Summary of Judgment

1. Introduction

The proceedings were brought in the Labour Court as part of ongoing contempt of court enforcement arising from a settlement agreement concluded between the parties and subsequently made an arbitration award. The applicants sought to secure compliance with the award, specifically the obligation on the first respondent to re-employ (reinstate) the individual applicants and to pay what was due to them under the award.

The parties were Molapisi Tshepo Brown, Obakeng Ngwako, Jeremiah Motsetau, and Papiso Keogatile as the individual applicants, and Bophirima, FM as the first respondent. The second respondent was Jacob Funny Morontsi, and the present judgment further concerned Kitso Itumeleng, Motoloki Modise, and Percy Pitso as the third to fifth respondents respectively, described as members of the board controlling and directing the first respondent’s activities.

The procedural history reflected a sequence of enforcement steps. After the first respondent allegedly failed to implement the settlement agreement/arbitration award, the applicants launched a main contempt application. A first “show cause” order was issued on 23 November 2018, followed by a further order on 8 February 2019 regulating the filing of explanatory affidavits and directing engagement on settlement. The matter then served before Nieuwoudt AJ, who issued an order on 2 May 2019 finding the first and second respondents in contempt, imposing fines (including a suspended fine linked to compliance with reinstatement), and permitting the applicants to bring a joinder application should non-compliance persist. The present judgment dealt primarily with that joinder application and the consequential steps to progress the contempt enforcement.

The general subject matter of the dispute was the enforcement of an arbitration award (originating from a settlement agreement) through contempt proceedings, and specifically whether individuals directing the first respondent should be joined and required to account for continued non-compliance, including the potential enforcement of a previously imposed suspended fine.

2. Material Facts

It was common cause, or treated as established for purposes of the present application, that a settlement agreement dated 14 August 2017 was made an arbitration award in February 2018 (the judgment refers to 20 February 2018 in the background narrative, while the operative order refers to 19 February 2018 under case number NWVB20-17). The award required the first respondent to re-employ/reinstate the applicants, with associated financial obligations described as remuneration and back-pay in the later enforcement orders.

The record further reflected that the applicants instituted contempt enforcement when the first respondent did not re-employ them in terms of the settlement award. On 23 November 2018, the court issued a directive calling upon the first and second respondents to show cause why they should not be held in contempt for failing to give effect to the award. On 8 February 2019, after the second respondent appeared and indicated the possibility of settlement, the court issued a further order requiring explanatory affidavits by 19 February 2019 and communication to the applicants by 20 February 2019 regarding the first respondent’s board’s response on settlement.

On 2 May 2019, the court (Nieuwoudt AJ) found that the first and second respondents had failed to comply with earlier court orders and held them to be in contempt, imposing fines of R5,000 (first respondent) and R1,000 (second respondent). A suspended fine of R50,000 was imposed on the first respondent, payable if it did not comply with the settlement agreement, including reinstatement and payment obligations. The order also contemplated incarceration of the second respondent if his fine was not paid within a specified period. The applicants were granted leave to bring a joinder application against further individuals if compliance did not follow.

A payment of R6,000 was received by the court on 23 May 2019, which the court assumed (in the respondents’ favour) was payment of the R5,000 and R1,000 fines. However, the respondents did not comply with the main obligation of reinstatement. The court treated the continued non-compliance as triggering the R50,000 suspended fine, which was described as having become due and payable following non-compliance within the time period stated in the earlier order.

The joinder application was launched on 7 August 2019 and was not opposed by the third to fifth respondents. On the founding papers, the third to fifth respondents were described as the individuals controlling and directing the activities of the first respondent (as members of its board). The court accepted, on the basis set out in the judgment, that the first respondent’s failure to comply with court orders was effectively also a failure by those officers to give effect to the court’s directives.

3. Legal Issues

The central legal questions were directed to procedural and enforcement matters arising in contempt proceedings.

A first issue was whether the requirements for joinder were met, such that the third to fifth respondents (as individuals alleged to control and direct the first respondent) should be joined in the existing contempt application. This entailed an application of procedural principles to the facts alleged regarding their roles and the first respondent’s non-compliance.

A second issue was whether, given the established history of non-compliance and the unpaid consequences of that non-compliance, the court should issue further show-cause directions requiring the newly joined individuals to explain why they should not be held in contempt and whether additional coercive enforcement mechanisms should be invoked. This was predominantly an application of law to fact within the court’s contempt enforcement jurisdiction, informed by evaluative judgment as to appropriate procedural steps and sanctions to secure compliance.

4. Court’s Reasoning

The court’s reasoning proceeded from the premise that the present enforcement steps “flow[ed] from” the settlement agreement that had been made an arbitration award, and from the respondents’ alleged failure to implement reinstatement. The court located the current application within the broader contempt process already underway, including the prior findings of contempt and sanctions imposed by Nieuwoudt AJ.

On joinder, the court attached significance to two considerations reflected in the papers and procedural posture. First, the third to fifth respondents had not opposed the joinder application. Second, the founding affidavit asserted that these individuals were those “controlling and directing the activities of the First Respondent.” The court reasoned that where the first respondent (a corporate or organisational entity) fails to comply with court orders, that failure is “effectively” attributable to the officers responsible for directing its conduct. On that basis, the court was satisfied that the requirements for joinder had been met and ordered their joinder in the contempt proceedings.

The court further considered the consequences of ongoing non-compliance with the reinstatement obligation and the earlier order. It noted that the purpose of the R50,000 suspended fine was to compel compliance with the primary obligation to reinstate the applicants with back-pay. Because the first respondent still had not complied with reinstatement, the court regarded the suspended fine as having become due and payable, and it treated failure to pay it as compounding the contempt.

Having joined the third to fifth respondents, the court determined that they should be required to show cause why they should not be held in contempt, both in relation to the failure to reinstate and in relation to the failure to pay the R50,000 after non-compliance. The court therefore issued procedural directions compelling personal attendance and permitting an explanatory affidavit, while making clear that affidavit filing would not excuse personal presence. The court also addressed a further enforcement step: if there was still non-compliance with the earlier order, the respondents would need to show cause why the court should not authorise the Registrar to issue a writ of execution against the first respondent’s movable assets to satisfy the R50,000 fine. These steps reflected an evaluative choice by the court to escalate enforcement mechanisms while preserving procedural fairness through a further opportunity to explain.

Finally, given the hearing on 25 October 2019 and the lack of respondent appearances, the court exercised its discretion to make a costs order against the first respondent for the applicants’ costs of appearance and representation on that date.

5. Outcome and Relief

The court granted the joinder of Kitso Itumeleng, Motoloki Modise, and Percy Pitso as the third, fourth, and fifth respondents in the contempt application.

The court ordered the third to fifth respondents to appear in the Labour Court in Johannesburg on 6 December 2019 at 10h00 to show cause why they should not be found guilty of contempt for failure to comply with the settlement agreement made an arbitration award under case number NWVB20-17 in February 2018, and with paragraph [3] of the court order dated 2 May 2019. It permitted them to file explanatory affidavits 10 days before the appearance date, with applicants entitled to respond five days later, but stipulated that affidavit filing would not excuse personal attendance.

The court directed that, failing a satisfactory explanation and/or failure to appear despite proper service, the third to fifth respondents would be found guilty of contempt, and that if found guilty, they could face incarceration, a fine, or another appropriate penalty.

The court further required the first, third, fourth and fifth respondents to show cause, in the absence of compliance with paragraph [3] of the 2 May 2019 order, why the court should not authorise the issuance of a writ of execution to attach and execute against the first respondent’s movable property to satisfy payment of the R50,000 fine.

The court ordered that service of the order must be effected personally on the third to fifth respondents as a matter of urgency, and it ordered the first respondent to pay the applicants’ costs of appearance and representation at the hearing on 25 October 2019.

Cases Cited

No cases were cited in the judgment.

Legislation Cited

No legislation was cited in the judgment.

Rules of Court Cited

No rules of court were cited in the judgment.

Held

The Labour Court held that the third to fifth respondents, as board members alleged to control and direct the first respondent’s activities, satisfied the requirements for joinder in the contempt proceedings arising from non-compliance with an arbitration award and subsequent court orders. It further held that, given continued non-compliance with reinstatement and the consequences flowing from the earlier contempt order (including the R50,000 suspended fine), the newly joined respondents should be compelled to show cause why they should not be held in contempt and warned of potential coercive sanctions, including incarceration or fines. The court also held that the respondents must show cause why further enforcement through a writ of execution should not be authorised to recover the R50,000 fine, and it granted a costs order against the first respondent for the applicants’ appearance and representation costs on 25 October 2019.

LEGAL PRINCIPLES

Joinder is appropriate where individuals who control and direct the conduct of an entity are implicated in the entity’s failure to comply with court orders, particularly in contempt enforcement contexts, and where the court is satisfied on the papers that their participation is necessary to ensure effective adjudication and enforcement.

In contempt proceedings arising from non-compliance with an order (including an order enforcing an arbitration award), the court may issue show-cause directives requiring personal appearance and permitting affidavit-based explanations, while retaining discretion to impose coercive sanctions if contempt is established and not satisfactorily explained.

Where a prior contempt order imposes a suspended fine conditional upon compliance with reinstatement and payment obligations, continued non-compliance may render the suspended fine due and payable, and the failure to pay may constitute an additional basis for contempt-related enforcement steps, including potential authorisation of execution processes to satisfy the fine.

The Labour Court retains a discretion on costs in contempt-related interlocutory and enforcement proceedings and may award costs against a non-compliant respondent, including where there is non-appearance and the applicants incur costs for attendance and representation.