About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Port Elizabeth Labour Court, Port Elizabeth
SAFLII
>>
Databases
>>
South Africa: Port Elizabeth Labour Court, Port Elizabeth
>>
2014
>>
[2014] ZALCPE 28
|
|
Civils v Smith and Others (P550/11) [2014] ZALCPE 28 (3 September 2014)
REPUBLIC
OF SOUTH AFRICA
THE
LABOUR COURT OF SOUTH AFRICA,
IN
PORT ELIZABETH
JUDGMENT
Of
interest to other judges
Case
no: P 550/11
In
the matter between:
MAWETHU CIVILS
Applicant
And
SMITH S
N.O.
First
Respondent
COMMISSION FOR
CONCILIATION, MEDIATION AND ARBITRATION
Second
Respondent
MAZOKA
MABUTHI
Third
Respondent
Heard:
02 September 2014
Delivered:
03 September 2014
Summary:
(Review – 142A order –
settlement agreement not reflecting parties intention –
alternatively waiver of terms of
settlement agreement).
REASONS
FOR JUDGMENT
LAGRANGE,
J
Introduction
[1]
Judgment in this matter was handed down on
3 September in the following terms:
“
The application to
review and set aside the ruling of the first respondent under case
number ECPE 5112-10 on 22 February 2011 is
dismissed with costs”.
The
reasons for the judgment are set out hereunder.
[2]
The applicant in this matter is the
employer party to a settlement agreement which was made an
arbitration award following an application
in terms of section 142A
of the Labour Relations Act 66 of 1995 (‘ the LRA’). The
applicant unsuccessfully opposed
the application and sought to set
aside the ruling making the settlement agreement an order of court.
[3]
The settlement agreement was concluded in
respect of an unfair dismissal claim. The material terms of the
agreement concluded on
22 February 2011 the read:
“
1.
REINSTATEMENT
1.1 the respondent agrees
to reinstate the applicant on the same terms and conditions of
employment which governed the employment
relationship prior to the
dismissal dated 8/7/2010.
1.2 the said
reinstatement
1.3 …
1.4 the applicant must
report for duty on 22/2/2011 at 12 H00 at the…..
…
6
OTHER
- The applicant will
return the Kerb Master Uniform (1X to piece overall & 1X pair of
safety boots). The company work done must
be refunded to period 23
February 2011.
-The applicant is
reinstated at the same rate of remuneration, but the company will
decide on the position.”
[4]
It is common cause that when the third
respondent returned the same day to resume his employment, he was
presented with a three
month fixed term contract which he signed.
When the employer issued him with a notice on 7 April 2011 confirming
that the fixed
term contract would end on 21 April 2011, the third
respondent refused to sign the document. The third respondent denies
that when
the settlement agreement was entered into it was on the
basis that he would accept a three month fixed term contract in
circumstances
where he was a permanent employee of the applicant
prior to his dismissal. He claims that he was not given an
opportunity to read
the fixed term contract and he was unaware at the
time of signing it that it was for a limited duration, which he
understood to
be contrary to the settlement agreement.
[5]
The third respondent referred a second
dispute to the CCMA arising from the expiry of this fixed term
contract, but withdrew the
claim at the conciliation of the dispute
on the advice of the presiding Commissioner. He then pursued the
application to have the
settlement agreement made an arbitration
award.
[6]
The applicant claims that at the
proceedings in which the settlement agreement was concluded it had
offered the third respondent
a three month fixed term contract which
he had accepted. However, it blames the Commissioner for recording
this “in a badly
worded settlement agreement”. It further
claims that the inexperienced representative of the applicant who
made the offer
trusted that the Commissioner would record the
agreement clearly and correctly.
[7]
The third respondent in reply to these
contentions denied that there had been any agreement on a three month
contract at the CCMA
proceedings and recorded that the Commissioner
read the settlement agreement and gave it to both parties to read and
understand
it before they signed it.
Grounds of the review
[8]
At the hearing of the review application,
the applicant persisted with the following grounds of review:
8.1
The arbitrator committed a reviewable
irregularity by not convening a hearing of the matter, particularly
because in deciding to
make the settlement agreement an award he took
account of his prior knowledge as the Commissioner who had
facilitated the settlement
agreement.
8.2
He
failed to apply the rule in
Plascon-Evans
[zRPz]Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1]
in
so far as he did consider the evidence on the affidavits before him.
8.3
He failed to consider the settlement
agreement in the context of events following the conclusion of the
settlement agreement, which
clearly demonstrated that the third
respondent either acted in a manner consistent with the applicant’s
interpretation of
the true nature of the settlement agreement which
had been concluded or, if the agreement had indeed meant that he
should have
been reinstated on a permanent basis, he elected to waive
his rights under the agreement and concluded a fixed term contract
instead.
[9]
In terms of the court’s approach to
such review it was argued by the applicant that “the thrust of
the case was one
of jurisdiction” and the court could determine
the matter on the basis of what it considered right and or wrong and
not on
the standard of reasonableness.
[10]
It should also be mentioned that it was
argued by the third respondent that since the settlement agreement
itself contained the
standard provision in the pro forma CCMA
settlement agreement to the effect that the parties consented to the
agreement being made
an arbitration award in terms of section 142A of
the LRA, there was no basis for the Commissioner to exercise any
discretion on
the issue of making it an award. However, I am not
aware of any principle that fetters the discretion of a forum being
asked to
give an agreement concluded between litigants the status of
an enforceable award or order to the extent that the forum is bound
to give the agreement an official imprimatur irrespective of its
terms or whether it has been complied with. No doubt the fact
that
the parties have agreed it may be made an award or order will carry
some weight when considering an application to confer
this status,
but the adjudicating functionary is not bound by what the parties
have agreed to between themselves.
The arbitrator’s
findings
[11]
The arbitrator, in summary, made the
following findings:
11.1
At the con-arb meeting on 22 February 2011
where the settlement agreement was concluded the applicant’s
representative had
indicated that the so-called ‘Kerb Master’
position was no longer available and offered to reinstate him to a
position
with the same terms and conditions to that of the Kerb
Master position. The representative had emphasised that there were a
number
of positions at the same level.
11.2
The third respondent made it clear that he
accepted the offer on the condition that the position was the same
level as the previous
one he held, and accordingly agreed to return
the uniform for the Kerb Master post.
11.3
The return of the uniform could not be
construed as an acceptance of employment on a fixed term period of
three months.
11.4
The settlement was explained to both
parties before they signed.
11.5
The plain text of clauses 1 and 6 of the
settlement agreement, which were initialled by both parties, clearly
speaks of reinstatement
on the same terms and conditions he was
previously employed under.
11.6
At no stage did the applicant’s
representative offer to reemploy the third respondent on a three
month contract and this was
not mentioned anywhere in the agreement.
11.7
What the parties did after the agreement
did not alter what they had agreed upon and accordingly it was not
necessary to consider
the reasons why the third respondent signed a
three month contract on his return to the applicant.
11.8
There was nothing complex or technical
requiring specialist knowledge of the applicant’s
representative in making the offer
of reinstatement.
Evaluation
[12]
I agree that the arbitrator should not have
taken account of his own knowledge of the events at the hearing on 22
February 2011,
without alerting the parties to that. It was
fortuitous that the application came before the same Commissioner who
had facilitated
the settlement and the parties could not have known
prior to the consideration of the matter that he would consider the
‘evidence’
of his own recollection apart from the
evidence tendered by the parties in the form of the settlement
agreement itself and their
affidavits.
[13]
But if the court ignores the evidence of
the arbitrator’s own recollection, does the evidence support
his finding that the
settlement agreement as concluded was not
complied with applying the
Plascon-Evans
test? Considering the affidavits alone, the nub of the dispute is
really contained in the allegations and responses in the answering
and replying affidavits, the applicant may be right that a strict
application of the test might not be capable of justifying the
arbitrator’s finding on the affidavits.
[14]
However, this attack overlooks a crucial
issue. Essentially the applicant’s case is that, the settlement
agreement does not
reflect the true nature of the agreement reached
and should have reflected that the applicant was only being employed
on a fixed
term contract. The procedure for dealing with this, in the
absence of an agreement between the parties to vary the agreement, is
by means of an application for rectification in the Labour Court. The
applicant seeks to do this indirectly in the course of reviewing
the
s142A ruling, having satisfied itself that its interpretation of the
agreement had in fact been given effect to by the conclusion
of the
fixed term contract.
[15]
The
applicant assumes the arbitrator is at liberty to consider what it
contends is the true nature of the agreement, based mainly
on the
subsequent conduct of the parties. There are circumstances in which
the subsequent conduct of parties may legitimately be
considered as a
factor in interpreting the correct meaning of a contract. But those
are instances in which there is an ambiguity
in the agreement itself.
Thus in
Coopers
& Lybrand and Others v Bryant
[2]
it
was held that it was legitimate to have regard to “
…
extrinsic
evidence regarding the surrounding circumstances
when
the language of the document is on the face of it ambiguous
,
by considering previous negotiations and correspondence between the
parties,
subsequent
conduct of the parties showing the sense in which they acted on the
document, save direct evidence of their own intentions
.
”
[3]
(emphasis
added).
[16]
In this instance, not only is there
no ambiguity in issue, because the applicant does not contend the
wording is ambiguous, and
it is plainly not, but the applicant
contends the arbitrator should have regard to its representative’s
allegations about
what he intended when concluding the agreement.
Such an enquiry would have plainly been at odds with the principle
stated in
Bryant’s
case.
[17]
However,
even if the arbitrator improperly took account of his own
recollection, in terms of the revised approach to reviews in
cases
where the arbitrator has adopted the wrong approach, the question the
court must decide is if the outcome is one that could
reasonably have
been reached on what was properly before the arbitrator. See
Herholdt
v Nedbank
[4]
and
Goldfields
Mining South Africa (Pty) Ltd (Kloof Gold Mine) v CCMA
.
[5]
[18]
Applying the correct approach to the
evidence, which would entail a consideration of the plain meaning of
the contract having regard
primarily to the language of the document,
the conclusion that the agreement meant that the third respondent
would be placed in
another position other than the Kerb Master job,
but that all other conditions would remain unchanged is a perfectly
plausible,
and arguably the most plausible, interpretation of the
agreement.
[19]
On that interpretation, what happened after
the conclusion of the settlement agreement would seem to be at odds
with its terms and
was not conduct in compliance therewith. While
those events are not ones that can be considered in interpreting a
document which,
on the face of it is unambiguous, they are of course
relevant to whether the award was complied with.
Conclusion
[20]
There was therefore sufficient material
before the arbitrator to make the settlement agreement an arbitration
award, without recourse
to evidence he ought not to have considered.
Accordingly, the ruling should not be set aside.
[21]
Having said that, it must also be mentioned
that the applicant raised an alternative attack, but strictly
speaking it was not necessary,
in my view, for the arbitrator to
determine for the purposes of the s 142A ruling. The applicant
contended that the applicant by
his conduct in signing the fixed term
contract had, in any event, indicated an election not to enforce it,
which amounted to a
waiver of his rights. A consideration of that
defence is not something that has to be determined at this stage, but
may well become
an issue if and when the applicant takes a further
step to enforce the award. I mention this because I do not wish it to
be understood
that this judgment is in anyway intended to decide the
validity of such a defence against the enforcement of the contract on
the
facts.
_______________________
R LAGRANGE, J
Judge of the Labour
Court of South Africa
APPEARANCES
APPLICANT:
H Lee of Snyman Attorneys
THIRD
RESPONDENT:
J D Van Der Walt
[1]
[1984] ZASCA 51
;
1984
(3) SA 623
(A) at 634-5,
viz:
“
In
such a case the general rule was stated by VAN WYK J (with whom DE
VILLIERS JP and ROSENOW J concurred) in Stellenbosch Farmers'
Winery
Ltd v Stellenvale Winery (Pty) Ltd
1957
(4) SA 234
(C)
at 235E - G, to be:
"...
where there is a dispute as to the facts a final interdict
should only be granted in notice of motion proceedings
if the facts
as stated by the respondents together with the admitted facts in the
applicant's affidavits justify such an order...
Where it is clear
that facts, though not formally admitted, cannot be denied, they
must be regarded as admitted."
This
rule has been referred to several times by this Court (see Burnkloof
Caterers (Pty) Ltd v Horseshoe Caterers (Green Point)
(Pty)
Ltd
1976
(2) SA 930 (A)
at
938A - B; Tamarillo (Pty) Ltd v B N Aitkin (Pty) Ltd
1982
(1) SA 398
(A)
at 430 - 1; Associated South African Bakeries (Pty) Ltd v Oryx &
Vereinigte Bäckereien (Pty) Ltd en Andere
1982
(3) SA 893 (A)
a
t
923G - 924D). It seems to me, however, that this formulation of
the general rule, and particularly the second sentence
thereof,
requires some clarification and, perhaps, qualification. It is
correct that, where in proceedings on notice of motion
disputes of
fact have arisen on the affidavits, a final order, whether it be an
interdict or some other form of relief, may be
granted if those
facts averred in the applicant's affidavits which have been admitted
by the respondent, together with the facts alleged
by the
respondent, justify such an order. The power of the Court to give
such final relief on the papers before it is, however,
not confined
to such a situation. In certain instances the denial by respondent
of a fact alleged by the applicant may not be
such as to raise a
real, genuine or bona fide dispute of fact (see in this regard Room
Hire Co (Pty) Ltd v Jeppe Street Mansions
(Pty) Ltd
1949
(3) SA 1155 (T)
at
1163 - 5; Da Mata v Otto NO
1972 (3) SA 858
(A) at 882D - H). If in
such a case the respondent has not
availed
himself of his right to apply for the deponents concerned to be
called for cross-examination under Rule 6 (5) (g) of the
Uniform
Rules of Court (cf Petersen v Cuthbert & Co Ltd
1945 AD 420
at
428; Room Hire case supra at 1164) and the Court is satisfied as to
the inherent credibility of the applicant's factual averment,
it may
proceed on the basis of the correctness thereof and include this
fact among those upon which it determines whether
the applicant
is entitled to the final relief which he seeks (see eg Rikhoto v
East Rand Administration Board and Another
1983
(4) SA 278
(W)
at
283E - H). Moreover, there may be exceptions to this general rule,
as, for example, where the allegations or denials of the
respondent are so far-fetched or clearly untenable that the
Court is justified in rejecting them merely on
the
papers (see the remarks of BOTHA AJA in the Associated South African
Bakeries case, supra at 924A).”
[2]
1995
(3) SA 761 (A)
[3]
At 768D-E
[4]
(2013) 34 ILJ 2795 (SCA) at 2806, para [25]
[5]
(2014) 35 ILJ 943 (LAC) at 950, para [21]