Her
trade union (SASBO, the finance union) assisted her in referring an
unfair dismissal dispute to the CCMA.
[3] A trade union
official, Lynne Hoffman, represented the employee at conciliation.
The dispute could not be resolved at that stage
and it was referred
to arbitration. SASBO appointed its in-house counsel, Adv Divan van
Niekerk, to represent the employee at arbitration.
He flew from
Pretoria to Cape Town and met the employee the day before the
arbitration, set down for 26 June 2012, in order to
prepare.
[4]
Before the
arbitration commenced, the commissioner asked the parties’
permission to attempt conciliation again in terms of
s 138 (3) of the
LRA.
[1]
They agreed. As often
happens in conciliation, the commissioner had separate caucuses with
the employee and her representative
on the one hand, and the Bank’s
representatives on the other hand, as well as plenary sessions. The
parties made proposals
and counter-proposals. Eventually the
employee, through her representative, asked for two months’
remuneration and for the
Bank to amend her employment record to
reflect resignation instead of dismissal. The Bank offered one
month’s remuneration,
together with the amendment as requested.
The employee agreed and signed a settlement agreement in those terms.
The parties also
agreed that the settlement agreement be made an
award as contemplated by s 142A(1) of the LRA.
[5] The employee now
argues that she entered into the agreement under duress or undue
influence. She submits that it should be set
aside.
Legal principles
[6]
Insofar as
the settlement agreement has been made an award in terms of s 142A(1)
of the LRA, this Court has jurisdiction to review
it in terms of s
145.
[2]
And in any event, this
Court has a residual power to set aside settlement agreements in
terms of s 158(1)(j) of the LRA on such
grounds as are acceptable in
common law.
[3]
[7] The employee argues
that she did not enter into the agreement freely and voluntarily, and
therefore the award was “improperly
obtained” as
contemplated by s 145(2)(b) of the LRA. Her argument is that she was
duped or coerced into signing the settlement
agreement by her own
legal representative.
[8]
A party
seeking to avoid the application and enforcement of a contract
allegedly entered into involuntarily by reason of undue influence
bears the onus to prove, on a preponderance of probabilities, that
she did not enter into the agreement voluntarily.
[4]
And in
Goddard
v Metcach Trading Africa (Pty) Ltd
[5]
this Court accepted that a settlement agreement constitutes a
contract for purposes of application of classic contractual law
principles.
Evaluation / Analysis
[9] It is common cause
that the employee signed the settlement agreement. She was assisted
and advised by her trade union’s
in-house counsel. Can it be
said that she was duped or coerced into doing so, or that she
otherwise did not enter into the agreement
freely and voluntarily?
[10] The employee’s
own evidence in her founding affidavit is that, after some horse
trading as is customary:
“
There was some
‘toing and froing’ during which time the prospect of the
first respondent ‘converting’ my
dismissal to a ‘mutually
agreed termination’ was raised. Adv van Niekerk then advised
the first respondent’s
representatives, in the presence of the
arbitrator and myself, and without a mandate, that I would accept
such a ‘conversion’
plus six weeks’ remuneration.
The first respondent immediately counter-proposed one month.
Adv
van Niekerk turned to me and I said ‘OK’.”
[6]
[11] After this
exchange, the commissioner enquired directly from the employee if she
confirmed and agreed to her acceptance
of the Bank’s
counter-proposal. She confirmed that she did. The commissioner then
left the room to fetch a CCMA
pro forma
settlement agreement.
He explained the terms to the parties. The employee confirmed that
she understood it. Only then did the commissioner
fill in the form
and ask the parties to sign it. The employee signed it herself,
having had the opportunity to read through it;
her legal
representative did not sign it on her behalf.
[12] The employee
is not uneducated or uninformed. She was a branch manager for the
Bank with some 30 years’ experience.
In her capacity as a Bank
employee and branch manager, she must have dealt with contracts on a
regular basis. The agreement that
she signed was written in English,
her first language. At no stage during the conciliation process, or
even after agreement had
been reached and before she signed the
written agreement, did she raise any objection or ask for a further
caucus with her legal
representative. It is inconceivable that she
was not fully aware of what she was agreeing to. One can only imagine
what her reaction,
as a bank manager, would have been if a bank
customer wished to resile from, say, a loan agreement that she had
entered into under
similar circumstances.
[13] On the
evidence before me, I cannot accept that the employee was coerced
into entering into the agreement. It may well
be that her legal
representative was ill-prepared and that he was happy for her to
settle cheaply; but she is not an ingénue.
She is an
experienced and informed woman, wise to the world of business and
contracts. She had been through an earlier conciliation
process. She
knew what it entailed. She could have rejected the Bank’s
counter-proposal at any time and insisted on proceeding
with the
arbitration. She could have asked to consult her legal representative
again before saying “OK” and subsequently
signing the
agreement. And even if she were unhappy with her representative, she
could have taken it up with her trade union and
asked for a
postponement; she did not do so.
[14] The employee’s
actions immediately after entering into the agreement also belie any
suggestion of coercion or misrepresentation.
The Bank paid the money
due to her in terms of the settlement agreement into her bank
account. She did not repay it or offer to
do so; only after she had
consulted her attorneys and launched this application, more than a
month later, did she say that “should
the settlement agreement
be set aside I shall tender to return the one month’s
remuneration paid to me as a consequence of
the settlement
agreement.”
[15] Five days
after she had signed the agreement, on 1 July 2012, the employee did
write to SASBO’s Hoffmann. Even
then, she did not claim to have
been coerced into signing the agreement. She expressed her
unhappiness with her legal representative,
but the closest to came to
questioning the agreement was to say:
“
After working for
30 years for Standard Bank and being a member of SASBO for just as
long, I walked away with Standard Bank reversing
the charge of
dismissal to ‘parting ways by mutual consent’ and one
month salary. How does one equate 30 years to one
month salary?”
[16] The employee
entered into the agreement with open eyes, fully aware of its
consequences. She is bound by that agreement.
[17] Both parties
asked for costs to follow the result. I agree, except that I do not
consider it fair to saddle the employee
with the travelling costs
occasioned by the Bank briefing counsel from Johannesburg for a
maater heard in Cape Town.
Order
[18] The
application is dismissed with costs, excluding the costs occasioned
by counsel travelling from Johannesburg to Cape
Town.
Steenkamp J
APPEARANCES
APPLICANT:
J
Whyte of Cheadle Thompson & Haysom Inc, Cape Town.
FIRST RESPONDENT:
D
Cithi
Instructed
by Mervyn Taback Inc, Johannesburg.
[1]
Labour
Relations Act 66 of 1995
.
[2]
Department
of Health v Jones & another
[2009] 3 BLLR 195 (LC).
[3]
This
was the approach followed by Landman J in
Eckhard
v Filpro Industrial Filters (Pty) Ltd
(1999) 20
ILJ
2043 (LC) para [8].
[4]
RH
Christie et al
The
Law of Contract in South Africa
(6 ed 2011) pp 281-4; 294-6: 321-4.
[5]
[2010]
2 BLLR 186
(LC).
[6]
My
underlining.