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[2019] ZALCJHB 281
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Glencore Coal South Africa Limited v Commission for Conciliation, Mediation and Arbitration and Others (JR843/15) [2019] ZALCJHB 281 (8 October 2019)
IN
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not
Reportable
case
no: JR 843/15
In
the matter between:
GLENCORE
COAL SOUTH AFRICA LIMITED
Applicant
and
COMMISSION
FOR CONCILIATION, MEDIATION
AND
ARBITRATION
First Respondent
COMMISSIONER
T NTIMBANA N.O.
Second Respondent
R
CHIPANE
Third
Respondent
V
CHIBI
Fourth
Respondent
Heard:
16 July 2019
Delivered:
08 October 2019
JUDGMENT
SAUNDERS,
AJ
Introduction
[1]
This is an application brought by the applicant to review and set
aside
a rescission ruling issued by the second respondent on 31 March
2015 and received on 6 April 2015, in which the second respondent
dismissed an application for the rescission of a default arbitration
award issued on 4 March 2015.
[2]
The default arbitration award found that the dismissal of the third
and
fourth respondents was substantively and procedurally unfair and
ordered their reinstatement with full retrospective effect.
Background
Facts
[3]
A dismissal dispute launched by the third and fourth respondents was
referred
to the Commission for Conciliation, Mediation and
Arbitration (CCMA) and set down for con-arb on 27 February 2015. The
applicant
was not present on 27 February 2015 and a default award was
issued under case number MP953-15 by the second respondent.
[4]
The default
award was received on 6 March 2015 and the deponent to the rescission
application states under oath that he immediately
contacted the CCMA
and requested the relevant documentation.
[1]
The rescission application was deposed to and launched timeously. The
rescission application remained unopposed and was ultimately
refused
by the second respondent.
[5]
The applicant launched this review application in May 2015, which was
opposed by the third and fourth respondents. The answering affidavit
is, on the version of the third and fourth respondents, 140
days
late. I am of the view that the interests of justice warrant the
granting of condonation in respect of the answering affidavit.
[6]
This matter turns on whether there was proper notice of set down of
the
con-arb process served on the applicant. It is common cause that
the notice of set down was sent by registered post on 13 February
2015 for a hearing on 27 February 2015. The notice of set down was
also faxed to the applicant. There was an element of confusion
as to
how many numbers it was faxed to. This shall be dealt with hereunder.
[7]
In respect
of the postal address, the papers state that the applicant did not
receive the notice of set down sent via registered
post. In argument,
it was highlighted that the incorrect address was used. While the
number of the postal address was correct,
a PO Box address was used
by the first respondent, instead of the correct address, which was
the Private Bag X address
[2]
.
[8]
On this basis, it is not necessary for me to consider whether this
service
was timeous and whether it gave the requisite notice in terms
of the rules of the CCMA. Simply put, it was the incorrect address
and therefore service was not effected.
[9]
In respect
of the fax numbers, three fax transmission slips were included in the
bundle.
[3]
Two of the
transmission slips illustrate an unsuccessful transmission and the
third indicates transmission to the following number:
(013) 655
2348. The version set out by the applicant was that this was
unsuccessful as it was sent to a totally different
complex, the
Impunzi complex.
[4]
The fax
number (013) 653 5349 is a correct number for the applicant, but
the first, third and fourth respondents erroneously
used 3549 instead
of 5349.
[5]
This is evident from
the con-arb set down notice as well as the Form 7.11 submitted by the
third and fourth respondents.
[10]
In short, no service of the set down was effected.
[11]
The second respondent’s finding is encapsulated at paragraph
[16] which states as
follows:
‘
After
consideration of the above submissions, failure to attend by the
respondent was wilful. The notice of set down was properly
served to
the respondent on time by registered mail on the same address as
provided in this application for rescission…’
[12]
The award continues at paragraph [17] to state that:
‘
There
was no explanation as to how a default award was received within
three days after such award was issued. It is evident from
the file
that the respondent received the default award through the same fax
number used to serve the notice of set down. In the
circumstances,
the respondent failed to show good cause for non-attendance.’
[13]
As highlighted above, this was not the case, as the first respondent
and the third and
fourth respondents had made an error in the fax
numbers. The default award had been received but the notice of set
down and Form
7.11 had not.
[14]
The first ground of review was that the commissioner committed an
irregularity by finding
that the applicant had received proper notice
of set down of the con-arb when the registered post had not been sent
with the requisite
14 days’ notice of the set down.
Furthermore, it was not received.
[15]
The second ground of review was that the commissioner found that the
applicant had received
the posted notice of set down which was not
the case. The commissioner found that service by fax to a number at a
different site
to the Impunzi complex (which belonged to the
applicant) could constitute service.
[16]
The third
ground of review was that the commissioner should not have found that
the individual respondents had been dismissed on
the basis of two
letters, when the individual functions had been outsourced to Burea
Veritas in terms of a section 197 of the Labour
Relations
Act
(LRA)
[6]
transfer and the respondents were both employed by Burea Veritas
thereafter. Reinstatement would therefore be an impossible remedy
in
circumstances where the third and fourth respondents are already
employed by another employer as a result of outsourcing.
[17]
The fourth ground of review is that the commissioner placed relevance
on how the default
award was received from the different complex to
the Impunzi complex.
[18]
The fifth ground of review was that the commissioner granted relief
in circumstances where
it was clear that the third and fourth
respondents had been employed by the organisation which had taken
over the laboratory function
of the applicant.
The
relevant test for review of rescission applications
[19]
As one of the central issues is whether or not the second respondent
properly applied the
principles relating to rescission applications,
it is important to set out exactly what these principles are. The
fact is that
the failure by the second respondent to apply the
required principles in determining a rescission application as
required by law
would constitute a reviewable irregularity.
[20]
The basic
test for determining a rescission application is found in the
judgment of
Superb
Meat Supplies CC v Maritz,
[7]
where it was held as follows:
‘
The
applicant must give a reasonable explanation of his default; his
application must be made bona fide; he must show that he has
a bona
fide defence to the plaintiff's claim. This needs to be shown prima
facie only and it is not necessary to deal fully with
the merits of
the case or to prove the case. It is sufficient to set out facts
which, if established at the trial, would constitute
a good defence.
The defence must have existed at the time of the judgment.
In determining whether or
not good cause has been shown, the court is given a wide and flexible
discretion in terms of rule 31(3)(b).
When dealing with words such as
'good cause' and 'sufficient cause' the Appellate Division has
refrained from attempting an exhaustive
definition of their meaning
in order not to abridge or fetter in any way the wide discretion
implied by these words. The court's
discretion must be exercised
after a proper consideration of all the relevant circumstances.’
[21]
In
Northern
Training Trust v Maake and Others,
[8]
the Court said:
‘
The enquiry in an
application for the rescission of an arbitration award is
consequently bipartite. The first leg is one which is
concerned with
whether or not the notice of set-down was sent (for instance by fax
or registered post). Should evidence show that
the notice was sent, a
probability is then created that the notice sent was received. The
second leg to the enquiry is one which
concerns itself with the
reasons proffered by the applicant who failed to attend the
arbitration proceedings. Such applicant needs
to prove that he or she
was not wilful in defaulting, that he or she has reasonable prospects
of being successful with his or her
case, should the award be set
aside. However, the applicant needs not necessarily deal fully with
the merits of the case.
The
two requirements of fairness and expedition should be balanced. Where
there is an apparent conflict between the two, fairness
should be
given precedence lest injustices are done.’
[22]
The above clearly illustrates that a rescission application requires
a proper determination of
the issue of whether “good cause”
exists to rescind a default award. The determination of “good
cause”
requires a two- tier investigation, the first being the
consideration of the explanation for the default and the second being
a
consideration of the issue of prospects of success. Furthermore,
was the application a
bona fide
one. Finally, there are
considerations of fairness.
The
issue of the explanation
[23]
It is apparent that service of the notice of set down was not
effected, either timeously or at
all. In this respect, the second
respondent was incorrect in his finding.
[24]
The judgment in
Ndhlela
v Transnet Ltd
[9]
is pertinent:
‘
An
ingredient of the requirement that good cause be shown is that the
element of wilfulness must be absent. The reasons for an applicant's
absence or default must be set out because they are relevant to the
question of whether or not the default was wilful. Before an
applicant can be said to be in wilful default the following elements
must be shown:
•
knowledge
that the action is being brought against him or her;
•
a
deliberate refraining from entering an appearance or appearing,
though free to do so; and
•
a
certain mental attitude towards the consequences of default.’
[25]
With regard to the issue of the explanation provided by the applicant
in this matter, the simple
explanation of the applicant is that the
notice of set down was sent to the incorrect postal address and to
the incorrect fax number.
This was set out extensively in the papers
and the argument. There is little doubt that the applicant did not
receive the notice
of set down. On this basis, there can be no
knowledge of the pending dispute and therefore no wilfulness in the
resultant absence
by the applicant.
[26]
The second respondent does not deal with any of the above issues. The
second respondent did not
cross-reference the correct fax numbers and
postal addresses. A proper analysis of the Form 7.11 and the proof of
faxes and postal
address against the letters of dismissal would have
highlighted that the details were not, in fact, correct. On this
basis, service
could not have been effected and therefore, the
conclusions that service was effected and that the default was wilful
are unsustainable
and irregular and fall to be set aside.
The
explanation that the applicant was unaware of the hearing date was
reasonable and acceptable.
[27]
It is accordingly my view that
there was a proper, and in essence, an undisputed explanation as to
why the applicant did not attend the arbitration, being that
it in
fact never received the set down notice and was unaware of the
con-arb process on 27 February 2015. Reference is accordingly
made to
the judgment in
Electrocomp
(Pty) Ltd v Novak
[10]
where the Court held as follows:
‘
The
principle laid down in
Federale Stene
and a line of preceding
cases including
Topol and
Others v L S Group Management
Services (Pty) Ltd
1988 (1) SA 639
(W), establishes that where a
party to an application was genuinely unaware of the date of set
down, the granting of judgment by
default would be erroneous and it
is not necessary for the party concerned to have shown or proved good
cause.’
[28]
In the circumstances, where not only was the applicant unaware of the
set down, but the set down
had not actually been served, the granting
of the judgment by default was erroneous, and similarly, so was the
refusal of the application
for rescission.
[29]
I conclude that the applicant has provided a
bona fide
and
acceptable explanation for not attending at the arbitration on 27
February 2015. Finally, fairness in this instance dictates
that the
applicant be afforded the opportunity to present its case on the
merits of the matter.
Conclusion
[30]
Based on all of the above, it is my view that the rescission ruling
of the second respondent
constitutes a reviewable irregularity and
cannot be allowed to stand. The applicant did provide an acceptable
explanation for its
default and has shown the requisite prospects of
success. Finally, it is in the interest of justice and fairness that
the applicant
be given an opportunity to present its case on the
merits of this matter. After hearing submissions in respect of this
matter,
I intend to substitute the rescission ruling of the second
respondent with an order that the applicant’s application for
rescission is granted.
[31]
This then only leaves the issue of costs. While the matter was
opposed, the fact that a hearing on the merits between
the parties is
still to come, I do not believe that a costs order is appropriate. In
the interests of fairness in this instance,
I intend to make no order
as to costs.
[32]
In the premises, I make the following order:
Order
1.
The condonation application for the late filing of the answering
affidavit is granted.
2.
The rescission ruling issued by the second respondent under case
number MP 953 dated 31 March 2015 is
reviewed and set aside and
substituted with the following order:
2.1 The
default award issued by the second respondent is rescinded.
3.
The first respondent is directed to set the arbitration proceedings
down for hearing on the merits
before an arbitrator other than the
second respondent.
4.
There is no order as to costs.
____________________
S.
Saunders
Acting
Judge of the Labour Court of South Africa
Appearances:
For
the Applicant: Mr
B. Masuku of Mervyn Taback Incorporated
For
the Third Respondent: Mr
N. Mahomed of Nadeem Mahomed
Attorneys
[1]
Pleadings Bundle, page 22, Annexure SK2, Rescission Application.
[2]
Record Bundle, page 13.
[3]
Record Bundle, page 9-11
[4]
Pleadings Bundle, page 14 at para 35.
[5]
Pleadings Bundle, page 66, Replying Affidavit at para 21.
[6]
Act
66
of 1995 as amended.
[7]
(2004)
25 ILJ 96 (LAC) at paras 21 and 22.
[8]
(2006)
27
ILJ
828 (LC)
at paras 28 and 29.
[9]
(2004)
25 ILJ 565 (LC) at para 30.
[10]
(2001)
22 ILJ 2015 (LC) at para 12.