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[2018] ZALCJHB 348
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Gama v Transnet SOC Limited and Others (J3701/18) [2018] ZALCJHB 348 (19 October 2018)
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not
Reportable
Case
no: J3701/18
In
the matter between:
GAMA,
SIYABONGA Applicant
and
TRANSNET
SOC LIMITED
AND
THIRTEEN
OTHERS
Respondents
Heard:
16 October 2018
Delivered
: 19 October 2018
Summary:
Urgent application to interdict non-compliance with an
employment contract. Where the contract sought to be
enforced
provides for an arbitration process, the jurisdiction of the Court is
not ousted but a Court would direct a party to comply
with the
process first before approaching a court of law. A declaratory relief
seeks to declare the rights of the parties. Held:
(1) The matter is
heard as one of urgency. (2) It is declared that the applicant's
contract of employment incorporates the first
respondent's
Disciplinary Code and Procedure. (3) The application is stayed
pending the outcome of the arbitration process contemplated
in the
employment agreement. (4) Each party to pay its own costs.
JUDGMENT
MOSHOANA,
J
Introduction
[1]
This is an urgent application in terms of which the applicant is
seeking a declaratory, a final interdict and other ancillary
reliefs.
The application. is opposed by all the respondents. Before writing
this judgment, I afforded the parties' representatives
an opportunity
to reconsider their respective positions in light of certain
concessions made during argument. This opportunity
came to naught.
Disappointing as it may have been, this court was compelled to pen
down this judgment.
Background
facts
[2]
Given the view I take at the end it is unnecessary to punctiliously
state the facts of this matter. Suffice to state that the
applicant
and the respondent entered into .a contract of employment on 13 April
2016. In terms of the contract, the applicant was
appointed as a
Group Chief Executive of the respondent. Around August 2018, the
Board of the respondent through its Chairperson,
Mr Popo Molefe
served the applicant with a notice of intention to suspend him from
duty. The applicant, through his appointed attorneys
made
representations why he should not be placed on suspension. The
applicant was not suspended, instead, on 1 October 2018, he
was
served with a notice to show cause as to why he should not be
terminated as an employee of the Transnet. By 15 October 2018,
and if
no cause was shown, the applicant would have been terminated.
Aggrieved by the threat of imminent termination, the applicant,
on 12
October 2018, approached this Court in order to be heard on 16
October 2018. After hearing submissions, I reserved my judgment
to be
delivered on 19 October 2018.
Evaluation
[3]
Although the respondents resisted that the matter must be treated as
one of urgency, citing amongst others abuse of the court
process, I
heard the matter. The reason being that the applicant's termination,
which he viewed to be in breach of his contract
of employment was to
happen soon. Hearing a matter as one of urgency involves an exercise
of discretion. Whether a matter should
be treated as one of urgency
i,s an issue to be decided case by case, taking into account the
facts of each. f was satisfied that
the applicant's matter is
sufficiently urgent.
[4]
With regard to a declaratory relief, Mr Cassim SC appearing for the
respondents rightly conceded that the Disciplinary Code
is
incorporated in the employment contract. He, however, submitted that
there is a conflict between the employment contract and
the code.
Given the view I take at the end, I choose not to decide whether
there is a conflict between the contract and the code.
The forum that
the parties chose may be seized with this argument if it is not
abandoned.
[5]
The concession was correctly made if regard is had to clause 16 read
with the provisions of the code. It has been long resolved
that the
interpretation of a document, contracts included, is a matter of law.
It requires consideration of the document as a whole
as opposed to
one clause. An interpretation exercise is there for the sole purpose
of establishing the intention of the parties.
My interpretation of
clause 16 of the employment contract suggests that the code is part
of the contract. Clause 2 1 of the code
makes it clear that the code
forms part of an employee's terms and conditions of employment and it
applies to all employees. In
the preamble of the employment contract
it is made clear that the agreement contains terms and conditions of
employment.
[6]
This finding suggests that the provisions of clause 6.2 of the code
constitute terms and conditions of the employment agreement.
The
process followed by the respondent in the letter of 1 October 2018 is
not one contemplated in clause 6.2. The applicant contends
that such
amounts to a breach of the agreement. Yet again, I choose not to
decide whether there is a breach of the agreement. The
respondent's
answer to this allegation is that there is a conflict between the
terms as set out in the policy, although incorporated
in the
agreement, and the employment agreement. As pointed out above, I am
not to decide the issue whether given the alleged conflict,
clause
6.2 does not find application.
[7]
Clause 19 of the agreement, as
now incorporating clause 6.2 of the code, provides that should any
dispute arise regarding the interpretation;
the effect; the parties'
respective rights of obligations under; a breach of; the termination
of; or any matter arising out of
the termination shall be decided by
arbitration. In alleging that the process undertaken by the
respondent through the letter of
1 October 2018 is unlawful, the
applicant is effectively alleging that the respondent is in breach.
In terms of clause 19 of the
agreement, a dispute around a breach
should be decided by arbitration. An arbitration agreement does not
deprive the court of its
ordinary jurisdiction over the disputes
which it encompasses. All it does is to oblige the parties to refer
such disputes in the
first instance to arbitration, and to make it a
prerequisite to an approach to Court for a final judgment, that is
what should
have happened
[1]
.
[8]
In the interim, the duty of the
Court is to give appropriate directions and to exercise due
supervision. The Constitutional Court
in
Lufuno
Mphaphu/i and Associates (Pty) Ltd v Andrews and another
[2]
said the following: ·
'The
decision to refer a dispute to private arbitration is a choice which,
as long as it is voluntarily made, should be respected
by the
courts...'
[9]
Court in
Mmethi
v DNM Investment
CC
t/a
Bloemfontein Celtics Football Club
[3]
after traversing various
authorities, had the following to say:
'In short the principle
in our law is that a clause in an agreement, as is the case in the
present matter, which provides for a
dispute to be referred to
arbitration does not preclude a party from initiating court
proceedings to have the dispute adjudicated
by the court. What an
arbitration clause however does is that it obliges the parties in the
first instance to refer the dispute
to arbitration. As stated earlier
a party seeking to invoke and rely on the arbitration clause in the
agreement must request a
stay of such proceedings, pending the
determination of the matter by an arbitrator.
The
court retains discretion whether or not to entertain the matter or
hold the parties to their agreement and order them to resolve
their
dispute in terms of their agreement but retain the supervisory power
over the arbitration process.'
[10]
I fully agree with the above. Only in cases where special
circumstances have been pointed out would a Court entertain a matter.
No such special circumstances have been brought to my attention.
Instead, Mr Nalane for the applicant submitted that since the
respondent is the first one to allege a breach, it ought to refer the
dispute to arbitration and not the applicant. The question
is not who
should refer, but whether the parties agreed that once they are in
dispute, as it is tt;le case in this matter, who
should decide that
dispute. The parties voluntarily chose an arbitrator over the court.
The parties did recognize the court's supervisory
role when they
inserted clause 19.8.
[4]
[11]
The applicant did not refer the dispute alleging breach of the
employment agreement to the arbitrator as agreed. Absent special
circumstances, I am unable to determine the dispute between the
parties. A final relief of an interdict is issued only in instances
where a clear right has been shown. The applicant has no right not to
be dismissed. The right to be dismissed after following the
procedure
set out in clause 6.2 of the Code has not been made clear. The
parties are in dispute and their dispute in that regard
can only be
resolved by an arbitrator as they agreed in 2016. For those reasons,
I am unable to interdict the respondent.
[12]
Had the applicant referred a dispute to an Arbitrator and the
respondent sought to take the law into its own hands as it were,
the
applicant could approach this court for an interim relief pending the
outcome of the arbitrator. Since it is now common cause
that there is
a dispute, the nature of which is to be specified by the referring
party, I can only stay these proceedings pending
the outcome of the
arbitration process. At this stage, I can only assume that the
respondent would not take the law into its own
hands. It would be an
unnecessary exercise for the applicant to return to this court for an
interim relief pending the outcome
of the arbitration process. Unless
the parties arrive at an amicable solution, it seems pretty obvious
to me that the dispute should
be arbitrated instead. As a comment in
passing, if the arbitrator resolves that there is a breach, it might
be that the respondent
would have to undertake the process
contemplated in clause 6.2 of the code and abandon its truncated
process. That being a possibility,
it seems to be in the best
interest of these parties to consider finding a lasting solution. Of
course whether the truncated process
is not in breach, it is the
question to be decided by an arbitrator.
Conclusions
and summary
[13]
For all the above reasons, I conclude that the disciplinary code
forms part of the employment agreement. I further conclude
that
pending a referral of the dispute to arbitration, the present
application is stayed. An interdict cannot be issued since the
issue
whether the applicant has the right to a process contemplated in
clause 6.2 of the code as opposed to the truncated process
is still
to be determined through arbitration. In relation to costs, I take
into account the fact that the issue of the arbitration
clause
preventing this court to deal with the matter was only raised in
argument. In their answering papers, the respondents did
not deal
with the requirement nor did it request a stay pending a referral.
Owing to the fact that the issue of a plea in abeyance
is more a
point of law, I allowed Mr Cassim SC to pursue it in argument. Mr
Nalane did not necessarily object to this point being
raised. For
those reasons an appropriate order to make is that of each party
paying its own costs.
Order
[14]
In the results I make the following order:
1. The application is heard as one of
urgency;
2. It is declared that the applicant's
contract of employment incorporates the Transnet SOC Limited's
Disciplinary Code and Procedure;
3. This application is stayed pending
a referral to arbitration· and determination of the dispute as
contemplated in clause
19.1 0f the employment agreement;
4. Each party to pay its own costs.
____________________
GN
Moshoana
Judge
of the Labour Court of South Africa.
Appearances
For
the Applicant: Advocate J Nalane
Instructed
by: MSMM Inc, Pretoria
For
the Respondent: Advocate N Cassim SC
Instructed
by: MNS Attorneys, lllovo.
[1]
See: Parakh v Shah Cinemas (Pty) Ltd and others 1980 (1) 301 (d)
quoted with approval in PCL Consulting (Pty) Ltd t/a Phillips
Consulting SA v Tressa Trading 119 (Pty) Ltd 2009 (4) SA 68 (SCA).
[2]
2009 (6) BCLR 527
(CC) at para 219.
[3]
(2011) 32 ILJ 659 (LC) at para 17.
[4]
This clause 19.1 shall not preclude any party from obtaining interim
relief on an urgent basis from a court of competent jurisdiction
pending the decision of the arbitrator. [My own underlining and
emphasis]