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[2013] ZALCCT 4
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BHP Billiton Hotazel Manganese Mines (Pty) Ltd v Commission for Conciliation Mediation and Arbitration and Others (C 161/12) [2013] ZALCCT 4; (2013) 34 ILJ 2857 (LC) (15 March 2013)
Reportable
Of interest to other judges
REPUBLIC OF
SOUTH AFRICA
THE LABOUR COURT OF SOUTH AFRICA,
CAPE TOWN
JUDGMENT
Case
no: C 161/12
In the matter between:
BHP BILLITON HOTAZEL MANGANESE MINES (PTY) LTD
Applicant
and
CCMA
First Respondent
ANTONY OSLER N.O.
Second Respondent
D SHUPING
Third Respondent
Heard
:
19 February 2013
Delivered
:
15 March 2013
Summary:
Review of condonation ruling in rescission
application before the CCMA. Interpretation of LRA s 144 considered.
JUDGMENT
STEENKAMP J
Introduction
If a party does not file written submissions in proceedings where it
had been agreed that no evidence would be led, and a CCMA
commissioner makes a default award, was that award “erroneously
made in the absence” of the defaulting party within
the
meaning of s 144 of the LRA
1
and thus open to rescission?
The third respondent, Mr D Shuping (“the employee”) was
reinstated in the applicant’s employ following a default
arbitration award issued by Commissioner Shiraz Mohamed Osman
2
.
The applicant (BHP) brought a rescission application and an
application for condonation for its late filing before the CCMA.
The
second respondent, Commissioner Antony Osler (“the
Commissioner”) dismissed both on the basis that the applicant
had not made out a case for condonation and that the award on the
merits was not “erroneously made in the absence”
of the
applicant from the proceedings. The applicant seeks to review that
rescission ruling and the ruling on condonation
3
in terms of s 158(1)(g) of the LRA.
The employee has also brought an application in terms of s 158(1)(c)
of the LRA
4
to have the initial arbitration award
5
made an order of court. The parties were
ad idem
that the two
applications should be heard together. Should I rule in favour of
BHP, the employee’s application would be
moot. Should I rule
in favour of the employee, the Osman arbitration award must be made
an order of court.
Background facts
The employee was dismissed after having committed a safety offence
in that he failed to carry out safety rules and procedures.
He was
employed as an electrician and disregarded certain isolation lockout
procedures.
The employee referred an unfair dismissal dispute to the CCMA.
Conciliation failed and he referred the dispute to arbitration.
On
the second day of arbitration the parties agreed that no evidence
would be led and that they would only submit written arguments
dealing with two crisp issues – inconsistency and double
jeopardy -- by 3 February 2012.
It is common cause that the applicant did not do so. The person who
attended to the matter on behalf of the applicant was its
employee
relations supervisor, Mr L Markus. He was present at the arbitration
proceedings when the agreement about written arguments
was reached
on 27 January 2012. Markus left the employ of the applicant on 31
January 2012, having resigned on one month’s
notice at the
beginning of January. He informed his successor, Mr Onkokame Moses
Masiga, on 2 February 2012 that he had to file
written arguments.
Masiga alleges in his founding affidavit that Markus did not provide
him with any further detail; he did not
realise that he had to
submit full submissions (including BHP’s defence and argument)
by 3 February 2012; and thus the
Commissioner made his award with
reference to the employee’s case only.
An arbitration award was handed down by Commissioner S Osman on 7
February 2012. The applicant received it on 16 February 2012.
It is
common cause, as recorded by Commissioner Osman, that BHP “failed
to file an opposition and the matter was considered
in default”.
He found the dismissal to have been unfair and ordered BHP to
reinstate the employee retrospectively.
After having taken legal advice, the applicant applied for
rescission in terms of section 144 of the LRA. The application was
filed 21 days outside the prescribed time period. The second
respondent, Commissioner Osler, dismissed the application for
condonation (and thus the application for rescission) on 18 May
2012.
The applicant seeks to have that ruling reviewed and set aside.
Evaluation / Analysis
The rulings on condonation and rescission are intertwined. In order
to consider the condonation application, the Commissioner
obviously
had to consider the prospects of success in the rescission
application. In this application for review, I shall do
likewise.
The condonation application
Although the Commissioner did not expressly refer to
Melane v
Santam Insurance Co Ltd
6
when considering the application for condonation, he appears to have
applied the well-known principles set out in that case.
I will
consider those principles in evaluating the ruling on condonation in
the context of this review application.
The rescission application was filed 21 days late. The Commissioner
found that “this is clearly late but whether it is
excessive
or not really depends on the validity of the explanation for the
delay”.
That finding, in itself, is not unreasonable. As the court pointed
out in
Melane
, the factors to be taken into account are
interrelated and not individually decisive.
Turning, then, to the explanation for the delay, the Commissioner
found that it was poor. It boiled down to the applicant initially
pursuing a review of the arbitration award before realising –
on advice from its attorneys, once they had started drafting
the
review papers -- that an application for rescission was the correct
option. That delay was exacerbated by BHP being a large
organisation
with various levels of management. The Commissioner considered that
BHP had access to legal advice at all times
and would or should have
been aware of the relevant time limits.
I agree with the Commissioner that the explanation for the delay is
a poor one, especially considering that BHP was represented
by
attorneys.
As Lagrange J pointed out in
Nehawu v Vanderbilpark Society for
the Aged
7
:
“
The
LRA has been in existence for more than fifteen years, and the time
limits governing referrals have not changed in that time.
It is
reasonable to expect that trade unions ought to be well aware of the
need to act timeously in the interest of its members
and would adapt
their internal procedures to accommodate these time limits, not
vice
versa
.
The scale of an organisation cannot serve as a justification for
delays. On the contrary, it is reasonable to expect that larger
organisations, be that trade unions or businesses, ought to be able
to see to it that they are organised to deal with disputes
of this
nature in a systematic manner to ensure that they do not fall foul of
the time limits in the LRA.”
The main thrust of the applicant’s condonation application
rested on its prospects of success in the rescission application.
The importance of the issue and strong prospects of success may tend
to compensate for a long delay; but without a reasonable
and
acceptable explanation for the delay, the prospects of success are
immaterial.
As Myburgh JP reiterated in
NUM v Council for Mineral
Technology:
8
“
The
approach is that the court has a discretion, to be exercised
judicially upon a consideration of all the facts, and in essence
it
is a matter of fairness to both sides. Among the facts usually
relevant are the degree of lateness, the explanation therefor,
the
prospects of success and the importance of the case. These facts are
interrelated; they are not individually decisive. What
is needed is
an objective conspectus of all the facts. A slight delay and a good
explanation may help to compensate for prospects
of success which are
not strong. The importance of the issue and strong prospects of
success may tend to compensate for a long
delay. There is a further
principle which is applied and that is that without a reasonable and
acceptable explanation for the delay,
the prospects of success are
immaterial, and without prospects of success, no matter how good the
explanation for the delay, an
application for condonation should be
refused (cf
Chetty
v Law Society, Transvaal
1985 (2) 756 (A) at 765A–C;
National
Union of Mineworkers & others v Western Holdings Gold Mine
(1994)
15
ILJ
610 (LAC) at 613E). The courts have traditionally demonstrated their
reluctance to penalise a litigant on account of the conduct
of his
representative but have emphasised that there is a limit beyond which
a litigant cannot escape the results of his representative’s
lack of diligence or the insufficiency of the explanation tendered
(
Saloojee
and another NNO v Minister of Community Development
1965
(2) SA 135
(A) at 140H–141D;
Buthelezi
& others v Eclipse Foundries Ltd
(1997) 18
ILJ
633 (A) at 638I–639A).”
The Commissioner found BHP’s arguments regarding its prospects
of success in the rescission application “ingenious
but
unconvincing”. I turn, then, to the merits of the rescission
application.
The rescission application and the commissioner’s findings
The Commissioner did not consider himself bound by the statements in
his colleague’s award that it was made on a default
basis.
Considering whether section 144 (a) of the LRA applied, he found
that the fact that BHP failed to make written submissions
“does
not mean that it was absent from the proceedings in the sense
intended in the section.”
On that basis, the Commissioner expressed the opinion that it was
not necessary for him to consider the reason for the applicant’s
failure to provide written submissions. Nevertheless, he found that
the reasons provided by BHP support the conclusion that “this
was no mere absence but an internal error on the part of [BHP] in
the handover of representation from the previous representative
to
his successor. Thus, the failure to present important evidence at
arbitration or the failure to submit argument when no evidence
has
been led, does not mean that the award was issued in the absence of
that party. And if we consider whether the award was
made
erroneously – a consideration that is again not strictly
necessary – I remain unpersuaded that there was any
such
error; [BHP]’s argument here, that the Commissioner would have
reached a different conclusion had he known the true
nature of its
case, can apply in any case badly presented and cannot be the basis
for rescission.”
In addition, the Commissioner disagreed with the applicant’s
submission that the term “erroneous” in section
144
relates to the content of an award; he found that this term applies,
rather, to the very act of making an award in circumstances
that
render it unfair, such as where an absent party did not receive
proper notice of the proceedings. He therefore found that
the
prospects of success in the rescission application were weak.
Legal principles : rescission
Section 144(a) of the LRA reads:
“
Variation
and rescission of arbitration awards and rulings
.—Any
commissioner who has issued an arbitration award or ruling, or any
other commissioner appointed by the director for
that purpose, may on
that commissioner’s own accord or, on the application of any
affected party, vary or rescind an arbitration
award or ruling—
(a) erroneously sought or
erroneously made in the absence of any party affected by that
award;”.
I agree with the Commissioner’s reasoning with regard to the
interpretation of the word ‘erroneous’. As the
court
pointed out in
Halcyon Hotels
9
,
“
Section
144(a) of the Act is similar to rule 42(l)(a) of the Uniform Rules of
the High Court. In the High Court, an order or judgment
will be held
to be erroneously granted if there was an irregularity in the
proceedings, or if it is not legally competent for the
court to have
made the order or judgment, or there existed at the time of issue a
fact of which the judge was unaware, which would
have precluded the
granting of the judgment and which would have induced the judge, if
he had been aware of it, not to grant the
judgment.”
An error cannot refer to the merits; it must refer to process of
making the award, as the Commissioner had found.
10
For example, in
Day & Night Investigators CC v Ngoasheng
11
the court considered the meaning of an “error” as
contemplated in s 144 (b). The court held:
“
As
regards section 144(b), the applicant argued that the first
respondent had alleged he did not know the reason for his dismissal.
Yet, he had a charge sheet which had told him why he was to be
disciplined. Consequently, it was contended, there was an error
in
the award. In my view, this is not the type of error contemplated in
section 144(b). In this connection, an ‘error’
means that
the judgment does not reflect the intention of the judicial officer
concerned. It does not refer to the correctness
or otherwise of the
decision (
First
Consolidated Leasing Corporation Ltd v McMullin
1975 (3) SA 606
(T) at 608E–F). It follows that the second
respondent rightly ruled that this was not a ground for rescission.”
The applicant nevertheless argued that, in the context of s 144(a)
as opposed to s 144(b), the Osman award was “erroneously
made
in the absence of the parties”.
The award was made in the absence of BHP. In this regard, I disagree
with the arbitrator. It is common cause that BHP did not
file
submissions when it should have; but the fact is that it did not.
The award was clearly made “in the absence”
of BHP. It
is analogous to the situation where a litigant is informed of the
set-down of a matter for argument but does not attend
the
proceedings.
The further question, though, is if the award was “erroneously
made”. The applicant argued that the Commissioner
could have
reached a different conclusion, had he known the true nature of its
case, i.e. that it had a valid and fair reason
to dismiss the
employee.
In this regard, the applicant relied on the authorities in
Promedia
Drukkers en Uitgewers (Edms) Bpk v Kaimowitz
12
and
Nyingwa v Moolman N.O.
13
In
Promedia,
the court held that there is an irregularity in
the proceedings if –
“
...the
court at the time was unaware of facts which, if known to it, would
have precluded the granting of the order”.
And in
Nyingwa
the court stated that –
“
It
therefore seems that a judgment has been erroneously granted if there
existed at the time of its issue a fact of which the judge
was
unaware, which could have precluded the granting of the judgement and
which would have induced the judge, if he had been aware
of it, not
to grant the judgement.”
I agree with the principles set out in these judgements. However, it
cannot be said that the Commissioner was unaware of any
facts at the
time that he wrote his award leading to the award having been
erroneously made. The applicant’s case is that
the
Commissioner was unaware of its argument because it had not
submitted it. But that was due to the applicant’s own
negligence. It was not due to any error on the side of the
Commissioner.
As the court found on the facts of
Nyingwa:
14
“
It
therefore seems that a judgment has been erroneously granted if there
existed at the time of its issue a fact of which the Judge
was
unaware, which would have precluded the granting of the judgment and
which would have induced the Judge, if he had been aware
of it, not
to grant the judgment.
In casu
it was manifest
to the presiding Judge that the defendant's attorneys had been aware
of the application for summary judgment from
its inception, and that
the defendant had been represented by counsel at the first hearing of
the application. Under these circumstances
the Judge was fully
justified in accepting that the defendant was a wilful defaulter, and
that summary judgment should be granted.
In view of the on-going
efforts to defend the application by the attorneys, to whom the
defendant had entrusted the defence of
his case, it is difficult to
envisage circumstances in which the judgment was erroneously granted.
The Court would have to be satisfied
that the defendant is absolved
from blame for his ignorance of the application, and that the
attorneys were solely to blame for
not having informed him of the
application and for their late withdrawal from the case. There is no
evidence on the papers to substantiate
such findings, but, to the
contrary, the Court has found, as is set out later in this judgment,
that the defendant was grossly
negligent in not keeping in contact
with his attorneys and also not advising them fully of the nature of
his defence. In my opinion,
therefore, summary judgment was not
granted erroneously and the application cannot be brought under Rule
42(1)
(a)
.”
The facts of the case before me are analogous. BHP was fully aware
of the fact that it had to file submissions at the CCMA; it
is due
to its own negligence that it did not do so. The default award was
not erroneously made in those circumstances.
Is the award reviewable?
The applicant argued that the rulings on condonation and rescission
are open to review because the Commissioner committed
process-related
errors as discussed in
Herholdt v Nedbank
.
15
I cannot agree. The Commissioner considered the condonation
application properly, applying the principles set out in
Melane v
Santam.
16
He concluded that the delay of 21 days – one third more than
the prescribed 14 day time limit – needed to be considered
together with the explanation for the delay. The explanation was a
poor one. It boiled down to the negligence of BHP, its senior
managers and its attorneys. Against this background, the prospects
of success were immaterial. Nevertheless, the conclusion of
the
Commissioner that the arbitration award of Commissioner Osman was
not “erroneously made” is a reasonable one.
The
applicant, therefore, did not have good prospects of success in the
rescission application.
Conclusion
For all these reasons, the ruling on condonation is not open to
review. Both parties asked for costs to follow the result. I
agree.
The consequence of this judgement is that the Osman award must be
made an order of court as requested by the employee under case
number C630/2012.
Order
I therefore make the following order:
The application for review in case number C161/2012 is dismissed.
The arbitration award under case number in C1755–11 dated 7
February 2012 is made an order of court in case number C630/2012.
The applicant (BHP) is ordered to pay the costs of the employee, D
Shuping, in both applications.
_______________________
Anton Steenkamp
Judge of the Labour Court of South Africa
APPEARANCES
APPLICANT:
Greg Fourie
Instructed by Glyn
Marais Inc.
THIRD RESPONDENT:
Neville Cloete
attorney.
1
Labour
Relations Act 66 of 1995
.
2
i.e.
the award of commissioner Osman dated 7 February 2012 under case
number NC 1755-11.
3
i.e.
the award of Commissioner Osler dated 18 May 2012 under the same
case number.
4
Under
case number C 630/12.
5
That
is the default award on the merits, made by Commissioner Osman under
case number NC 1755-11 on 7 February 2012 (“the
Osman award”).
6
1962
(4) SA 532
(A).
7
[2011]
7 BLLR 690
(LC) para [9].
8
[1999]
3 BLLR 209
(LAC) para [10].
9
Halcyon
Hotels t/a Baraza v CCMA & others
[2001] 8 BLLR 911
(LC)
para [10].
10
See
Lumka & Associates v Maqubela
(2004) 25
ILJ
2326
(LAC) para [27].
11
[2000]
4 BLLR 398
(LC) at 401.
12
1996
(4) SA 411
(C).
13
[1993]
3 All SA 569
(Tk);
1993 (2) SA 508
(Tk).
14
Supra
at 510 G-J.
15
(2012)
33
ILJ
1789 (LAC) para [36].
16
Supra
.