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[2017] ZALCJHB 148
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Lusitania Food Products (Pty) Ltd v Commission for Conciliation, Meditation and Arbitration and Others (JR2454/10, JI304/13) [2017] ZALCJHB 148 (8 May 2017)
IN
THE LABOUR COURT OF SOUTH AFRICA
HELD
AT JOHANNESBURG
Case
Nos: JR 2454/10 and JI 304/13
In
the matter between:
LUSITANIA
FOOD PRODUCTS (PTY) LTD
Applicant
and
COMMISSION
FOR CONCILIATION MEDIATION
First Respondent
AND
ARBITRATION
MYHILL
E,
N.O.
Second Respondent
NICOLE
AUTUMN
MARTIN
Third
Respondent
Heard:
2 March 2017
Judgment:
8 May 2017
Summary:
Judgment on costs only in respect of two related applications.
Applicant’s conduct in the litigation unreasonable
and
vexatious warranting award of costs on the attorney and client scale.
Not demonstrated that the manner in which litigation
conducted
attributable entirely to the applicant’s attorney or that the
conduct of the applicant’s attorney rose to
the level of
negligence in a serious degree. Costs
de
bonis propriis
against
the applicant’s attorney therefore not warranted.
JUDGMENT
BARNES
AJ
Introduction
[1]
This judgment concerns
the question of costs only. It does so in respect of two related
applications – a review application
launched under case number
JR 2454/10 and an interlocutory application launched under case
number JI 304/13.
[2]
The two applications
were set down to be heard together on 2 March 2017. On 1 March 2017,
the applicant filed a notice of withdrawal
of the review application.
This effectively rendered the relief sought in the interlocutory
application moot.
[3]
While the applicant did
not tender costs in its notice of withdrawal, counsel for the
applicant, Ms Sibeko, did so in court on 2
March 2017. Counsel for
the third respondent, Mr Goslett submitted, however, that this is a
case which warrants a costs order on
the attorney and client scale to
be paid
de bonis
propriis
by the
applicant’s attorney. Mr Goslett stated that upon receiving the
applicant’s notice of withdrawal on 1 March
2017, the third
respondent’s attorney advised the applicant’s attorney in
writing that it intended to seek such a costs
order. Ms Sibeko
confirmed this.
[4]
In order to determine
the appropriate costs order, it is necessary to have regard to the
history of the litigation in this matter.
I do so below.
The
History of the Litigation
[5]
On 15 August 2008, the
third respondent resigned from her employment with the applicant and
referred a constructive dismissal dispute
to the Commission for
Conciliation, Mediation and Arbitration (“the CCMA”).
[6]
Following an
arbitration, the CCMA issued an award in the third respondent’s
favour, finding that she had been constructively
dismissed and
ordering the applicant to pay her R124 032.00 as compensation.
[7]
On 23 September 2010,
the applicant launched an application to review and set aside the
arbitration award under case number JR 2454/2010.
[8]
On 10 December 2010 the
applicant filed the record.
[9]
The applicant failed,
however, to file a notice in terms of Rule 7A(8).
[10]
In February 2011, and
in the absence of any further steps having been taken by the
applicant in the review application, the third
respondent filed an
answering affidavit. The third respondent states that it did so as a
“precautionary measure.”
[11]
On 15 September 2011
the registrar directed the applicant to file heads of argument in the
review application. It failed to do so.
[12]
On
19 June 2012 the arbitration award was certified in terms of section
143(3) of the Labour Relations Act
[1]
(“the LRA”).
[13]
A writ of execution was
issued and on 4 March 2013, the sheriff attached movable property
belonging to the applicant in execution
of the award. This was
released in terms of an agreement between the parties on the basis
that the applicant indicated that it
intended to apply for a stay of
execution. The applicant failed to bring an application for a stay.
[14]
In the circumstances, a
further writ was issued on 11 April 2013 and funds belonging to the
applicant were attached on 30 April
2013.
[15]
That attachment gave
rise to the applicant launching an interlocutory application to set
aside the attachment and stay the execution
of the award pending the
outcome of the review application. The interlocutory application was
launched on 8 August 2013 under case
number JI 1304/13.
[16]
On 1 July 2013, the
third respondent filed its answering affidavit in the interlocutory
application together with a counter application
in which it sought
the dismissal of the review application.
[17]
The applicant filed no
answering affidavit to the counter application.
[18]
The third respondent
set its counter-application down for hearing on 29 April 2015. The
applicant filed heads of argument which
dealt with the review
application instead of the counter-application. As a consequence, the
applicant was forced to apply for a
postponement on 29 April 2015.
The postponement was granted and the applicant was ordered to pay the
wasted costs.
[19]
Thereafter, the
applicant took no further steps in relation to either the review
application or the interlocutory application.
[20]
The third respondent
then took steps to have both applications set down for hearing
simultaneously. On 25 November 2016, a notice
of set down was sent to
both parties advising the parties that the applications had been set
down for hearing on 2 March 2017.
[21]
The applicant failed to
file heads of argument.
[22]
On 1 March 2017, the
applicant filed a notice of withdrawal of the review application. The
effect of that was to render the relief
sought in both the
applicant’s interlocutory application and the third
respondent’s counter application moot.
[23]
Upon receipt of the
notice of withdrawal, the third respondent’s attorney gave the
applicant’s attorney written notice
that it intended to apply
for a costs order on the attorney and client scale to be paid
de
bonis propriis
by
the applicant’s attorney.
Attorney
and Client Costs?
[24]
It
is well established that a court will not order a litigant to pay the
costs of another litigant on the attorney and client scale
unless
there are special grounds justifying this. Such grounds have been
found to be present in cases where litigants have been
guilty of
dishonesty or fraud or where their motives have been vexatious,
reckless, malicious or frivolous, or where they have
acted
unreasonably in the conduct of the litigation or where their conduct
has been in some way reprehensible.
[2]
[25]
In
Gois
t/a Shakespeare’s Pub v Van Zyl and Others
(2003)
24 ILJ 2302 (LC), this Court held as follows:
“…
.this
court may make a punitive costs order such as costs on an attorney
and client scale where it believes it appropriate to do
so. Factors
to consider whether or not to grant such punitive costs orders
include where the conduct of the party –
(a)
is
vexatious and amounts to an abuse of the legal process, even though
there is no intention to be vexatious;
(b)
evinces
a lack of bona fides;
(c)
is
reckless, malicious and unreasonable.”
[3]
[26]
As is evident from the
above, the applicant was guilty of inordinately long periods of
inactivity in relation to both applications
launched by it. The
applicant took no steps to prosecute its review application after
filing the record on 10 December 2010. Moreover,
the applicant took
no steps whatsoever to prosecute its interlocutory application after
launching it on 8 August 2013.
[27]
Also notable is the
fact the applicant failed to take any steps to defend the counter
application brought by the third respondent
for the dismissal of the
review application.
[28]
The applicant failed to
file heads of argument when required to do so. Ultimately, when the
applications were finally set down to
be heard at the third
respondent’s instance, the applicant filed a notice of
withdrawal of its review application. It did
so at the eleventh hour.
[29]
All these facts taken
together make it difficult, in my view, to resist the conclusion that
the applicant was not serious about
prosecuting its applications but
sought mainly to delay and obstruct the third respondent in her
efforts to execute the award.
I am of the view that the applicant’s
conduct in this regard was unreasonable and vexatious and that a
costs order on the
attorney and client scale is therefore warranted.
Costs
de Bonis Propriis
?
[30]
The circumstances in
which a costs order
de
bonis propriis
may
justifiably be imposed are however significantly more exacting.
Negligence in a serious degree must be established on the part
of the
party against whom such a costs order is sought. Thus in
Moloi
and another v Euijen and another
(1999) 20 ILJ 2829 (LAC) the Labour Appeal Court held as follows:
“
Costs
de
bonis propriis
are
awarded against legal practitioners in cases which involve serious
delinquencies such as dishonesty, wilfulness or negligence
in a
serious degree.”
[4]
[31]
That this is the
appropriate standard was confirmed by the Constitutional Court in
SA
Liquor Traders Association v Chairperson, Gauteng Liquor Board and
Others
2009 (1) SA
565
(CC) in the following terms:
“
An
order of costs de bonis propriis is made against attorneys where a
court is satisfied that there has been negligence in a serious
degree
which warrants an order of costs being made as a mark of the court’s
displeasure.”
[5]
[32]
In that case the
Constitutional Court referred to the case of
Waar
v Louw
1977 (3) SA
297
(O) in which the court said the following:
“
The
tendency of time past was to make attorneys pay for their mistakes by
means of an order of costs
de
bonis propriis
.
And the reason for such an order against an attorney is quite clear.
The office of an attorney is a high and responsible office.
The
attorneys’ profession is a learned profession requiring great
skill from its members. Mistakes which an attorney makes
in
litigation and which result in unnecessary costs should, therefore,
not lightly be overlooked. And a litigant should not always
be
obliged himself to the costs which have been caused by the negligence
of his attorney. But too strict action should not be taken
against an
erring attorney. The administration of justice is sometimes an
irritating discipline, and even the most skilful practitioners
can
make mistakes which cause unnecessary costs. The attorney’s
profession should not be moved by too lenient an attitude
to loosen
its reins, but should also not be demoralised by too much cracking of
the whip. As usual, in the affairs of man, the
middle course s best.
The circumstances under which a court can make an order of costs
de
bonis propriis
against an attorney should be reasonably serious, as, eg, dishonesty,
wilfulness or negligence of a serious degree.”
[6]
[33]
In this case, I do not
believe that it has been demonstrated that the manner in which the
litigation was conducted was attributable
entirely to the applicant’s
attorney or that the conduct of the applicant’s attorney rose
to the level of negligence
in a serious degree. I am therefore not
persuaded that an order of costs
de
bonis propriis
against the applicant’s attorney is warranted.
[34]
In the circumstances I
make the following order.
Order
1.
The applicant is to pay
the third respondent’s costs incurred under case numbers JR
2454/10 and JI 1304/13 on the attorney
and client scale.
__________________________
Heidi
Barnes
Acting
Judge of the Labour Court
Appearances:
For
the Applicant: Adv X Sibeko instructed by Kirchmanns Inc
For
the Third Respondent: Adv R Goslett instructed by Craig Ballie
Attorneys
[1]
Act 66 of
1995.
[2]
See Erasmus
Superior
Court Practice
at E12-20 and the footnotes cited there.
[3]
At para 43.
[4]
At para 27.
[5]
At para 54.
[6]
At para