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[2015] ZALCJHB 157
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Mads Pub & Sizzle CC t/a The Grand v Ngwenya and Others (JS448/12) [2015] ZALCJHB 157 (21 May 2015)
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REPUBLIC
OF SOUTH AFRICA
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Case no: JS 448/12
DATE: 21 MAY 2015
Not Reportable
Of interest to other judges
In the
matter between
MADS
PUB & SIZZLE CC t/a THE
GRAND
.......................................................................
Applicant
And
RAYMOND
NGWENYA
.............................................................................................
First
Respondent
DUMOLUHLE
NCUBE
...........................................................................................
Second
Respondent
BRIAN
MAHLANGU
................................................................................................
Third
Respondent
Heard: 14 May 2015
Delivered: 21 May 2015
Summary:
Security for costs –
peregrinus
– domiciled and residing outside the jurisdiction of the Court
– lack of information on financial means – security
ordered
JUDGMENT
COETZEE
AJ
[1]
This
in an application wherein the Applicant seeks an order in the
following terms:
[1.1]
That
the First and Third Respondents provide security for costs in the sum
of R300 000,00 within ten days of date of granting of
this order;
[1.2]
That
the proceedings be stayed until such order is complied with;
[1.3]
In
the event of the First and Third Respondents failing to provide the
aforesaid security for costs within 10 days of the date of
granting
of this order the Applicant is granted leave to approach this Court
on the same papers, supplemented where necessary,
for an order
dismissing the action instituted by the First and Third Respondents
with costs.
Background
[2]
The
Respondents initiated proceedings in the CCMA against the applicant
alleging that they had been constructively dismissed and
sought 24
months' salary as compensation.
[3]
The
First and Third Respondents commenced the proceedings in the CCMA
under the following names:
[3.1]
The
First Respondent was cited as Raymond Ngwenya being a South African
citizen having ID No. 88......................
[3.2]
The
Third Respondent was cited as Brian Mahlangu, being a South African
citizen having ID No 85....................
[4]
Nowhere
in any of the documentation submitted in the proceedings did the
First or Third Respondents disclose that the names which
they had
adopted in the proceedings were false and that the ID numbers
utilised by them were fictitious, having been obtained by
them
together with fraudulent identity documents.
[5]
The
matter remained unresolved in the CCMA and was referred to the Labour
Court pursuant to the provisions of section 191 of the
Labour
Relations Act, No. 66 of 1995 ("the LRA").
[6]
Pleadings
were exchanged between the parties and in their Statements of Claim
the First and Third Respondents perpetuated their
conduct by
persisting in citing themselves as Raymond Ngwenya and Brian Mahlangu
respectively.
[7]
On
the first day of the trial of the matter it emerged that the identity
documents of the persons described as Raymond Ngwenya and
Brian
Mahlangu were false and that the First and Third Respondents had
simply assumed the names which were reflected in the fraudulent
identity documents.
[8]
An
official of the Department of Home Affairs testified that the First
and Third Respondents are illegal immigrants who had assumed
the
names Raymond Ngwenya and Brian Mahlangu in order to, amongst others,
obtain employment.
[9]
As
a result of their illegal conduct, the Department of Home Affairs
declared the First and Third Respondents to be prohibited persons
and
deported them from South Africa to Zimbabwe. The First Respondent was
criminally charged and found guilty of fraud.
[10]
Subsequent
to their deportation, on 4 March 2014, the Respondents' attorney
sought to amend the Statements of Claim in respect of
the First and
Third Respondents by substituting the citation of the First and Third
respondents as follows:
[10.1]
in
respect of the First Respondent "MBUSI VUNDHLA ALSO KNOWN AS
RAYMOND NGWENYA"
[10.2]
in
respect of the Third Respondent, "BHEKINKOSI DUBE ALSO KNOWN AS
BRIAN MAHLANGU"
[11]
In
the application for amendment, the Respondents' attorneys confirmed
under oath that the First and Third Respondents were
peregrini
of this Court.
[12]
The
application for the amendment was opposed by the Applicant on a
number of grounds but was granted by the Court.
[13]
On
25 March 2014, the applicant served a notice for security for costs
on the respondents' attorneys of record.
[14]
Although
the Labour Court Rules make no provision for security for costs, it
is established that this Court has jurisdiction to
determine such
applications.
[15]
Where
the Labour Court Rules are silent on a particular aspect, the Uniform
Rules of Court may be applied.
Security for costs
[16]
An
application for security for costs
is
governed
in the High Court
by
the provisions
of
Rule 47 of the
Uniform Rules
of
Court.
[17]
Rule
47 provides as follows:
‘
(1)
A party
entitled
and
desiring
to
demand
security
for
costs from
another
shall as soon as practicable after the commencement
of
proceedings,
deliver
a
notice
setting
forth
the grounds upon
which
such
security is claimed, and the amount
demanded.
(2)
If the amount of security only is contested the Registrar
shall
determine the amount to be given and his decision shall be
final.
(3)
If the party from
whom
the
security
is demanded contests his liability to give security or if he
fails or refuses to furnish security in the amount demanded or the
amount fixed by the Registrar within ten days of the demand or the
Registrar's decision, the
other
party
may apply to Court on notice for an
order
that
such security be given and that
the
proceedings
be stayed until
such
order is
complied
with.
(4)
The
Court
may,
if
security
be not given within a
reasonable time, dismiss any proceedings instituted or
strike
out
any pleadings filed by the
party
in
default,
or
make
such
other order
as to it may
seem
meet’.
[18]
Section
162(1) of the Labour Relations Act, No.66 of 1995 ("the LRA")
provides that a Labour Court may make an order for
payment of costs
according to the requirements of the law and fairness.
[19]
In
my view and because of the test that must be applied (as set out
below) the Labour Court is not obliged to strictly follow the
High
Court Rule without taking into account equity and fairness to both
parties.
[20]
In
Silvercraft
Helicopters
(Switzerland)
Ltd and Another
v
Zonnekus
Mansions
(Pty),and Two Other cases
[1]
the Court
stated
the position
related
to
security for
costs in
regard to a
peregrinus
as follows:
‘
[26]
It is trite law that the courts have a discretion to grant or refuse
an application for security and, in coming to a decision,
will
consider the relevant facts of each case. Hardship to the
peregrinus
and financial ability to provide security are taken into account, but
are not necessarily decisive. The Court should have due regard
to the
particular circumstances of the case and considerations of equity and
fairness to both the
incola
and the non-domiciled foreigner…’.
[21]
Both
parties submitted that it is thus evident that the Courts take into
consideration equity and fairness in relation to both parties
and
does not consider only the position of the
peregrini
respondents.
[22]
In
Lappeman Diamond Cutting Works (Pty) Ltd
v MIB Group (Pty) Ltd (No 1)
,
[2]
the Court when considering the constitutionality of section 13 of the
Companies Act with approval referred
to
Magida v
Minister of Police
[3]
which stated the following:
‘
The
applicant, a
peregrinus
,
who
did
not
own unmortgaged immovable
property
in
the Republic
was
ordered
to
furnish security for the costs of his action. The approach
until
then adopted
by
the
Courts
to
applications
of
that kind
emerged
from
judgments
such
as
Saker
and
Co
Ltd
v
Granger
1937
AD 223
at
227
,
namely
that:
‘
(T)he
principle
underlying
this
practice
is
that
in
proceedings initiated
by
a
peregrinus
the Court is entitled
to
protect
an
incola
to
the fullest
extent’.
In
South
African
Television Manufacturing
Co
(Pty)
Ltd
v
Jubati
and
Others
[4]
,
it
was
stated
that:
'There must be
some
special fact, inherent to the action itself, which will persuade a
Court to exercise its discretion in favour of the
peregrinus...
And, finally,
Santam
Insurance Co Ltd v Korste
[5]
,
namely that: ‘The reason for the rule being what it is, it
follows that the Court should exercise its discretion in favour
of a
peregrinus
,
only sparingly and in exceptional circumstances...’.
[23]
The
Labour Court in
Ganga
considered
[6]
an
application for security for costs and conveniently summarized the
principles from the previous judgements referred to therein
as
follows:
[23.1]
When
the Court exercises its discretion whether a
peregrinus
is required to furnish security for costs, it must have regard to all
relevant facts as well as considerations of equity and fairness
to
both parties;
[23.2]
The
Court must consider the relevant provisions of the Constitution which
include sections 34 and 39, section 9 (the right to equality
before
the law), and section 23 (the right to fair labour practices); and
[23.3]
Common
law rules which limit a litigant access to Court should be applied in
appropriate circumstances.
[24]
The
Court in the
Ganga v St John’s
Parish
-case
[7]
referred with approval to the Supreme Court of Appeal matter of
Magida v Minister of Police
.
[25]
In
the
Magida
-case
the following factors were considered by the Court in favour of the
peregrinus
:
[25.1]
He
was a labourer in East London who received legal aid and was a
citizen and
incola
of South of Africa when he launched his action but became a
peregrinus
when the Ciskei became an independent State in 1981.
[25.2]
He
was impecunious and an order compelling him to furnish security would
effectively destroy his chances of prosecuting his action
against the
respondent.
[25.3]
He
was economically active within the jurisdiction of the Court and thus
not a
vagabundus
or
suspectus de fuga
or a dishonourable person.
[25.4]
Execution
of the Court's judgement was possible where the appellant resided in
the then Republic of the Ciskei.
[26]
The
Court in
September and Another v
Muddford International Services Ltd: In re Muddford International
Services v Metal and Engineering Industries
Bargaining Council and
Others
[8]
ordered an applicant employer in a review application who was a
peregrinus
to provide security for the compensation it was ordered to pay in the
award on review. The Court stated that the respondent would
not
suffer any real prejudice if it provided security for costs and also
that it was fair and equitable to do so.
[27]
The
Respondents relied on and referred to
the
facts in the unreported judgment
Sherenisa
and Others v Minister of Safety and Security and Another
[9]
,
submitting
that the facts are
almost
identical
to
the
case at
hand.
The
Defendants, being the
Minister of Safety and Security and the Minister of Justice, brought
an application
for security for costs against the second plaintiff in the main
action
,
Ms
Neliswe Sengoane. The facts are
:
[27.1]
Sengoane
disputed
that
she
was
a
peregrinus
.
The
Court
however,
concluded
,
after
considering the submissions, that Sengoane was not only
a
peregrinus
,
but
"
probably
an illegal immigrant";
[27.2]
Sengoane
had nevertheless resided for two years within the jurisdiction of the
Court in Kroonstad and was still living at the same
address, and
[27.3]
It
would be possible to find her and execute upon a cost order, if any;
[27.4]
She
was impecunious.
[28]
The
Court held as follows
[10]
:
‘
Taking
all
these
into
consideration
,
I
am
of
the
view
that
to
accede
to
the def
e
ndants
'
application
will
be to
place
obstacles
in the se
c
ond
plaintiff
's
ques
t
for
justice’
.
[29]
I
now turn to the facts of this application.
[30]
The
applicant in its founding affidavit seeks security for costs on the
following grounds:
[30.1]
The
first and third
responde
n
ts
are
peregrini
o
f
t
h
i
s
Court,
both being
residents
of
Zim
b
ab
we.
This is common cause.
[30.2]
They
have no assets within the jurisdiction of this Court and no means of
settling any adverse costs order granted against them.
This is common
cause.
[30.3]
They
are prohibited persons under the
Immigration Act, 13 of 2002
and are
not entitled to reside or be employed within the Republic of South
Africa. This is common cause.
[30.4]
In
the event of a costs order being granted against the first and third
respondents, there is no prospect of the applicant being
able to
recover said costs.
[30.5]
To
date, and despite requests therefor, the applicants' attorneys have
failed to provide a power of attorney or any confirmation
that they
are mandated to act in the matter on behalf of the first and third
applicants. In fact their counsel disclosed in argument
that the
attorneys of record occasionally receive messages from them through
the second respondent.
[30.6]
They
misrepresented their identity and residential addresses in the
Statements of Claim as well as the notice of intention to amend.
The
respondents argue that they did not with intent tried to mislead the
Court but used their aliases.
[30.7]
It
is the applicant's contention that the proceedings are vexatious and
are being orchestrated by the attorneys and not on behalf
of the
first and third respondents. The respondents' attorneys deny this and
point out that they took on the matter on the request
of the Saslaw
pro bono office not knowing about the status of the respondents.
[30.8]
As
appears from the manner in which they have conducted themselves, the
second and third respondents have no compunction to act
dishonestly,
to utilise fraudulent documentation and to manipulate the legal
process for their own ends. It is the applicant's
contention that the
entire proceedings are tainted by the vexatious manner in which the
first and third respondents have acted.
The respondents deny this.
[30.9]
There
is no evidence that the names by which they are now described in the
pleadings, are their correct names or whether these names
are also
fictitious. The respondents argue that the Department of Home Affairs
have identified the two respondents as such and
that according to the
official records those are their lawful names and identity numbers.
[30.10]They have not pursuant to the notice
provided any security and have not contested the amount thereof
either. The respondents
concede that they have not provided security,
allege that they do not have to and if they have to say the amount is
excessive.
[30.11]Having regard to the fact that the trial
of this matter has already endured for a number of days and is
part-heard, it is
submitted that the amount of R300 000 for security
for costs is reasonable. The respondents submit the amount is
excessive and
that the trial will continue in respect of the second
respondent in any event. The applicant will incur those costs in any
event
and need not have recourse to security. The applicant counters
by submitting that it has been deprived of two litigants from whom
it
may attempt to recover a cost order as they are
peregrini
with no assets in South Africa.
[30.12]The respondents did not file affidavits.
Their attorney of record filed one on their behalf. The affidavit
does not specifically
deal with the current financial position of the
respondents.
[31]
The
attorney in opposition to the application in essence says the
following:
‘
10
In
summary, the respondents will contend that considering the
circumstances of the case, as well as equity and fairness to the
first and third respondents, the latter should be absolved from
furnishing security, alternatively the amount is wholly unreasonable.
This is because of the following factors:
‘
10.1.
It is three years since the respondents launched their action against
the Grand and the trial is in its final
juncture, with one (possibly
two) witness from the Grand left to testify, yet only now is this
application being launched when
the trial is all but concluded;
10.2.
The costs that the Grand is to further incur in opposing this action
will continue as it is still to answer
to the claim of Ncube whose
action is Identical to that of the first and third respondents; and
10.3.
If there is an order requiring the first and third respondents to pay
security for costs, this will result
in preventing them from
concluding the trial proceedings concerning a legitimate claim.
11.
Relevant to this whole matter of the illegality of Vundhla and Dube
Is the testimony of
Ncube that Phillips, the owner of the Grand, was
aware of their illegal status when he employed Vundhla and Dube.
Phillip has simply
baldly denied this in his testimony.
12.
Nothing justifies Vundhla and Dube's unlawful actions when they were
in this country. However
the illegal nature of their status does not
nullify the employment contract between them and the Grand, nor does
it destroy the
constitutional protection that Vundhla and Dube enjoy.
Their dignity cannot be exploited or abused simply because of their
illegal
or foreign status’.
[32]
The
respondents also contend that there was no prejudice to the applicant
by the respondents having used assumed names.
[33]
In
the answering affidavit it is argued that they are impecunious and
would not be able to meet any requirement to put up security.
The
affidavit does not set out the facts underlying this submission and
does not provide any detail of assets or income in Zimbabwe.
The
deponent relies on the fact that the two respondents have pro bono
representation, lost their employment in South Africa and
were
repatriated to Zimbabwe.
[34]
It
is further submitted by respondents that the costs of completing the
trial will have to be incurred in any event as the second
Respondent
will continue with the case.
[35]
The
final submission is that the application has been brought very late
in the day and should be dismissed for that reason alone.
The
Respondents rely on
Buttner v
Buttner
[11]
for this submission.
[36]
The
Supreme Court of appeal in the
Buttner
-case
in dealing with an application for costs which was brought on an
urgent basis a few days before the appeal was to be heard,
dismissed
the application without giving reasons, save to say that as most of
the costs have been incurred and the application
was brought a few
days before the hearing, the application was dismissed.
[37]
I
do not find support for the respondents' case in
Buttner
which case is distinguishable as regards the subject matter of the
proceedings and the Court process.
Considerations of
equity and fairness
[38]
The
law requires that consideration is given to fairness and equity to
both parties in deciding the application.
[39]
The
distinguishing factors in this case are the following:
[39.1]
Firstly,
the conduct of the two respondents in using false identity documents
and names when approaching the CCMA and this Court:
The fact that
their employer may have known this, as is alleged by the respondents,
does not excuse them from coming to Court with
false identities.
While it does not preclude them from coming to Court under assumed
names there was potential prejudice to the
applicant in the event
that it later had to execute upon any possible cost order. Their
hands are not as clean as how the Court
in the
Magida
-case
would have wanted.
[39.2]
Secondly,
the fact that they are
peregrini
who are not within the jurisdiction of the Court, which jurisdiction
covers the whole of South Africa. The Courts have taken into
account
to the advantage of a
peregrinus
the fact that a
peregrinus
unlawfully in the country was still residing within the Court's
jurisdiction. This counts against the respondents as they are no
longer within the jurisdiction of the Court and any order against
them cannot be given effect to.
[39.3]
In
this case even the addresses of the two respondents are unknown. Even
their own attorney admittedly does not know where and how
to contact
them in Zimbabwe save occasionally to hear from them through the
second respondent. They were deported to Zimbabwe and
it is unknown
even if they are still there as their addresses in Zimbabwe are
unknown. It will be impossible to execute upon any
possible cost
order.
[39.4]
The
financial position of the two respondents is unknown. Their attorney
speculates in this regard. The respondents should have
taken the
Court in their confidence. In the
Ganga
-matter
the Court considered the fact that the
peregrinus
had access to other funding. It is for the Respondents to persuade
the Court as to their financial position or lack thereof and
whether
they have assets in Zimbabwe or access to other funding or not. They
have not done so. It cannot be stated as a fact that
they will be
unable to put up security if ordered to do so.
[40]
In
light of the above, I am of the view that there are no special
circumstances to absolve the two respondents from providing security.
The delay in
bringing the application
[41]
The
notice calling for security was filed on 24 March 2014. Thereafter,
the Applicant waited until April 2015 to pursue the application.
All
that occurred in between was that the Respondents moved for the
amendment which was granted, appealed against and which appeal
finally was dismissed by the Constitutional Court.
[42]
Applicant
contends that the amendment is the reason for not pursuing the matter
earlier as a successful appeal against the amendment
would for all
practical purposes have brought the matter to an end.
[43]
While
this Court follows
Rule 47
procedure in the High Court, it is not
bound to do so strictly. I do not see any prejudice to the
respondents in that the application
has been pursued only now. The
part heard matter has again been set down for trial, after the
parties had agreed the date, for
29 June 2015. As the respondents are
represented
pro bono,
there are no adverse cost consequences for them whether or not the
trial proceeds on that date.
[44]
I
have referred to the decision in the
Buttner
-case
which is distinguishable.
The amount
[45]
The
Applicant asks for security in an amount of R300 000. It is not clear
whether each one is required to provide security in that
amount.
[46]
Neither
of the parties has quantified the estimated costs of the trial or the
remaining part thereof. The parties asked the Court
to determine an
amount as the Registrar of this Court does not regularly deal with
requests for security for costs.
[47]
I
take into account that at the trial itself, the Applicant has been
represented by junior counsel.
[48]
The
trial is estimated to run for another day, maybe two. It has run for
two days.
[49]
I
am of the view that a reasonable amount for each of the Respondents
to provide security is R60 000.
[50]
The
amounts in respect of security must be paid into the trust account of
the respondents' attorney of record. The security may
be applied only
in respect of a cost order in respect of trial costs.
[51]
The
security must be provided on or before 12 June 2015.
Costs
[52]
I
have considered whether a cost order in respect of the application is
appropriate. Respondents submitted that the late launching
of the
application warrants a cost order. I am not inclined to make an order
for costs.
Order
[53]
I
make the following order:
[53.1]
Each
respondent must provide security in an amount of R60 000.
[53.2]
The
amounts in respect of security must be paid into the trust account of
the respondents' attorney of record. The security may
be applied only
in respect of a cost order in favour of the Applicant (the Respondent
in the main action) for the costs of the
trial if there is a cost
order in favour of the Applicant.
[53.3]
The
security must be provided on or before 12 June 2015.
[53.4]
There
is no order as to costs.
Coetzee AJ
Acting Judge of the Labour Court
of South Africa
APPEARANCES:
For the applicant: Advocate N Redman SC
Instructed by: S Moldt Attorneys
For the Respondents: Advocate J T Venter
Instructed by: Webber-Wentzel Inc
[1]
2009 (5) SA 602
(C) at para [26]
[2]
1997 (4) SA 908
(W)
[3]
1987 (1) SA 1
(A)
[4]
1983 (2) SA 14
(E) at 19E
[5]
1962 (4) SA 53
(E) at 56B
[6]
(2014) 35
ILJ
1294 (LC)
[7]
See note 6
[8]
(2008) 29
ILJ
1049 (LC)
[9]
Case 2394/2009 (unreported)
[10]
At para 20
[11]
2006 (3) SA 23
(SCA)