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[2017] ZALCJHB 139
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South African Police v Nkopane and Others (JR965/13) [2017] ZALCJHB 139 (4 April 2017)
IN
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not
Reportable
Case
no: JR965/13
In the
matter between:
SOUTH
AFRICAN POLICE SERVICE
Applicant
and
MJ
NKOPANE
First Respondent
ENDLANE
COLLIN MALUBANE
Second Respondent
GUGU
BRENDA
MAZIBUKO
Third Respondent
NTENYANE
CHRISTIAN TLHAKUDI
Fourth Respondent
Heard:
24 November 2016
Delivered:
04 April 2017
JUDGMENT
TLHOTLHALEMAJE
J
Introduction
[1]
The
applicant, the South African Police Service (SAPS) seeks an order
reviewing and setting aside the undated arbitration ruling
issued by
the first respondent (Arbitrator) under case numbers DRP13/2012 and
DRP15/2012. The arbitration proceedings were conducted
in terms of
the provisions of the Arbitration Act
[1]
(the Act).
[2]
This dispute emanates from a termination of
a training programme agreement – Memorandum of Agreement (the
MOA) between the
SAPS and the second to fourth respondents (the
Trainees) as prospective members of the Service. The Trainees were
discharged from
the training program after they were found guilty of
acts of misconduct deemed to be in contravention of the provisions of
the
MOA.
Background
[3]
The Trainees were appointed as police
trainees during January 2012 in terms of a fixed-term MOA for a
period of 24 months.
In or around July 2012, they were charged
with various acts of misconduct in contravention of the MOA and the
SAPS’
Academy Orders. Annexure “C” to the MOA makes
provision for a disciplinary procedure to be followed in instances of
misconduct.
[4]
Endlane Collin Malubane (Malubane) was
allegedly found to have been under the influence of alcohol and in
possession of alcoholic
drinks on 01 July 2012. Gugu Brenda
Mazibuko (Mazibuko) and Ntenyane Christian Tlhakudi (Tlhakudi) were
charged with
offences related to an incident involving another
trainee, Mmelesi, who had complained of being assaulted by Mazibuko.
Mmelesi
had also alleged that Tlhakudi attempted to sexually assault
and forcibly kiss her. An internal disciplinary enquiry took place
on
05 September 2012 and 21 September 2012, and they were
accordingly found guilty of the said charges, resulting in
the MOA’s
being terminated.
[5]
After the disciplinary hearings, the
chairperson had informed the Trainees of their rights in terms of
clause 15 of Annexure “C”
of the MOA, which provided that
a party aggrieved by the outcome of an internal hearing, could make
submissions to the Divisional
Commissioner: Human Resource
Development within three (3) business days, whose decision is deemed
final and binding, subject to
any arbitration ruling on the matter in
accordance with clause 17 of Annexure “C”. Malubane had
made representations,
and his outcome is recorded as follows:
“
I
have viewed the details of the case and have taken cognizance of your
representation. I consider the misconduct to be of a very
serious
nature. I concur with the sanction imposed by the Presiding Officer
to terminate the agreement”.
[6]
The above was signed by Major General S
Nyalungu (Nyalungu), Head: Basic Police Development. On 12 September
2012, Malubane was
served with a notice of termination of the MOA
with effect from 07 September 2012. The outcome of similar
representations made
by Mazibuko and Tlhakudi was dated 09 October
2012, and signed by Nyalungu. They were informed on 11 October 2012
of
the termination of the MOAs.
[7]
In terms of clause 4 of Annexure “D”
to the MOA, any dissatisfaction and/or dispute regarding the
interpretation, application
or termination of the agreement must be
referred to the Dispute Resolution Panel, which is appointed by the
National Commissioner.
Representatives of the SAPS and the Trainees
agree on a member of the Panel, who will arbitrate the dispute in
accordance with
the provisions of the Act.
[8]
On 15 February 2013, the Trainees and SAPS
agreed to refer the dispute to arbitration. The arbitration hearing
took place on 15 February 2013
after the Trainees’
disputes were consolidated. At the commencement of the arbitration
proceedings the Trainees’ representative
had raised a
“preliminary point”, calling into question the authority
of the reviewing personnel (Nyalungu) to confirm
the termination of
the MOAs. The Arbitrator upheld the preliminary point, concluded that
the termination of the MOAs was invalid,
and ordered SAPS to
reinstate the Trainees in the training programme.
Condonation
[9]
The
ruling of the Arbitrator is undated, and it was contended on behalf
of SAPS that it was only received on 25 March 2013. The
review
application was filed and served on 15 May 2013. In terms of section
32(2) of the Act, an application for review must be
filed within six
weeks from the date the award was published.
[2]
Accordingly, the delay in filing the review application is about six
days.
[10]
The
principles applicable in applications for condonation are well-known.
The court exercises its discretion in such matters having
considered
circumstances of each case, including whether it is in the interests
of justice to grant condonation, the extent of
the delay, the
explanation for the delay, the effect of the delay on the
administration of justice and other litigants, the importance
of the
issues and the prospects of success.
[3]
[11]
It cannot be doubted that a delay of about
six days is hardly excessive. I have also taken regard of the
explanation in this regard
as proffered by the SAPS’ Josiah
Rasi Mokoena in his founding affidavit, including that the papers for
the review application
were finalised on time, and that one Mhambi,
who was tasked by the Office of the State Attorney to service and
file the papers
timeously, had not done so prior to his resignation.
In the light of the non-excessive nature of the delay, the
explanation in
that regard, the SAPS’ prospects of success in
the review application, and a further consideration of the interests
of justice,
it is concluded that condonation ought to be granted.
The
arbitration agreement
[12]
The essential elements of the arbitration
agreement are:
a)
The Arbitrator will be appointed on a
rotation basis by the SAPS from the Dispute Resolution Panel;
b)
The Arbitrator will have the power to
decide upon the procedure to be followed at the hearing;
c)
The Arbitrator shall make an award which
he/she deems reasonable and appropriate in the circumstances;
d)
The Arbitrator’s award would be final
and binding;
e)
The Arbitrator was required to decide (in
respect of Malubane):
“
Whether
the conduct of SAPS was unfair towards the Trainee.”
f)
In respect of Mazibuko and Tlhakudi, the
Arbitrator was asked to decide:
(i)
Whether there is fair cause to make a
finding of misconduct against the Trainee and whether the sanction
imposed was fair;
(ii)
Whether there was a fair cause to terminate
the Agreement between SAPS and the Trainee; or
(iii)
Whether the conduct of SAPS was unfair
towards the Trainee.
The
arbitration proceedings
[13]
As
already indicated, a preliminary point was raised on behalf of the
Trainees at the commencement of the proceedings, which it
was
contended, went to the validity of the dismissal.
[4]
In this regard, the argument was that in purporting to terminate the
MOAs, the SAPS had not adhered to the provisions of clause 15
of
Annexure “C” to the MOA, insofar as Nyalungu had signed
off the notices or letters confirming the terminations.
It was argued
that only the Divisional Commissioner: Human Resources Development
had the authority to respond to the representations
made by the
Trainees after the termination of the MOAs, and when Nyalungu
purported to give notice of outcome of the representations,
he had
acted
ultra
vires
,
and the decision was therefore null and void.
[14]
The SAPS’ initial response to the
preliminary point was that any reference to “The Divisional
Provincial Human Resource
Development” was in regard to the
office
,
and
not the individual
,
and that Nyalungu had in signing off the terminations, acted on
behalf of those in power and was authorised to do so. At that
point,
the Arbitrator sought proof of delegated authority, and stood down
the matter to allow the SAPS’ representative at
the proceedings
to get proof that indeed Nyalungu had delegated authority. Prior to
doing so, the SAPS’ representative then
conceded that the point
raised pertained to a procedural issue, and that to the extent that
Nyalungu had no delegated authority,
then the substance of the
charges should be dealt with. The Arbitrator was still not satisfied
and had implored the SAPS’
representative to go and verify
whether Nyalungu had the necessary delegated authority to sign off
the confirmation of the termination
of the MOAs.
[15]
Nyalungu was then called upon to testify on
whether he signed the outcome of representation and/ or whether he
had authority to
consider the representation taking into account the
provisions of Annexure “C”. His evidence may be
summarised as follows:
15.1.
He is the Head: Human Resource Development,
and had been in the South African Police Service for over 30 years at
the time of the
arbitration. His duties included the management of
the Basic Training Development Department;
15.2.
He confirmed that he had signed the notices
of termination. He testified that the functions such as termination
and suspension of
Trainees were assigned to him by the Divisional
Commissioner, and that he reported to the Divisional Commissioner,
Lieutenant General
Mbekela;
15.3.
The Divisional Commissioner had assigned
him the referred functions verbally, but he had readily conceded that
the verbal instruction
did not amount to an amendment of the MOA, as
reference to ‘Divisional Commissioner’ referred to the
Office and not
the incumbent. He however contended that reference to
‘Divisional Commissioner’ also includes the Management
Team of
the Office, and as a result, and as it was normal practice,
he was assigned with the administration of the MOAs;
15.4.
He maintained under cross-examination that
he had the authority to sign the outcome of representations, and
contended that his conduct
did not infringe on the contractual rights
of the Trainees.
The
Ruling
[16]
The Arbitrator’s starting point was
to consider whether the MOAs were validly terminated, and her
reasoning in coming to her
conclusions was as follows:
16.1.
There was insufficient evidence to enable
her to make a finding on whether the authority vesting on the
Divisional Commissioner
to consider the representation was a
delegated authority or not;
16.2.
In terms of the MOA, the authority to
consider the representation was vested in the Divisional
Commissioner: Human resources Development,
Lieutenant General
Mbekela.
16.3.
If it was the intention of the parties that
the powers to consider the representation were to be vested in the
Office of the Divisional
Commissioner, and by extension, the person
within that Office, that would have been explicitly included in the
agreement, and any
delegated authority would have been in writing;
16.4.
Nyalungu therefore did not have the
authority to consider the representations made by the Trainees or the
authority to terminate
the MOAs. In the result, MOAs were not validly
terminated, and therefore the purported terminations were null and
void;
16.5.
In respect of the relief, the Arbitrator
found that the only competent order was for the Trainees to be
allowed back and continue
with the training programme from where they
had “left off”.
The
review test
[17]
Flowing
from the seminal decisions in
Lufuno
Mphaphuli and Associates (Pty) Ltd v Andrews & Another
[5]
and
Telcordia
Technologies Inc v Telkom SA Ltd
,
[6]
it is now accepted that awards emanating from proceedings conducted
under private arbitrations are reviewable only on the grounds
set out
in section 33 of the Act.
[7]
The Labour Appeal Court in
NUM
obo 35 Employees v Arbitrator John Grogan NO & Another
[8]
succinctly restated the review test as follows:
“
I
am inclined to agree with Counsel for the first respondent that, on
the facts of this case, it would not matter whether one used
the
standard of review applicable to CCMA awards as stipulated in sec 145
of the LRA or one used the standard of review contained
in sec 33 of
the Arbitration Act as the result would be the same. However,
in so far as it may be necessary to decide the
issue, I am of the
view that the respondent’s Counsel is correct that, since this
is a review of a private arbitration award,
it can only be reviewed
on the grounds set out in sec 33 of the Arbitration Act and not in
terms of the grounds set out in sec
145 of the LRA as extended by the
judgments of this Court in
Carephone
and
Shoprite
Checkers
and by the
judgment of the Constitutional Court in
Sidumo
.
In my view, while parties to a dispute are able to give an arbitrator
powers which he otherwise does not have in resolving
their dispute,
they cannot do the same with regard to a court such as the Labour
Court which has statutory power to review arbitration
award issued by
such arbitrator. Parties to a dispute such as the parties in this
case cannot confer on the Labour Court powers
to review a private
arbitrator’s award on grounds which it otherwise has no power
to rely upon to review such an award.
It would be different if
there was a provision of the LRA which conferred upon the Labour
Court the power to review such an award
on any grounds upon which the
parties to a dispute may agree. That is not the case here.
Accordingly, I hold that the
grounds of review applicable in this
case are only those grounds set out in sec 33 of the Arbitration Act
on which the appellant
has relied in its papers. In this regard
the appellant relied upon gross irregularity.”
[18]
Thus,
the
wider
test for review of section 145 of the Labour Relations Act
[9]
(LRA) is not applicable to private arbitrations, and in
Clear
Channel Independent (Pty) Ltd v Savage NO and Another
,
[10]
it was confirmed that the test as set out in
Telcordia
applied
in reviews of private arbitration labour disputes.
[19]
In
Telcordia
Technologies Inc,
the SCA further held
that courts should not be too eager to interfere with private
arbitration awards, and held that:
“
By
agreeing to arbitration parties to a dispute necessarily agree that
the fairness of the hearing will be determined by the provisions
of
the Act and nothing else. Typically, they agree to waive the right of
appeal, which in context means that they waive the
right to have
the merits of their dispute re-litigated or reconsidered. They may,
obviously, agree otherwise by appointing an arbitral
appeal panel,
something that did not happen in this case.”
[11]
And,
“
Last,
by agreeing to arbitration the parties limit interference by courts
to the ground of procedural irregularities set out in
s 33(1) of the
Act. By necessary implication they waive the right to rely on any
further ground of review, '”common law”
or otherwise. If
they wish to extend the grounds, they may do so by agreement but then
they I have to agree on an appeal panel
because they cannot by
agreement impose jurisdiction on the court.”
[12]
The
grounds of review
[20]
SAPS’ main contentions are that the
Arbitrator:
20.1.
committed a gross irregularity in the
conduct of the arbitration proceedings and/ or exceeded her powers;
20.2.
the ruling did not fall within the
Arbitrator’ terms of reference;
20.3.
made an error in law by finding that the
decision of Nyalungu to uphold the terminations was the actual
decision to terminate the
agreement;
20.4.
misconceived the nature of the inquiry she
was required to determine. In this regard, the applicant’s
argument was that
the Arbitrator had to determine whether the
Trainees were guilty of misconduct and if so, what ought to have been
the appropriate
sanction.
[21]
The Trainees in their answering affidavit
submitted that:
21.1.
this Court lacked jurisdiction to hear the
review application on basis that the ruling was issued in terms of
the Act, and further
that they were not “employees” as
defined;
21.2.
the parties by agreeing to arbitrate the
dispute under the Act agreed that the fairness of the hearing would
be determined by the
provisions of the Act; and had waived their
rights of appeal;
21.3.
the parties further agreed to limit the
interference by the Courts to the ground of procedural irregularities
set out in section
33(1) of the Act, and thus waived the right to
rely on any further ground of review, common law or otherwise;
21.4.
the SAPS’ application was meant to
ask the Court to exercise a mandate it did not have, as the only
grounds of review applicable
were those set out in section 33 of the
Act.
[22]
The SAPS’ response in this regard was
that a court may set aside an award in terms of the Act if the
grounds as outlined in
section 33(1) were met; that in terms of
section 157(3) of the LRA, any reference to the court in terms
of the Arbitration
Act must be interpreted as referring to the Labour
Court when an arbitration is conducted under that Act in respect of
any dispute
that may be referred to arbitration in terms of the Act;
and that this Court has jurisdiction to hear a dismissal dispute that
has been arbitrated in terms of the Arbitration Act, and that the
relationship between the parties must be determined in terms of
the
agreement between the parties.
[23]
SAPS’ further contended that the
Trainees were appointed in terms of Regulation 38(1); were paid
a stipend, and had received
other benefits. It was argued that there
was nothing in the MOAs that stipulated that the Trainees were not
employees, and further
reliance in support of this contention was
placed on the provisions of section 200A of the LRA to demonstrate
that the trainees
ought to be regarded as employees.
Evaluation
[24]
On 4 August 2016, the Trainees’
application in terms of rule 11(1)(a) and (2) of the Rules of this
Court came before Van Niekerk
J. In that application, they had
contended that the review application ought to be dismissed on the
basis that the SAPS had not
established the jurisdiction of this
Court as they were not “employees” as defined in section
213 of the LRA. They
had further contended that the ruling which was
the subject matter of the review application was final and binding,
and was thus
not subject to review by this Court.
[25]
The rule 11 application was however
withdrawn on its hearing date. Van Niekerk J had further
ordered that costs of that
application were to be determined together
with the review application. To the extent that this was the case, I
will accept that
the question of whether the Trainees were
“employees” or not is no longer an issue. In any event, I
am of the view
that the status of the Trainees as at the date of
termination of the MOAs is of no consequence in this case, as the
parties per
the provisions of the MOAs and Annexure “C”
had agreed to subject their dispute to private arbitration in terms
of
the Act, and accordingly, its section 33 is applicable.
[26]
Regarding
the issue of whether this Court has the requisite jurisdiction to
determine the review application, it is trite that the
competency of
this Court to adjudicate matters derives from the provisions of
section 157 of the LRA.
[13]
Section 157(3) of the LRA
[14]
enjoins this Court to adjudicate matters emanating from private
arbitrations in respect of disputes which may be referred for
arbitration under the LRA. Thus, for this Court to have the requisite
jurisdiction to consider this review application, the question
is
whether the underlying dispute between the parties is one that could
have been arbitrable under the provisions of the LRA.
[27]
The dispute referred for private
arbitration in this case pertained to the termination of the MOAs. In
this regard, the Arbitrator
was required to determine the issues as
per the terms of reference as agreed between the parties. In terms of
clause 7.3 of
the MOA, any termination of the agreement on
grounds of misconduct was to be dealt with in terms of the provisions
of Annexure
“C” to the MOA. Clause 12 of the MOA further
provides that any disputes between the parties in connection with the
interpretation, application or termination of the MOA shall, unless
resolved by the parties, be determined by arbitration as provided
for
in Annexure “C”.
[28]
Annexure “C” mainly deals with
misconduct during the training programme. Once the matter reaches a
stage where the Divisional
Commissioner makes a final determination
on the matter involving misconduct and the Trainee is dissatisfied,
the matter must be
referred to the Dispute Resolution Panel for
arbitration, which is appointed by the National Commissioner after
consultation with
recognised trade unions.
[29]
But for the above in-built dispute
resolution procedures as contained in the MOAs, the trainees would
ordinarily have been entitled
to refer the termination thereof to the
relevant bargaining council for determination. There is therefore no
merit in the argument
that this Court lacks jurisdiction to determine
the review application in the light of the provisions of section
157(3) of the
LRA and the authorities referred above.
[30]
A further argument raised on behalf of the
Trainees was that the ruling is not reviewable on the basis that the
Arbitrator’s
terms of reference specifically provided that her
award (or ruling as in this case) was ‘final and binding’.
This contention
equally has no merit. Awards and rulings issued under
section 138(7) of the LRA are meant to be final and binding in
accordance
with the provisions of section 143(1) of the LRA. This
however does not imply that they are not susceptible to a review
under the
provisions of sections 145 or 158 (h) of the LRA.
Equally so with private arbitrations, section 28 of the Act provides
that an award shall, subject to the provisions of the Act, be final
and not subject to appeal and each party to the reference shall
abide
by and comply with the award in accordance with its terms. The
provisions of section 33 however specify circumstances
where any
award issued under the Act may be reviewed. As far as I understood
the Trainees’ case, it was not contended that
this review
application was an appeal in disguise.
[31]
The next issue to be determined is whether
the grounds relied upon by SAPS in seeking relief are sustainable
within the provisions
of section 33 of the Act. Thus, it must be
determined whether the Arbitrator committed a gross irregularity in
the conduct
of proceedings, or alternatively, exceeded her powers as
alleged by SAPS.
[32]
As to
what constitutes the “exceeding of powers” was addressed
by the Supreme Court of Appeal in
Telcordia
Technologies Inc
[15]
in the following terms:
“
The
term ‘exceeding its powers’ requires little by way of
elucidation and this statement by Lord Steyn says it all:
“
But
the issue was whether the tribunal “exceeded its powers”
within the meaning of section 68(2)(b) [of the English
Act]. This
required the courts below to address the question whether the
tribunal purported to exercise a power which it did not
have or
whether it erroneously exercised a power that it did have. If it is
merely a case of erroneous exercise of power vesting
in the tribunal
no excess of power under section 68(2)(b) is involved. Once the
matter is approached correctly, it is clear that
at the highest in
the present case, on the currency point, there was no more than an
erroneous exercise of the power available
under section 48(4). The
jurisdictional challenge must therefore fail.””
[33]
Similarly,
in
Amalgamated
Clothing and Textile Workers Union of South Africa v Veldspun (Pty)
Ltd
,
[16]
Goldstone JA in a further elucidation of the grounds of review under
section 33 held that:
“
Before
considering these grounds, it is as well to emphasise that the basis
upon which a Court will set aside an arbitrator’s
award is a
very narrow one....”
“
It
is only in those cases which fall within the provisions of s 33(1) of
the Arbitration Act that a Court is empowered to intervene.
If an
arbitrator exceeds his powers by making a determination outside the
terms of the submission, that would be a case falling
under s
33(1)(b). As to misconduct, it is clear that the word does not extend
to bona fide mistakes the arbitrator may make whether
as to fact or
law. It is only where a mistake is so gross or manifest that it would
be evidence of misconduct or partiality that
a Court might be moved
to vacate an award:
Dickenson
and Brown v Fisher's Executors
1915 AD 166
at 174-81
.
It was held in
Donner
v Ehrlich
1928 WLD 159
at
161 that even a gross mistake, unless it establishes
mala
fides
or
partiality, would be insufficient to warrant interference.”
[17]
[34]
The SAPS’ argument is predicated on
the contention that the Arbitrator’s ruling did not fall within
her terms of reference.
Thus, in finding that the termination of the
MOAs as confirmed by Nyalungu was invalid, the inquiry is not whether
the Arbitrator
erroneously exercised powers vested in her but whether
she purported to exercise powers she did not have.
[35]
The arbitration agreement as already stated
is formulated in broad terms. The Arbitrator’s terms of
reference included a determination
of whether there was
a
fair cause
to make a finding of
misconduct against the trainees, whether there
was
a fair cause
to terminate the MOAs, and
whether the conduct of SAPS was
unfair
towards the Trainees. Clause 4 of the arbitration agreement granted
the Arbitrator the power to decide upon the procedure to be
followed
at the hearing, whilst clause 5 enjoined her to make an award which
she deemed
reasonable and appropriate in
the circumstances
.
[36]
Thus, to the extent that fairness was the
theme of the terms of reference, the question that arises is whether
the Arbitrator committed
an irregularity or exceeded her powers by
determining the validity of the termination of the MOAs. Thus, can it
be said that the
Arbitrator’s mandate was only confined to the
fairness of the termination of the MOAs in line with the terms of
reference
and her powers, or was she entitled to address and consider
any other points pertaining to the matter?
[37]
In
Telcordia
Technologies Inc,
the SCA held that
arbitrators can be “wrong in their exercise of duties”
and restated the position as follows:
“
The
fact that the arbitrator may have either misinterpreted the
agreement, failed to apply South African law correctly, or had regard
to inadmissible evidence does not mean that he misconceived the
nature of the inquiry or his duties in connection therewith. It
only
means that he erred in the performance of his duties. An arbitrator
‘has the right to be wrong’ on the merits
of the case,
and it is a perversion of language and logic to label mistakes of
this kind as a misconception of the nature of the
inquiry –
they may be misconceptions about meaning, law or the admissibility of
evidence but that is a far cry from saying
that they constitute a
misconception of the nature of the inquiry. To adapt the quoted words
of Hoexter JA: ‘It cannot be
said that the wrong interpretation
of the Integrated Agreement prevented the arbitrator from fulfilling
his agreed function or
from considering the matter left to him for
decision. On the contrary, in interpreting the Integrated Agreement
the arbitrator
was actually fulfilling the function assigned to him
by the parties, and it follows that the wrong interpretation of the
Integrated
Agreement could not afford any ground for review by a
court’”
[18]
And,
“
Likewise,
it is a fallacy to label a wrong interpretation of a contract, a
wrong perception or application of South African law,
or an incorrect
reliance on inadmissible evidence by the arbitrator as a
transgression of the limits of his power. The power given
to the
arbitrator was to interpret the agreement, rightly or wrongly; to
determine the applicable law, rightly or wrongly; and
to determine
what evidence was admissible, rightly or wrongly. Errors of the kind
mentioned have nothing to do with him exceeding
his powers; they are
errors committed within the scope of his mandate. To illustrate, an
arbitrator in a ‘normal’ local
arbitration has to apply
South African law but if he errs in his understanding or application
of local law the parties have to
live with it. If such an error
amounted to a transgression of his powers it would mean that all
errors of law are reviewable, which
is absurd.”
[19]
(Footnote omitted)
[38]
In this case, the issue of the invalidity
of the termination of the MOAs was raised right at the commencement
of private arbitration
proceedings. In
Lufuno
Mphaphuli and Associates
, it was held
that:
“
The
final question that arises is what the approach of a court should be
to the question of fairness. First, we must recognise that
fairness
in arbitration proceedings should not be equated with the process
established in the Uniform Rules of Court for the conduct
of
proceedings before our courts. Secondly, there is no reason why an
investigative procedure should not be pursued as long as
it is
pursued fairly. The international conventions make clear that the
manner of proceeding in arbitration is to be determined
by agreement
between the parties and, in default of that, by the arbitrator.
Thirdly, the process to be followed should be discerned
in the first
place from the terms of the arbitration agreement itself. Courts
should be respectful of the intentions of the parties
in relation to
procedure. In so doing, they should bear in mind the purposes of
private arbitration which include the fast and
cost-effective
resolution of disputes. If courts are too quick to find fault with
the manner in which an arbitration has been conducted,
and too
willing to conclude that the faulty procedure is unfair or
constitutes a gross irregularity within the meaning of section
33(1),
the goals of private arbitration may well be defeated.”
[20]
[39]
In my
view, given the wide powers conferred upon the Arbitrator in
accordance with clauses 4 and 5 of the arbitration agreement,
and the narrow approach that this Court is required to adopt in
reviews of this nature,
[21]
there was nothing that precluded the Arbitrator from considering
whether the terminations were valid or not as a point raised on
behalf of the Trainees. As far as those arbitration proceedings are
concerned, the Arbitrator went at length in affording the SAPS
an
opportunity to demonstrate that Nyalungu did indeed have the
requisite delegated authority to confirm the termination of the
MOAs.
There is in my view, no basis to suggest that the Arbitrator’s
approach in this regard was in any manner irregular,
or that she had
exceeded her powers in considering the point as raised, or that she
had incorrectly interpreted her terms of reference.
[40]
The validity in question pertained to
whether the SAPS had effected the terminations in accordance with the
terms and conditions
of the MOAs, and the Arbitrator’s
interpretation of Annexure “C” of the MOA cannot in my
view be faulted. Thus,
once it was established that Nyalungu did not
have the requisite delegated authority to terminate the MOAs, it
followed that the
terminations could not have been valid. The
contention by SAPS that Nyalungu merely acted in error can only be
affirmation of the
invalidity of his decision.
[41]
The SAPS’ contention that the
Arbitrator had to first determine whether the Trainees were guilty of
misconduct and if so,
what was the appropriate sanction is however
not without merit. This is so in that, in the light of the terms of
reference under
clause 2 of the arbitration agreement, the Arbitrator
was required to consider the merits leading to the termination of the
MOAs
and the fairness thereof.
[42]
Central to the determination of the merits
however, and as can be gleaned from the record of the proceedings and
the ruling itself,
is the initial decision to terminate the MOAs,
which was not even dealt with during the arbitration proceedings. To
the extent
that this was the case, that decision stands. What was
invalid however was the confirmation of that decision by Nyalungu in
contravention
of the provisions of Annexure ‘C’. Thus,
once that finding of invalidity was made, that was the end of the
matter.
There is however no merit in the contention that a finding of
invalidity extended to the initial decision to terminate the MOAs.
[43]
In the light of the above conclusions,
there is no basis for a conclusion to be reached that the Arbitrator
exceeded her powers
or committed any gross irregularity in the
conduct of proceedings. The only issue that remains however is
whether the relief granted
by the Arbitrator was reasonable and
appropriate in the circumstances, more specifically in the light of
her powers as encapsulated
in clause 5 of the arbitration agreement.
[44]
In
Steenkamp,
[22]
Zondo
J having considered a competent remedy within the context of an
invalid dismissal and the effect thereof held as follows:
“
The
common law which gives us the concept of the invalidity of a
dismissal is rigid. It says that if a dismissal is unlawful
and
invalid, the employee is treated as never having been dismissed
irrespective of whether the only problem with the dismissal
was some
minor procedural non-compliance. The consequences thereof are that
the employer must pay the employee full back-pay even
if,
substantively, the employer had a good and fair reason to dismiss the
employee.
[23]
And,
“
An
invalid dismissal is a nullity. In the eyes of the law an employee
whose dismissal is invalid has never been dismissed. If, in
the eyes
of the law, that employee has never been dismissed, that means the
employee remains in his or her position in the employ
of the
employer. In this Court’s unanimous judgment in
Equity
Aviation
,
Nkabinde J articulated the meaning of the word “reinstate”
in the context of an employee who has been dismissed.
She
said, quite correctly, it means to restore the employee to the
position in which he or she was before he or she was dismissed.
With
that meaning in mind, the question that arises in the context of an
employee whose dismissal has been found to be invalid
and of no force
and effect is: how do you restore an employee to the position from
which he or she has never been moved? That a
dismissal is invalid and
of no force and effect means that it is not recognised as having
happened. It is different from a dismissal
that is found to be unfair
because that dismissal is recognised in law as having occurred.”
[24]
(Footnotes
omitted.)
[45]
It is accepted that the above was stated
within the context of the interpretation of section 189A(2)(a)
read with section 189A(8)
of the LRA, in addressing whether
non-compliance with those provisions could lead to a finding of
invalidity or not. In this case
however, the issue was the
termination of the MOAs in terms of which the Trainees were
appointed, and not a dismissal within the
meaning of the provisions
of the LRA. Furthermore, the arbitration proceedings were conducted
in terms of the provisions of the
Act.
[46]
From the above, and considering the effect
of a declaration of invalidity as elucidated in
Steenkamp
,
what this implies then is that the purported termination of the MOAs
as effected by Nyalungu is a nullity, and of no force and
effect.
There is therefore no basis to interfere with the Arbitrator’s
findings, including the relief granted therein.
[47]
In regard to the issue of costs, as already
indicated elsewhere in this judgment, the Trainees had launched and a
rule 11 application
and withdrew it on 04 August 2016.
Nothing was presented before the Court as to the reason costs should
not be awarded
in that instance, especially in the absence of a
tender of costs prior to the withdrawal. In respect of the costs
pertaining to
this application, it is my view however that the
requirements of law and fairness militates against any such cost
order.
Order
[48]
In the premises, the following order is
made:
1.
The Applicant’s late filing of the
review application is condoned.
2.
The application to review and set aside the
undated ruling issued by the First Respondent is dismissed.
3.
The Second to Fourth respondents are
ordered jointly and severally, to pay the costs of the rule 11
application that was withdrawn
on 04 August 2016.
4.
There is no order as to costs in respect of
the review application.
__________________
E.
Thotlhalemaje
Judge
of the Labour Court of South Africa.
APPEARANCES
For the
Applicant:
Adv. P Pio
Instructed
by:
The State Attorney, Pretoria
For the
Second –
Fourth
respondents:
Adv. VP Ngutshana
Instructed
by:
Maoba Attorneys
[1]
Act 42 of
1965.
[2]
Section
32(2) which provides that:
“
The
court may, on the application of any party to the reference after
due notice to the other party or parties made within six
weeks after
the publication of the award to the parties, on good cause shown,
remit any matter which was referred to arbitration,
to the
arbitration tribunal for reconsideration and for the making of a
further award or a fresh award or for such other purpose
as the
court may direct.”
[3]
See
Melane
v Santam Insurance Co. Ltd
1962 (4) SA 531
(A) at 532B-E,
United
Plant Hire (Pty) Ltd v Hills 1976
(1)
SA 717 (A) at 720 E –G;
Brummer
v Gorfil Brothers Investments (Pty) Ltd
[2000] ZACC 3
;
[2000]
(2) SA 837
(CC) at 839 F.
[4]
Line 14 of
page 7 of the record of proceedings.
[5]
[2009] ZACC
6
;
2009 (4) SA 529
(CC);
2009 (6) BCLR 527
(CC).
(Lufuno
Mphaphuli and Associates)
[6]
[2006]
ZASCA 112
;
2007 (3) SA 266
(SCA;
2007 (5) BCLR 503
(SCA).
(Telcordia
Technologies Inc)
[7]
Section 33
of the Arbitration Act which provides:
“
(1)
Where
a)
Any member of an arbitration tribunal has
misconducted himself in relation to his duties as arbitrator or
umpire; or
b)
An arbitration tribunal has committed any
gross irregularity in the conduct of the arbitration proceedings or
has exceeded its
powers;
c)
An award has been improperly obtained,
the
court may, on the application of any party to the reference after
due notice to the other party or parties, make an order
setting the
award aside.”
[8]
[2010] 8
BLLR 799
(LAC); (2010) 31 ILJ 1618 (LAC) at para 33. See
also
Volkswagen
SA (Pty) Ltd v Koorts NO & Others
(2011)
6 BLLR 561 (LAC).
[9]
66 of 1995.
[10]
[2008] ZALC
166
;
[2009] 5 BLLR 439
(CC); (2009) 30 ILJ 1593 (LC) at para 36.
[11]
Telcordia
Technologies Inc
above n 6
at 50.
[12]
Id at para
51. See also
Volkswagen
SA (Pty) Ltd v Koorts NO & Others
(2011) 6 BLLR 561
(LAC); (2011) 32 ILJ 1892 (LAC) at para 9.
[13]
Section
157(1) which reads:
“
subject
to the Constitution and section 173, and except where this Act
provides otherwise, the Labour Court has exclusive jurisdiction
in
respect of all matters that elsewhere in terms of this Act or in
terms of any other law are to be determined by the Labour
Court.”
[14]
Section
157(3) of the LRA provides that:
“
Any
reference to the court in the Arbitration Act, 1965 (Act No. 42 of
1965), must be interpreted as referring to the Labour Court
when an
arbitration is conducted under that Act in respect of any dispute
that may be referred to arbitration in terms of this
Act.”
[15]
Telcordia
Technologies Inc
above n 6 at para 52.
[16]
1994
(1) SA 162 (A).
[17]
Id
at
page 169 B-D.
[18]
Telcordia
Technologies Inc
above n 6 at para 85.
[19]
Id a
t
para 86.
[20]
Lufuno
Mphaphuli and Associates
above n 5
at
para 236.
[21]
See
Academic
and Professional Staff Association v Pretorius SC N.O. and Others
[2008] 1 BLLR 1
(LC) para 59 where it was held that:
“
The
courts have, in dealing with review of private arbitration, adopted
a narrow approach. This approach confines itself to mainly
issues
related to procedural aspects of the arbitration. This approach is
mainly informed by the fact that private arbitration
flow from the
consent of parties, who, through an agreement, determine the powers
of the arbitrator.”
[22]
Steenkamp
and Others v Edcon Limited
[2016] ZACC 1
; (2016) 37 ILJ 564 (CC);
2016 (3) BCLR 311
(CC);
[2016] 4 BLLR 335
(CC);
2016 (3) SA 251
(CC).
[23]
Id at para
118.
[24]
Id at
para
189.