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[2015] ZALCCT 45
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Scholtz v CCMA and Others (C675/2014) [2015] ZALCCT 45 (25 June 2015)
REPUBLIC
OF SOUTH AFRICA
THE
LABOUR COURT OF SOUTH AFRICA, CAPE TOWN
JUDGMENT
Reportable
Of
interest to other judges
Case
no: C 675/2014
In
the matter between:
Elze SCHOLTZ
Applicant
and
CCMA
First Respondent
COMMISSIONER JP
HANEKOM N.O.
Second Respondent
UTILITAS BELLVILLE
NPC
Third Respondent
UTILITAS
ONTWIKKELINGSTRUST
Fourth Respondent
Heard
:
18 June 2015
Delivered
:
25 June 2015
Summary:
Review of settlement agreement at CCMA. LRA s
158(1)(g). Review of appointment of commissioner – LRA s 137.
Jurisdiction to
settle dispute outside of dispute referred to CCMA.
Undue influence.
JUDGEMENT
STEENKAMP
J
Introduction
[1]
The applicant, Ms Elze Scholtz, was
dismissed by the third respondent, Utilitas Bellville, a non-profit
company that operates two
old age homes. She referred an unfair
dismissal dispute to the CCMA. The parties settled the dismissal
dispute as well as a pending
dispute before the High Court between
the employee and the fourth respondent, Utilitas Ontwikkelingstrust.
The employee now wants
to have the settlement agreement reviewed and
set aside, mainly on the ground of undue influence.
Background
facts
[2]
The arbitration commenced on 25 June 2014,
exactly a year ago. Both parties were legally represented at the
arbitration; the employee
by Riaan de Lange, her erstwhile attorney;
and Utilitas by its current counsel, Adv Stelzner, and Michiel Heyns
of Werksmans attorneys.
The parties had asked for a senior
commissioner who is Afrikaans speaking and their request was granted.
However, the senior commissioner
that was allocated to deal with the
dispute, Ms Marieke van der Walt, is the applicant’s previous
attorney. No other Afrikaans
speaking senior commissioner was
available. The second respondent, Commissioner J P Hanekom, was then
appointed as arbitrator.
He is not designated as a senior
commissioner although he has about ten years’ experience.
Neither party objected to his
hearing the arbitration at that stage,
although it is now one of the grounds of review.
[3]
After both legal representatives had made
opening statements and while Mr De Lange was looking for some
documents, the Commissioner
made some remarks relating to settlement.
These remarks were made off the record while the recording equipment
was switched off.
[4]
The parties couldn’t settle and the
employer called its first witness, Ms Magdalena Fölscher. At the
end of her evidence
in chief the commissioner asked the employee’s
attorney if he was ready to cross-examine. Mr de Lange said:
“
Kommissaris,
ek sal verkies om nie te begin nie en eers more-oggend stiptelik
nege-uur te begin. Dan wil ek behoorlik instruksies
neem oor van die
goed, hopelik tyd spaar en ek wil op rekord sit,
ons
moet nog steeds probeer vanaand om te kyk of ons die ding kan skik
,
maar ek twyfel of dit sommer gaan realiseer, maar who knows. Maar ek
sal verkies om nie nou met kruisondervraging te begin nie.”
[1]
[5]
That evening, De Lange consulted with Ms
Scholtz and her father. He telephoned the employer’s attorney,
Michiel Heyns of Werksmans,
and told him that they were in the
process of preparing a draft settlement agreement. De Lange sent
Heyns a text message at 20:53
saying that he had sent Scholtz a draft
settlement agreement for her consideration and further instructions.
At 21:49 de Lange
sent Heyns a second text message to tell him that
Scholtz would revert shortly. At 22:52 de Lange sent Heyns an email
with the
proposed settlement agreement. The pertinent terms of the
draft agreement were that:
5.1
Scholtz withdraws the CCMA dispute;
5.2
the fourth respondent (the trust) withdraws
the High Court action;
5.3
the trust writes off the motor loan;
5.4
Scholtz
acknowledges that her independent contractor agreement with De
Rust
[2]
was terminated lawfully;
5.5
Scholtz would return the Mercedes-Benz used
by her; and
5.6
the parties will have no further claims
against each other.
[6]
The parties’ legal representatives
had further discussions the next morning at the CCMA, but without the
involvement of the
Commissioner. The employee’s legal
representative, De Lange, advised the legal representatives for
Utilitas that she wanted
to add further terms to the draft agreement,
including payments of independent contractor fees of R51 005, 27
and medical
aid contributions of R 9 381, 00. The parties
agreed.
[7]
The
employee’s case that the commissioner acted improperly and that
she entered into the settlement agreement because of undue
influence
rests mainly on the commissioner’s comments that he made off
the record whilst facilitating settlement discussions
between the
parties. Although those discussions were expressly and literally off
the record – the recording equipment was
switched off –
the employee tape recorded it and had it transcribed. Both parties
agreed that, despite the provisions of
rule 16 of the CCMA rules
[3]
,
the commissioner’s comments are central to this application and
could and should be disclosed. The pertinent discussions
are these:
[After
opening statements]:
“
KOMMISARIS:
Terwyl julle nou dit soek, op die einde van die dag sit en wonder ek
nou maar, dis nou nie ʼn
siviele saak
dié
nie. So maak die saak nie klaar
in twee dae nie, jy weet, dan sit julle al twee met regskostes. En jy
weet, op die einde van die
dag, die dame het ʼn
halfdag
gewerk. Sy wil graag haar werk terug hê. Ons moet hoor by die
werkgewer of so iets haalbaar is in die lig van die
applikant se
verweer. Indien hulle sê
hulle is nie
lus vir haar nie, dan is dit mos (onduidelik) dat haar werk nie
beskikbaar is nie. Is die pos gevul of hy is nog vakant?
MNR
STELZNER:
Die werk word aan ander geallokeer, deur ander mense
gedeel. Ander
mense doen die werk.
MNR
DE LANGE:
Ek dink daar is vroeg in 2013 is daar ʼn
–
ʼn
ander boekhouer of rekenmeester…(tussenbeide)
MNR
STELZNER:
(onduidelik) ouditeure (onduidelik).
MNR
DE LANGE: Ja. So sy sou nou baie van die funksies
ook oorneem.
…
KOMMISSARIS:
Want jy weet, ek sien nou – wees nou realisties. Ek meen
enige goeie mediator sal vir julle sê,
luister, kyk, at the
best case scenario or take the worst case scenario. Look at the best
alternative to a solution. Nou die realiteit
is, dit is nie seker of
die pos nog beskikbaar is nie. Daar is nou ‘n rekenmeesterspos
geskep. As dit nou – as die
saak nie in twee dae klaarmaak nie
en ons moet die omie se getuienis aanhoor en die
regsverteenwoordigers wat nou lang asems gaan
hê
met
kruisondervraging, dan hoe ver gaan ons nou kom? En dan moet ek nog
hoor of sy nog die werknemer is en nie ‘n kontrakteur
is by die
ander trust nie. Dit gaan die ding net nog langer uitrek. En op die
einde van die dag, as jy al die geld nou in ag neem,
moet ʼn
mens nie dalk tot ʼn
vergelyk
kom nie?
…
KOMMISSARIS:
En
dan sê
ek, verloor sy die saak, dan
is sy nog slegter af.
MNR
DE LANGE:
Maar soos ek sê, Kommissaris, ek doen nie
daai siviele saak
nie, dis ʼn
ander prokureur wat dit
doen. Hy het haar geadviseer oor die meriete in daai saak.
KOMMISSARIS:
Dis al wat ek net vir jou wil sê.
Dan gaan dit te laat raak om
te skik. Okay. So ek is nou klaar met die openingstoesprake. Ek weet
nie of julle repliek wou gehad
het nie. Kom ons gaan weer oor die
rekord.”
…
[At
the end of Folscher’s evidence]:
“
KOMMISSARIS:
Kyk, ek sê
nog steeds wat ek netnou
gesê het en ek wil my nou nie self oor en oor herhaal nie. Mnr
De Lange en die applikant, die bal
is in julle hande. In die lig van
wat hier nou getuig is, né, en moet my nou nie verkeerd
verstaan nie. Ek loop nie die
saak vooruit nie. My ondervinding sê
net vir my een ding, in die lig van wat u hier nou getuig is oor die
klousules in die
trust-akte en ek verwys nou veral hierso na die
klousules – en ek gaan nou vir u sê… ja, op
bladsy 74
van die Bundel B, ten behoewe van, tot voordeel van
trustbegunstigdes en die goete en so en so. Dan sê ek weer, dis
vir my
eintlik die kruks waaroor die saak gaan. So op die einde van
die dag moet ek bepaal, die dinge wat nou aan die gebeur was en die
pa wat nou vir haar voorgesê het wat om te doen. Is sy nou soos
die redelike man ʼn professionele persoon, ʼn boekhouer
wat
nou soos die redelike man nou moes geweet het, maar die goete wat
hier gebeur, is nie reëlmatig nie? Was sy dan nalatig
of was dit
nou werklik ʼn geval wat sy nou nie geweet het hier is dinge
verkeerd dan nie, as jy die bepalings nou op bladsy
74 in ag neem
nie? Of moes sy geweet het en dan sê ek, dis 50-50. En ek moet
ook in ag neem, want ek het vergeet om dit te
sê netnou, sy het
ʼn maand kennis gekry. So nou trek ek die maand af, dan gee ek
vir haar vyf maande as sy die saak loshande
wen, of wat ook al, maar
my gut feel sê vir my, as sy die saak wen loshande, dan gaan sy
iets in die omgewing van ses maande
kry. Hoekom moet ek haar 12
maande gee? Wat maak haar geval uniek dat ek haar 12 maande kan gee?
Tensy julle my kan oortuig? En
ek meen ek sê dit nou maar van
die rekord af, né.
MNR
DE LANGE:
H’m..
MNR
STELZNER:
H’m..
KOMMISSARIS:
Moet my nie quote nie, maar dit is wat die risiko’s is en dit
is wat kan gebeur. So ek gaan –
ek deel maar net my
ondervinding met julle. So ek sal ernstig sê
julle
moet dink aan skikking, want julle gaan mekaar se tyd mors en op die
einde van die dag gaan julle spyt wees. Miskien is hulle
in ʼn
beter posisie om regkostes te kan bekostig en op
die einde van die dag betaal die trust nou maar die regskostes wat
nie ʼn
probleem is nie, maar kyk na
julle situasie, wat julle koste aanbetref. Is die kool die sous werd
om (onduidelik) of aan te gaan
met die saak? As jy sterk voel in die
saak, ek kan julle nie dwing om te skik nie, maar ek sê
dit is die kruks van die saak. Ons kan nou baie
tyd mors oor die ander goed, maar dit is vir my die kruks van die
saak. En as ek
op die einde van die dag verkeerd is, dan weet julle
mos nou, julle vat my op hersiening. Goed. Geniet julle aand, menere,
dames,
sien dan mȏre weer.”
…
[On
resumption the next day after the parties had submitted their typed
settlement agreement]:
“
KOMMISSARIS:
Okay, goed, ek gaan nou maar net – dit is nou julle
skikkingsooreenkoms. Ek gaan dan nou net sê,
die is nou maar
net die dekblad, né, mos nou die Aanhangsel A.
MNR
STELZNER:
Gaan ons ʼn
afskrif kry?
KOMMISSARIS:
Ja, nee, definitely, julle sal kry, julle gaan kry. Ek lees dan gou
hierso:
“
This
is the settlement agreement…”
Vertaal
maar as julle nie Afrikaans – of Engels verstaan nie.
“
This
is a settlement agreement in the CCMA in the dispute between Elze
Scholtz, the applicant and Utilitas Bellville NPC, the respondent.
The
undersigned parties record a settlement of their dispute in the
following terms:
Dis
nou julle wat teken hierso:
“
By
signing the agreement, the parties acknowledge that the agreement was
read to them and interpreted where necessary and that they
understand
the contents thereof”.
So
as julle teken, weet julle wat julle teken en julle verstaan wat
julle teken. Kan nie more terugkom en sê
julle
was gedwing om te teken en julle het nie verstaan nie. (onduidelik)
andias
[4]
[
sic
]
gaan nou nie werk nie.
MNR
STELZNER:
Andias. [
sic
]
KOMMISSARIS:
“This agreement is a full and final settlement of the
dispute referred to the CCMA, as well as a full
and final settlement
of all statutory payments due to the applicant, unless specifically
excluded in paragraph 4 of this agreement.”
Nou
dit is nie van toepassing nie, dit is doodgetrek. As julle nou skik,
dan is dit eens en finaal. U kan nie nou weer mȏre
gaan eis vir
uitstaande salaris en uitstaande verlofgeld en sulke goed nie. U
verstaan dit so? Die betalings is so, dit is alles
vervat in die
ooreenkoms, né.
MNR
STELZNER:
Ja.
KOMMISSARIS:
Hoe julle dit gaan betaal, in haar bankrekening in?
MNR
STELZNER:
Sewe dae, binne sewe dae.
KOMMISSARIS:
Ja, okay.
MNR
STELZNER:
(onduidelik).
KOMMISSARIS:
Ek gaan dan net sê
hierso, “monetary
settlement as per Annexure A”, né? Okay, en dan “method
of payment”, dis ook “As
per annexure A’.
MNR
STELZNER:
Reg.
KOMMISSARIS:
Okay, as per Annexure A attached. Dan: “Withdrawal of the
dispute.
The
applicant voluntary withdraws her referral and the balance of dispute
against the respondent in settlement of her case at the
CCMA, with
the full knowledge that she will not be able to proceed with this
dispute at a later stage.”
So
u sal nie mȏre weer u saak kan oopmaak nie. As u nou teken is
dit oor en verby.”
[8]
The applicant received the money and both
parties acted in terms of the settlement agreement. However, one day
short of six weeks
later, she brought this application to have the
agreement reviewed and set aside.
Evaluation
/ Analysis
[9]
It is against this background that the settlement agreement and the
review application must be considered. But first, the applicant
seeks
condonation for the late filing of her review application (insofar as
it is necessary) and her replying affidavit.
Condonation:
review application and replying affidavit
[10]
Although
the applicant initially framed her review application in terms of s
145 of the LRA
[5]
(when she was
represented by a different legal team), Mr
Ackermann
made it clear in his argument that she now confines the application
to one in terms of s 158(1)(g). That subsection does not prescribe
a
time frame within which to bring a review application, but it must be
done within a reasonable time.
[6]
[11]
In
Weder
v MEC for the Department of Health, Western Cape
[7]
this Court took the view that a review application in terms of s 158
that is delivered outside a period of six weeks should at
least
trigger a condonation application. On appeal
[8]
the LAC did not refer to a specific time period, but noted with
reference to
Gqwetha
v Transkei Development Corporation Ltd and others
2006 (2) SA 603
(SCA) at paras 22 – 23 that Nugent JA explained
the purpose and function of the delay rule both under s 7 (1) of the
Promotion
of Administrative Justice Act 3 of 2000 (‘PAJA’),
which is inapplicable to a review brought under s 158 of the
LRA , and its common law predecessor as follows:
‘
It
is important for the efficient functioning of public bodies…
that a challenge to the validity of their decisions by proceedings
for judicial review should be initiated without undue delay.
The rationale for that longstanding rule … is twofold:
First,
the failure to bring a review within a reasonable time may cause
prejudice to the respondent. Secondly, and in my
view, more
importantly, there is a public interest element in the finality of
administrative decisions and the exercise of administrative
functions.’
[12]
In this case, the delay in bringing the
application was not excessive. Had it been a s 145 review, it would
have been in time, albeit
by one day.
[13]
The reasons for the delay, taken together
with its length, are persuasive. After delivering the initial review
application within
six weeks, Mr De Lange withdrew as the applicant’s
attorney. The CCMA filed the record on 4 October 2014, two months
after
the applicant had delivered her review application. The record
was not complete as the settlement discussions were pertinent to
the
application. Those discussions were recorded and transcribed by the
applicant. She sought new legal representatives. In November
2014 she
obtained the services of Ms Fiona Bester of Chennels Albertyn. Ms
Bester went through some 9 lever arch files pertaining
to the matter
and then instructed counsel. Initially she briefed Adv Leslie but he
informed her two days later that he was not
available. She then
briefed Adv Suzanna Harvey, who consulted with the applicant two days
later (after she had been in Johannesburg)
and delivered the
supplementary founding affidavit two days after that. There is no
prejudice to the respondents.
[14]
The third and fourth respondents delivered
their answering affidavit some one and a half months late. The
applicant did not object.
In December 2014 the applicant’s
previous attorney told her that she had to deliver her replying
affidavit by 15 January
2015. That was wrong, but in any event, she
told the applicant that the respondents’ attorneys had agreed
that she could
deliver the replying affidavit by 28 January 2015.
[15]
That also turned out to be incorrect. The
applicant made contact with her previous attorney, Ms Bester, on 6
January. She followed
up four times between 6 and 20 January. Still
the attorney had not drafted the replying affidavit. Then Ms Bester
advised the applicant
to obtain an opinion from junior counsel. That
was provided on 24 January. A dispute arose between the applicant and
Ms Bester.
She terminated Bester’s mandate on 26 January and
instructed her current attorney, Mr Geyser of Cluver Markotter, the
next
day, 27 January. They consulted on 30 January. Bester exercised
a lien over her files. Eventually the replying affidavit was drafted
without all the files. It was delivered on 17 February 2015.
[16]
The delay is not excessive and the
explanation is acceptable. I will deal with the merits on the basis
that condonation is granted
for the late filing of the founding,
supplementary and replying affidavits, although the prospects of
success can only be considered
by dealing with the merits.
First
review ground: conduct of commissioner
[17]
The applicant argues that the commissioner
conducted himself in a manner that left her no alternative but to
settle.
[18]
This submission rests on the commissioner’s
remarks as set out above. The applicant argues that the commissioner
expressed
his views on the merits of the case, having heard only the
evidence on chief of the employer’s first witness, and induced
her to settle. He entered into the merits of the matter and made it
clear to her that it was not worth her while to continue.
[19]
It
is so that, when a commissioner enters into the merits of a dispute
before the end of the arbitration, thus inducing a party
to settle,
it may be a reviewable irregularity. Thus, in
Kasipersad
v CCMA
[9]
the court noted that the commissioner had told the employee that he
had a 50/50 chance of success (as did the commissioner in this
case);
that it would take between two to three months before the matter
would be heard in the Labour Court; and that he might have
to pay for
legal representation and, if he lost, the employer’s costs.
Pillay J further noted:
“
Except
for her assessment of the prospects of success being a 50/50 chance,
the other three outcomes sketched by the commissioner
present a
negative scenario for the applicant. She did not advise the applicant
of the possible outcome if he succeeded.
…
By
sketching only the four possible outcomes, the commissioner
manifested bias against the applicant. As the commissioner elected
to
use the technique of scenario sketching, she ought to have presented
fully and dispassionately all the consequences of proceeding
with and
withdrawing the dispute. If she did not intend to advise the
applicant to withdraw the application, then her conduct had
precisely
that effect. It was not unreasonable for the applicant, a layperson,
to infer from what she said that he was being advised
to withdraw the
dispute.
…
Giving
advice is … counterproductive to the objectives of
conciliation. A party who is advised that she has a good case is
unlikely to settle. One who is advised that he has a bad case is
likely to capitulate, as happened in this case.”
[20]
Mr
Ackermann
also referred to
Anglo
Platinum Ltd v CCMA
[10]
where the court found that, when the commissioner gave direct legal
advice when facilitating conciliation, he had induced the company
to
settle:
“
The
applicant contends that the decision to settle the matter on its part
was influenced quite significantly by the advice its representative
received from the commissioner. Whatever the reason for giving the
advice, there seems to be no doubt that the commissioner acted
outside his mandate and in so doing induced the applicant to enter
into the settlement agreement. It is on this ground alone that
I
believe that the settlement agreement stands to be set aside…”
[21]
I agree with these sentiments. But each
case has to be assessed on its own merits. It is clear from the
excerpts quoted above that
the court in
Kasipersad
did not consider the remark of a “50/50
chance” to be improper; the learned judge says that, “
except
for
her assessment of the prospects of
a 50/50 chance”, the other three scenarios presented a negative
scenario for the applicant
in that case. The same goes for the
applicant in this case. And the commissioner did not tell Ms Scholtz
that she would not succeed;
what he did do, was to sketch two
possible scenarios: either she withstood cross-examination, of which
she had a 50/50 chance,
thus showing that she was not negligent; or
she didn’t, in which case her dismissal would be fair. But even
if she won the
case “hands down”, it would be unlikely
that she would get more than six months’ compensation.
[22]
I do think that the commissioner
overstepped the mark in expressing a
prima
facie
view that, if the employee were
successful, she was unlikely to receive more than six months’
compensation. But his remarks
must be seen in context. They were made
off the record in circumstances akin to conciliation. And the
commissioner was sketching
different scenarios. He was not giving
legal advice. He did point out the costs of litigation; but that is
no more than a “reality
check” without expressing a view
on her prospects of success. It must also be borne in mind that,
contrary to the position
in
Kasipersad
,
the applicant was represented throughout by an attorney; and it was
her attorney who mooted the possibility of settlement. And
in
Anglo
Platinum
the commissioner gave legal
advice based on a decision of the Labour Court that had been
overturned by the Labour Appeal Court.
I do not think that the
commissioner’s remarks in this case constitute legal advice as
opposed to a form of reality checking.
[23]
The commissioner reverted to conciliation
at the end of the first witness’s evidence in chief in
circumstances where the applicant’s
attorney indicated that he
did not wish to commence cross-examination as he still wanted to
explore settlement overnight. It is
only after he had made that
remark that the commissioner made the “off the record”
remarks with regard to settlement
that he did.
[24]
In
that context, I agree with the following remarks of Van Niekerk J in
WESUSA
v Slabbert Burger Transport (Pty) Ltd
:
[11]
“
[8]
The LRA acknowledges mediation (the nature of the process undertaken
by the arbitrator in the pre-arbitration phase) as a preferred
form
of dispute resolution. Mediation is often a robust process in which
the mediator will seek to persuade and cajole parties,
using
techniques that rely on gentle and less gentle pressure to reach
agreement. Obviously, a mediator cannot overstep the mark
and act
dishonestly, or misrepresent a position to the parties, or engage in
conduct that amounts to intimidation. In
National
Union of Metalworkers of SA & others v Cementation Africa
Contracts (Pty) Ltd
(1998) 19
ILJ
1208 (LC) Waglay J said:
‘
While
a commissioner may not advise the parties on the merits or compel
parties to adopt any particular view, he or she may indicate
to the
parties making the claims or demands the possible weaknesses in their
claims or demands.’
[9] There
may often be a fine line involved here, but there are a number of
self-evident guidelines that might apply in a situation
where a
panellist attempts, with the parties’ agreement, to explore the
prospect of a settlement before arbitrating a dispute.
First, the
hallmark of the process is its voluntary nature. The panellist must
therefore protect the voluntary participation in
the process of each
party, and respect the right of the parties to reach their own
agreement. Secondly, the panellist should conduct
the process
impartially. By this, I mean not only that the panellist should avoid
a conflict of interest, but also that the panellist
should avoid
communicating any pre-existing opinion that might bring her integrity
and impartiality into question. Any conduct
that might compromise the
position of the panellist as a neutral intermediary should be
avoided. This does not imply, as the quote
from the
Cementation
Africa
judgment suggests, that the panellist is not entitled to
provide an evaluation of a party's position nor sketch likely
outcomes
should a dispute proceed to arbitration. But the panellist
should avoid any expression of her own views to the parties on the
merits
of their positions.
[10] I am
not persuaded that in the present instance, the arbitrator acted
unethically. This is evident from Beer's own evidence
in which the
arbitrator's language is expressed in tentative terms. He avers that
the arbitrator stated that if the matter proceeded
to arbitration he
would be asked and would have the power to award the employees a
year’s remuneration. These are the arbitrator's
powers under
the LRA, and the union would have been quite within its rights to
seek that relief. It does not appear from Beer's
evidence that the
arbitrator expressed his own opinion on the outcome of any
arbitration, or that he ever stated that he would
make an award less
favourable to the Respondent than the terms of the union's proposal.
In other words, there is no evidence that
the arbitrator pointed out
anything other than a range of possibilities should the matter
proceed to arbitration. It was for Beer
to assess the Respondent's
risk in the light of those possibilities, and to decide whether to
settle the dispute on the terms proposed.
In short, I am unable to
find on the evidence before me that the arbitrator made any
misrepresentations to Beer, that he subjected
Beer to any form of
duress, or that he acted otherwise in a manner that was unbecoming.”
[25]
It seems to me that the commissioner’s
remarks in this case, albeit expressed strongly, are more akin to the
situation in
Slabbert Burger
.
The commissioner sketched different scenarios: It could be that the
applicant withstood cross-examination and the employer could
not show
that she was negligent; or, on the other hand, the employer could
show that she had not fulfilled her duties and had,
as bookkeeper,
been ignorant (like “ ’n donkie met oogklappe aan”).
On the other hand, if the dismissal was unfair,
the likely outcome
was that she would receive in the region of six months’
compensation; but to both of these scenarios the
commissioner added
the
caveat
,
“Ek loop nie die saak vooruit nie”.
[26]
This
is a case where the commissioner sailed close to the wind and came
near to crossing the line, at the risk of mixing my sailing
metaphors, from a robust conciliation process to one where he pressed
too hard for a settlement.
[12]
But in my view, given the context and the nature of the proceedings,
I do not think that he did. Neither party objected to the
mid-arbitration attempts, off the record, to settle; it was at the
instance of the applicant’s attorney; and, once the
commissioner
had sketched the risks and possible scenarios, everyone
went home and the actual settlement was brokered between the parties’
legal representatives, with no further input from the commissioner
(other than his remarks post settlement, to which I shall return
under the fourth review ground).
[27]
In all these circumstances, I am of the
view that the first review ground cannot succeed.
[28]
The CCMA has already conducted an
investigation into the commissioner’s conduct; suffice it to
say that he will be well advised
to be particularly careful in future
processes not to push too hard when discussing possible settlement
with the parties.
Second
review ground: Senior commissioner not appointed
[29]
The second review ground is that the CCMA
was obliged to appoint a senior commissioner.
[30]
The parties jointly asked for a senior
commissioner fluent in Afrikaans to be appointed, as all the
witnesses would be Afrikaans
speaking. The CCMA granted the request.
However, the first senior commissioner appointed, Ms Marieke van
Rooyen, was the applicant’s
erstwhile attorney. The second
senior commissioner appointed was not fluent in Afrikaans. The matter
then ended up with the second
respondent, Mr J P Hanekom. Although he
has extensive experience, he is not a designated senior commissioner,
[31]
The applicant argues that, once the CCMA
had decided to appoint a senior commissioner, it was unlawful –
and thus a reviewable
irregularity – for another commissioner
to hear the dispute.
[32]
Section 137 of the LRA reads:
“
Section
137 Appointment of senior commissioner to resolve dispute
through arbitration
(1)
In the circumstances contemplated in section 136(1), any party to the
dispute may
apply to the director to appoint a senior commissioner to
attempt to resolve the dispute through arbitration.
(2)
When considering whether the dispute should be referred to a senior
commissioner,
the director must hear the party making the
application, any other party to the dispute and the commissioner who
conciliated the
dispute.
(3)
The director may appoint a senior commissioner to resolve the dispute
through arbitration,
after having considered—
(a)
the nature of the questions of law raised by the dispute;
(b)
the complexity of the dispute;
(c)
whether there are conflicting arbitration awards that are relevant to
the dispute;
and
(d)
the public interest.
(4)
The director must notify the parties to the dispute of the decision
and—
(a)
if the application has been granted, appoint a senior commissioner to
arbitrate the
dispute; or
(b)
if the application has been refused, confirm the appointment of the
commissioner initially
appointed, subject to section 136(4).
(5)
The director’s decision is final and binding.
(6)
No person may apply to any court of law to review the director’s
decision until
the dispute has been arbitrated.”
[33]
Mr
Ackermann
made the following points:
33.1
The director
may
appoint a senior commissioner.
33.2
Once a senior commissioner has been
appointed, the CCMA is
functus officio
.
33.3
The director’s decision is final and
binding.
33.4
No person may apply to review that decision
until the dispute has been arbitrated.
33.5
Thus, the applicant could not review the
fact of Hanekom hearing the dispute until now; but he had no
jurisdiction to do so.
[34]
Compelling as this argument is, I cannot
agree. Neither party objected to Hanekom being seized with the
arbitration; in fact, they
appeared to welcome it, as he was the only
Afrikaans speaking commissioner available and he was experienced,
albeit not a senior
commissioner. Had the applicant had any remaining
misgivings, her attorney would surely have objected at the time; and
only if
that objection had been overruled, he would have reserved the
right to review Hanekom’s appointment at the end of the
arbitration
in terms of s 137(6). It could not have been the
legislature’s intention that the parties – especially
when they are
legally represented – would acquiesce in the
appointment of an arbitrator where the first choice of a senior
commissioner
who speaks their language is not available, only to pull
the rabbit out of the hat at the end of the arbitration and review
the
full proceedings on that ground. That scenario would be against
the very spirit of the LRA: it would mean that, rather than a cheap
and quick process, it would envisage the scenario of a lengthy
arbitration, involving legal costs for both parties, only to have
the
whole process repeated before a different arbitrator in circumstances
where no-one objected initially.
[35]
In any event, the arbitration did not
continue. The parties settled the dispute, assisted by their
attorneys, and presented the
commissioner with that agreement. He
merely added the standard CCMA form to it as a cover sheet and asked
them to sign that document
as well. And the parties and their legal
representatives accepted his limited role.
[36]
In my view this ground of review cannot
succeed either.
Third
review ground: settlement of High Court litigation
[37]
The applicant further submits that the CCMA
did not have jurisdiction to settle the matter pending in the High
Court.
[38]
The settlement agreement states:
“
Hierdie
skikking is ‘n volle en finale vereffening van enige en alle
eise wat die partye teen mekaar het of mag hê gebaseer
op
bogenoemde twee sake, synde WECT 18114-13 en 7656/2014.”
[39]
WECT 18114-13 was the case number of the
dispute referred to the CCMA and 7656/14 was the case number in the
High Court.
[40]
The parties settled both disputes as part
of an “all-in” settlement agreement. The applicant now
says that the CCMA
did not have jurisdiction to settle the High Court
dispute.
[41]
I
agree with Mr
Ackermann
that
the CCMA would not have the jurisdiction to make that settlement
agreement an arbitration award in terms of s 142A of the LRA
or an
order of this Court in terms of s 158(1)(c). The CCMA could only do
so “in settlement of a dispute that a party has
the right to
refer to arbitration or to the Labour Court”.
[13]
[42]
But in this case, neither party has asked
for the agreement to be made either an arbitration award or a court
order. The question
of jurisdiction does not arise. The parties,
assisted by their legal representatives, reached an “all-in”
settlement
of al disputes between them, reduced it to writing, and
signed it. That settled the disputes, including the dispute between
Ms
Scholtz and the Trust (the fourth respondent, which was not her
employer). The commissioner,
ex
abundante cautela
, it seems, added the
standard CCMA settlement form to the typed settlement agreement. As
he said, “dié
is nou maar net
die dekblad, né” – in other words, he merely added
it as a cover sheet to the settlement agreement
typed up and signed
by the parties.
[43]
In my view, there was nothing to prevent
the parties from settling all their disputes in one agreement.
Indeed, it made sense to
do so, thus avoiding further litigation and
costs. It so happened that they reached a settlement in the midst of
an arbitration
between the employee and her employer, the third
respondent. They did so with the help of their lawyers and without
that of the
arbitrator. They did not ask for it to be made an
arbitration award or a court order. The issue of the CCMA’s
jurisdiction
is to my mind not relevant to the fact that the parties
reached an all-in settlement agreement.
[44]
This ground of review also fails.
Fourth
review ground: undue influence
[45]
The final ground on which the applicant
relies to attack the settlement agreement is the common law ground of
“undue influence”.
[46]
This
is a recognised doctrine in our law
[14]
and has been applied by this Court in similar applications.
[15]
[47]
In
Patel
v Grobbelaar
[16]
the court required the following:
47.1
that the defendant had obtained an
influence over the plaintiff;
47.2
that this influence had weakened his powers
of resistance and had rendered his will compliant; and
47.3
that the defendant had used his influence
in an unscrupulous manner to persuade the plaintiff to agree to a
transaction which:
47.3.1
was prejudicial to him; and
47.3.2
he would not have concluded with normal
freedom of will.
[48]
Mr
Stelzner
argued, firstly, that the commissioner was not a party to the
agreement. But, as Mr
Ackermann
pointed out, undue influence by a third party also gives the party
influenced the right to rescind if the other party to the contract
was aware at the time the contract was made that undue influence had
been exercised.
[17]
Did
the commissioner obtain an influence over Scholtz?
[49]
Mr
Ackermann
argued that the commissioner was in a position of authority over Ms
Scholtz and that she was reliant on him for her further conduct
of
the matter. He argued that the commissioner clearly communicated to
her that she had no case and should settle: “die kool
is die
sous nie werd nie”.
[50]
I think that is to place too much of a
gloss on his words. The commissioner pointed out the risks to the
applicant; but he left
open the question whether she could be
successful, putting it at 50/50; and he expressed a view, unwisely,
as to the possible compensation
to be awarded if she were successful
(“as sy die saak loshande wen”). And the idiomatic
expression must be seen in
the context of the following reality check
with regard to the costs involved:
“
Miskien
is hulle in ʼn beter posisie om regskostes te kan bekostig en op
die einde van die dag betaal, die trust nou, maar die
regskostes wat
nie ʼn probleem is nie, maar kyk na julle situasie, wat julle
koste aanbetref. Is die kool die sous werd om
(onduidelik) of aan te
gaan met die saak?”
[51]
The
arbitrator was pointing out – correctly – that the
employer’s legal costs would be paid by the trust. The
respondents had – and have – deeper pockets than the
applicant. That is something she had to weigh up against the amount
of compensation she stood to recover if she were successful. Against
that background, the commissioner asked her to consider,
realistically, if it was worth her while to continue: “Is die
kool die sous werd om aan te gaan met die saak?” As in
most
cases, that was a valid consideration. And, as the commissioner
noted, a mediator or conciliator should look at the
best alternative
to a solution. This comment harks back to that cited by Molahlehi J
in
Anglo
Platinum
[18]
:
“
It
is essential that conciliators be given some leeway in exploring the
parties’ BATNAs [best alternatives to negotiated agreements].”
Did
the commissioner’s influence weaken the applicant’s
powers of resistance and make her will compliant?
[52]
This case has to be decided on affidavit
and on the strength of the commissioner’s
ipsissima
verba
. The Court does not have the
benefit of oral evidence. But I do not think the applicant has
discharged the onus of showing that
the commissioner’s words
had weakened her resistance – if any – and rendered her
will compliant.
[53]
Again,
it must be borne in mind that it was the applicant’s attorney
who initiated settlement talks. And the onus is on the
applicant to
prove, on a preponderance of probabilities, that she did not enter
into the agreement voluntarily.
[19]
[54]
As
Mr
Stelzner
pointed out, there are many similarities between this matte and
Ulster
v Standard Bank
.
[20]
In that case, the applicant, a bank manager, had also referred an
unfair dismissal dispute to arbitration. Before the arbitration
began, the commissioner attempted conciliation again. The parties
settled. The applicant was assisted by her trade union’s
in-house counsel. She asked this Court to set the settlement
agreement aside because she entered into the agreement under duress
or undue influence. In dismissing the application, the Court took
into account the following factors:
54.1
She was assisted and advised by her trade
union’s in-house counsel.
54.2
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.
54.3
The employee was 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.
54.4
The agreement that she signed was written
in English, her first language.
54.5
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.
[55]
In the present case, the following factors
are as pertinent:
55.1
Ms Scholtz was assisted throughout by her
attorney. He brokered the “all-in” settlement agreement
on her instructions
(together with her father), typed it up, and sent
it to the respondents’ attorney.
55.2
The next morning, and without the
intervention of the commissioner, the legal representatives added and
deleted further clauses
to the draft agreement, mostly in the
applicant’s favour (such as further payments to her).
55.3
The agreement was typed in her mother
tongue, Afrikaans.
55.4
She signed the agreement herself.
55.5
After the lawyers had negotiated the
agreement and presented it to the commissioner, the commissioner was
at pains to find out if
she agreed that it was in full and final
settlement of all claims and that she could not turn around and say
she did not know what
she was doing; yet that is exactly what she
did, six weeks later. One is reminded of these words from the
commissioner:
“
So
as julle teken, weet julle wat julle teken en julle verstaan wat
julle teken. Kan nie môre terugkom en sê julle was
gedwing om te teken en julle het nie verstaan nie. …
As
julle nou skik, dan is dit eens en finaal. U kan nie nou weer mȏre
gaan eis vir uitstaande salaris en uitstaande verlofgeld
en sulke
goed nie. U verstaan dit so? Die betalings is so, dit is alles vervat
in die ooreenkoms, né…
So
u sal nie mȏre weer u saak kan oopmaak nie. As u nou teken is
dit oor en verby.”
[56]
The applicant signed the settlement
agreement and the pro forma CCMA document and her attorney signed as
a witness. She complied
with the agreement the following day by
returning the motor vehicle.
[57]
I also take into account that the applicant
waited for one day short of six weeks to object to the agreement,
well after both parties
had acted in terms of the agreement and she
had been paid accordingly. And, Like Ms Ulster in the eponymous case,
she is not an
ingénue. She was a bookkeeper for the
respondents for 14 years. She was a trustee of a number of trusts.
She took advice
from her attorney and her father. She literally had
the opportunity to sleep on it before signing the settlement
agreement, after
the commissioner had warned her that it was final
and binding.
[58]
In all of these circumstances, an on a
balance of probabilities, I am not satisfied that the applicant has
shown that the commissioner’s
interaction with her attorney had
rendered her will compliant to the extent that the commissioner
exercised an undue influence
over her.
Conclusion
and costs
[59]
It follows that the application to have the
settlement agreed set aside must be dismissed.
[60]
With regard to costs, I have to take into
account the requirements of both law and fairness. On either count, I
do not see any reason
why the third and fourth respondents should not
be awarded their costs. They had already spent legal fees in the CCMA
and High
Court proceedings. They settled both of those disputes on
the basis that each party would pay its own costs. Then they had to
incur
further costs in this application challenging that settlement.
They should not have had to. I differ with Mr
Stelzner
,
though, who argued that Ms Scholtz should have to pay punitive costs
.
Order
The
application is dismissed with costs.
_______________________
A
J Steenkamp
Judge
of the Labour Court
APPEARANCES
APPLICANT:
L
W Ackermann
Instructed
by Cluver Markotter, Stellenbosch.
THIRD
and FOURTH RESPONDENTS
R
G L Stelzner SC
Instructed
by Werksmans, Cape Town.
[1]
My emphasis.
[2]
Scholtz was employed by Huis André van der Walt as a
bookkeeper, but also acted as a bookkeeper in an independent
contractor
agreement to De Rust.
[3]
This rule reads: “1. Conciliation proceedings are private and
confidential and are conducted on a without prejudice basis.
No
person may refer to anything said at conciliation proceedings during
any subsequent proceedings, unless the parties agree
in writing.
2. No person,
including a commissioner, may be called as a witness during any
subsequent proceedings in the Commission or in any
court to give
evidence about what transpired during conciliation.”
[4]
Seemingly a mistaken transcription of “andazi”, the
isiXhosa expression for “I don’t know” or,
in this
case, “I didn’t know”.
[5]
Labour Relations Act 66 of 1995
.
[6]
Fidelity
Guards Holdings (Pty) Ltd v Epstein N.O.
[2000] 12 BLLR 1389
(LAC) para 15;
JDG
Trading (Pty) Ltd v Laka N.O.
[2001] 3 BLLR 294
(LAC) paras 17-20.
[7]
[2013] 1 BLLR 94 (LC).
[8]
MEC,
Department of Health v Weder; MEC, Department of Health v DENOSA obo
Mangena
[2014] 7 BLLR 687
(LAC), (2014) 35
ILJ
2131 (LAC).
[9]
(2003) 24
ILJ
178 (LC) paras 15-29.
[10]
(2009) 30
ILJ
2396 (LC) para 36.
[11]
[2009] ZALC 214
(3 Feb 2009) paras 8-10.
[12]
As
the learned authors note in Du Toit et al,
Labour
Relations Law: A Comprehensive Guide
(LexisNexis 6 ed 2015 at 140): [I]f settlement is encouraged as a
goal in itself, the push to settle acquires a normative force.”
[13]
LRA
s 142A(2)
and
s 158(1A).
See also
Greeff
v Consol Glass (Pty) Ltd
(2013) 34
ILJ
2385 (LAC).
[14]
Preller
v Jordaan
1956 (1) SA 483
(A). Fagan JA (for the majority) stated [at 492H],
after having trawled through the Roman Dutch authorities: “Myns
insiens
blyk uit die aangehaalde regsbronne dat die gronde vir
restitutio
in integrum
in
die Romeins-Hollandse reg wyd genoeg is om die geval te dek waar een
person ‘n invloed oor ‘n ander verkry wat
laasgenoemde
se teenstandsvermoë
verswak
en sy wil plooibaar maak, en waar so ‘n person sy invloed dan
op gewetenlose wyse laat geld om die ander te oorreed
om toe te stem
tot ‘n skadelike transaksie wat hy met normale wilsvryheid nie
aangegaan het nie.” Van den Heever
JA dissented. In his
inimitable style he opined [at 503H]: “Vra is vry en om ‘n
ander tot jou eie voordeel te oortuig
is ook geen sedelike vergryp
nie”.
[15]
Ulster
v Standard Bank of SA Ltd
(2013) 34
ILJ
2343 (LC).
[16]
1974 (1) SA 532 (A).
[17]
Kat
z
enellenbogen
v Katzenellenbogen & Joseph
1947 (2) SA 528 (W) 540.
[18]
Supra
para
30, citing Bosch, Molahlehi and Everett,
The
Conciliation and Arbitration Handbook
.
[19]
R H Christie et al,
The
Law of Contract in South Africa
(6 ed 2011) 281-4; 294-6; 321-4;
Ulster
v Standard Bank (supra)
para
8.
[20]
[20]
(2013) 34
ILJ
2343 (LC) (
supra
).