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[2016] ZALCD 13
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Mahlaba v Msunduzi Municipality and Others (D462/16) [2016] ZALCD 13 (29 June 2016)
IN
THE LABOUR COURT OF SOUTH AFRICA, DURBAN
Not Reportable
Case
no: D462/16
In
the matter between:
PETRUS
JABULANI MAHLABA
Applicant
and
THE
MSUNDUZI MUNICIPALITY
First Respondent
THE
ACTING MUNICIPAL MANAGER – BONIWE ZULU
Second Respondent
MORAR
INCORPORATED
Third Respondent
Heard:
24 June 2016
Delivered:
29 June 2016
JUDGMENT
WHITCHER
J
[1]
The
applicant seeks, on an urgent basis, orders declaring unlawful and
setting aside his suspension by the second respondent. The
application is squarely based on a legality challenge.
[2]
The
applicant has been employed as the Executive Manager of the Internal
Audit Unit of the first respondent since July 2012. He
works with an
audit team whose primary functions,
inter
alia
,
includes to conduct audits, forensic investigations and report to the
Audit Committee, to make recommendations to the Audit Committee,
Executive Committee and Council of the first respondent and to
determine whether there was mismanagement of public funds.
[3]
In
February 2016, the third respondent was appointed under the
provisions of
section 106(1)(b)
of the
Local Government: Municipal
Systems Act 32 of 2000
to investigate various issues of
irregularities within the first respondent.
[4]
On
14 March 2016 what purports to be a subpoena was served on the
applicant by the office of the third respondent in terms of section
4
of the KwaZulu-Natal Commissions Act No 3 of 1999, requiring him to
appear before the third respondent’s investigators
and produce
a specified list of documents.
[5]
On
1 April 2016, the second respondent, in her capacity as the Acting
Municipal Manager, sent a letter the applicant wherein she,
inter
alia
,
stated:
I am advised by the
lead investigator [of the third respondent] that you are
un-cooperative and have failed to produce any of the
documents that
you were required to produce in the subpoena, despite the lapse of
the time period within which you were required
to do so in terms of
the subpoena.
This is completely
unacceptable. As you are no doubt aware, the Municipality is
required, not only in terms of the law, but also
in the spirit of
good governance and in the interest of transparency and
accountability, to cooperate with the Honourable MEC’s
investigation.
You are also no doubt
aware that you are required, as a municipal official, to carry out
the lawful instructions of the Municipality.
Given that the
Municipality has resolved to cooperate with the investigation team
and the fact that the Municipality is, in any
event, required by law
to cooperate, your failure to act accordingly is inexcusable and will
not be tolerated.
This letter serves to
inform you that you are required, forthwith, to make available to the
Honourable MEC’s investigators,
all of the documents that you
are required to produce in terms of the subpoena. You are also
required to fully cooperate with the
investigation team.
In the event that you
fail to do so, the Municipality will have no other option but to take
whatever lawful steps are open to it
pursuant to your refusal to
cooperate.
[6] The applicant sent a
long written response wherein he claimed that he was cooperating with
the investigation team but was experiencing
problems producing
certain documents. A number of emails were also exchanged in relation
to the matter and other issues, including
his alleged deliberate
failure to attend a meeting with the second respondent regarding the
issue.
[7] On the 8
th
April 2016, the second respondent placed the applicant on
precautionary suspension with pay, claiming in the suspension letter
that the investigators of the third respondent had informed her
office that the applicant had persisted in his refusal to cooperate
with their investigation team. The reason for the suspension is
framed as a failure to cooperate with the investigation team. The
applicant was further advised that possible charges of misconduct
will be investigated against him in light of his failure to cooperate
with the investigation.
[8] The applicant was
invited to provide reasons why he believed his suspension should be
uplifted, which he did in a detailed response
drafted on his behalf
by his attorneys. His response in essence indicated his willingness
to comply with the subpoena, a claim
that he had substantially
complied with the subpoena and that he was having difficulties in
producing certain documents.
[9] In his founding
affidavit the applicant urged the court to take into account that his
suspension was also effected in the following
“exceptional
circumstances”. The applicant’s audit team had occasion
to investigate and report on a number of
alleged financial
irregularities in the financial affairs of the first respondent in or
about 2014/5. The report, submitted to
council in April 2016,
included recommendations arising from the investigations relating to
charges of misconduct to be proffered
against officials. The second
respondent, in her capacity as Deputy Municipal Manager: Community
Services, was implicated in these
reports. The second respondent was
appointed Acting Municipal Manager on 4 March 2016 and one month
later she suspended the applicant.
[10] In the founding
affidavit, the applicant’s challenge to the lawfulness of the
suspension was based on two grounds:
(i)
The
applicant is a senior manager as contemplated in section 56 of the
Municipal Systems Act No. 32 of 2000 and his suspension did
not
comply with the requirements set out for the suspension of a senior
manager. The respondent denied that the applicant is a
senior manager
as contemplated by the Act.
(ii)
Exceptional
circumstances exist in this matter in that the investigated (the
second respondent) suspended the investigator (the
applicant)
involved in an investigation against the second respondent.
[11] In his replying
affidavit, the applicant extended his legality challenge to a
contention that the subpoena was not lawfully
issued and so there was
no lawful obligation on him to comply with the subpoena. In these
circumstances, any decision taken by
the second respondent based on
non-compliance with the subpoena is likewise unlawful.
[12] In his heads of
argument, a further legality challenge was submitted on behalf of the
applicant. It was contended that in effecting
the suspension, the
second respondent did not comply with the provisions of the National
Treasury Circular No. 65 and the Audit
Charter drafted in terms of
the provisions of section 168(3) of the Municipal Finance Management
Act. The Circular and Charter
inter alia
provide (i) for the
concurrence of the Internal Audit Committee “with any
appointment and
termination of the services
of the chief
audit executive
” (ii) that independence is enhanced when
the Audit Committee concurs in the
appointment or removal of the
chief audit executive”
and (iii) that it is one of the
duties of the Audit Committee to “resolve any difficulties or
unjustified restrictions or
limitations on the
scope of the
internal audit activity or any significant disagreements between the
Executive Manager (Internal Audit Unit) and management”.
[13] The applicant
contended that these provisions obliged the second respondent to
consult with the Audit Committee and to obtain
their concurrence in
the decision to suspend the applicant because a suspension is a
temporary termination of services.
[14] I will deal with the
last issue first. I agree with the respondent that the reliance on
the provisions in question constitutes
a misconstruction of the
relevant circular and legislation.
[15] A suspension, and,
in this case, a precautionary suspension, does not constitute a
temporary termination of employment. A suspension
is in law the
holding of the duty to tender services in abeyance whilst all the
essentialia
and the
naturalia
of the contract of
employment continues to be in full force and effect.
[16] The third provision
contemplates attempts to limit the scope of work and work duties of
the audit team, not disagreements concerning
the suspension or the
termination of the services of the chief audit executive.
[17] Even if I am wrong
and the provisions, particularly the concept “removal”,
ought to be given a wide meaning to
include a precautionary
suspension, the respondent pointed out that this issue and the facts
relied upon in relation thereto were
not pleaded, but introduced in
heads of argument.
[18] With regard to the
status of the applicant, it is my finding that the applicant has
failed to establish the existence of all
the jurisdictional
requirements set out in section 56 of the Local Government: Municipal
System Act 32 of 2000 for this court to
conclude that he is a senior
manager as contemplated in Section 56 of the Act. In particular he
has failed to produce a written
contract of employment and has failed
to establish that he is part of the first respondent’s Senior
Management Committee
and that he was appointed by the Municipal
Council in terms of a Council Resolution. The objective documentation
points to him
being a level 3 process manager.
[19] I
also reject the applicant’s belated reliance in his replying
affidavit on estoppel to claim he was appointed as a Section
56
Senior Manager. He did not establish the requirements of estoppel. In
addition, as pointed out by the respondent, estoppel cannot
be used
to achieve that which legislation (in this case, section 56 of the
Act) does not provide for or permit.
[1]
Moreover, estoppel will not supplement a deficient legal status and
cannot be used to confer a legal status upon a person.
[2]
[20] I turn now to the
issue about the lawfulness of the subpoena. The subpoena was issued
and signed by one Sanjay Rabichand who
describes himself as the lead
investigator of the third respondent acting in accordance with the
provisions of section 4, read
with section 3, 5, 6 and 7 of the KZN
Commissions Act.
[21] The applicant argued
that the subpoena was not lawfully issued because the power to issue
subpoenas is vested in the Sheriff
of the High Court.
[22] During argument, the
respondent accepted that the subpoena was not issued by the Sheriff
of the High Court. The respondent,
however, contended that even
if it is arguable that the subpoena was not lawfully issued, this did
not assist the applicant for
the reasons discussed below.
[23] The applicant’s
claim that the subpoena was unlawfully issued and that he accordingly
was not obliged to comply therewith
was not raised in the founding
papers. It was belatedly claimed in the applicant’s replying
affidavit as a new matter.
[24]
It is correct that an applicant for relief must (save in exceptional
circumstances) make his case and produce all the evidence
he desires
to use in support of it in his affidavits filed in the notice of
motion, whether he is moving an
ex
parte
or on notice to the respondent and is not permitted to supplement his
replying affidavit (the purpose of which is to reply to averments
made by the respondent in his answering affidavit) still less make
out a new case in his replying affidavit.
[3]
In summary, an applicant cannot raise new matters in a replying
affidavit as he is required to make out his case in the founding
papers.
[25]
However, I agree with Mr Van Rooyen, counsel for the applicant, that
the above rule is not absolute, particularly where, as
in this case,
the point raised is a point of law based on facts set forth in the
founding affidavit and admitted by the second
respondent in its
opposing affidavit and there is no prejudice to the other party.
[4]
With regard to the issue of prejudice, the second respondent was
invited to deliver a further affidavit in response to this particular
issue but elected not to do so. I will therefore consider this new
issue.
[26] I
find no merit in the applicant’s claim because the respondent
referred this court to relevant authority which holds
that a
subpoena, unless set aside, should not be disobeyed.
[5]
[27]
It is also relevant that the SCA has recently held that an
administrative act and its consequences must be treated as valid
until set aside in judicial proceeding even if it was actually
invalid. The SCA in
Kwa
Sani Municipality v Underberg/Himeville Community Watch Association
and Others
,
[6]
held as follows:
“
If a public
body believes one of its administrative acts is invalid, it may not
simply ignore it. This is because even invalid administrative
acts
are treated as valid until they are set aside. The public body
contending for invalidity is thus duty bound to approach the
court to
have it set aside. Since it is administrative action which must be
set aside, the delay rule applies. If there has been
an undue delay,
it must provide an acceptable and adequate explanation. If this is
not done, the invalid administrative act may
be insulated against
being set aside. In such a case, the administrative act will continue
to have effect and be treated as valid,
despite its invalidity. If
the public body has not delayed unduly and shows that the act is
invalid, a court is bound to make a
declaration of invalidity. There
is no discretion afforded a court not to do so. If a declaration of
invalidity is made, a court
is then granted discretion under its just
and equitable powers to suspend the invalidity for any period and on
any condition…
[7]
[28] When the issue of
non-compliance with the subpoena arose between the applicant and the
second respondent, the subpoena had
not been set aside. Accordingly,
the applicant had no right to ignore it.
[29] It is evident from
the letters exchanged between the applicant and the second respondent
that the Municipality had resolved
to cooperate with the
investigation and instructed the applicant to cooperate with the
investigation. This resolution and instruction
took the issue beyond
the subpoena and transformed the matter into that of an instruction
from an employer to an employee to assist
and cooperate with the
investigators. Thus, when the disagreement between the applicant and
the respondent arose, it concerned
an issue of a work instruction: an
instruction to cooperate with the investigation. The heading of the
suspension letter, namely
“the failure to cooperate with the
investigation” confirms this.
[30]
I turn now to the issue of “exceptional circumstances”. I
point out that this issue was pleaded with reference
to the LAC
judgment in
Booysen
v Minister of Safety and Security and Others
[8]
in which the court held:
“…
The
Labour Court has jurisdiction to interdict any
unfair
conduct including disciplinary action. However, such intervention
should be exercised in exceptional cases. It is not appropriate
to
set out the test. It should be left to the discretion of the Labour
Court to exercise such powers having regard to the facts
of each
case. Among the factors to be considered would in my view be whether
failure to intervene would lead to grave injustice
or whether justice
might be attained by other means. The list is not exhaustive.”
[emphasis added]
[31]
As correctly pointed out by the respondent, the need to show
exceptional circumstances, as discussed by the LAC, applies only
to
instances where an applicant is seeking to challenge the
fairness
of a suspension, having referred the suspension dispute to the
CCMA or relevant Bargaining Council. The applicant in this case has
disavowed any reliance on the unfairness of his suspension and has
not indicated that he has referred his suspension to the CCMA
or to
the relevant Bargaining Council. He thus cannot rely upon the
existence of exceptional circumstances to support a legality
challenge.
[32]
To the extent that I may have misconstrued the matter and that the
applicant is actually suggesting that the exceptional circumstance
is
that second respondent suspended the applicant for ‘ulterior’
purposes, which I accept falls within a legality challenge,
I deal
with the matter as follows.
[33]
The SCA in
National
Director of Public Prosecutions v Zuma
[9]
held as follows:
“
[37]
A prosecution is not wrongful merely because it is brought for an
improper purpose. It will only be
wrongful, if in addition,
reasonable and probable grounds for prosecuting are absent,
[10]
something not alleged by Mr Zuma and which in any event can only be
determined once criminal proceedings have been concluded.
[11]
The motive behind prosecution is irrelevant because as Schreiner JA
said in connection with arrests, the best motive does not cure
an
otherwise illegal arrest and the worst motive does not render an
otherwise legal arrest illegal.
[12]
The same applies to prosecutions.
[13]
[38]
This does not, however, mean that the prosecution may use its powers
for ‘ulterior purposes’.
To do so would breach the
principle of legality. The facts in the
Highstead
Entertainment (Pty) Ltd t/a ‘The Club’ v Minister of Law
and Order
[14]
illustrate and explain the point. The police had confiscated machines
belonging to Highstead for the purpose of charging it with
gambling
offences. They were intent on confiscating further machines. The
object was not to use them as exhibits – they had
enough
exhibits – but to put Highstead out of business. In other
words, the confiscation had nothing to do with the intended
prosecution and the power to confiscate was accordingly used for a
purpose not authorised by the statute. This is what ‘ulterior
purpose’ in this context means. This is not the case before us.
In the absence of evidence that the prosecution of Mr Zuma
was not
intended to obtain a conviction the reliance on this line of
authority is misplaced as was the focus on motive.
[15]
”
[34]
This means that the applicant had to convince this court, with
sufficient supporting facts, that the second respondent used
her
powers to suspend for ‘ulterior purposes’. In my view,
the applicant has failed to provide a sufficient evidentiary
basis
for this court to make such a profound finding. The fact that the
applicant’s audit team had investigated the second
respondent
and recommended that action should be taken against the second
respondent, read together with the fact that his suspension
(on an
unrelated matter) followed one month after the second respondent’s
appointment as Acting Municipal Manager is questionable
but not
sufficient for me to arrive at a finding that she used her powers for
an ‘ulterior purpose’ considering that
the letter of
suspension repeatedly states that the third respondent’s
investigative team laid the complainant against the
applicant and
were pursuing the complaint.
[35]
In conclusion, while there are a number of aspects in this case which
brings into question the fairness of the suspension,
I find no merit
in the legality challenge.
Order
[36]
The application is dismissed with no order as to costs.
________________________________
Whitcher J
Judge
of the Labour Court of South Africa
APPEARANCES:
For
the applicant: Adv Van Rooyen, instructed by Lister & Lister
Attorneys
For
the first and second respondents: Adv J Nxusani, SC, instructed by
Kathy James Attorneys
[1]
City of Tshwane Metropolitan Municipality v RPM Bricks
2008
(2) SA 1
at paras 11-12;
Stand 242 Hendrick Potgieter Road
Ruimsig v Gobel
NO
2011 (5) SA 1
at para 23
[2]
JC Sonnekus,
The Law of Estoppel in SA
(2
nd
ed, Butterworths) 182 and the cases cited therein.
[3]
Bayat and Others v Hansa and Others
1955 (3) SA 547
(N) at
553D-E
[4]
See:
Sarrahwitz v
Maritz NO
2015 (4) SA 499
(CC) at par
[30].
[5]
Herbstein & Winsen,
The Civil Practice of the High Court of
South Africa
(5
th
ed) Volume 1, Cilliers, Loots &
Nel at page 855.
[6]
(2015) 2 ALL SA 657 (SCA).
[7]
Para [34].
[8]
[2010] ZALAC 21
at para 54.
[9]
(573/08
[2009] ZASCA 1
(12 Jan 2009).
[10]
Beckenstrater v Rottcher & Theunissen
1955 (1) SA 129
(A);
Relyant Trading (Pty) Ltd v Shongwe
[2007] 1 ALL SA 375
(SCA).
[11]
Thompson v Minister of Police 1971 (1) SA 371 (E)375A-D.
[12]
Tsose v Minister of Justice 1951 (3) SA 10 (A) 17.
[13]
Beckenstrater v Rottcher & Theunissen
1955 (1) SA 129
(A).
[14]
1994 (1) SA 387 (C).
[15]
Beckenstrater v Rottcher & Theunissen
1955 (1) SA 129
(A).